EXHIBIT 4(c)
CONFORMED COPY
DATED 26 JUNE 1999
AND AMENDED AND RESTATED BY AGREEMENTS
DATED 23 OCTOBER 2001, 21 MARCH 2002 AND 20 APRIL 2004
NORWEGIAN STAR LIMITED
NORWEGIAN DAWN LIMITED
(AS JOINT AND SEVERAL BORROWERS)
COMMERZBANK AKTIENGESELLSCHAFT
EMDEN BRANCH
NORDDEUTSCHE LANDESBANK GIROZENTRALE
KFW
(AS ARRANGERS AND UNDERWRITERS)
COMMERZBANK AKTIENGESELLSCHAFT
EMDEN BRANCH
NORDDEUTSCHE LANDESBANK GIROZENTRALE
KFW
BREMER BANK NIEDERLASSUNG DER DRESDNER BANK AKTIENGESELLSCHAFT
BREMEN
DEUTSCHE SCHIFFSBANK AKTIENGESELLSCHAFT
BREMEN AND HAMBURG
THE BANK OF NOVA SCOTIA
SINGAPORE BRANCH
HSH NORDBANK AG
(AS LENDERS)
COMMERZBANK AKTIENGESELLSCHAFT
HAMBURG BRANCH
(AS CO-ORDINATOR)
COMMERZBANK INTERNATIONAL S.A.
(AS AGENT)
SECURED LOAN AGREEMENT
FOR UP TO USD626,922,000 POST DELIVERY
FINANCE FOR TWO CRUISE VESSELS BEING
HULL NO S.648 (TBN "NORWEGIAN STAR") AND
HULL NO S.649 (TBN "NORWEGIAN DAWN")
AT THE YARD OF JOS L MEYER GMBH
STEPHENSON HARWOOD
ONE ST PAUL'S CHURCHYARD
LONDON EC4M 8SH
TEL: +44 (0)20 7329 4422
FAX: +44 (0)20 7606 0822
REF: 1253/239499/262035/90035218/42-02557
CONTENTS
PAGE
1 Definitions and Construction................................... 2
2 The Facility................................................... 20
3 Repayment...................................................... 22
4 Prepayment..................................................... 23
5 Interest....................................................... 26
6 Substitute Basis of Funding.................................... 29
7 Payments....................................................... 31
8 Yield Protection and Force Majeure............................. 34
9 Representations and Warranties................................. 37
10 Undertakings................................................... 45
11 Joint and Several Obligations.................................. 66
12 Rights of the Agent and the Lenders............................ 69
13 Default........................................................ 70
14 Application of Funds........................................... 78
15 Fees........................................................... 81
16 Expenses....................................................... 83
17 Waivers, Remedies Cumulative................................... 84
18 Counterparts................................................... 85
19 Assignment..................................................... 85
20 Notices........................................................ 89
21 Governing Law.................................................. 90
22 Waiver of Immunity............................................. 90
23 Jurisdiction................................................... 91
Schedule 1 Particulars of Arrangers and Underwriters...................... 95
Schedule 2 Particulars of Co-ordinator, Agent and Lenders................. 96
Schedule 3 Notice of Drawdown............................................. 99
Schedule 4 Conditions Precedent........................................... 101
Schedule 5 Confidentiality Undertaking.................................... 107
Schedule 6 Transfer Certificate........................................... 109
Schedule 7 Lower Saxony Guarantee......................................... 116
Schedule 8 Chartering of the Six Vessels (as defined in Clause 10.6(D))... 117
THIS LOAN AGREEMENT is made the 26 day of June 1999 and amended and restated by
agreements made the 23 day of October 2001, the 21 day of March 2002 and the 20
day of April 2004
BETWEEN:
(1) NORWEGIAN STAR LIMITED ("NORWEGIAN STAR") (formerly Superstar Libra
Limited) and NORWEGIAN DAWN LIMITED ("NORWEGIAN DAWN") (formerly Superstar
Scorpio Limited) both of International House, Castle Hill, Victoria Road,
Douglas, Isle of Man IM2 4RB, British Isles as joint and several borrowers
(collectively the "BORROWERS" and each individually a "BORROWER");
(2) THE SEVERAL BANKS particulars of which are set out in Schedule 1 as
arrangers and underwriters (collectively the "ARRANGERS" and each
individually an "ARRANGER");
(3) THE SEVERAL BANKS particulars of which are set out in Schedule 2 and any
Transferee as lenders (collectively the "LENDERS" and each individually a
"LENDER");
(4) COMMERZBANK AKTIENGESELLSCHAFT, Hamburg Branch of Ness 7-9, 20457 Hamburg,
Federal Republic of Germany as co-ordinator (the "CO-ORDINATOR"); and
(5) COMMERZBANK INTERNATIONAL S.A. of 25 rue Edward Steichen, L-2540
Luxembourg as agent (the "AGENT").
WHEREAS:
The Arrangers have agreed on the terms and subject to the conditions set out in
this Agreement to arrange and underwrite a loan of up to six hundred and twenty
six million nine hundred and twenty two thousand Dollars (USD626,922,000) to be
made by the Lenders to the Borrowers to part-finance the construction by the
Builder of, respectively, the Norwegian Star Vessel and the Norwegian Dawn
Vessel to be purchased by Norwegian Star and Norwegian Dawn for the Norwegian
Star Contract Price and the Norwegian Dawn Contract Price and to part-finance
the cost of the buyer's supplies in respect of each of the Vessels.
NOW IT IS HEREBY AGREED as follows:
1 DEFINITIONS AND CONSTRUCTION
1.1 DEFINITIONS
In this Agreement:
"ACCOUNT CHARGES" means either of the two (2) charges over the
Operating Accounts, one (1) given by each of the Borrowers in
respect of its Operating Account such charges to be in the form and
on the terms and conditions required by the Co-ordinator and agreed
on the Restatement Date and as specified in paragraph 37 of Schedule
4;
"AGENCY AND CO-ORDINATION DEED" means the deed entered into by the
Lenders, the Agent and the Co-ordinator dated 26 June 1999 and
amended and restated by a first supplemental agreement dated 23
October 2001 whereby the Agent has been appointed as agent and the
Co-ordinator has been appointed as co-ordinator for the Lenders;
"AGREEMENT" means this agreement;
"ARRASAS" means Arrasas Limited of International House, Castle Hill,
Victoria Road, Douglas, Isle of Man IM2 4RB, British Isles;
"ASSOCIATED COMPANY" in relation to any company, means any company
which is a Subsidiary or Holding Company of that company or the
majority of whose shares are beneficially owned by the same person
or persons as own the majority of the shares of that company;
"BUILDER" means Jos L Meyer GmbH (formerly Jos L Meyer GmbH & Co.)
of Industriegebiet Sud, 26871 Papenburg, Federal Republic of Germany
as constructor of the Vessels;
"BUILDING CONTRACTS" means (i) the contract dated 2 May 1998,
specification no 8121/96 dated 28 April 1998 as amended by a first
addendum thereto dated 29 April 1999 and the general arrangement
drawings dated 28 April 1998, as amended by a first addendum thereto
dated 3 August 1998, a second addendum thereto dated 29 April 1999
as amended on 27 April 2001, a third addendum thereto dated 30
September 1999, a fourth addendum thereto dated 27 April 2001 and a
fifth addendum thereto dated 27 April 2001 for the construction and
2
delivery of the Norwegian Star Vessel made between the Builder and
Star and as assigned to Norwegian Star by a sixth addendum thereto
to be made on or before the relevant Delivery Date and (ii) the
contract dated 2 May 1998, specification no 8121/96 dated 28 April
1998 as amended by a first addendum thereto dated 29 April 1999 and
the general arrangement drawings dated 28 April 1998, as amended by
a first addendum thereto dated 3 August 1998, a second addendum
thereto dated 29 April 1999 as amended on 27 April 2001, a third
addendum thereto dated 30 September 1999 and a fourth addendum
thereto dated 27 April 2001 for the construction and delivery of the
Norwegian Dawn Vessel made between the Builder and Star and as
assigned to Norwegian Dawn by a fifth addendum thereto dated 4 March
2002;
"BUSINESS DAY" means any day on which, in a country where any act or
thing is required to be done hereunder, banks and financial markets
and, if applicable, TARGET are open for the transaction of business
of the nature contemplated by this Agreement;
"CERTIFIED COPY" means, in relation to any document delivered or
issued by or on behalf of any company, a copy of such document
certified as a true, complete and up-to-date copy of the original by
any of the directors or the secretary or assistant secretary for the
time being of that company;
"CHARGE" means either of the two (2) charges over shares, one (1) to
be given by the Shareholder as holders (legally and beneficially) of
all the shares in each of the Borrowers pursuant to the Charge
Options;
"CHARGE OPTION" means either of the two (2) options to take the
Charges to be given by the Shareholder on the Third Restatement
Date, such options and the Charges being in the form and on the
terms and conditions required by the Co-ordinator and agreed on the
date of the Fourth Supplemental Agreement;
"COMMITMENT" means, as to each Lender, the sum set out opposite its
name in Schedule 2 as the amount which, subject to the terms of this
Agreement, it is obliged to advance to the Borrowers under Clause 2
(or, where the context so admits, such amount which any successor in
title, assignee or transferee (including any Transferee) of any
Lender shall be obliged to advance to the Borrowers under Clause 2,
following the assumption of all or any portion of such
3
liability from any Lender hereunder) in each case as such amount may
be reduced, cancelled or terminated under this Agreement;
"COMMITMENT PERIOD" means the period beginning on 26 June 1999 and
ending on the date on which the Facility is drawn down in full or
cancelled hereunder;
"COMPULSORY ACQUISITION" means requisition for title or other
compulsory acquisition of a Vessel including its capture, seizure,
detention or confiscation or expropriation but excluding any
requisition for hire by or on behalf of any government or
governmental authority or agency or by any persons acting or
purporting to act on behalf of any such government or governmental
authority or agency;
"CONFIDENTIALITY UNDERTAKING" means the undertaking to be entered
into relating to the release of financial information pertaining to
the Group by the Agent, the Co-ordinator or any Lender to a
potential Transferee or assignee such undertaking to be in the form
of Schedule 5 hereto;
"CONTRIBUTION" means as to each Lender the sum set out opposite its
name in Schedule 2 as the amount which it is obliged to advance to
the Borrower under Clause 2 or, as the case may be, the portion of
such sum so advanced and for the time being outstanding;
"DEBENTURE" means either of the two (2) debentures, one (1) entered
into by each of the Borrowers in favour of the Agent on 26 June 1999
such debentures being in the form and on the terms and conditions
required by the Co-ordinator and agreed on 26 June 1999 and as
specified in paragraph 20 of Schedule 4;
"DELIVERY DATE" means the Norwegian Star Vessel Delivery Date and/or
the Norwegian Dawn Vessel Delivery Date;
"DEUTSCHE MARK" AND "DEM" means the lawful currency of the Federal
Republic of Germany;
"DISCLOSURE LETTER" means the letter so designated given by the
Borrowers and acknowledged by the Co-ordinator (acting on the
instructions of the Lenders) on the date of the Fourth Supplemental
Agreement;
4
"DOCUMENT OF COMPLIANCE" means a document issued to a vessel
operator as evidence of its compliance with the requirements of the
ISM Code;
"DOLLARS" AND "USD" means the lawful currency of the United States
of America;
"DRAWDOWN DATE" means a date being a Business Day on which a Tranche
is drawn down pursuant to Clause 2.3;
"DRAWDOWN NOTICE" means either of the notices to be given by the
Borrowers to the Agent pursuant to Clause 2.3;
"EARNINGS" means, in respect of a Vessel, (whether earned or to be
earned) any and all freights, hire and passage monies, proceeds of
requisition (other than proceeds of Compulsory Acquisition), rebates
and commissions, all earnings deriving from contracts of employment,
demurrage, charterparties, contracts of affreightment, pooling
agreements and joint ventures, compensation, remuneration for
salvage and towage services, damages howsoever arising and detention
monies, damages for breach of any charterparty or other contract for
the employment of the Vessel, any amounts payable in consideration
of the termination or variation of any charterparty or other such
contract and any other earnings whatsoever due or to become due to
the relevant Borrower;
"EARNINGS ASSIGNMENT" means either of the two (2) valid and
effective first legal assignments of the Earnings (together with the
notices thereof and the acknowledgements), one (1) executed by each
of the Borrowers in respect of its Vessel in favour of the Agent
such assignments, notices and acknowledgements to be in the form and
on the terms and conditions required by the Co-ordinator and agreed
on the Restatement Date and as specified in paragraph 34 of Schedule
4;
"ENCUMBRANCE" means any mortgage, charge, pledge, lien, assignment,
hypothecation, title retention, preferential right or trust
arrangement or any other security agreement or arrangement;
"EURIBOR" means, in relation to any amount owing by the Borrowers
hereunder in Euro on which interest for a given period is to accrue,
the percentage rate per annum determined by the Agent to be equal to
the rate which appears on the page of the Reuters Screen which
displays the average EURIBOR rate as agreed with EURIBOR FBE for
deposits in Euro of the relevant amount for such
5
period, or if such page or such service shall cease to be available
or relevant such other page or such other service for displaying the
average EURIBOR rate for Euro as the Agent, after consultation with
the Lenders, shall select;
"EURIBOR FBE" means the Banking Federation of the European Union;
"EURO" AND "EUR" means the common European currency pursuant to laws
and resolutions implementing the European Economic and Monetary
Union;
"EVENT OF DEFAULT" means any of the events specified in Clause 13;
"FACILITY" means the loan facility granted hereunder being in a
maximum amount of six hundred and twenty six million nine hundred
and twenty two thousand Dollars (USD626,922,000);
"FINANCIAL INDEBTEDNESS" means any obligation for the payment or
repayment of money, whether as principal or as surety and whether
present or future, actual or contingent;
"FIRST DRAWDOWN DATE" means the date on which Tranche 1 or Tranche 2
(as the case may be) is drawn down and applied in accordance with
Clause 2.2(A) or Clause 2.2(B) (as the case may be);
"FORCE MAJEURE" means, in relation to the Agent, the Co-ordinator or
any Lender, any event or circumstance which is beyond the reasonable
control of such party, which cannot be foreseen or if foreseeable
which is unavoidable, which occurs after the date of this Agreement
and which prevents that party from performing any of its obligations
under this Agreement;
"FOURTH SUPPLEMENTAL AGREEMENT" means the fourth supplemental
agreement dated 2004 to (among other things) the Original Loan
Agreement as amended and restated by the Third Supplemental
Agreement;
"GAAP" means generally accepted accounting principles in the United
States of America consistently applied (or, if not consistently
applied, accompanied by details of the inconsistencies) including,
without limitation, those set forth in the opinion and
pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board;
6
"GROUP" means Star and its Subsidiaries;
"GUARANTEE" means the guarantee executed by the Guarantor in favour
of the Agent on the Third Restatement Date such guarantee being in
the form and on the terms and conditions required by the
Co-ordinator and agreed on the date of the Fourth Supplemental
Agreement;
"GUARANTOR" means NCL Corporation Ltd. of Reid Hall, 3 Reid Street,
Hamilton HM 11, Bermuda and its principal place of business at 7665
Corporate Center Drive, Miami, Florida 33126, United States of
America;
"HOLDING COMPANY" has the meaning defined in the Companies Act 1985,
Section 736 as substituted by the Companies Act 1989, Section 144;
"IOL" means Inter-Ocean Limited of International House, Castle Hill,
Victoria Road, Douglas, Isle of Man IM2 4RB, British Isles;
"ISM CODE" means the International Management Code for the Safe
Operation of Ships and for Pollution Prevention adopted by the
International Maritime Organisation;
"ISPS CODE" means the International Ship and Port Facility Security
Code adopted by the International Maritime Organisation;
"INDEBTEDNESS FOR BORROWED MONEY" means Financial Indebtedness
(whether present or future, actual or contingent, long-term or
short-term, secured or unsecured) in respect of:
(i) moneys borrowed or raised;
(ii) the advance or extension of credit (including interest and
other charges on or in respect of any of the foregoing);
(iii) the amount of any liability in respect of leases which, in
accordance with GAAP, are capital leases;
(iv) the amount of any liability in respect of the purchase price
for assets or services payment of which is deferred for a
period in excess of one hundred and eighty (180) days;
7
(v) all reimbursement obligations whether contingent or not in
respect of amounts paid under a letter of credit or similar
instrument;
(vi) all interest rate and currency swap and similar agreements
obliging the making of payments, whether periodically or upon
the happening of a contingency (and the value of such
Financial Indebtedness shall be the mark-to-market valuation
of such transaction at the relevant time); and
(vii) (without double counting) any guarantee of Financial
Indebtedness falling within paragraphs (i) to (vi) above;
"INSTALMENT" means in respect of a Tranche the amount of principal
of that Tranche (other than the relevant Maturity Date Payment)
repayable on a Repayment Date in accordance with Clause 3;
"INSURANCE ASSIGNMENT" means either of the two (2) valid and
effective first legal assignments of the Insurances (together with
the notices thereof), one (1) executed by each Borrower in respect
of the relevant Vessel in favour of the Agent and/or the Lenders
such assignments and notices to be in the form and on the terms and
conditions required by the Co-ordinator and agreed on signing hereof
and as specified in paragraph 35 of Schedule 4;
"INSURANCES" means all policies and contracts of insurance and
entries of a Vessel in a protection and indemnity or war risks
association which are effected in respect of the Vessel, her
freights, disbursements, profits or otherwise and all benefits,
including all claims and returns of premiums thereunder and shall
also include all compensation payable by virtue of Compulsory
Acquisition;
"INTEREST PAYMENT DATE" means the last day of each Interest Period
and if an Interest Period is longer than six (6) months' duration
the date falling at the end of each successive period of six (6)
months during such Interest Period from its commencement;
"INTEREST PERIOD" means each period ascertained in accordance with
Clause 5.2 or Clause 5.8;
"INTEREST RATE" means the rate of interest applicable to the Loan
calculated in accordance with Clause 5.6, Clause 5.8 or Clause 6.3;
8
"LENDING BRANCH" means in respect of the Agent, the Co-ordinator and
each Lender its office at the address set out beneath its name in
Schedule 2 or such other office as it shall from time to time select
and notify through the Agent to the Borrowers;
"LIBOR" means with respect to any Interest Period the rate of
interest (expressed as an annual rate) determined by the Agent to
be:
(i) the offered rate for deposits in Dollars for a period
equivalent to such Interest Period which appears on the
Telerate Page 3750 at or about 11.00 a.m. London time on the
Quotation Date; or
(ii) if no rate is provided for the respective Interest Period on
the Telerate Page 3750, the interpolated rate per annum for
deposits in Dollars in an amount approximately equal to the
relevant Tranche as calculated by the Agent, such interpolated
rate to be based on the Telerate Page 3750 (for periods of
more than one (1) month) or on the Reuters Page LIBO (for
periods of more than one (1) week and up to one (1) month)
provided that LIBOR for periods of less than one (1) week will
be ascertained under sub-section (iii) below;
OR (if Telerate Page 3750 or Reuters Page LIBO (as the case may be)
is discontinued or if the Agent is unable to make the said
determination due to technical breakdown in the relevant system or
the Interest Period is less than one (1) week)
(iii) the arithmetic mean (rounded upwards, if necessary, to the
nearest one-sixteenth of one per cent (1/16%)) of the rates
per annum notified to the Agent by each of the Reference Banks
as the rate at which deposits in Dollars in an amount
approximately equal to the relevant Tranche are offered to
such Reference Bank by leading banks in the London Interbank
Market at such Reference Bank's request at or about 11.00 a.m.
London time on the Quotation Date for a period equal to the
Interest Period and for delivery on the first Business Day
thereof;
9
"LOAN" means the principal amount of the Tranches advanced to the
Borrowers under this Agreement or (as the context may require) the
amount thereof for the time being advanced and outstanding under
this Agreement;
"LOWER SAXONY GUARANTEED AMOUNT" means the amount guaranteed from
time to time under a Lower Saxony Guarantee;
"LOWER SAXONY GUARANTEES" means the guarantees to be issued by the
German State of Lower Saxony in favour of the Co-ordinator
substantially in the form of Schedule 7 one (1) in respect of each
Tranche and each in the maximum amount of fifty six million seven
hundred thousand Dollars (USD56,700,000) payable in Deutsche Mark at
an exchange rate of two Deutsche Mark and twenty five pfennig
(DEM2.25) to one Dollar (USD1) up to a maximum amount of one hundred
and twenty seven million five hundred and seventy five thousand
Deutsche Mark (DEM127,575,000) or the agreed equivalent in Euro
being sixty five million two hundred and twenty eight thousand and
sixty one Euro and seventy four cents (EUR65,228,061.74) as security
for part of the relevant Tranche;
"MANAGEMENT AGREEMENT ASSIGNMENT" means either of the two (2) valid
and effective first legal assignments of the Management Agreements
(together with the notices thereof and the acknowledgements), one
(1) executed by each of the Borrowers in respect of its Vessel in
favour of the Agent such assignments, notices and acknowledgements
to be in the form and on the terms and conditions required by the
Co-ordinator and agreed on the date of the Fourth Supplemental
Agreement;
"MANAGEMENT AGREEMENTS" means the two (2) agreements entered into
between a Borrower and the Manager on or before the Third
Restatement Date providing for the commercial and technical ship
management and crewing of the relevant Vessel such agreements to be
in the form and on the terms and conditions required by the
Co-ordinator and agreed on the date of the Fourth Supplemental
Agreement;
"MANAGER" means NCL (Bahamas) Ltd. of Reid Hall, 3 Reid Street,
Hamilton HM 11, Bermuda the company which (among other things)
provides the
10
commercial and technical ship management and crewing services for
the Vessels pursuant to the Management Agreements;
"MARGIN" means the rate of one point two five per cent (1.25%) per
annum and from 13 December 2001 the rate of one point four per cent
(1.4%) per annum;
"MATURITY DATE" means the Tranche 1 Maturity Date and/or the Tranche
2 Maturity Date;
"MATURITY DATE PAYMENT" means the amount of sixty two million six
hundred and ninety two thousand two hundred Dollars (USD62,692,200)
in the case of each Tranche repayable to the Lenders pursuant to
Clause 3 on the relevant Maturity Date;
"MONTH" means a period starting on one day in a calendar month and
ending on the numerically corresponding day in the next calendar
month save that, where any such period would otherwise end on a day
which is not a Business Day, it shall end on the next Business Day,
unless that day falls in the calendar month succeeding that in which
it would otherwise have ended, in which case it shall end on the
preceding Business Day provided that, if a period starts on the last
Business Day in a calendar month or if there is no numerically
corresponding day in the month in which that period ends, that
period shall end on the last Business Day in that later month;
"MORTGAGES" means either of the two (2) first priority statutory
Bahamian ship mortgages and deeds of covenants collateral thereto,
one (1) granted by each of the Borrowers over its Vessel in favour
of the Agent and/or the Lenders as security pursuant hereto such
mortgages and deeds of covenants to be in the form and on the terms
and conditions required by the Co-ordinator and agreed on the
Restatement Date and as specified in paragraph 33 of Schedule 4;
"NCL AMERICA" means NCL America Inc. of Corporation Trust Center,
1209 Orange Street, Wilmington, Delaware 19801, United States of
America;
"NCL AMERICA HOLDINGS" means NCL America Holdings of Corporation
Trust Center, 1209 Orange Street, Wilmington, Delaware 19801, United
States of America;
11
"NCLC FLEET" means the vessels owned by the companies in the NCLC
Group;
"NCLC GROUP" means the Guarantor and its wholly owned Subsidiaries;
"NCLL" means Norwegian Cruise Line Limited of Reid Hall, 3 Reid
Street, Hamilton HM 11, Bermuda;
"NORWEGIAN DAWN CONTRACT PRICE" means three hundred and eighty four
million Dollars (USD384,000,000) in respect of the Norwegian Dawn
Vessel being the price agreed between the Builder and Norwegian Dawn
for the construction of the Norwegian Dawn Vessel under article 1,
clause 1.1(ii) of the relevant Building Contract;
"NORWEGIAN DAWN VESSEL" means hull no S.649 (tbn "NORWEGIAN DAWN")
at the yard of the Builder to be delivered to Norwegian Dawn
pursuant to the relevant Building Contract and registered in the
name of Norwegian Dawn under the laws and flag of the Bahamas;
"NORWEGIAN DAWN VESSEL DELIVERY DATE" means 3 December 2002 being
the date on which the Norwegian Dawn Vessel was delivered to and
accepted by Norwegian Dawn pursuant to the relevant Building
Contract;
"NORWEGIAN STAR CONTRACT PRICE" means three hundred and eighty four
million Dollars (USD384,000,000) in respect of the Norwegian Star
Vessel being the price agreed between the Builder and Norwegian Star
for the construction of the Norwegian Star Vessel under article 1,
clause 1.1(ii) of the relevant Building Contract;
"NORWEGIAN STAR VESSEL" means hull no S.648 (tbn "NORWEGIAN STAR")
at the yard of the Builder to be delivered to Norwegian Star
pursuant to the relevant Building Contract and registered in the
name of Norwegian Star under the laws and flag of the Bahamas;
"NORWEGIAN STAR VESSEL DELIVERY DATE" means 5 November 2001 being
the date on which the Norwegian Star Vessel was delivered to and
accepted by Norwegian Star pursuant to the relevant Building
Contract;
12
"OBLIGORS" means the Borrowers, the Guarantor, the Manager, the
Shareholder and any other party from time to time to any of the
Security Documents excluding the Agent, the Co-ordinator, the
Arrangers and the Lenders;
"OPERATING ACCOUNTS" means either of the two (2) accounts opened or
to be opened by the Borrowers with Citibank N.A. of 3 Temasek
Avenue, #17-00 Centennial Tower, Singapore 039190 or such other bank
or banks as may be approved by the Co-ordinator from time to time
for receipt of the Earnings of the Vessels;
"ORIGINAL LOAN AGREEMENT" means this Agreement as executed on 26
June 1999, as amended by transfer certificates dated 23 June 2000, 4
December 2000, 19 January 2001 and 22 February 2001 between
Commerzbank Aktiengesellschaft, Emden Branch and Bremer Bank
Niederlassung der Dresdner Bank Aktiengesellschaft, Bremen, Deutsche
Schiffsbank Aktiengesellschaft, Bremen and Hamburg, The Bank of Nova
Scotia, Singapore Branch and Landesbank Schleswig-Holstein
Girozentrale (now known as HSH Nordbank AG) respectively and a first
supplement dated 17 August 2000 and as amended and restated by the
Second Supplemental Agreement (prior to, inter alia, its amendment
and restatement pursuant to the Third Supplemental Agreement and the
Fourth Supplemental Agreement);
"OUTSTANDING INDEBTEDNESS" means all sums of any kind payable
actually or contingently to the Agent or the Lenders under or
pursuant to this Agreement or any Transaction Document (whether by
way of repayment of principal payment of interest or default
interest payment of any indemnity or counter indemnity reimbursement
for fees, costs or expenses or otherwise howsoever);
"PERMITTED LIENS" means (i) any Encumbrance created by or pursuant
to the Security Documents (ii) liens on a Vessel up to an aggregate
amount at any time not exceeding one million Dollars (USD1,000,000)
for current crew's wages and salvage and liens incurred in the
ordinary course of trading a Vessel (iii) the Norwegian Star Second
Security Documents (iv) the Norwegian Dawn Second Security Documents
and (v) any other Encumbrance notified by any of the Obligors to the
Agent prior to the Restatement Date;
13
"POSSIBLE EVENT OF DEFAULT" means any event which, with the giving
of notice, passage of time or occurrence of any other event, would
constitute an Event of Default;
"PROCESS AGENT" means Clifford Chance Secretaries Limited whose
registered office is presently at 10 Upper Bank Street, London E14
5JJ or any other person in England nominated by the Borrowers or any
other Obligor and approved by the Co-ordinator as agent to accept
service of legal proceedings on their behalf under any of this
Agreement and the Security Documents;
"QUOTATION DATE" means, in relation to any Interest Period, the day
on which quotations would ordinarily be given in the relevant
interbank eurocurrency market for Dollar or Euro (as the case may
be) deposits for delivery on the first day of that Interest Period;
"REFERENCE BANKS" means Commerzbank Aktiengesellschaft, Norddeutsche
Landesbank Girozentrale and Dresdner Bank Aktiengesellschaft;
"REPAYMENT DATES" means in respect of a Tranche the last day of each
of the twenty four (24) consecutive periods of six (6) months the
first such period commencing on the relevant Delivery Date and the
twenty fourth such period terminating twelve (12) years thereafter
the last such Repayment Date also being the relevant Maturity Date;
"RESTATEMENT DATE" has the same meaning as set out in the Second
Supplemental Agreement;
"REUTERS PAGE LIBO" means the display currently designated as
Reuters Page LIBO, which includes London Interbank Offered Rates of
four (4) major banks, which are members of the International Swap
and Derivatives Association, or such other service as may be
nominated by the British Bankers' Association as the information
vendor for displaying the London Interbank Offered Rates of major
banks in the London Interbank Market;
"SAME DAY FUNDS" means Dollar funds settled through the New York
Clearing House Interbank Payments System or Euro funds settled
through TARGET such other funds for payment in Dollars or Euro as
the Agent shall specify by notice to the Borrowers as being
customary at the time for the settlement of international
14
transactions in New York or Frankfurt of the type contemplated by
this Agreement;
"SAFETY MANAGEMENT CERTIFICATE" means a document issued to a vessel
as evidence that the vessel operator and its shipboard management
operate in accordance with an approved Safety Management System;
"SAFETY MANAGEMENT SYSTEM" means a structured and documented system
enabling the personnel of a vessel operator to implement effectively
the safety and environmental protection policy of such vessel
operator;
"SECOND RESTATEMENT DATE" has the same meaning as set out in the
Third Supplemental Agreement;
"SECOND SUPPLEMENTAL AGREEMENT" means the second supplemental
agreement dated 23 October 2001 to (among other things) the Original
Loan Agreement prior to its amendment and restatement by the Second
Supplemental Agreement;
"SECURITY DOCUMENTS" means this Agreement, the Account Charges, the
Mortgages, the Guarantee, the Debentures, the Earnings Assignments,
the Insurance Assignments, the Charge Options, the Charges, the
Management Agreement Assignments and all such other documents as may
be executed at any time in favour of the Agent and/or any of the
Lenders as security for the obligations of the Borrowers and the
other Obligors whether executed pursuant to the express provisions
of this Agreement or otherwise howsoever but excluding the Lower
Saxony Guarantees;
"SECURITY PERIOD" means the period beginning on the First Drawdown
Date and ending on the date on which the amounts outstanding under
this Agreement and under each of the other Security Documents are
finally paid or repaid in full;
"SHAREHOLDER" means NCL International, Ltd. of Reid Hall, 3 Reid
Street, Hamilton HM 11, Bermuda, the sole registered and beneficial
shareholder of the entire issued share capital of each of the
Borrowers;
"SHARES" means the two (2) shares in each of the Borrowers being one
hundred per cent (100%) of the authorised and issued shares in each
of the Borrowers registered in the name of and beneficially owned by
the Shareholder;
15
"STAR" means Star Cruises Limited of Canon's Court, 22 Victoria
Street, Hamilton HM 12, Bermuda;
"SUBSIDIARY" has the meaning defined in the Companies Act 1985,
Section 736 as substituted by the Companies Act 1989, Section 144;
"SUBSTITUTE BASIS" means an alternative basis for maintaining the
Loan certified by the Agent pursuant to Clause 6.3(A);
"SUSPENSION NOTICE" means a notice given by the Agent to the
Borrowers pursuant to Clause 6.1;
"TARGET" means trans-European automated real-time gross settlement
express transfer system;
"TAXES" means all present and future income and other taxes, levies,
imposts, deductions, compulsory liens and withholdings whatsoever
together with interest thereon and penalties with respect thereto,
if any, and any payments made on or in respect thereof and
"TAXATION" shall be construed accordingly;
"TELERATE PAGE 3750" means the display currently designated as
Telerate Page 3750 (or such other page as may replace it on such
service) or such other service as may be nominated by the British
Bankers' Association as the information vendor for displaying the
London Interbank Offered Rates of major banks in the London
Interbank Market;
"THIRD RESTATEMENT DATE" has the same meaning as set out in the
Fourth Supplemental Agreement;
"THIRD SUPPLEMENTAL AGREEMENT" means the third supplemental
agreement dated 21 March 2002 to (amongst other things) the Original
Loan Agreement;
"TOTAL LOSS" means any ACTUAL or constructive or arranged or agreed
or compromised total loss or Compulsory Acquisition of a Vessel;
"TRANCHE" means Tranche 1 and/or Tranche 2;
"TRANCHE 1" means the amount of up to three hundred and thirteen
million four hundred and sixty one thousand Dollars (USD313,461,000)
to be applied in
16
payment of the delivery instalment due by Norwegian Star to the
Builder under the relevant Building Contract and in part payment (to
the extent of one million seven hundred and eighty seven thousand
Dollars (USD1,787,000)) of the cost of Norwegian Star's buyer's
supplies to be advanced by the Lenders on the Norwegian Star Vessel
Delivery Date by way of their Contributions thereto or (as the
context may require) the amount thereof for the time being drawn
down and outstanding hereunder;
"TRANCHE 2" means the amount of up to three hundred and thirteen
million four hundred and sixty one thousand Dollars (USD313,461,000)
to be applied in payment of the delivery instalment due by Norwegian
Dawn to the Builder under the relevant Building Contract and in part
payment (to the extent of one million seven hundred and eighty seven
thousand Dollars (USD1,787,000)) of the cost of Norwegian Dawn's
buyer's supplies to be advanced by the Lenders on the Norwegian Dawn
Vessel Delivery Date by way of their Contributions thereto or (as
the context may require) the amount thereof for the time being drawn
down and outstanding hereunder;
"TRANCHE 1 MATURITY DATE" means, in respect of Tranche 1, either the
date being a Business Day falling twelve (12) years from the
Norwegian Star Vessel Delivery Date or such other date as is
determined by the provisions of Clause 4;
"TRANCHE 2 MATURITY DATE" means, in respect of Tranche 2, either the
date being a Business Day falling twelve (12) years from the
Norwegian Dawn Vessel Delivery Date or such other date as is
determined by the provisions of Clause 4;
"TRANSACTION DOCUMENTS" means the Security Documents, the Building
Contracts, the Drawdown Notices, the Management Agreements and any
other material document now or hereafter issued in connection with
the documents or the transaction herein referred to and also
including any document entered into in respect of interest rate swap
agreements, hedging agreements and/or funding documents at the
request of the Borrowers for the purposes of this Agreement but
excluding the Lower Saxony Guarantees;
"TRANSFER CERTIFICATE" means the certificate attached hereto as
Schedule 6;
17
"TRANSFER DATE" means, in relation to any Transfer Certificate, the
date specified in such Transfer Certificate as the date for the
making of the transfer or, where such transfer is specified as being
subject to the fulfilment of certain conditions, the date on which
the Agent receives a certificate from the Lender making the transfer
confirming that all such conditions have been fulfilled;
"TRANSFEREE" means any reputable bank acceptable to the Agent and
the Borrowers which becomes a party to this Agreement as a Lender
pursuant to Clause 19;
"VESSELS" means:
(i) the Norwegian Star Vessel; and
(ii) the Norwegian Dawn Vessel,
to be respectively a one thousand one hundred and twenty (1,120) and
a one thousand one hundred and twelve (1,112) cabin luxury passenger
cruise vessel; and
"YEAR 2000 CONFORMITY" means that neither performance nor
functionality of computer systems, electronic and electro-mechanical
or similar equipment will be affected by dates prior to or during or
after the year 2000.
1.2 CONSTRUCTION
In this Agreement unless the context otherwise requires:
(A) clause headings are inserted for convenience of reference only
and shall be ignored in the construction of this Agreement;
(B) references to Clauses and to Schedules are to be construed as
references to clauses of and schedules to this Agreement
unless otherwise stated and references to this Agreement are
to be construed as references to this Agreement including its
Schedules;
(C) references to (or to any specified provision of) this
Agreement or any other document shall be construed as
references to this Agreement, that
18
provision or that document as from time to time amended,
supplemented and/or novated;
(D) references to any Act or any statutory instrument shall be
construed as references to that Act or that statutory
instrument as from time to time re-enacted, amended or
supplemented;
(E) references to any party to this Agreement or any other
document shall include reference to such party's successors
and permitted assigns;
(F) words importing the plural shall include the singular and vice
versa;
(G) references to a person shall be construed as references to an
individual, firm, company, corporation, unincorporated body of
persons or any state or any agency thereof;
(H) where any matter requires the approval or consent of the Agent
or the Co-ordinator such approval or consent shall not be
deemed to have been given unless given in writing; where any
matter is required to be acceptable to the Agent or the
Co-ordinator, the Agent or the Co-ordinator (as the case may
be) shall not be deemed to have accepted such matter unless
its acceptance is communicated in writing; each of the Agent
and the Co-ordinator may give or withhold its consent,
approval or acceptance at its unfettered discretion;
(I) a certificate by the Agent as to any amount due or calculation
made hereunder shall be conclusive except for manifest error;
and
(J) terms and expressions not defined in this Agreement but whose
meanings are defined in this Agreement prior to its amendment
and restatement by the Fourth Supplemental Agreement shall
have the meanings set out therein.
1.3 AGENT AND CO-ORDINATOR
The Agent and the Co-ordinator will be appointed by the Lenders as
agent and co-ordinator respectively under the Agency and
Co-ordination Deed and references herein to the Agent or the
Co-ordinator shall be construed as references to itself and the
Lenders. The Borrowers shall only communicate with the
19
Lenders under this Agreement and the other Security Documents
through the Co-ordinator or the Agent (as the case may be) and as
hereinafter referred to.
2 THE FACILITY
2.1 AVAILABILITY
(A) The Lenders grant to the Borrowers jointly and severally the
Facility by way of Tranche 1 and Tranche 2. So far as and to
the extent that any part of the Facility remains undrawn at
close of business in London on 31 May 2003 it shall be
automatically cancelled.
(B) Each Lender shall advance its Contribution to the Tranches in
the proportion which its Contribution for the time being bears
to the other Contributions of the Lenders.
(C) Neither the Agent nor any other Lender shall be liable for any
failure or delay on the part of any Lender in making any
advance hereunder nor shall the Agent, the Co-ordinator or the
Arrangers have any obligation to seek to procure additional
Lenders in the event of such a failure PROVIDED THAT if any
Lender should fail to advance its Contribution hereunder, that
Lender and the Agent will take all reasonable steps to
mitigate the effect of that failure. Notwithstanding the
aforesaid proviso, neither the Agent nor any Lender shall be
obliged to increase its Contribution hereunder in respect of
the failure by any other Lender(s) to fund its Contribution.
2.2 PURPOSE AND APPLICATION
The purpose of the Facility is set out below.
(A) Norwegian Star shall apply Tranche 1 in payment of the
delivery instalment due to the Builder under the relevant
Building Contract and in part payment of the cost of Norwegian
Star's buyer's supplies; and
(B) Norwegian Dawn shall apply Tranche 2 in payment of the
delivery instalment due to the Builder under the relevant
Building Contract and in part payment of the cost of Norwegian
Dawn's buyer's supplies.
20
2.3 DRAWDOWN
The Borrowers shall only make drawings under the Facility if:
(A) the Agent receives at least five (5) Business Days' notice of
the Borrowers' request for such drawing in the form of
Schedule 3;
(B) no Event of Default or Possible Event of Default has occurred
before the date of such drawing;
(C) the representations and warranties set out in Clause 9 and
each of the other Security Documents are correct on the date
of such drawing; and
(D) it is then lawful for each of the Lenders to make available
its Contribution to the Facility.
2.4 BREAK COSTS
If for any reason a Tranche is not drawn down by the Borrowers
hereunder after notice of drawdown has been given to the Agent
pursuant to Clause 2.3, the Borrowers will pay to the Agent for the
account of the Lenders such amount as the Agent may certify as
necessary to compensate the Lenders (other than any Lender whose
default has caused the Tranche not to be drawn down) for any loss
(including any losses under any interest rate swap agreements or
other financial derivatives entered into for the purpose of this
Agreement) or expense on account of funds borrowed, contracted for
or utilised in order to fund its Contribution to the Tranche. Each
Lender shall supply to the Agent a certificate of break costs which
in the absence of manifest error shall be conclusive as to the
amounts due.
2.5 CONDITIONS OF DRAWDOWN
The Agent shall not be under any obligation to advance a Tranche
hereunder until all the documents and evidence referred to in the
relevant part of Schedule 4 are in the possession of the
Co-ordinator in form and substance satisfactory to it.
2.6 SEVERAL OBLIGATIONS OF THE LENDERS
The obligations and rights of each Lender hereunder are several and
if for any reason the Borrowers receive in respect of a Tranche an
amount greater than the
21
aggregate of the Contributions to that Tranche, the Borrowers
forthwith upon the demand of the Agent shall pay to the Agent (for
the account of those Lenders whose Contributions were exceeded) the
amount certified by the Agent as representing the excess of the
amount paid to the Borrowers over the due and proper amount of the
Contributions of the Lenders actually received by the Agent.
2.7 LENDER'S FAILURE TO PERFORM
Subject to Clause 2.1(C), the failure by a Lender to perform its
obligations hereunder shall not affect the obligations of the
Borrowers towards any other party hereto nor shall any such other
party be liable for the failure by such Lender to perform its
obligations hereunder.
2.8 FULFILMENT OF CONDITIONS AFTER DRAWDOWN
If the Lenders, acting unanimously, decide (or the Co-ordinator in
accordance with the Agency and Co-ordination Deed decides) to
advance a Tranche to the Borrowers hereunder without having received
all of the documents or evidence referred to in the relevant part of
Schedule 4, the Borrowers will nevertheless deliver the remaining
documents or evidence to the Co-ordinator within fourteen (14) days
of such drawing (or such other period as the Co-ordinator may
stipulate) and the advance of the Facility shall not be construed as
a waiver of the Co-ordinator's right to receive the documents or
evidence as aforesaid nor shall this provision impose on the
Co-ordinator or the Lenders any obligation to permit the drawing in
the absence of such documents or evidence.
3 REPAYMENT
3.1 Unless otherwise repaid in accordance with the provisions of this
Agreement, the Borrowers hereby jointly and severally agree to repay
the Loan as follows:
(A) by repaying each Tranche by twenty four (24) equal half yearly
Instalments of principal the first such Instalment to be paid
six (6) months from the relevant Delivery Date and the
remainder at six (6) monthly intervals thereafter the final
such Instalment to be paid on the relevant Maturity Date; and
(B) by repaying each Maturity Date Payment on the relevant
Maturity Date.
22
4 PREPAYMENT
4.1 VOLUNTARY PREPAYMENT
On giving at least thirty (30) days' prior notice to the Agent, the
Borrowers may on the last day of an Interest Period prepay the whole
or any part of a nominated Tranche (but if in part in an amount of
five million Dollars (USD5,000,000) or an integral multiple thereof)
provided that in the event of such a prepayment being effected from
a source other than the profits of the NCLC Group's activities (of
which the Agent shall be the sole judge) a prepayment fee of one per
cent (1%) of the amount so prepaid shall be due and payable to the
Agent on behalf of the Lenders simultaneously with such a
prepayment.
4.2 VOLUNTARY PREPAYMENT IN CASE OF INCREASED COST
At any time after any sum payable by the Borrowers has been
increased under Clause 8 or a Lender has made any claim for
indemnification under Clause 8, the Borrowers may, after giving to
the Agent five (5) Business Days' notice of its intention to do so,
prepay the whole (but not part only) of the Contribution of that
Lender.
4.3 MANDATORY PREPAYMENT IN CASE OF ILLEGALITY
(A) If any change in, or in the interpretation or application of,
any law, regulation or treaty shall make it unlawful in any
jurisdiction applicable to any of the Lenders for that Lender
to make available or maintain its Contribution or to give
effect to its obligations as contemplated hereby, the Agent
may, by notice thereof to the Borrowers, declare that the
relevant Lender's obligations shall be terminated forthwith
whereupon (if any of the Facility has then been advanced) the
Borrowers shall prepay forthwith to the relevant Lender its
Contribution together with interest thereon to the date of
such prepayment and all other amounts due to such Lender under
the Security Documents (or, if permitted by the relevant law,
regulation or treaty, at the end of the then current Interest
Period).
(B) A Lender affected by any provision of Clause 4.3(A) shall
promptly inform the Agent after becoming aware of the relevant
change and the Agent shall, as soon as reasonably practicable
thereafter, notify the
23
Borrowers of the change and its possible results. Without
affecting the Borrowers' obligations under Clause 4.3(A) and
in consultation with the Agent, the affected Lender will then
take all such reasonable steps as may be open to it to
mitigate the effect of the change (for example (and if then
possible) by changing its Lending Branch or transferring some
or all of its rights and obligations under this Agreement to
another financial institution reasonably acceptable to the
Borrowers and the Agent). The reasonable costs of mitigating
the effect of any such change shall be borne by the Borrowers
save where such costs are of an internal administrative nature
and are not incurred in dealings by any Lender with third
parties.
4.4 VOLUNTARY PREPAYMENT FOLLOWING IMPOSITION OF SUBSTITUTE BASIS
The Borrowers may notify the Agent within ten (10) days of the
receipt of a certificate from the Agent of a Substitute Basis under
Clause 6.3 whether or not they wish to prepay the relevant Tranche,
in which event the Borrowers shall forthwith prepay such Tranche
together with interest accrued thereon at the rate specified in the
relevant certificate of Substitute Basis.
4.5 PREPAYMENT IN CASE OF TOTAL LOSS OF A VESSEL
If a Vessel is or becomes a Total Loss, then the Borrowers will,
within thirty (30) days thereof or, if the Co-ordinator is satisfied
in its sole discretion that the Total Loss is adequately covered by
the Insurances and that the relevant insurance proceeds will be
payable to the Agent within one hundred and fifty (150) days
thereof, by no later than the date which is one hundred and fifty
(150) days after the date of the event giving rise to such Total
Loss prepay not less than the relevant Tranche in accordance with
Clause 4.7 and Clause 14.1.
For the purposes of this Clause a Total Loss shall be deemed to have
occurred:
(A) if it consists of an actual loss, at noon Greenwich Mean Time
on the actual date of loss or, if that is not known, on the
date on which the Vessel was last heard of;
(B) if it consists of a Compulsory Acquisition, at noon Greenwich
Mean Time on the date on which the requisition is expressed to
take effect by the person requisitioning the Vessel; and
24
(C) if it consists of a constructive or compromised or
arranged or agreed total loss or damage to the Vessel
rendering repair impracticable or uneconomical or
rendering the Vessel permanently unfit for normal
use, at noon Greenwich Mean Time on the date on which
notice claiming the loss of the Vessel is given to
her insurers.
4.6 PREPAYMENT IN CASE OF SALE OF A VESSEL
If a Vessel is sold by a Borrower with the prior consent of
the Co-ordinator (which consent is not to be unreasonably
withheld or delayed), then the Borrowers will concurrent with
completion of the sale prepay at least the relevant Tranche in
accordance with Clause 4.7 and Clause 14.1. Subject to Clause
4.8 hereof, prepayment of a Tranche or part consequent upon
the permitted sale of a Vessel shall absolve the Borrowers
from any liability to pay prepayment fees or costs.
4.7 EFFECT OF PREPAYMENT
Any notice given by the Borrowers under Clause 4.1, Clause 4.2
or Clause 4.4 shall be irrevocable and shall oblige the
Borrowers to pay to the Agent on account of the Lenders the
amount therein stated on the date therein stated. No amount
prepaid under this Agreement may be redrawn. Each prepayment
in respect of a particular Tranche under this Agreement shall
be applied in satisfaction of the Borrowers' remaining
obligations under Clause 3 in respect of that Tranche pro rata
in inverse chronological order and the Maturity Date shall
then be the date on which the last Instalment is repayable.
Prepayments under this Agreement shall be made together with
accrued interest thereon and the payment of all other sums
then owing under any of the Security Documents.
4.8 BREAK COSTS
If any repayment or prepayment of a Tranche or part thereof is
made otherwise than on the last day of an Interest Period, the
Borrowers shall pay to the Agent on behalf of the Lenders on
demand such additional amount as the Agent may certify (such
certificate to contain a calculation thereof in reasonable
detail) as necessary to compensate each of the Lenders for any
loss (including cost of breaking deposits (including
warehousing and other related costs) or any losses under
25
interest rate swap agreements or other financial derivatives
entered into for the purpose of this transaction) or expense
(including warehousing and other related costs) on account of
funds borrowed, contracted for or utilised to fund the amount
so repaid or prepaid.
5 INTEREST
5.1 PAYMENT OF INTEREST
The Borrower shall pay interest on each Tranche at the
Interest Rate applicable for each Interest Period in respect
thereof which interest shall be payable in arrears on each
Interest Payment Date.
5.2 SELECTION AND DURATION OF INTEREST PERIODS
(A) The Borrowers may give notice to the Agent to be
received by the Agent not later than 9.00 a.m. London
time five (5) Business Days prior to the commencement
of each Interest Period in respect of a Tranche,
specifying whether that Interest Period is to be of
three (3), six (6) or twelve (12) months' duration.
Interest Periods shall commence, in the case of the
first, on the first Drawdown Date in respect of the
relevant Tranche and, in the case of Interest Periods
other than the first, on the expiry of the preceding
Interest Period. Each Interest Period shall, subject
to the following provisions of this Clause 5, be of a
duration selected by the Borrowers as above provided
that the final Interest Period in respect of a
Tranche shall end on the Maturity Date for that
Tranche.
(B) The Borrowers shall also be entitled to give notice
to the Agent to be received by the Agent not later
than 9.00 a.m. London time seven (7) Business Days
prior to the commencement of an Interest Period in
respect of a Tranche requesting an Interest Period to
be fixed to end at any time up to and including the
relevant Maturity Date and to which request all the
Lenders in their absolute discretion may agree.
(C) The Borrowers shall also be entitled to give notice
to the Agent at any time hereafter and prior to
giving a Drawdown Notice in respect of the relevant
Tranche requesting an Interest Period for that
Tranche to be fixed
26
to end at any time up to and including the relevant
Maturity Date and to which request all the Lenders in
their absolute discretion may agree.
5.3 NO NOTICE AND UNAVAILABILITY
If the Borrowers fail to select an Interest Period in
accordance with Clause 5.2 or the Agent certifies that
deposits for the period selected by the Borrowers are not
available to each of the Lenders in the ordinary course of
business in the London interbank eurocurrency market to fund
the relevant Tranche, the Borrowers shall be deemed to have
selected an Interest Period of six (6) months (or such other
period as the Agent may in its discretion decide).
5.4 SEPARATE INTEREST PERIODS FOR INSTALMENTS
If an Interest Period would otherwise extend beyond any
Repayment Date, the relevant Tranche shall be divided into two
(2) or more portions. One or more portions will be of an
amount equal to the amount of the Tranche required to be
repaid on each relevant Repayment Date and will have an
Interest Period of such length as will expire on that date and
the Interest Period relating to the remainder of the Tranche
will be determined in accordance with Clauses 5.2 and 5.3.
5.5 EXTENSION AND SHORTENING OF INTEREST PERIODS
If an Interest Period would otherwise end on a day which is
not a Business Day, the Interest Period shall be extended
until the next following Business Day unless the next
following Business Day falls in the next calendar month in
which case the Interest Period will be shortened to expire on
the preceding Business Day.
If an Interest Period commences on the last Business Day in a
month or if there is no day in the month in which the Interest
Period will end which corresponds numerically to the day on
which it begins, the Interest Period shall end on the last
Business Day in that month.
5.6 INTEREST RATE
(A) In respect of Interest Periods pursuant to Clause
5.2(A) and subject to Clause 5.8 and Clause 6, the
rate of interest applicable to a Tranche (or relevant
part in the case of the division of such Tranche
under Clause 5.4)
27
during an Interest Period shall be the rate per annum
which is the sum of LIBOR plus the Margin.
(B) In respect of Interest Periods pursuant to Clause
5.2(B) and Clause 5.2(C) and subject to Clause 5.8
and Clause 6, the rate of interest applicable to a
Tranche during an Interest Period shall be the rate
including the Margin agreed between the Agent and the
Borrowers.
5.7 BANK BASIS
Interest, commitment fee, agency fees and any other payments
hereunder of an annual nature shall accrue from day to day and
be computed on the basis of a year of three hundred and sixty
(360) days and for the actual number of days elapsed.
5.8 DEFAULT INTEREST
If the Borrowers fail to pay on the due date any sum due under
this Agreement or any of the other Security Documents to which
it may at any time be a party, the Borrowers shall, without
affecting any other remedy of the Agent or the Lenders, pay
interest on such sum from the due date to the actual date of
payment (as well after as before judgment). Such interest
shall accrue on a daily basis at the higher of the Interest
Rate fixed for the latest Interest Period and the rate
computed by the Agent and certified by the Agent to the
Borrowers as being the aggregate of (i) the Margin plus one
per cent (1%) and (ii) the greater of (a) in the case of the
Lenders, the average (rounded upwards if necessary to the next
integral multiple of one-sixteenth of one per cent (1/16%)) of
the respective rates per annum at which each of the Lenders is
able to acquire in accordance with its normal practice
deposits in Dollars or Euro (as the case may be) in successive
periods of one (1) month (or for such shorter period as the
Agent may in its absolute discretion select) in the relevant
interbank eurocurrency market in an amount equivalent to or
comparable with its Contribution to such sum, and, in the case
of the Agent, the rate per annum at which it is able to
acquire in accordance with its normal practice deposits in
Dollars in successive periods of one (1) month (or for such
shorter period as the Agent may in its absolute discretion
select) in the London interbank eurocurrency market in an
amount equivalent to such sum, as at approximately 11.00 a.m.
(London time) on any relevant day and (b) in the case of the
Lenders, the average (rounded upwards if necessary to the next
integral
28
multiple of one-sixteenth of one per cent (1/16%)) of the cost
to each of the Lenders of funding its Contribution to such
sum, and, in the case of the Agent, the cost of funding such
sum, such interest to be compounded at the end of the period
selected by the Agent and to be payable on demand. In the
event of LIBOR or EURIBOR (as the case may be) not being
available then the Agent shall in its discretion use the
Substitute Basis for its calculation as set out in Clause 6.3.
6 SUBSTITUTE BASIS OF FUNDING
6.1 MARKET DISTURBANCE
Notwithstanding anything to the contrary in this Agreement, if
prior to the commencement of any Interest Period the Agent
shall determine in good faith (which determination shall be
conclusive and binding on the parties hereto) that:
(A) by reason of circumstances affecting the relevant
interbank eurocurrency market adequate and fair means
do not exist for ascertaining the Interest Rate
during such Interest Period pursuant to Clause 5; or
(B) deposits in Dollars or Euro of equal duration to such
Interest Period will not be available to any of the
Lenders in the relevant interbank eurocurrency market
in sufficient amounts in the ordinary course of
business to fund its Contribution during such
Interest Period; or
(C) by reason of any material change in applicable law or
regulation or of any change in national or
international financial or economic conditions any of
the Lenders is unable to fund or to continue to fund
its Contribution during such Interest Period by
deposits obtained in the relevant interbank
eurocurrency market,
then the Agent shall promptly give a notice (being a
Suspension Notice), containing full particulars thereof in
reasonable detail to the Borrowers.
6.2 SUSPENSION OF DRAWDOWN
If a Suspension Notice is given by the Agent before the
advance of any of the Facility in accordance with Clause 2
then the Agent shall not be obliged to advance the Facility
until notice to the contrary is given by the Agent. During the
period of thirty (30) days from the giving of such Suspension
Notice, the Agent
29
and any Lender affected by the relevant market disturbance
shall consult in good faith with the Borrowers with a view to
agreeing to an alternative basis for advancing of the Facility
or any relevant part thereof. If such alternative basis is
agreed between the Borrowers, the Agent and the relevant
Lender or Lenders, it shall apply in accordance with its
terms.
6.3 CERTIFICATES OF SUBSTITUTE BASIS
(A) If the Facility or part thereof has been advanced
before a Suspension Notice is given, the Lender or
Lenders affected by the relevant market disturbance
shall within thirty (30) days following the date of
the Suspension Notice, certify (through the Agent) in
good faith to the Borrowers an alternative basis
(being the Substitute Basis) for maintaining its
Contribution affected by the relevant market
disturbance. Such Substitute Basis may be retroactive
to the beginning of the then current Interest Period
(or Interest Periods), and may include an alternative
method of fixing the interest rate (which shall
reflect the cost to the relevant Lender or Lenders of
funding its Contribution from other sources plus the
Margin) or alternative Interest Periods for the
Tranche or any relevant part thereof, provided always
that so far as practicable any such Substitute Basis
shall be computed in a manner and for periods as
similar as possible to those provided in Clause 5.
(B) Each Substitute Basis so certified shall be binding
upon the Borrowers, the Agent and the Lenders and
shall be treated as part of this Agreement.
6.4 REVIEW
So long as any Substitute Basis is in force, the Agent, in
consultation with the Borrowers and the Lenders, shall from
time to time, but not less often than monthly, review whether
or not the circumstances referred to in Clause 6.1 still
prevail with a view to returning to the normal provisions of
this Agreement.
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7 PAYMENTS
7.1 PLACE FOR PAYMENT
All payments by the Borrowers under this Agreement or any of
the other Security Documents to which any of them may at any
time be a party shall be made to the Agent in Same Day Funds:
(A) if in Dollars by 10.00 a.m. New York time to
Commerzbank Aktiengesellschaft, New York (SWIFT
COBAUS3XXXX), account Commerzbank Aktiengesellschaft,
Frankfurt (SWIFT COBADEFFXXX) in favour of
Commerzbank International S.A., Luxembourg (SWIFT
COBALULXXXX) account no 871 6961; and
(B) if in Euro by 10.00 a.m. Frankfurt time to
Commerzbank Aktiengesellschaft, Frankfurt, for the
account of Commerzbank International S.A., account no
400.8716961.01EUR,
or such other account or bank as the Agent may from time to
time designate.
7.2 DEDUCTIONS AND GROSSING-UP
(A) Each payment to be made by the Borrowers to the Agent
hereunder in Dollars or Euro shall be made free and
clear of and without deduction for or on account of
Taxes unless the Borrowers are required by law to
make such a payment subject to the deduction or
withholding of Taxes, in which case the sum payable
by the Borrowers in respect of which such deduction
or withholding is required to be made shall be
increased to the extent necessary to ensure that,
after the making of such deduction or withholding,
the Agent receives and retains (free from any
liability in respect of any such deduction or
withholding) a net sum equal to the sum which it
would have received and so retained had no such
deduction or withholding been made or required to be
made.
(B) Without prejudice to the provisions of Clause 7.2(A),
if any Lender or the Agent on its behalf is required
to make any payment on account of tax (not being a
tax imposed on the net income of its Lending Branch
by the jurisdiction in which it is incorporated or in
which its Lending Branch is
31
located or any other tax existing and applicable
on the date of this Agreement under the laws of
any jurisdiction) or otherwise on or in relation
to any sum received or receivable hereunder by
such Lender or the Agent on its behalf (including,
without limitation, any sum received or receivable
under this Clause 7) or any liability in respect
of any such payment is asserted, imposed, levied
or assessed against such Lender or the Agent on
its behalf, the Borrowers shall, upon demand of
the Agent, indemnify such Lender or the Agent
against such payment or liability, together with
any interest, penalties and expenses payable or
incurred in connection therewith. If any Lender
proposes to make a claim under the provisions of
this Clause 7.2(B) it shall certify to the
Borrowers in reasonable detail within thirty (30)
days (or such longer period as any Lender may
reasonably require) after becoming aware of the
event by reason of which it is entitled to make
its claim or claims the basis of its claim or
claims, such certificate to be conclusive, save
for manifest error.
7.3 PRODUCTION OF RECEIPTS FOR TAXES
If the Borrowers make any payment hereunder in Dollars or Euro
in respect of which they are required by law to make any
deduction or withholding, they shall pay the full amount to be
deducted or withheld to the relevant taxation or other
authority within the time allowed for such payment under
applicable law and shall deliver to the Agent within thirty
(30) days after they have made such payment to the applicable
authority any original receipt issued by such authority
evidencing the payment to such authority of all amounts so
required to be deducted or withheld from such payment.
If an additional payment is made under Clause 7.2(B) and any
Lender or the Agent on its behalf determines that it has
received or been granted a credit against or relief of or
calculated with reference to the deduction or withholding
giving rise to such additional payment, such Lender or the
Agent (as the case may be) shall, to the extent that it can do
so without prejudice to the retention of the amount of such
credit, relief, remission or repayment, pay to the Borrowers
such amount as such Lender or the Agent shall in its opinion
have concluded to be attributable to the relevant deduction or
withholding. Any such payment shall be conclusive evidence of
the amount due to the Borrowers hereunder and shall be
32
accepted by the Borrowers in full and final settlement of
their rights of reimbursement hereunder in respect of such
deduction or withholding. Nothing herein contained shall
interfere with the right of any Lender and the Agent to
arrange their respective tax affairs in whatever manner they
think fit.
7.4 MONEY OF ACCOUNT
If any sum due from the Borrowers under this Agreement or any
other Security Document to which either of them may at any
time be a party, or any order or judgment given or made in
relation thereto, has to be converted from the currency (the
"FIRST CURRENCY") in which the same is payable under such
Security Document, order or judgment into another currency
(the "SECOND CURRENCY") for the purpose of:
(A) making or filing a claim or proof against the
Borrowers or either of them;
(B) obtaining an order or judgment in any court or other
tribunal; or
(C) enforcing any order or judgment given or made in
relation thereto;
the Borrowers shall indemnify and hold harmless the Agent and
each of the Lenders from and against any damages or losses
suffered as a result of any discrepancy between (i) the rate
of exchange used to convert the sum in question from the first
currency into the second currency and (ii) the rate or rates
of exchange at which each Lender and the Agent (as the case
may be) may in the ordinary course of business purchase the
first currency with the second currency upon receipt of a sum
paid to it in satisfaction, in whole or in part, of any such
order, judgment, claim or proof. The above indemnity shall
constitute an obligation of the Borrowers separate and
independent from their other obligations and shall apply
irrespective of any indulgence granted by the Agent or any of
the Lenders.
7.5 ACCOUNTS
The Agent shall maintain in accordance with its usual practice
accounts evidencing the amounts from time to time lent by and
owing to each of the Lenders hereunder or under any of the
other Security Documents. In any legal action or proceeding
arising out of or in connection with this Agreement or any
33
other Security Documents, the entries made in the accounts so
maintained shall be prima facie evidence, save in the case of
manifest error, of the existence and amounts of the
obligations of the Borrowers recorded therein.
7.6 EARNINGS
Provided no Event of Default or Possible Event of Default has
occurred (following which the Agent shall (inter alia) be
entitled to request the Borrowers to give notice pursuant to
Clause 3.2 of the Earnings Assignments and apply the Earnings
in accordance with Clause 14.1) the Earnings shall throughout
the Security Period be at the free disposal of the Borrowers
but during the currency of the Management Agreements the net
earnings of the Vessels shall be paid by the Manager to the
relevant Borrower's Operating Account within five (5) Business
Days of the end of each cruise of a Vessel.
7.7 CONTINUING SECURITY
The security created by this Agreement and each of the other
Security Documents shall be held by the Agent and/or the
Lenders as a continuing security for the repayment of the
Outstanding Indebtedness and the security so created shall not
be satisfied by any intermediate payment or satisfaction of
any part of the amount hereby or thereby secured or by any
amendment of this Agreement or any of the other Security
Documents. Such security shall be in addition to and shall not
in any way be prejudiced or affected by any collateral or
other security now or hereafter held by the Agent or the
Lenders or any of them for all or any part of the amount
hereby or thereby secured or any other right or remedy of the
Agent or the Lenders or any of them under this Agreement, any
of the other Security Documents or the Lower Saxony
Guarantees, by operation of law or otherwise howsoever
arising. All the powers arising from such security may be
exercised from time to time as the Agent may deem expedient.
8 YIELD PROTECTION AND FORCE MAJEURE
8.1 INCREASED COSTS
If by reason of:
(A) any change in law or in its interpretation or
administration; and/or
34
(B) compliance with any request from or requirement of
any central bank or other fiscal, monetary or other
authority including but without limitation the Basle
Committee on Banking Regulations and Supervisory
Practices whether or not having the force of law:
(i) any of the Lenders incurs a cost as a result
of its performing its obligations under this
Agreement and/or its advancing its
Contribution hereunder; or
(ii) there is any increase in the cost to any of
the Lenders of funding or maintaining all or
any of the advances comprised in a class of
advances formed by or including its
Contribution advanced or to be advanced by
it hereunder; or
(iii) any of the Lenders incurs a cost as a result
of its having entered into and/or its
assuming or maintaining its commitment under
this Agreement; or
(iv) any of the Lenders becomes liable to make
any payment on account of Tax or otherwise
(other than Tax on its overall net income)
on or calculated by reference to the amount
of its Contribution advanced or to be
advanced hereunder and/or any sum received
or receivable by it hereunder; or
(v) any of the Lenders suffers any decrease in
its rate of return as a result of any
changes in the requirements relating to
capital ratios, monetary control ratios, the
payment of special deposits, liquidity costs
or other similar requirements affecting that
Lender,
then the Borrowers shall from time to time on demand pay to
the Agent for the account of the relevant Lender or Lenders
amounts sufficient to indemnify the relevant Lender or Lenders
against, as the case may be, such cost, such increased cost
(or such proportion of such increased cost as is in the
reasonable opinion of the relevant Lender or Lenders
attributable to the funding or maintaining of its or their
Contribution(s) hereunder) or such liability.
A Lender affected by any provision of Clause 8.1 above shall
promptly inform the Agent after becoming aware of the relevant
change and its possible results and the
35
Agent shall, as soon as reasonably practicable thereafter,
notify the Borrowers of the change and its possible results.
Without affecting the Borrowers' obligations under Clause 8.1
and in consultation with the Agent, the affected Lender will
then take all such reasonable steps as may be open to it to
mitigate the effect of the change (for example (if then
possible) by changing its Lending Branch or transferring some
or all of its rights and obligations under this Agreement to
another financial institution reasonably acceptable to the
Borrowers and the Agent). The reasonable costs of mitigating
the effect of any such change shall be borne by the Borrowers
save where such costs are of an internal administrative nature
and are not incurred in dealings by any Lender with third
parties.
8.2 FORCE MAJEURE
Where the Agent or any Lender (the "NON-PERFORMING PARTY") is
prevented from performing any of its obligations under this
Agreement by reason of Force Majeure this Agreement shall
remain in effect but the Non-Performing Party's relevant
obligations shall be suspended for so long as the Force
Majeure continues and to the extent that the Non-Performing
Party is so prevented, provided that:
(A) the suspension of performance is of no greater scope
and of no longer duration than is required by the
Force Majeure;
(B) the obligations of the Non-Performing Party shall not
be excused as a result of the Force Majeure; and
(C) in respect of the suspension of the Non-Performing
Party's obligations:
(i) the Non-Performing Party gives the Agent
prompt written notice which the Agent shall
forthwith upon receipt send to the Borrowers
describing the circumstances of Force
Majeure (including the nature of the
occurrence, its expected duration and the
effects of the Force Majeure on the ability
of the Non-Performing Party to perform its
relevant obligations), and continues to
furnish weekly reports with respect thereto
during the period of Force Majeure;
36
(ii) the Non-Performing Party uses all reasonable
efforts to remedy its inability to perform
and to mitigate the effects of the Force
Majeure; and
(iii) as soon as reasonably possible after the
cessation of the Force Majeure the
Non-Performing Party shall notify the Agent
(who shall notify the Borrowers) in writing
of such cessation and shall resume
performance of its obligations under this
Agreement if such resumption is then
possible.
9 REPRESENTATIONS AND WARRANTIES
9.1 DURATION
The representations and warranties in Clause 9.2 and Clause
9.3 shall survive the execution of this Agreement and shall be
deemed to be repeated, with reference mutatis mutandis to the
facts and circumstances subsisting, as if made on each day
until the Borrowers have no remaining obligations, actual or
contingent, under or pursuant to this Agreement or any of the
other Security Documents.
9.2 REPRESENTATIONS AND WARRANTIES
Each of the Borrowers represents and warrants to the Agent and
each of the Lenders that:
(A) STATUS
Each Obligor is a corporation duly organised
constituted and validly existing under the laws of
the country of its incorporation, possessing
perpetual corporate existence, the capacity to sue
and be sued in its own name and the power to own and
charge its assets and carry on its business as it is
now being conducted.
(B) POWERS AND AUTHORITY
Each of the Obligors has the power to enter into and
perform this Agreement and those of the other
Security Documents to which it is a party and the
transactions contemplated hereby and thereby and has
taken
37
all necessary action to authorise the entry into and
performance of this Agreement and such other Security
Documents and such transactions.
(C) LEGAL VALIDITY
This Agreement constitutes legal, valid and binding
obligations of the Borrowers enforceable in
accordance with its terms and in entering into this
Agreement and borrowing the Loan, each of the
Borrowers is acting on its own account. Each other
Transaction Document constitutes (or will constitute
when executed) legal, valid and binding obligations
of each Obligor expressed to be a party thereto
enforceable in accordance with their respective
terms.
(D) NON-CONFLICT WITH LAWS
The entry into and performance of this Agreement and
the other Transaction Documents and the transactions
contemplated hereby and thereby do not and will not
conflict with:
(i) any law or regulation or any official or
judicial order; or
(ii) the constitutional documents of any Obligor;
or
(iii) any agreement or document to which any
Obligor is a party or which is binding upon
such Obligor or any of its assets,
nor result in the creation or imposition of any
Encumbrance on an Obligor or its assets pursuant to
the provisions of any such agreement or document.
(E) NO DEFAULT
Save as disclosed in the Disclosure Letter, no event
has occurred which constitutes a default under or in
respect of any Transaction Document to which any
Obligor is a party or by which any Obligor may be
bound (including (inter alia) this Agreement) and no
event has occurred which, with the giving of notice,
lapse of time, determination of materiality or other
condition might constitute a default under or in
respect of any such Transaction Document and no event
has occurred which constitutes a
38
default under or in respect of any agreement or
document to which any Obligor is a party or by which
any Obligor may be bound to an extent or in a manner
which might have a material adverse effect on its
business, assets or financial condition and no event
has occurred which, with the giving of notice, lapse
of time, determination of materiality or other
condition might constitute a default under or in
respect of any such agreement or document.
(F) CONSENTS
Except for the filing of those Security Documents
which require registration in the Companies
Registries in the Isle of Man, England and Wales or
Bermuda, which filing must be completed within one
(1) month and twenty one (21) days respectively of
the execution of the relevant Security Document(s) in
the case of England and Wales and the Isle of Man and
for the registration of the Mortgages through the
Bahamas Maritime Authority, all authorisations,
approvals, consents, licences, exemptions, filings,
registrations, notarisations and other matters,
official or otherwise, required in connection with
the entry into, performance, validity and
enforceability of this Agreement and each of the
other Transaction Documents and the transactions
contemplated thereby have been obtained or effected
and are in full force and effect.
(G) ACCURACY OF INFORMATION
All information furnished by any Obligor relating to
the business and affairs of any Obligor in connection
with this Agreement and the other Transaction
Documents was and remains true and correct in all
material respects and there are no other material
facts or considerations the omission of which would
render any such information misleading.
(H) FULL DISCLOSURE
Each Obligor has fully disclosed in writing to the
Co-ordinator all facts relating to each Obligor which
it knows or should reasonably know and which might
reasonably be expected to influence the Lenders in
deciding whether or not to enter into this Agreement.
39
(I) NO ENCUMBRANCES
None of the assets or rights of any Obligor is
subject to any Encumbrance except Permitted Liens.
(J) PARI PASSU OR PRIORITY STATUS
The claims of the Agent and the Lenders against each
Borrower under this Agreement will rank at least pari
passu with the claims of all unsecured creditors of
that Borrower (other than claims of such creditors to
the extent that they are statutorily preferred) and
in priority to the claims of any creditor of that
Borrower who is also an Obligor.
(K) SOLVENCY
Each of the Borrowers is and shall remain, after the
advance to them of the Facility, solvent in
accordance with the laws of the Isle of Man and the
United Kingdom and in particular with the provisions
of the Insolvency Act 1986 (as from time to time
amended) and the requirements thereof.
(L) WINDING-UP, ETC.
Neither Borrower nor any other Obligor has taken any
corporate action nor have any other steps been taken
or legal proceedings been started or (to the best of
its knowledge and belief) threatened against any of
them for the winding-up, dissolution or for the
appointment of a liquidator, administrator, receiver,
administrative receiver, trustee or similar officer
of any of them or any or all of their assets or
revenues nor have either sought any other relief
under any applicable insolvency or bankruptcy law.
(M) ACCOUNTS
The consolidated audited accounts of the Group for
the period ending on 31 December 1998 and for all
subsequent periods up to and including the period
ending on 31 December 2003 (which accounts will be
prepared in accordance with GAAP) fairly represent
the financial condition of the Group as shown in such
audited accounts and the consolidated audited
accounts of the NCLC Group for the period ending on
31 December 2004
40
and for all subsequent periods (which accounts will
be prepared in accordance with GAAP) will fairly
represent the financial condition of the NCLC Group
as shown in such audited accounts.
(N) LITIGATION
Save as disclosed in writing to the Co-ordinator
prior to 26 June 1999 and by way of the Disclosure
Letter no litigation, arbitration or administrative
proceedings are current or pending or, to its
knowledge, threatened, which might, if adversely
determined, have a material adverse effect on the
business, assets or financial condition of any
Obligor. For the avoidance of doubt, any such
disclosure after 26 June 1999 shall not be deemed to
be a reference to the facts and circumstances then
subsisting at any time that this representation is
deemed to be repeated pursuant to Clause 9.1.
(O) TAX LIABILITIES
The NCLC Group has complied with all taxation laws in
all jurisdictions in which it is subject to Taxation
and has paid all Taxes due and payable by it; no
material claims are being asserted against it with
respect to Taxes, which might, if such claims were
successful, have a material adverse effect on its
business, assets or financial condition.
(P) OWNERSHIP OF ASSETS
Each member of the Group or the NCLC Group (as the
case may be) has good and marketable title to all its
assets which are reflected in the audited accounts
referred to in sub-clause (M) of this Clause.
(Q) NO IMMUNITY
None of the Obligors nor any of their respective
assets enjoys any right of immunity (sovereign or
otherwise) from set-off, suit or execution in respect
of their obligations under this Agreement or any of
the other Transaction Documents or by any relevant or
applicable law.
41
(R) TAXES ON PAYMENTS
As at the date of this Agreement all amounts payable
by them hereunder may be made free and clear of and
without deduction for or on account of any Taxation.
(S) PLACE OF BUSINESS
None of the Obligors has a place of business in any
jurisdiction (except as already disclosed) which
requires any of the Security Documents to be filed or
registered in that jurisdiction to ensure the
validity of the Security Documents to which it is a
party.
(T) OWNERSHIP OF SHARES
The Shares and all the shares in the Manager are
legally and beneficially owned by the Shareholder,
all the shares in the Shareholder are legally and
beneficially owned by Arrasas and all the shares in
Arrasas are legally and beneficially owned by the
Guarantor and such structure shall remain so
throughout the Security Period. Further, no Event of
Default has occurred under clause 11.2 of the
Guarantee in respect of the ownership and/or control
of the shares in the Guarantor.
(U) COMPLETENESS OF DOCUMENTS
The copies of the Building Contracts, the Management
Agreements and any other relevant third party
agreements delivered to the Co-ordinator are true and
complete copies of each such document constituting
valid and binding obligations of the parties thereto
enforceable in accordance with their respective terms
and no amendments thereto or variations thereof have
been agreed nor has any action been taken by the
parties thereto which would in any way render such
document inoperative or unenforceable.
(V) NO UNDISCLOSED COMMISSIONS
There are and will be no commissions, rebates,
premiums or other payments by or to or on account of
any Obligor, their shareholders or
42
directors in connection with the transaction as a
whole other than as disclosed to the Co-ordinator in
writing.
(W) ENVIRONMENT
Each of the Obligors:
(i) is in compliance with all applicable
federal, state, local, foreign and
international laws, regulations, conventions
and agreements relating to pollution
prevention or protection of human health or
the environment (including, without
limitation, ambient air, surface water,
ground water, navigable waters, water of the
contiguous zone, ocean waters and
international waters), including without
limitation, laws, regulations, conventions
and agreements relating to:
(a) emissions, discharges, releases or
threatened releases of chemicals,
pollutants, contaminants, wastes,
toxic substances, hazardous
materials, oil, hazard substances,
petroleum and petroleum products
and by-products ("MATERIALS OF
ENVIRONMENTAL CONCERN"); or
(b) the manufacture, processing,
distribution, use, treatment,
storage, disposal, transport or
handling of Materials of
Environmental Concern (such laws,
regulations, conventions and
agreements the "ENVIRONMENTAL
LAWS");
(ii) has all permits, licences, approvals,
rulings, variances, exemptions, clearances,
consents or other authorizations required
under applicable Environmental Laws
("ENVIRONMENTAL APPROVALS") and are in
compliance with all Environmental Approvals
required to operate its business as
presently conducted or as reasonably
anticipated to be conducted;
(iii) has not received any notice, claim, action,
cause of action, investigation or demand by
any other person, alleging potential
liability for, or a requirement to incur,
investigatory costs, clean-up costs,
response and/or remedial costs (whether
incurred by a
43
governmental entity or otherwise), natural
resources damages, property damages,
personal injuries, attorney's fees and
expenses or fines or penalties, in each case
arising out of, based on or resulting from:
(a) the presence or release or threat
of release into the environment of
any Material of Environmental
Concern at any location, whether or
not owned by such person; or
(b) circumstances forming the basis of
any violation, or alleged
violation, of any Environmental Law
or Environmental Approval
("ENVIRONMENTAL CLAIM"); and
there are no circumstances that may prevent or
interfere with such full compliance in the future.
There is no Environmental Claim pending or threatened
against any of the Obligors.
There are no past or present actions, activities,
circumstances, conditions, events or incidents,
including, without limitation, the release, emission,
discharge or disposal of any Material of
Environmental Concern, that could form the basis of
any Environmental Claim against any of the Obligors.
(X) YEAR 2000 CONFORMITY
Any upgrading, replacement or reprogramming required
to achieve Year 2000 Conformity of any Obligor's
computer systems, electronic and electro-mechanical
or similar equipment (including leased systems and
equipment) and the testing of all such systems and
equipment as so upgraded, replaced or reprogrammed,
will be completed in a timely manner and in respect
of such systems or equipment owned or leased on or
before 26 June 1999 in any event by 30 July 1999; the
cost of such upgrading, replacement or reprogramming
and testing to such Obligor will not have a material
adverse effect on the Obligor's business or financial
condition.
44
(Y) MONEY LAUNDERING
Any borrowing by a Borrower hereunder, and the
performance of its obligations hereunder and under
the other Security Documents, will be for its own
account and will not involve any breach by it of any
law or regulatory measure relating to "MONEY
LAUNDERING" as defined in Article 1 of the Directive
(91/308/EEC) of the Council of the European
Communities.
9.3 REPRESENTATIONS ON A DELIVERY DATE
Each Borrower further represents and warrants to the Agent and
each of the Lenders that on the relevant Delivery Date its
Vessel will be:
(A) in its absolute and unencumbered ownership save as
contemplated by the Security Documents;
(B) provisionally registered in its name under the
Bahamian flag;
(C) classed with the highest classification available for
a vessel of its type free of all recommendations and
qualifications with Det Norske Veritas;
(D) operationally seaworthy and in compliance with all
relevant provisions, regulations and requirements
(statutory or otherwise) applicable to ships
registered under the Bahamian flag;
(E) insured in accordance with the provisions of Clause
10.21 and in compliance with the requirements therein
in respect of such insurances; and
(F) managed by the Manager on and subject to the terms
set out in the relevant NCLL Management Agreement.
10 UNDERTAKINGS
10.1 DURATION
The undertakings in this Clause 10 shall survive the execution
of this Agreement and shall be deemed to be repeated with
reference mutatis mutandis to the facts and circumstances
subsisting, as if made on each day until the Borrowers have no
45
remaining obligations, actual or contingent, under or pursuant
to this Agreement or any of the other Security Documents.
10.2 INFORMATION
Each Borrower will provide to the Co-ordinator (or will
procure the provision of):
(A) as soon as practicable (and in any event within one
hundred and twenty (120) days after the close of each
of its financial years) a Certified Copy of its
audited accounts for that year and of the
consolidated Group accounts in that year (commencing
with audited accounts made up to 31 December 1999)
such Group accounts being substituted with NCLC Group
accounts commencing with the audited accounts made up
to 31 December 2004;
(B) as soon as practicable (and in any event within forty
five (45) days of the end of each quarter of each
financial year) a Certified Copy of the unaudited
consolidated accounts of the Borrower and the Group
for that quarter such Group accounts being
substituted with NCLC Group accounts commencing with
the unaudited accounts made up to 31 March 2004;
(C) promptly, such further information in its possession
or control regarding its financial condition and
operations and those of any company in the NCLC Group
as the Co-ordinator may request;
(D) details of any material litigation, arbitration or
administrative proceedings which affect any Obligor
as soon as the same are instituted and served, or, to
the knowledge of the Borrower, threatened (and for
this purpose proceedings shall be deemed to be
material if they involve a claim in an amount
exceeding one million Dollars (USD1,000,000) or the
equivalent in another currency).
All accounts required under this Clause 10.2 shall be prepared
in accordance with GAAP and shall fairly represent the
financial condition of the relevant company.
46
10.3 NOTIFICATION OF DEFAULT
Each Borrower will notify the Co-ordinator of any Event of
Default or Possible Event of Default forthwith upon any
Obligor becoming aware of the occurrence thereof. Upon the
Co-ordinator's request from time to time the Borrowers will
issue a certificate stating whether any Obligor is aware of
the occurrence of any Event of Default or Possible Event of
Default.
10.4 CONSENTS AND REGISTRATIONS
Each Borrower will procure that (and will promptly furnish
Certified Copies to the Co-ordinator of) all such
authorisations, approvals, consents, licences and exemptions
as may be required under any applicable law or regulation to
enable it or any Obligor to perform its obligations under, and
ensure the validity or enforceability of, each of the
Transaction Documents are obtained and promptly renewed from
time to time and will procure that the terms of the same are
complied with at all times. Insofar as such filings or
registrations have not been completed on or before the
relevant Drawdown Date each Borrower will procure the filing
or registration within applicable time limits of each Security
Document which requires filing or registration together with
all ancillary documents required to preserve the priority and
enforceability of the Security Documents.
10.5 NEGATIVE PLEDGE
Neither of the Borrowers will create or permit to subsist any
Encumbrance on the whole or any part of its present or future
assets, except for the following:
(A) Encumbrances created with the prior consent of the
Lenders; or
(B) Permitted Liens.
10.6 DISPOSALS
Except with the prior consent of all the Lenders, neither
Borrower shall (and will procure that no other company in the
NCLC Group shall), either in a single transaction or in a
series of transactions whether related or not and whether
voluntarily or involuntarily, sell, transfer, lease or
otherwise dispose of all or a substantial part of its assets
except that the following disposals shall not be taken into
account:
47
(A) disposals made in the ordinary course of trading of
the disposing entity (excluding disposal of ships)
including without limitation, the payment of cash as
consideration for the purchase or acquisition of any
asset or service or in the discharge of any
obligation incurred for value in the ordinary course
of trading;
(B) disposals of cash raised or borrowed for the purposes
for which such cash was raised or borrowed;
(C) disposals of assets in exchange for other assets
comparable or superior as to type and value;
(D) a vessel owned by any member of the Star Group (other
than a Borrower) may be sold provided such sale is on
a willing seller willing buyer basis at or about
market rate and at arm's length subject always to the
provisions of any loan documentation for the
financing of such vessel and NCLL may, following the
sale of its shares by Arrasas to IOL, a wholly owned
Subsidiary of Star, transfer to other wholly owned
Subsidiaries of Star its vessels "NORWEGIAN WIND",
"NORWEGIAN DREAM", "NORWEGIAN SEA", "NORWEGIAN
MAJESTY", "NORWEGIAN CROWN" and "MARCO POLO" (the
"SIX VESSELS") for their transfer values as set out
in Schedule 8 and sell m.v. "NORWAY" to a third party
and, prior to the sale of its shares as aforesaid,
transfer its vessel "NORWEGIAN SKY" to Pride of Aloha
Inc., a wholly owned Subsidiary of NCL America
Holdings;
(E) the Subsidiaries of Star to whom the Six Vessels (as
defined in Clause 10.6(D)) have been transferred may
let each of the Six Vessels on demise or bareboat
charter to the Manager for the period and at the
charterhire rate set out in Schedule 8; and
(F) Arrasas may transfer its shares in NCLL to IOL and
Star may transfer its shares in Arrasas to the
Guarantor.
10.7 CHANGE OF BUSINESS
Except with the prior consent of the Co-ordinator, neither
Borrower shall make or threaten to make any substantial change
in its business as presently conducted,
48
namely that of a single ship owning company for its Vessel, or
carry on any other business which is substantial in relation
to its business as presently conducted so as to affect, in the
opinion of the Co-ordinator, that Borrower's ability to
perform its obligations hereunder and shall not form any
Subsidiaries and the Borrowers will procure that the other
Obligors continue, throughout the Security Period, to perform
their current business activities.
10.8 MERGERS
Except with the prior consent of the Co-ordinator, neither
Borrower will enter into any amalgamation, restructure,
substantial reorganisation, merger or consolidation or
anything analogous to the foregoing. Further, no member of the
NCLC Group will acquire any equity, share capital or
obligations of any corporation or other entity PROVIDED THAT
the Shareholder or NCL America Holdings may so acquire equity,
share capital or obligations of a corporation or entity whose
business is the ownership, operation or management of cruise
vessels and PROVIDED FURTHER THAT:
(A) Arrasas may form two (2) wholly owned Subsidiaries,
namely the Shareholder and NCL America Holdings;
(B) the existing shareholders of the owners of the
Bahamas flag vessels in the NCLC Fleet may transfer
their shares in such owners to the Shareholder;
(C) the existing shareholders of the owners of the US
flag vessels in the NCLC Fleet may transfer their
shares in such owners to NCL America Holdings;
(D) the Shareholder may form a wholly owned Subsidiary,
namely the Manager, to operate the Bahamas flag
vessels in the NCLC Fleet and to charter in each of
the Six Vessels (as defined in Clause 10.6.(D)) on
demise or bareboat charter for the period and at the
charterhire rate set out in Schedule 8; and
(E) NCL America Holdings may form two (2) wholly owned
Subsidiaries, namely NCL America, to operate the US
flag vessels in the NCLC Fleet, and Pride of Aloha
Inc., to own m.v. "NORWEGIAN SKY".
49
10.9 MAINTENANCE OF STATUS AND FRANCHISES
Each Borrower will do all such things as are necessary to
maintain its corporate existence in good standing and will
ensure that it has the right and is duly qualified to conduct
its business as it is conducted in all applicable
jurisdictions and will obtain and maintain all franchises and
rights necessary for the conduct of its business.
10.10 FINANCIAL RECORDS
Each Borrower will keep proper books of record and account, in
which proper and correct entries shall be made of all
financial transactions and the assets, liabilities and
business of that Borrower in accordance with GAAP.
10.11 FINANCIAL INDEBTEDNESS AND SUBORDINATION OF INDEBTEDNESS
(A) Otherwise than in the ordinary course of business as
owner of its Vessel, except as contemplated by this
Agreement and except any loan, advance or credit
extended by the Guarantor or any member of the NCLC
Group which is a wholly owned Subsidiary of the
Guarantor, neither Borrower will create, incur,
assume or allow to exist any financial indebtedness,
enter into any finance lease or undertake any
material capital commitment (including but not
limited to the purchase of any capital asset).
(B) Each Borrower shall procure that any and all
indebtedness (and in particular with any other
Obligor) is at all times fully subordinated to the
Security Documents and the obligations of the
Borrowers hereunder. Upon the occurrence of an Event
of Default or a Possible Event of Default, neither
Borrower shall make any repayments of principal,
payments of interest or of any other costs, fees,
expenses or liabilities arising from or representing
such indebtedness. In this Clause "FULLY
SUBORDINATED" shall mean that any claim of the lender
against the relevant Borrower in relation to such
indebtedness shall rank after and be in all respects
subordinate to all of the rights and claims of the
Agent and the Lenders under this Agreement and the
other Security Documents and that the lender shall
not take any steps to enforce its rights to recover
any monies owing to it by that Borrower and in
particular but without
50
limitation the lender will not institute any legal or
quasi-legal proceedings under any jurisdiction at any
time against the relevant Vessel, its Earnings or
Insurances or the relevant Borrower and it will not
compete with the Agent or the Lenders in a
liquidation or other winding-up or bankruptcy of the
relevant Borrower or in any proceedings in connection
with that Borrower's Vessel, its Earnings or
Insurances.
(C) The Borrowers hereby jointly and severally covenant
with the Agent and each of the Lenders that so long
as any part of the Outstanding Indebtedness remains
unpaid or undischarged neither will, without the
Co-ordinator's prior written consent, assign,
mortgage, dispose of or otherwise deal with any
inter-Borrower Financial Indebtedness or any part
thereof.
10.12 POOLING OF EARNINGS AND CHARTERS
Neither Borrower will enter into in respect of its Vessel (A)
any pooling agreement or other arrangement for the sharing of
any of the Earnings or the expenses of its Vessel or (B) any
demise or bareboat charter or (C) any charter whereunder two
(2) months' charterhire (or the equivalent thereof) is payable
in advance in respect of its Vessel or (D) any charter of its
Vessel or contract of affreightment which, with the exercise
of options for extension, could be for a period longer than
thirteen (13) months.
10.13 LOANS AND GUARANTEES BY THE BORROWERS
Otherwise than in the ordinary course of business as owner of
its Vessel or except as contemplated hereby, a Borrower will
not make any loan or advance or extend credit to any person,
firm or corporation (except any loans, advances or credits
made available to (a) passengers on board its Vessel for
gambling purposes (b) ship's agents and/or (c) the Guarantor
and/or members of the NCLC Group which are wholly owned
Subsidiaries of the Guarantor and, in the case of such loans,
advances or credits as are referred to in this paragraph (c),
do not prevent the relevant Borrower from performing its
obligations hereunder) or issue or enter into any guarantee or
indemnity or otherwise become directly or contingently liable
for the obligations of any other person, firm or corporation.
51
10.14 MANAGEMENT AND OPERATION OF CASINO
Except with the prior consent of the Co-ordinator, neither
Borrower will permit any person other than the Manager to be
the commercial, technical and crewing manager of its Vessel or
permit any amendment to be made to the terms of the relevant
Management Agreement.
10.15 ACQUISITION OF SHARES
Neither Borrower will acquire any equity, share capital,
assets or obligations of any corporation or other entity or
permit its shares to be held by any party other than the
Shareholder.
10.16 TRADING WITH THE UNITED STATES OF AMERICA
Where a Vessel trades in the territorial waters of the United
States of America, the relevant Borrower shall in respect of
its Vessel take all reasonable precautions to prevent any
infringements of the Anti-Drug Abuse Act of 1986 of the United
States of America (as the same may be amended and/or
re-enacted from time to time hereafter) or any similar
legislation applicable to its Vessel in any other jurisdiction
in which such Vessel shall trade (a "RELEVANT JURISDICTION")
and, for this purpose a Borrower shall (inter alia) enter into
a "Carrier Initiative Agreement" with the United States'
Customs Service (if such is possible) and procure that the
same (or a similar agreement in a Relevant Jurisdiction) is
maintained in full force and effect and its obligations
thereunder performed by it in respect of its Vessel throughout
any period of United States of America (including coastal
waters over which it claims jurisdiction) or Relevant
Jurisdiction related trading.
10.17 FURTHER ASSURANCE
Each Borrower will, from time to time on being required to do
so by the Co-ordinator, do or procure the doing of all such
acts and/or execute or procure the execution of all such
documents in a form satisfactory to the Co-ordinator as the
Co-ordinator may reasonably consider necessary for giving full
effect to any of the Transaction Documents or securing to the
Agent and the Lenders the full benefit of the rights, powers
and remedies conferred upon the Agent or the Lenders in any
such Transaction Document.
52
10.18 VALUATION OF THE VESSELS
(A) The Borrowers will from time to time (but at
intervals no more frequently than annually at the
Borrowers' expense) within fifteen (15) days of
receiving any request to that effect from the
Co-ordinator, procure that the Vessels are valued by
an independent reputable shipbroker or shipvaluer
experienced in valuing cruise ships appointed by the
Borrowers and approved by the Co-ordinator (which
approval shall not be unreasonably withheld or
delayed and such valuation to be made with or without
taking into account the benefit or otherwise of any
fixed employment relating to the Vessels as the
Co-ordinator may require).
(B) If the Borrowers do not accept the valuation obtained
pursuant to Clause 10.18(A) (the "FIRST VALUATION")
they may (at their own expense) within five (5)
Business Days of receipt of the First Valuation
obtain a second valuation (the "SECOND VALUATION")
from another independent reputable shipbroker or
shipvaluer experienced in valuing cruise ships
appointed by the Borrowers and approved by the
Co-ordinator which approval shall not be unreasonably
withheld or delayed.
(C) If the Second Valuation exceeds the First Valuation
by a margin of no less than ten per cent (10%) of the
First Valuation the Borrowers may at their expense
forthwith upon receipt of the Second Valuation
request the shipbrokers and/or shipvaluers appointed
pursuant to Clauses 10.18(A) and (B) to obtain a
third valuation (the "THIRD VALUATION") from a
further independent reputable shipbroker or
shipvaluer experienced in valuing cruise ships
approved by the Co-ordinator such approval not to be
unreasonably withheld or delayed. Subject to the
Third Valuation being made available within five (5)
Business Days of the date of the Second Valuation the
valuation of the Vessels will be determined on the
basis of the average of the three (3) valuations so
obtained. If the Third Valuation is not made
available within the aforementioned time limit the
Vessels shall be valued on the basis of the average
of the First Valuation and the Second Valuation.
53
(D) The Borrowers shall procure that forthwith upon the
issuance of any valuation obtained pursuant to this
Clause 10.18 a copy thereof is sent directly to the
Co-ordinator for review.
10.19 MARGINAL SECURITY
If:
(A) at any time after the second anniversary of the first
Delivery Date and before the second anniversary of
the second Delivery Date, the value of the first
delivered Vessel as assessed in accordance with the
provisions of Clause 10.18 and the value of any
additional cash collateral deposits or the value of
other security (not including any other security
provided by the existing Security Documents)
acceptable to the Co-ordinator provided by the
Borrowers or any third party to secure the due
performance by the Borrowers of their obligations
hereunder at valuations reasonably estimated by the
Co-ordinator from time to time is less than one
hundred and twenty five per cent (125%) of the amount
of the relevant Tranche; or
(B) at any time after the second anniversary of the
second Delivery Date, the aggregate of the value of
the Vessels as assessed in accordance with the
provisions of Clause 10.18 and the value of any
additional cash collateral deposits or the value of
other security (not including any other security
provided by the existing Security Documents)
acceptable to the Co-ordinator provided by the
Borrowers or any third party to secure the due
performance by the Borrowers of their obligations
hereunder at valuations reasonably estimated by the
Co-ordinator from time to time is less than one
hundred and twenty five per cent (125%) of the amount
of the Loan,
then the Co-ordinator may give the Borrowers notice requiring
the Borrowers to provide additional security and in such event
within thirty (30) days of such notice, the Borrowers will
either:
(i) provide the Agent with additional security acceptable
to the Co-ordinator such that the security value of
the first delivered Vessel or the aggregate of the
security value of the Vessels (as the case may be)
and any additional security provided to the Agent
hereunder (at valuations
54
reasonably estimated by the Co-ordinator from time to
time) is at least one hundred and twenty five per
cent (125%) of the amount of the relevant Tranche or
the Loan (as the case may be); or
(ii) prepay pro rata to the Tranches (in the case of the
Loan) all or an appropriate proportion of the Tranche
or the Loan (as the case may be) together with
accrued interest on the amount prepaid such that the
value of the security is one hundred and twenty five
per cent (125%) of the Tranche or the Loan (as the
case may be).
10.20 PERFORMANCE OF EMPLOYMENT CONTRACTS
Each Borrower will:
(A) perform its obligations under each charterparty or
employment contract made in respect of its Vessel and
take all necessary steps to procure the due
performance of the obligations of any party under any
charterparty or contract. It will not without the
prior written consent of the Co-ordinator rescind,
cancel or otherwise terminate any charterparty or
contract in respect of its Vessel provided always
that any determination by it of any charterparty or
contract after such consent is given shall be without
responsibility on the part of the Co-ordinator who
shall be under no liability whatsoever in the event
that such termination thereafter be adjudged to
constitute a repudiation of such charterparty or
contract by such Borrower;
(B) promptly notify the Co-ordinator (i) of any default
under any charterparty or contract of which it has
knowledge by it and/or by any party under any
charterparty or contract (ii) of any charterparty or
contract being frustrated or the performance thereof
becoming impossible or substantially different from
that contemplated originally by the parties thereto;
(C) institute and maintain all such proceedings as may be
necessary or expedient to preserve or protect the
interest of the Agent as assignee and itself under
any charterparties or contracts made in respect of
its Vessel;
55
(D) not take or omit to take any action the taking or
omission of which might result in any material
alteration or impairment of any charterparty or
contract made in respect of its Vessel;
(E) not substitute any other ship or ships for its Vessel
under any charterparty or contract made in respect of
its Vessel;
(F) not without the Co-ordinator's prior consent agree to
any material variation, modification or amendment in
the terms of any charterparty or contract in respect
of its Vessel or release any other party from any of
their respective obligations thereunder or waive any
breach of the obligations of any person or consent to
any such act or omission of any person as would
otherwise constitute such breach;
(G) not without the Co-ordinator's prior consent let or
employ its Vessel below about the market rate
prevailing when the Vessel is fixed;
(H) procure that the Earnings (if any) are paid in full
without set off and free and clear of and without
deduction for any taxes levies duties imposts charges
fees restrictions or conditions of any nature
whatsoever; and
(I) if, immediately following the termination (for
whatever reason) of any charterparty or contract in
respect of its Vessel, its Vessel is not employed in
a manner acceptable to the Co-ordinator in its sole
discretion the Borrowers shall provide additional
security for their obligations hereunder in such
manner, of such type and within such period as the
Co-ordinator may determine in its absolute
discretion.
10.21 INSURANCES
Each Borrower covenants with the Agent and the Lenders and
undertakes from the Delivery Date of its Vessel:
(A) to insure its Vessel, or to procure that its Vessel
is insured, in its name and keep its Vessel and
procure that its Vessel is kept insured during the
existence of this Agreement on an agreed value basis
for an amount in Dollars approved by the Co-ordinator
but not being less than the greater of:
56
(i) one hundred and twenty five per cent (125%)
of the relevant Tranche; or
(ii) the full market and commercial value of its
Vessel determined in accordance with Clause
10.18 from time to time
through internationally recognised independent first
class insurance companies, underwriters, war risks
and protection and indemnity associations acceptable
to the Co-ordinator in each instance on terms and
conditions approved by the Co-ordinator including as
to deductibles but at least in respect of:
(a) marine risks including all risks customarily
and usually covered by first-class and
prudent shipowners in the London insurance
markets under English marine policies or
Co-ordinator-approved policies containing
the ordinary conditions applicable to
similar vessels;
(b) war risks including the Lost Vessel Clause
and, should Institute War and Strike
Clauses, Hulls Conditions prevail, the
London Blocking and Trapping Addendum and
war risks (protection and indemnity) up to
the insured amount;
(c) excess risks that is to say the proportion
of claims for general average and salvage
charges and under the running down clause
not recoverable in consequence of the value
at which its Vessel is assessed for the
purpose of such claims exceeding the insured
value;
(d) protection and indemnity risks with full
standard coverage and up to the highest
limit of liability available (for oil
pollution risk the highest limit currently
available is one billion Dollars
(USD1,000,000,000) and this to be increased
if requested by the Co-ordinator and the
increase is possible in accordance with the
standard protection and indemnity cover for
vessels of its type and is compatible with
prudent insurance practice for first class
cruise
57
shipowners or operators in waters where its
Vessel trades from time to time during the
Security Period);
(e) when and while its Vessel is laid-up, in
lieu of hull insurance, normal port risks;
(f) such other risks as the Co-ordinator may
from time to time reasonably require;
and in any event in respect of those risks and at
those levels covered by first class and prudent
owners and/or financiers in the international market
in respect of similar tonnage PROVIDED THAT if any of
such insurances are also effected in the name of any
other person (other than the relevant Borrower, the
Agent and/or the Lenders) such person shall if so
required by the Co-ordinator execute a first priority
assignment of its interest in such insurances in
favour of the Agent and/or the Lenders in similar
terms mutatis mutandis to the relevant Insurance
Assignment;
(B) to agree that the Co-ordinator at the cost of the
Borrowers shall take out mortgagee interest insurance
on such conditions as the Co-ordinator may reasonably
require and mortgagee interest insurance for
pollution risks as from time to time agreed the
Borrowers having no interest or entitlement in
respect of such policies;
(C) if its Vessel shall trade in the United States of
America and/or the Exclusive Economic Zone of the
United States of America (the "EEZ") as such term is
defined in the US Oil Pollution Act 1990 ("OPA"), to
comply strictly with the requirements of OPA and any
similar legislation which may from time to time be
enacted in any jurisdiction in which its Vessel
presently trades or may or will trade at any time
during the existence of this Agreement and in
particular before such trade is commenced and during
the entire period during which such trade is carried
on:
(i) to pay any additional premiums required to
maintain protection and indemnity cover for
oil pollution up to the limit available to
it for its Vessel in the market;
58
(ii) to make all such quarterly or other voyage
declarations as may from time to time be
required by its Vessel's protection and
indemnity association and to comply with all
obligations in order to maintain such cover,
and promptly to deliver to the Co-ordinator
copies of such declarations;
(iii) to submit its Vessel to such additional
periodic, classification, structural or
other surveys which may be required by its
Vessel's protection and indemnity insurers
to maintain cover for such trade and
promptly to deliver to the Co-ordinator
copies of reports made in respect of such
surveys;
(iv) to implement any recommendations contained
in the reports issued following the surveys
referred to in sub-clause (iii) above within
the time limit specified therein and to
provide evidence satisfactory to the
Co-ordinator that the protection and
indemnity insurers are satisfied that this
has been done;
(v) in particular strictly to comply with the
requirements of any applicable law,
convention, regulation, proclamation or
order with regard to financial
responsibility for liabilities imposed on
the relevant Borrower or its Vessel with
respect to pollution by any state or nation
or political subdivision thereof, including
but not limited to OPA, and to provide the
Co-ordinator on demand with such information
or evidence as it may reasonably require of
such compliance;
(vi) to procure that the protection and indemnity
insurances do not contain a clause excluding
its Vessel from trading in waters of the
United States of America and the EEZ or any
other provision analogous thereto and to
provide the Co-ordinator with evidence that
this is so; and
(vii) strictly to comply with any operational or
structural regulations issued from time to
time by any relevant authorities under OPA
so that at all times its Vessel falls within
the provisions which limit strict liability
under OPA for oil pollution;
59
(D) to give notice forthwith of any assignment of its
interest in the Insurances to the relevant brokers,
insurance companies, underwriters and/or associations
in the form approved by the Co-ordinator;
(E) to execute and deliver all such documents and do all
such things as may be necessary to confer upon the
Agent and/or the Lenders legal title to the
Insurances in respect of its Vessel and to procure
that the interest of the Agent and/or the Lenders is
at all times filed with all slips, cover notes,
policies and certificates of entry and to procure (i)
that a loss payable clause in the form approved by
the Co-ordinator shall be filed with all the hull,
machinery and equipment and war risks policies in
respect of its Vessel and (ii) that a loss payable
clause in the form approved by the Co-ordinator shall
be endorsed upon the protection and indemnity
certificates of entry in respect of its Vessel;
(F) to procure that each of the relevant brokers and
associations furnish the Agent with a letter of
undertaking in such form as may be required by the
Co-ordinator and waives any lien for premiums or
calls except in relation to premiums or calls
attributable to its Vessel;
(G) punctually to pay all premiums, calls, contributions
or other sums payable in respect of the Insurances on
its Vessel and to produce all relevant receipts when
so required by the Co-ordinator;
(H) to renew each of the Insurances on its Vessel at
least ten (10) days before the expiry thereof and to
give immediate notice to the Co-ordinator of such
renewal and to procure that the relevant brokers or
associations shall promptly confirm in writing to the
Co-ordinator that such renewal is effected it being
understood by each Borrower that any failure to renew
the Insurances on its Vessel at least ten (10) days
before the expiry thereof or to give or procure the
relevant notices of such renewal shall constitute an
Event of Default;
(I) to arrange for the execution of such guarantees as
may from time to time be required by any protection
and indemnity and/or war risks association;
60
(J) to furnish the Co-ordinator from time to time on
request with full information about all Insurances
maintained on its Vessel and the names of the
offices, companies, underwriters, associations or
clubs with which such Insurances are placed;
(K) not to agree to any variation in the terms of any of
the Insurances on its Vessel without the prior
approval of the Co-ordinator nor to do any act or
voluntarily suffer or permit any act to be done
whereby any Insurances shall or may be rendered
invalid, void, voidable, suspended, defeated or
unenforceable and not to suffer or permit its Vessel
to engage in any voyage nor to carry any cargo not
permitted under any of the Insurances without first
obtaining the consent of the insurers or reinsurers
concerned and complying with such requirements as to
payment of extra premiums or otherwise as the
insurers or reinsurers may impose;
(L) not without the prior written consent of the
Co-ordinator to settle, compromise or abandon any
claim in respect of any of the Insurances on its
Vessel other than a claim of less than one million
Dollars (USD1,000,000) or the equivalent in any other
currency and not being a claim arising out of a Total
Loss;
(M) promptly to furnish the Co-ordinator with full
information regarding any casualties or other
accidents or damage to its Vessel involving an amount
in excess of one million Dollars (USD1,000,000);
(N) to apply or ensure the appliance of all such sums
receivable in respect of the Insurances on its Vessel
for the purpose of making good the loss and fully
repairing all damage in respect whereof the insurance
monies shall have been received;
(O) that in the event of it making default in insuring
and keeping insured its Vessel as hereinbefore
provided then the Co-ordinator may (but shall not be
bound to) insure that Vessel or enter that Vessel in
such manner and to such extent as the Co-ordinator in
its discretion thinks fit and in such case all the
cost of effecting and maintaining such insurance
together with interest thereon at the Interest Rate
shall be paid on demand by the Borrowers to the
Agent; and
61
(P) to agree that the Co-ordinator shall be entitled from
time to time (but at intervals no more frequently
than annually at the Borrowers' expense) to instruct
independent reputable insurance advisers for the
purpose of obtaining any advice or information
regarding any matter concerning the Insurances which
the Co-ordinator shall at its sole discretion deem
necessary, it being hereby specifically agreed that
it shall reimburse the Agent on demand for all
reasonable costs and expenses incurred by the
Co-ordinator in connection with the instruction of
such advisers as aforesaid.
10.22 OPERATION AND MAINTENANCE OF THE VESSELS
From the Delivery Date in respect of its Vessel until the end
of the Security Period at its own expense each Borrower will
in respect of its Vessel:
(A) keep its Vessel in a good and efficient state of
repair so as to maintain it to the highest
classification available for a vessel of its age and
type free of all recommendations and qualifications
with Det Norske Veritas. On its Vessel's Delivery
Date and annually thereafter, it will furnish to the
Co-ordinator a statement by such classification
society that such classification is maintained. It
will comply with all recommendations, regulations and
requirements (statutory or otherwise) from time to
time applicable to its Vessel and shall have on board
as and when required thereby valid certificates
showing compliance therewith and shall procure that
all repairs to or replacements of any damaged, worn
or lost parts or equipment are carried out (both as
regards workmanship and quality of materials) so as
not to diminish the value or class of its Vessel. It
will not make any substantial modifications or
alterations to its Vessel or any part thereof without
the prior consent of the Co-ordinator;
(B) submit its Vessel to continuous survey in respect of
her machinery and hull and such other surveys as may
be required for classification purposes and, if so
required by the Co-ordinator, supply to the
Co-ordinator copies in English of the survey reports;
(C) permit surveyors or agents appointed by the
Co-ordinator to board its Vessel at all reasonable
times to inspect her condition or satisfy
62
themselves as to repairs proposed or already carried
out and afford all proper facilities for such
inspections;
(D) comply, or procure that the Manager will comply, with
the ISM Code or any replacement of the ISM Code and
the ISPS Code or any replacement of the ISPS Code and
in particular, without prejudice to the generality of
the foregoing, as and when required to do so by the
relevant code and at all times thereafter:
(i) hold, or procure that the Manager holds, a
valid Document of Compliance duly issued to
the relevant Borrower or the Manager (as the
case may be) pursuant to the ISM Code and a
valid Safety Management Certificate duly
issued to its Vessel pursuant to the ISM
Code;
(ii) provide the Co-ordinator with copies of any
such Document of Compliance and Safety
Management Certificate as soon as the same
are issued;
(iii) pursuant to the ISM Code, keep, or procure
that there is kept, on board its Vessel a
copy of any such Document of Compliance and
the original of any such Safety Management
Certificate;
(iv) pursuant to the ISPS Code, keep, or procure
that there is kept, on board the Vessel the
original of the International Ship Security
Certificate; and
(v) pursuant to the ISPS Code, keep, or procure
that there is kept, on board the Vessel a
copy of the ship security plan prepared
pursuant to the ISPS Code;
(E) not employ its Vessel or permit her employment in any
trade or business which is forbidden by any
applicable law or is otherwise illicit or in carrying
illicit or prohibited goods or in any manner
whatsoever which may render her liable to
condemnation in a prize court or to destruction,
seizure or confiscation or that may expose its Vessel
to penalties. In the event of hostilities in any part
of the world (whether war be declared or
63
not) it will not employ its Vessel or permit her
employment in carrying any contraband goods;
(F) promptly provide the Co-ordinator with (i) all
information which the Co-ordinator may reasonably
require regarding its Vessel, her employment,
earnings, position and engagements (ii) particulars
of all towages and salvages and (iii) copies of all
charters and other contracts for her employment and
otherwise concerning her;
(G) give notice to the Co-ordinator promptly and in
reasonable detail upon any Obligor becoming aware of:
(i) accidents to its Vessel involving repairs
the cost of which will or is likely to
exceed one million Dollars (USD1,000,000);
(ii) its Vessel becoming or being likely to
become a Total Loss or a Compulsory
Acquisition;
(iii) any recommendation or requirement made by
any insurer or classification society or by
any competent authority which is not
complied with within any time limit relating
thereto;
(iv) any writ served against or any arrest of its
Vessel or the exercise of any lien or
purported lien on its Vessel her Earnings or
Insurances;
(v) the occurrence of any Possible Event of
Default and/or Event of Default;
(vi) its Vessel ceasing to be registered as a
Bahamian vessel or anything which is done or
not done whereby such registration may be
imperilled;
(vii) it becoming impossible or unlawful for it to
fulfil any of its obligations under the
Security Documents; and
(viii) anything done or permitted or not done in
respect of its Vessel by any person which is
likely to imperil the security created by
the Security Documents or the relevant Lower
Saxony Guarantee;
64
(H) promptly pay and discharge all debts, damages and
liabilities, taxes, assessments, charges, fines,
penalties, tolls, dues and other outgoings in respect
of its Vessel and keep proper books of account in
respect thereof PROVIDED ALWAYS that the Borrowers
shall not be obliged to compromise any debts, damages
and liabilities as aforesaid which are being
contested in good faith subject always that full
details of any such contested debt, damage or
liability which, either individually or in aggregate
exceeds one million Dollars (USD1,000,000) shall
forthwith be provided to the Co-ordinator. As and
when the Co-ordinator may so require it will make
such books available for inspection on behalf of the
Co-ordinator and provide evidence satisfactory to the
Co-ordinator that the wages and allotments and the
insurance and pension contributions of the master and
crew are being regularly paid, that all deductions of
crew's wages in respect of any tax liability are
being properly accounted for and that the master has
no claim for disbursements other than those incurred
in the ordinary course of trading on the voyage then
in progress or completed prior to such inspection;
(I) maintain the type of its Vessel as at its Delivery
Date and not put its Vessel into the possession of
any person without the prior consent of the
Co-ordinator for the purpose of work being done on
her in an amount exceeding or likely to exceed one
million Dollars (USD1,000,000) unless such person
shall first have given to the Co-ordinator a written
undertaking addressed to the Agent in terms
satisfactory to the Co-ordinator agreeing not to
exercise a lien on the Vessel or her Earnings for the
cost of such work or for any other reason;
(J) promptly pay and discharge all liabilities which have
given rise, or may give rise, to liens or claims
enforceable against its Vessel under the laws of all
countries to whose jurisdiction its Vessel may from
time to time be subject PROVIDED ALWAYS that the
Borrowers shall not be obliged to compromise any
liabilities as aforesaid which are being contested in
good faith subject always that full details of any
such contested liabilities which, either individually
or in aggregate, exceed one million Dollars
(USD1,000,000) shall be forthwith provided to the
Co-ordinator. If its Vessel is arrested or detained
for any reason it will procure her immediate
65
release by providing bail or taking such other steps
as the circumstances may require;
(K) give to the Co-ordinator at such times as it may from
time to time require a certificate, duly signed on
its behalf as to the amount of any debts, damages and
liabilities relating to the Vessel and, if so
required by the Co-ordinator, forthwith discharge
such debts, damages and liabilities to the
Co-ordinator's satisfaction; and
(L) maintain the registration of its Vessel as a Bahamian
vessel and not do or permit anything to be done
whereby such registration may be forfeited or
imperilled.
11 JOINT AND SEVERAL OBLIGATIONS
(A) Each obligation of or expressed to be assumed by the
Borrowers or either of them in or under this
Agreement or any other Security Document is the joint
and several obligation of the Borrowers and each of
them.
(B) Each Borrower acknowledges and confirms that it is a
principal and original debtor in respect of all
amounts which may become payable by the Borrowers in
accordance with the terms hereof or any other
Security Document and agrees that the Agent and the
Lenders and each of them may in all circumstances
treat it as such whether or not the Agent or any
Lender is or becomes aware that such Borrower is or
has become a surety for another.
(C) The Borrowers agree to indemnify and hold harmless
the Agent and the Lenders and each of them from and
against any loss incurred by any of them as a result
of any Clause or provision of this Agreement or any
other Security Document being or becoming void,
voidable or unenforceable for any reason whatsoever,
whether or not known to any such person, the amount
of such loss being limited to the amount which the
Agent or the relevant Lender would otherwise have
been entitled to recover hereunder or under any other
Security Document had such Clause or provision not
become void, voidable or unenforceable.
66
(D) The obligation of each Borrower under this Agreement
or any other Security Document shall not be in any
way discharged or impaired by reason of (i) any time
or indulgence which may be granted by the Agent, the
Lenders or any of them to the other Borrower or any
other person from whom they may seek payment of sums
due from either Borrower under this Agreement or any
other Security Document (ii) by any variation of this
Agreement or any other Security Document or any
related document or (iii) by any other circumstances
which might (but for this provision) constitute a
legal or equitable discharge of such Borrower.
(E) Until the Outstanding Indebtedness has been paid in
full neither Borrower (hereinafter called a "CREDITOR
BORROWER") will, without the prior written consent of
the Agent, ask, demand, sue for, take or receive from
the other Borrower (hereinafter called the "DEBTOR
BORROWER") by set-off or any manner the whole or any
part of all present and future sums, liabilities and
obligations payable or owing by the Debtor Borrower
to the Creditor Borrower whether actual or
contingent, jointly or severally or otherwise
howsoever or demand or accept any Encumbrance in
respect thereof so long as any Senior Liabilities are
outstanding to any Lender (for which purpose "SENIOR
LIABILITIES" shall mean all present and future sums,
liabilities and obligations whatsoever payable or
owing by the Borrowers (or either of them) to the
Agent or any Lender under this Agreement and the
other Security Documents (or any of them) or
otherwise whatsoever, whether actual or contingent,
jointly or severally or otherwise howsoever.
(F) To provide for just and equitable contribution
between the Borrowers the Borrowers hereby agree, as
between themselves, that if any payment is made by a
Borrower (the "FUNDING BORROWER") under this
Agreement, the Funding Borrower shall be entitled to
a contribution from the other Borrower for such
payment, such contribution to be made in the manner
and to the extent set forth in this Clause 11. Any
amount payable as a contribution hereunder shall be
determined as of the date on which the related
payment is made by the Funding Borrower. The other
Borrower shall be liable to the Funding Borrower in
an aggregate amount, subject to Clause 11(G), equal
to (i) the ratio of (x) the Net Assets of such
Borrower to (y) the aggregate Net Assets of the
Borrowers multiplied by (ii) the
67
amount of such payment made by or on account of, the
Funding Borrower. For purposes of any calculations
pursuant to this Clause 11 "NET ASSETS" for the
Borrowers shall mean an amount equal to the excess of
the fair, saleable value of the assets of such
Borrower as at such date (without taking into account
the rights of such Borrower under this Clause 11) and
excluding the value of any shares of stock owned by
such Borrower in any other company on such date over
the amount that would be required to pay the probable
liabilities of such Borrower determined as at such
date (excluding the obligations of such Borrower
under this Clause 11) on all of its debts. Any
contribution hereunder may be made by adjustment to
the inter-company accounts maintained by the
Shareholder with respect to each of the Borrowers;
however, none of the Borrowers shall be entitled to
make any claim in respect of any contribution owed to
it by the other Borrower until all monies owing to
the Agent and/or the Lenders under this Agreement and
the other Security Documents have been paid in full.
(G) If as a result of any amendment, waiver or
modification of the terms and conditions governing
this Agreement, or for any other reason the
contributions of a Borrower under this Clause 11
become inequitable, the parties hereto shall promptly
modify and amend this Agreement to provide for any
equitable allocation of contributions. Any of the
foregoing modifications and amendments shall be in
writing and signed by all parties hereto.
(H) The Borrowers acknowledge that the right of
contribution hereunder shall constitute an asset of
the party to which such contribution is owing.
(I) In the event of payment being made to, or an
Encumbrance being held by, a Creditor Borrower in
breach of Clause 11(E) or any payment or distribution
being made to a Creditor Borrower by any liquidator
or other person rather than to the Agent such
Creditor Borrower shall hold such payment or
Encumbrance to the order and for the benefit of the
Agent and shall forthwith pay to the Agent any sums
which shall have been so received by it from the
Debtor Borrower or from the enforcement of such
Encumbrance (in which respect the Creditor Borrower
shall act in
68
accordance with the directions of the Agent) or, as
the case may be, the liquidator of the Debtor
Borrower or such other person and until such payment
such Creditor Borrower will hold such sums and the
benefit of such Encumbrance (as the case may be) on
trust for the Agent and any such sums so paid to or
held on trust for the Agent shall be applied, or
pending application held, in such manner as the Agent
shall think fit in or towards discharge of the
Outstanding Indebtedness.
12 RIGHTS OF THE AGENT AND THE LENDERS
12.1 NO DEROGATION OF RIGHTS
Any rights conferred on the Agent and the Lenders or any of
them by this Agreement or any other Security Document shall be
in addition to and not in substitution for or in derogation of
any other right which the Agent and the Lenders or any of them
might at any time have to seek from either Borrower or any
other person for payment of sums due from either Borrower or
indemnification against liabilities as a result of either
Borrower's default in payment of sums due from it under this
Agreement or other Security Document.
12.2 ENFORCEMENT OF REMEDIES
None of the Agent or the Lenders shall be obliged before
taking steps to enforce any rights conferred on it by this
Clause or exercising any of the rights, powers and remedies
conferred on it hereby or by law (i) to take action or obtain
judgment in any court against either Borrower or any other
person from whom they may seek payment of any sum due from
either Borrower under this Agreement or any other Security
Document (ii) to make or file any claim in a bankruptcy,
winding-up, liquidation or re-organisation of either Borrower
or any other such person or (iii) to enforce or seek to
enforce any other rights it may have against either Borrower
or any other such person or (iv) to enforce the Lower Saxony
Guarantees.
12.3 EXERCISE OF RIGHTS
Each Borrower agrees that, so long as any sums are or may be
owed by either Borrower under this Agreement or any other
Security Document, any rights which it may have, at any time,
by reason of performance by or of its obligations
69
under this Clause, to be indemnified by the other Borrower
and/or to take the benefit (in whole or in part) of any
security taken pursuant to this Agreement or any Security
Document by the Lenders or the Agent on their behalf, shall be
exercised by it in such manner and upon such terms as the
Agent may require and further agrees to hold any monies at any
time received by it as a result of the exercise of any such
rights for and on behalf and to the order of the Agent for
application in or towards payment of any sums at any time owed
by either Borrower under this Agreement or any other Security
Document.
12.4 WAIVER OF SET-OFF
Each Borrower further agrees that so long as any sums are or
may be owed by either Borrower under this Agreement or any
other Security Document it will not (A) claim any set-off or
counterclaim against the other Borrower in respect of any
liability on the part of such other Borrower to it and
attributable to this Agreement or any other Security Document
or (B) prove in competition with the Agent or the Lenders or
any of them in any liquidation or winding-up of the other
Borrower, whether in respect of any payment by it hereunder or
under any other Security Document or in respect of any monies
including proceeds of realisation of securities, dividends or
otherwise.
13 DEFAULT
13.1 EVENTS OF DEFAULT
Each of the events set out below is an Event of Default:
(A) NON-PAYMENT
The Borrowers or any other Obligor do not pay on the
due date any amount of principal or interest of the
Loan (provided however that if any such amount is not
paid when due solely by reason of some error or
omission on the part of the bank or banks through
whom the relevant funds are being transmitted no
Event of Default shall occur for the purposes of this
Clause 13.1(A) until the expiry of three (3) Business
Days following the date on which such payment is
due), or within three (3) days of the due date any
other amount, payable by them under any
70
Security Document to which they may at any time be a
party, at the place and in the currency in which it
is expressed to be payable.
(B) BREACH OF OTHER OBLIGATIONS
(i) Any Obligor fails to comply with any other
material provision of any Security Document
or there is any other material breach in the
sole opinion of the Co-ordinator of any of
the Transaction Documents and such failure
(if in the opinion of the Co-ordinator in
its sole discretion it is capable of remedy)
continues unremedied for a period of twenty
one (21) days from the date of its
occurrence and in any such case as aforesaid
the Co-ordinator in its sole discretion
considers that such failure is or could
reasonably be expected to become materially
prejudicial to the interests, rights or
position of the Lenders; or
(ii) If there is a repudiation or termination of
any Transaction Document or if any of the
parties thereto becomes entitled to
terminate or repudiate any of them and
evidences an intention so to do.
(C) MISREPRESENTATION
Any representation warranty or statement made or
repeated in, or in connection with, any Security
Document or the Lower Saxony Guarantees or in any
accounts, certificate, statement or opinion delivered
by or on behalf of any Obligor thereunder or in
connection therewith is materially incorrect when
made or would, if repeated at any time hereafter by
reference to the facts subsisting at such time, no
longer be materially correct.
(D) CROSS DEFAULT
(i) Any event of default occurs under any
financial contract or financial document
relating to any Financial Indebtedness of
any member of the NCLC Group.
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(ii) Any such Financial Indebtedness or any sum
payable in respect thereof is not paid when
due (after the expiry of any applicable
grace period(s)) whether by acceleration or
otherwise.
(iii) Any Encumbrance over any assets of any
member of the NCLC Group becomes
enforceable.
(iv) Any other Financial Indebtedness of any
member of the NCLC Group is not paid when
due or is or becomes capable of being
declared due prematurely by reason of
default or any security for the same becomes
enforceable by reason of default,
PROVIDED THAT:
(a) No Event of Default will arise if the
relevant Financial Indebtedness is not
accelerated or, if it is accelerated but, in
aggregate, the Financial Indebtedness is
less than three million Dollars
(USD3,000,000); and
(b) Financial Indebtedness being contested by
the Borrowers in good faith will be
disregarded PROVIDED first that full details
of the dispute shall be submitted to the
Co-ordinator forthwith upon its occurrence
and second if the dispute remains unresolved
for a period of one hundred and fifty (150)
days this Clause 13.1(D)(b) shall not apply
to that Financial Indebtedness.
(E) WINDING-UP
Any order is made or an effective resolution passed
or other action taken for the suspension of payments
or dissolution, termination of existence,
liquidation, winding-up or bankruptcy of any member
of the NCLC Group.
(F) MORATORIUM OR ARRANGEMENT WITH CREDITORS
A moratorium in respect of all or any debts of any
member of the NCLC Group or a composition or an
arrangement with creditors of any member of the NCLC
Group or any similar proceeding or arrangement by
which the assets of any member of the NCLC Group are
submitted to the control
72
of its creditors is applied for, ordered or declared
or any member of the NCLC Group commences
negotiations with any one or more of its creditors
with a view to the general readjustment or
rescheduling of all or a significant part of its
Financial Indebtedness.
(G) APPOINTMENT OF LIQUIDATORS ETC.
A liquidator, trustee, administrator, receiver,
manager or similar officer is appointed in respect of
any member of the NCLC Group or in respect of all or
any substantial part of the assets of any member of
the NCLC Group and in any such case such appointment
is not withdrawn within thirty (30) days (the "GRACE
PERIOD") unless the Co-ordinator considers in its
sole discretion that the interest of the Lenders
might reasonably be expected to be adversely affected
in which event the Grace Period shall not apply.
(H) INSOLVENCY
Any member of the NCLC Group becomes or is declared
insolvent or is unable, or admits in writing its
inability, to pay its debts as they fall due or
becomes insolvent within the terms of any applicable
law.
(I) LEGAL PROCESS
Any distress, execution, attachment or other process
affects the whole or any substantial part of the
assets of any member of the NCLC Group and remains
undischarged for a period of twenty one (21) days.
(J) ANALOGOUS EVENTS
Anything analogous to or having a substantially
similar effect to any of the events specified in
sub-clauses (E) to (I) of this Clause shall occur
under the laws of any applicable jurisdiction.
(K) CESSATION OF BUSINESS
Any member of the NCLC Group ceases to carry on all
or a substantial part of its business.
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(L) REVOCATION OF CONSENTS
Any authorisation, approval, consent, licence,
exemption, filing, registration or notarisation or
other requirement necessary to enable any Obligor to
comply with any of its obligations under any of the
Transaction Documents is materially adversely
modified, revoked or withheld or does not remain in
full force and effect and within ninety (90) days of
the date of its occurrence such event is not remedied
to the satisfaction of the Co-ordinator and the
Co-ordinator considers in its sole discretion that
such failure is or might be expected to become
materially prejudicial to the interests, rights or
position of the Lenders PROVIDED THAT the Borrowers
shall not be entitled to the aforesaid ninety (90)
day period if the modification, revocation or
withholding of the authorisation, approval or consent
is due to an act or omission of any Obligor and the
Co-ordinator is satisfied in its sole discretion that
the Lenders' interests might reasonably be expected
to be materially adversely affected.
(M) UNLAWFULNESS
At any time it is unlawful or impossible for any
Obligor to perform any of its obligations under any
Security Document to which it is a party or it is
unlawful or impossible for the Agent or any Lender to
exercise any of its rights under any of the Security
Documents or the Lower Saxony Guarantees PROVIDED
THAT no Event of Default shall be deemed to have
occurred (except where the unlawfulness or
impossibility adversely affects any Obligor's payment
obligations under this Agreement and other Security
Documents (the determination of which shall be in the
Co-ordinator's sole discretion) in which case the
following provisions of this Clause 13.1(M) shall not
apply) where the unlawfulness or impossibility
prevents any Obligor from performing its obligations
(other than its payment obligations under this
Agreement and the Security Documents) and is cured
within a period of twenty one (21) days of the
occurrence of the event giving rise to the
unlawfulness or impossibility and the relevant
Obligor, within the aforesaid period, performs its
obligation(s) and PROVIDED FURTHER THAT no Event of
Default shall be deemed to have occurred where the
Agent and/or any relevant Lender could, in its
74
sole discretion, mitigate the consequences of unlawfulness or
impossibility in the manner described in Clause 4.3(B). The
costs of mitigation shall be determined in accordance with
Clause 4.3(B).
(N) INSURANCES
Either Borrower fails to insure its Vessel in the manner
specified in Clause 10.21 or fails to renew the Insurances at
least ten (10) days prior to the date of expiry thereof and
produce prompt confirmation of such renewal to the
Co-ordinator.
(O) TOTAL LOSS
If a Vessel shall become a Total Loss and the proceeds of the
Insurances in respect thereof shall not have been received by
the Agent within one hundred and fifty (150) days after the
date of the event giving rise to such Total Loss.
(P) DISPOSALS
If either Borrower or any other member of the NCLC Group shall
have concealed, removed, or permitted to be concealed or
removed, any part of their property, with intent to hinder,
delay or defraud their respective creditors or any of them, or
made or suffered a transfer of any of their property which may
be fraudulent under any bankruptcy, fraudulent conveyance or
similar law; or shall have made any transfer of their property
to or for the benefit of a creditor with the intention of
preferring such creditor over any other creditor.
(Q) PREJUDICE TO SECURITY
Anything is done or suffered or omitted to be done by any
Obligor which in the reasonable opinion of the Co-ordinator
would or might be expected to imperil the security created by
any of the Security Documents or the Lower Saxony Guarantees.
75
(R) MATERIAL ADVERSE CHANGE
Any material adverse change in the business, assets or
financial condition of any Obligor occurs which in the
reasonable opinion of the Co-ordinator would or might
reasonably be expected to affect the ability of that Obligor
duly to perform any of its material obligations under any
Security Document to which it may at any time be a party. For
the purposes of this Clause 13.1(R) and without prejudice to
the generality of the expression "MATERIAL OBLIGATIONS" any
payment obligations of any Obligor shall be deemed material.
(S) GOVERNMENTAL INTERVENTION
The authority of any member of the NCLC Group in the conduct
of its business is wholly or substantially curtailed by any
seizure or intervention by or on behalf of any authority and
within ninety (90) days of the date of its occurrence any such
seizure or intervention is not relinquished or withdrawn and
the Co-ordinator reasonably considers that the relevant
occurrence is or might be expected to become materially
prejudicial to the interests, rights or position of the
Lenders PROVIDED THAT the Borrowers shall not be entitled to
the aforesaid ninety (90) day period if the seizure or
intervention executed by any authority is due to an act or
omission of any member of the NCLC Group and the Co-ordinator
is satisfied, in its sole discretion, that the Lenders'
interest might reasonably be expected to be materially
adversely affected.
13.2 ACCELERATION
(A) On the occurrence of an Event of Default or a Possible Event
of Default and at any time thereafter whilst such event shall
be continuing the Agent may if the Facility has not yet been
drawn down, by notice to the Borrowers cancel the obligations
of the Lenders under this Agreement.
(B) On the occurrence of an Event of Default and at any time
thereafter whilst such event shall be continuing, if any of
the Facility has been drawn down the Agent may:
76
(i) by notice to the Borrowers declare the whole or any part
of the Loan due and repayable in accordance with the
terms of such notice whereupon the same shall become due
and repayable accordingly together with all interest
accrued thereon and all other amounts payable hereunder
and under any of the other Security Documents and any
undrawn Tranche shall be cancelled; and/or
(ii) from time to time exercise all or any of its rights
under any of the Security Documents in such order and in
such manner as it shall deem appropriate; and/or
(iii) at its discretion terminate or continue with the
Management Agreements.
13.3 DEFAULT INDEMNITY
The Borrowers shall on demand indemnify the Agent and the Lenders,
without prejudice to any of their other rights under this Agreement
and the other Security Documents, against any loss or expense which
the Agent shall certify as sustained or incurred by any of them as a
consequence of:
(A) any default in payment by the Borrowers of any sum under this
Agreement or any of the other Security Documents when due,
including, without limitation, any liability incurred by the
Agent and the Lenders by reason of any delay or failure of the
Borrowers to pay any such sums;
(B) any break in funding (including without limitation warehousing
and other related costs) due to the occurrence of any Event of
Default or Possible Event of Default;
(C) any prepayment of a Tranche or part thereof being made at any
time for any reason; and/or
(D) a Tranche not being drawn for any reason (excluding any
default by the Agent or any Lender) after a Drawdown Notice
has been given,
including, in any such case, but not limited to, any loss or expense
sustained or incurred in maintaining or funding the Tranches or in
liquidating or re-employing deposits from third parties acquired to
effect or maintain the Tranches and also
77
any loss or expense (including without limitation warehousing and
other related costs) incurred in connection with any interest rate
swap agreements or other financial instruments entered into for the
purposes of this transaction.
13.4 SET-OFF
Following the occurrence of any Event of Default and for so long as
the same is continuing, each Borrower irrevocably authorises the
Agent and the Lenders to apply any credit balance to which that
Borrower is entitled upon any account of that Borrower with any
branch of any of the Agent and the Lenders in or towards
satisfaction of any sum due to the Agent or any Lender hereunder but
unpaid, and to combine any accounts of the Borrowers for this
purpose. If such set-off requires a credit balance in a currency
other than Dollars or Euro (as the case may be) to be transferred to
an account maintained in connection herewith the transfer shall be
effected by crediting to the account in question the amount of
Dollars or Euro (as the case may be) which the Agent or the Lender
(as the case may be) could obtain by exchanging such currency for
Dollars or Euro (as the case may be) at the rate of exchange at
which its Lending Branch would, at the opening of business on the
date on which the combination is effected, have sold the currency of
that credit balance for Dollars or Euro (as the case may be) for
immediate delivery.
14 APPLICATION OF FUNDS
14.1 TOTAL LOSS PROCEEDS/PROCEEDS OF SALE/EVENT OF DEFAULT MONIES
In the event of a Vessel becoming a Total Loss or if a Vessel is
sold or if an Event of Default has occurred then all Total Loss
proceeds or proceeds of sale of a Vessel or any monies received by
the Agent or any Lender under or pursuant to the Security Documents
shall be held by the Agent and applied in the following manner and
order:
FIRSTLY to the payment of all fees, expenses and charges
(including brokers' commissions and any costs (including
without limitation warehousing and other related costs)
incurred in breaking any swap agreements or other
interest rate management products entered into for the
purpose of this transaction), the expenses of
78
any sale, the expenses of retaining any attorney,
solicitors' fees, court costs and any other expenses or
advances made or incurred by the Agent or any Lender in
the protection of the Agent's and the Lender's rights or
the pursuance of its or their remedies hereunder and
under the other Security Documents or to any payments
whether voluntary or not which the Agent considers
advisable to protect its or their security and to
provide adequate indemnity against liens claiming
priority over or equality with the lien of Security
Documents or any other Encumbrances;
SECONDLY in or towards payment in such order as the Lenders may
require of any accrued (but unpaid) fees and interest to
which the Lenders and/or the Agent are entitled
hereunder and/or under the other Security Documents in
connection with the relevant Tranche and/or the Loan;
THIRDLY in or towards satisfaction of all interest accrued on
the relevant Tranche;
FOURTHLY in retention by the Agent in its discretion in a
suspense or impersonal interest bearing security
realised account of such sum as it considers appropriate
by way of security for the Outstanding Indebtedness or
for any actual or contingent liability of the Agent or
the Lenders or any of them in connection with the
transactions herein contemplated;
FIFTHLY in or towards payment of the Maturity Date Payment and
the Instalments of the relevant Tranche (whether or not
then due and payable) in reverse order of maturity date;
SIXTHLY in or towards satisfaction of any other amounts due from
the Borrowers to the Agent under the Security Documents
using in the discretion of the Agent the same order of
application as FIRSTLY to FIFTHLY;
SEVENTHLY in retention of such other sum or sums as the Agent may
require as security for any further monies which may
reasonably be
79
expected to become due and payable to the Agent and/or
the Lenders under this Agreement or any of the other
Security Documents and which the assigned Earnings may
be insufficient to satisfy; and
EIGHTHLY the balance, if any, in payment to the Borrowers or
whomsoever shall then be entitled thereto.
In the event of the proceeds being insufficient to pay the amounts
referred to above the Agent shall be entitled to collect the balance
from the Borrowers.
14.2 GENERAL FUNDS
Any other monies received by or in the possession of the Agent or
any Lender under or pursuant to the Security Documents which are
expressed hereunder and/or under the Security Documents to be
distributed in accordance with the provisions of this Clause or
where no express provisions are made for disposal shall be applied
in the discretion of the Agent as follows:
FIRSTLY in or towards payment of all fees, costs and expenses
(including any costs (including without limitation any
warehousing and other related costs) incurred breaking
any interest rate swap agreements or other interest rate
management products entered into for the purposes of
this transaction) incurred by the Agent or any Lender in
connection with the Loan and which are for the time
being unpaid;
SECONDLY in or towards payment in such order as the Lenders may
require of any accrued (but unpaid) fees and interest to
which the Lenders and/or the Agent are entitled
hereunder and/or under the other Security Documents in
connection with the Loan;
THIRDLY in retention by the Agent in its discretion in a
suspense or impersonal interest bearing security
realised account of such sum as it considers appropriate
by way of security for the Outstanding Indebtedness or
for any actual or contingent liability of the Agent or
the Lenders or any of them in connection with the
transactions herein contemplated;
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FOURTHLY in or towards payment of the Maturity Date Payment and
the Instalments of the relevant Tranche in reverse order
of maturity date;
FIFTHLY in retention of such other sum or sums as the Agent may
require as security for any further monies which may
reasonably be expected to become due and payable to the
Agent and/or the Lenders under this Agreement or any of
the other Security Documents and which the assigned
Earnings may be insufficient to satisfy; and
SIXTHLY the balance (if any) shall be released to the Borrowers
or to their order or whomsoever else may be entitled
thereto.
14.3 APPLICATION OF PROCEEDS OF INSURANCES
Proceeds of the Insurances for partial losses shall be applied in
accordance with the Insurance Assignments and/or the loss payable
clauses endorsed on the Insurances in the form approved by the
Co-ordinator and in the case of a Total Loss of a Vessel in
accordance with Clause 4.5 and Clause 14.1.
14.4 SUSPENSE ACCOUNT
Any monies received or recovered by the Agent or any Lender under or
in connection with the Security Documents and credited to any
suspense or impersonal interest bearing security realised account
may be held in such account for so long as the Agent thinks fit
pending application at the Agent's discretion in accordance with
THIRDLY of Clause 14.1 or Clause 14.2 (as the case may be).
15 FEES
15.1 AGENCY FEE
The Borrowers shall pay to the Agent an agency fee in Dollars on the
date on which the German State of Lower Saxony advises the
Co-ordinator that the Lower Saxony Guarantees will be issued in form
acceptable to the Lenders and on the first and second anniversaries
of 26 June 1999 calculated at the rate of nought point nought three
one two five per cent (0.03125%) per annum of the Facility (in the
case of the fee payable on the date on which the German State of
Lower
81
Saxony advises the Co-ordinator that the Lower Saxony Guarantees
will be issued in form acceptable to the Lenders) or of the Loan (in
the case of the fee payable on an anniversary of 26 June 1999). From
the third anniversary of 26 June 1999 the Borrowers shall pay to the
Agent an agency fee in Dollars on each Interest Payment Date
thereafter calculated at the rate of nought point nought three one
two five per cent (0.03125%) per annum of the relevant Tranche.
15.2 MANAGEMENT FEE
The Borrowers shall pay to the Agent for distribution to the Lenders
a management fee of two million two hundred and sixty eight thousand
Dollars (USD2,268,000) on the date on which the German State of
Lower Saxony advises the Co-ordinator that the Lower Saxony
Guarantees will be issued in form acceptable to the Lenders.
15.3 COMMITMENT FEE
The Borrowers shall pay to the Agent for distribution to the Lenders
on the date falling three (3) months after 26 June 1999 and three
(3) monthly thereafter and on the date that the Facility has been
drawn down or cancelled a commitment fee in Dollars calculated at
the rate of nought point two five per cent (0.25%) per annum on the
daily undrawn, uncancelled amount of a Tranche from 31 July 1998 in
the case of Tranche 1 and from 22 June 1999 in the case of Tranche 2
until the Facility has been drawn down in full or cancelled.
15.4 LOWER SAXONY GUARANTEES FEE
The Borrowers shall pay to the Agent on each Interest Payment Date
in respect of a Tranche from 13 December 2001 in the case of Tranche
1 and from the Norwegian Dawn Vessel Delivery Date in the case of
Tranche 2 until the relevant Maturity Date a guarantee fee in Euro
calculated at the rate of nought point seven five per cent (0.75%)
per annum on the relevant Lower Saxony Guaranteed Amount.
15.5 UNDERWRITING FEE
Pursuant to the offer letter dated 11 June 1999 between the
Arrangers and Star, Norwegian Dawn shall pay to the Agent on
acceptance of the said offer letter an
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underwriting fee of three hundred and two thousand four hundred
Dollars (USD302,400). It is hereby agreed between the Arrangers and
the Borrowers that the Borrowers shall pay the said underwriting fee
to the Agent for distribution to the Arrangers on the date on which
the German State of Lower Saxony advises the Co-ordinator that the
Lower Saxony Guarantees will be issued in form acceptable to the
Lenders.
15.6 RESTRUCTURING FEES
The Borrowers shall pay to the Agent for distribution to the
Lenders:
(A) on the Restatement Date a non-refundable restructuring fee in
the amount of three hundred thousand Dollars (USD300,000); and
(B) on the signing of the Third Supplemental Agreement a
non-refundable restructuring fee in the amount of one million
two hundred and fifty three thousand eight hundred and forty
four Dollars (USD1,253,844.00).
15.7 SECOND RESTRUCTURING FEE
The Borrowers shall pay to each of the Lenders on the earlier of
five (5) Business Days from the date of the Fourth Supplemental
Agreement and the Third Restatement Date a non-refundable second
restructuring fee of fifty thousand Dollars (USD50,000) provided
that a Lender which is the provider of any other loan or other
facility to the Borrowers or any other member of the Group shall
only be entitled to receive one (1) such fee of fifty thousand
Dollars (USD50,000). Notwithstanding any provision of this Agreement
or the Agency and Co-ordination Deed to the contrary, no Lender
shall be required to share with the other Lenders, the Agent and/or
the Co-ordinator any such restructuring fee received.
16 EXPENSES
16.1 INITIAL EXPENSES
The Borrowers shall reimburse the Agent on demand on a full
indemnity basis for the reasonable charges and expenses (together
with value added tax or any similar tax thereon and including
without limitation the fees and expenses of legal, insurance and
other advisers) incurred by the Agent or the Co-ordinator in respect
83
of the syndication, negotiation, preparation, printing, execution
and registration of this Agreement and the other Transaction
Documents and any other documents required in connection with the
implementation of this Agreement.
16.2 ENFORCEMENT EXPENSES
The Borrowers shall reimburse the Agent and the Lenders on demand on
a full indemnity basis for all charges and expenses (including value
added tax or any similar tax thereon and including the fees and
expenses of legal advisers) incurred by the Agent and each of the
Lenders in connection with the enforcement of, or the preservation
of any rights under, this Agreement, the other Security Documents
and the Lower Saxony Guarantees.
16.3 STAMP DUTIES
The Borrowers shall pay or indemnify the Agent on demand against any
and all stamp, registration and similar Taxes which may be payable
in any jurisdiction in connection with the entry into, performance
and enforcement of this Agreement or any of the other Security
Documents.
17 WAIVERS, REMEDIES CUMULATIVE
17.1 NO WAIVER
No failure to exercise and no delay in exercising on the part of the
Agent or any of the Lenders any right or remedy under any of the
Security Documents shall operate as a waiver thereof, nor shall any
single or partial exercise of any right or remedy preclude any other
or further exercise thereof, or the exercise of any other right or
remedy. No waiver by the Agent, the Co-ordinator or any of the
Lenders shall be effective unless it is in writing.
17.2 REMEDIES CUMULATIVE
The rights and remedies of the Agent and the Lenders provided herein
are cumulative and not exclusive of any rights or remedies provided
by law.
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17.3 SEVERABILITY
If any provision of this Agreement is prohibited or unenforceable in
any jurisdiction, such prohibition or unenforceability shall not
invalidate the remaining provisions hereof or affect the validity or
enforceability of such provision in any other jurisdiction.
17.4 TIME OF ESSENCE
Time is of the essence in respect of all of the obligations of the
Borrowers under the Security Documents provided however that neither
the Agent nor any of the Lenders shall be entitled to terminate or
treat this Agreement or any of the other Security Documents as
having been repudiated otherwise than in circumstances which
constitute an Event of Default.
18 COUNTERPARTS
18.1 This Agreement may be executed in any number of counterparts and all
such counterparts taken together shall be deemed to constitute one
and the same agreement.
19 ASSIGNMENT
19.1 BENEFIT OF AGREEMENT
This Agreement shall be binding upon the Borrowers and their
successors and shall inure to the benefit of the Agent, the
Co-ordinator and each of the Lenders and their successors and
assigns.
19.2 NO TRANSFER BY THE BORROWERS
Neither of the Borrowers may assign or transfer all or any of its
rights, benefits or obligations hereunder or under any of the other
Security Documents.
19.3 ASSIGNMENTS, PARTICIPATIONS AND TRANSFERS BY A LENDER
Each Lender may, subject to obtaining the prior written approval of
the Agent, at any time transfer or assign all of its rights and
benefits hereunder and under the Security Documents and the Lower
Saxony Guarantees to any other lending institution but shall, prior
to such transfer or assignment, on request by the Agent,
85
pay a fee to the Agent of one thousand Dollars (USD1,000) PROVIDED
THAT (save in the case of a transfer or assignment of rights and
benefits to any subsidiary or holding company of such Lender or to
another Lender) no such transfer or assignment may be made without
the prior written consent of the Borrowers (which consent is not to
be unreasonably withheld or delayed). If a Lender transfers or
assigns its rights and benefits hereunder as provided above, all
references in this Agreement and the other Security Documents and
the Lower Saxony Guarantees to that Lender shall be construed as a
reference to that Lender and/or its Transferee or assignee to the
extent of their respective interests.
19.4 EFFECTIVENESS OF TRANSFER
If a Lender transfers or assigns all or any of its rights and
benefits hereunder in accordance with Clause 19.3, then, unless and
until the Transferee or assignee has agreed that it shall be under
the same obligations towards the parties to this Agreement as it
would have been under if it had been a party hereto as a lender, the
parties to this Agreement shall not be obliged to recognise such
Transferee or assignee as having the rights against each of them
which it would have had if it had been such a party hereto.
19.5 TRANSFER OF RIGHTS AND OBLIGATIONS
If any Lender wishes to transfer all or any of its rights, benefits
and/or obligations hereunder or under the other Security Documents
as contemplated in Clause 19.3, then such transfer may be effected
by the due completion and execution by the Lender and the relevant
Transferee of a Transfer Certificate in the form of Schedule 6. The
Agent shall then forthwith execute the Transfer Certificate on
behalf of itself, the other parties to this Agreement and the
Guarantor in accordance with the provisions of Clause 19.8. On the
later of the Transfer Date and the fifth (5th) Business Day
following the date of delivery of the Transfer Certificate to the
Agent for execution:
(A) to the extent that in such Transfer Certificate the Lender
party thereto seeks to transfer its rights, benefits and/or
its obligations hereunder or under the other Security
Documents, the Borrowers and the relevant Lender shall each be
released from further obligations to the other hereunder and
their respective rights against each other shall be cancelled
86
(such rights and obligations being referred to in this Clause
19.5 as "DISCHARGED RIGHTS, BENEFITS AND OBLIGATIONS");
(B) the Borrowers and the Transferee party thereto shall each
assume obligations towards each other and/or acquire rights
against each other which differ from such discharged rights,
benefits and obligations only insofar as the Borrowers and
such Transferee have assumed and/or acquired the same in place
of the Borrowers and the relevant Lender; and
(C) such Transferee shall acquire the same rights and benefits and
assume the same obligations as it would have acquired and
assumed had such Transferee been an original party hereto as a
Lender with the rights, benefits and/or obligations acquired
or assumed by it as a result of such transfer.
19.6 CONSENT AND INCREASED OBLIGATIONS OF THE BORROWERS
In the event that a Lender transfers its Lending Branch or transfers
or assigns its rights and/or benefits hereunder to its affiliate or
another Lender and, at the time of such transfer or assignment,
there arises an obligation on the part of the Borrowers hereunder to
pay to the relevant Lender or any other person any amount in excess
of the amount they would have been obliged to pay but for such
transfer or assignment and the consent of the Borrowers has not been
obtained to such transfer or assignment and the increased cost then,
without prejudice to any obligation of the Borrowers which arises
after the time of such transfer or assignment, the Borrowers shall
not be obliged to pay the amount of such excess.
19.7 DISCLOSURE OF INFORMATION
Any Lender may disclose to a potential Transferee or assignee who
may otherwise propose to enter into contractual relations with it in
relation to this Agreement such information about each of the
Obligors (or otherwise) as that Lender shall consider appropriate
SUBJECT ALWAYS to the relevant Lender procuring the execution by the
potential Transferee or assignee of a Confidentiality Undertaking
PROVIDED ALWAYS that a Lender may provide any such information to
its professional advisers and auditors and to any banking
87
or regulatory authority or as required by law, regulation or legal
process without first procuring the execution of a Confidentiality
Undertaking.
19.8 TRANSFER CERTIFICATE TO BE EXECUTED BY THE AGENT
In order to give effect to a Transfer Certificate each of the
Arrangers and the Lenders, the Co-ordinator and each of the
Borrowers hereby irrevocably and unconditionally appoints the Agent
as its true and lawful attorney with full power to execute on its
behalf each Transfer Certificate delivered to the Agent pursuant to
Clause 19.5 without the Agent being under any obligation to take any
further instructions from, or give any prior notice to, the
Arrangers, the Lenders, the Co-ordinator or the Borrowers before
doing so and the Agent shall so execute each such Transfer
Certificate on behalf of the Arrangers, the Lenders, the
Co-ordinator and the Borrowers forthwith upon its receipt thereof
pursuant to Clause 19.5.
19.9 NOTICE OF TRANSFER CERTIFICATES
The Agent shall promptly notify the Arrangers, the Lenders, the
Co-ordinator, the Transferee, the Guarantor and the Borrowers upon
the execution by it of any Transfer Certificate together with
details of the amount transferred, the Transfer Date and the parties
to such transfer.
19.10 DOCUMENTATION OF TRANSFER OR ASSIGNMENT
The Borrowers shall at the request of the Agent promptly execute or
promptly procure the execution of such documents and do (or procure
the doing of) all such acts and things as may be necessary or
desirable to give effect to any transfer or assignment pursuant to
this Clause 19.
19.11 CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999 (THE "ACT")
A person who is not a party to this Agreement has no right under the
Act to enforce any term of this Agreement but this does not affect
any right or remedy of a third party which exists or is available
apart from the Act.
88
20 NOTICES
20.1 MODE OF COMMUNICATION
Except as otherwise provided herein, each notice, request, demand or
other communication or document to be given or made hereunder shall
be given in writing but unless otherwise stated, may be made by
telex or telefax.
20.2 ADDRESS
Any notice, demand or other communication (unless made by telefax)
to be made or delivered by the Agent or the Co-ordinator to the
Borrowers pursuant to this Agreement shall (unless the Borrowers
have by fifteen (15) days' written notice to the Agent specified
another address) be made or delivered to the Borrowers at 7665
Corporate Center Drive, Miami, Florida 33126, United States of
America (marked for the attention of Mr Lamarr Cooler and the Legal
Department (but one (1) copy shall suffice)) with a copy to 25th
Floor, Wisma Genting, Jalan Sultan Ismail, 50250 Kuala Lumpur,
Malaysia (marked for the attention of Mr Gerard Lim). Any notice,
demand or other communication to be made or delivered by the
Borrowers to the Agent or the Co-ordinator pursuant to this
Agreement shall (unless the Agent has by fifteen (15) days' written
notice to the Borrowers specified another address) be made or
delivered to the Agent or the Co-ordinator (as the case may be) at
its Lending Branch, the details of which are set out in Schedule 2.
20.3 TELEFAX COMMUNICATION
Any notice, demand or other communication to be made or delivered
pursuant to this Agreement may be sent by telefax to the relevant
telephone numbers (which at the date hereof in respect of the
Borrowers is, in both cases +1 305 436 4140 (marked for the
attention of Mr Lamarr Cooler) and +1 305 436 4117 (marked for the
attention of the Legal Department) with a copy to +60 3 2161 3621
(marked for the attention of Mr Gerard Lim) and in the case of the
Agent, the Co-ordinator or any Lender is as recorded in Schedule 2)
specified by it from time to time for the purpose and shall be
deemed to have been received when transmission of such telefax
communication has been completed. Each such telefax communication,
if made to the Agent, the Co-ordinator or any Lender by a Borrower,
shall be signed
89
by the person or persons authorised in writing by such Borrower and
whose signature appears on the list of specimen signatures contained
in the secretary's certificate required to be delivered by paragraph
2 of Schedule 4 and shall be expressed to be for the attention of
the department or officer whose name has been notified for the time
being for that purpose by the Agent or any Lender to such Borrower.
20.4 RECEIPT
Each such notice, demand or other communication shall be deemed to
have been made or delivered (in the case of telex) when the
addressee's answerback shall have been received at the end of the
transmission or (in the case of any letter) when delivered to its
office for the time being or, if sent by post, five (5) days after
being deposited in the post first class postage prepaid in an
envelope addressed to it at that address.
20.5 LANGUAGE
Each notice, demand or other communication made or delivered by one
(1) party to another pursuant to this Agreement or any other
Security Document shall be in the English language or accompanied by
a certified English translation.
21 GOVERNING LAW
21.1 This Agreement shall be governed by English law.
22 WAIVER OF IMMUNITY
22.1 To the extent that either Borrower may in any jurisdiction claim for
itself or its assets immunity from suit, execution, attachment
(whether in aid of execution, before judgment or otherwise) or other
legal process in relation to this Agreement or the other Security
Documents and to the extent that in any such jurisdiction there may
be attributed to itself or its assets such immunity (whether or not
claimed) each Borrower hereby irrevocably and unconditionally agrees
throughout the Security Period not to claim and hereby irrevocably
waives such immunity to the full extent permitted by the laws of
such jurisdiction. In respect of any legal action or proceedings
arising out of or in connection with any of the Security Documents
each Borrower hereby consents generally as a matter of
90
procedure in relation to the waiver of immunity (but not so as to
prejudice any defence which that Borrower may have on the merits of
the substantive issue) to the giving of any relief or the issue of
any process in connection with such legal action or proceedings
including without limitation, the making, enforcement or execution
against any property whatsoever (irrespective of its uses or
intended uses) of any order or judgment which may be made or given
in such legal action or proceedings.
23 JURISDICTION
23.1 The courts of England have exclusive jurisdiction to settle any
dispute arising out of or in connection with this Agreement
(including a dispute regarding the existence, validity or
termination of this Agreement) (a "DISPUTE"). Each party to this
Agreement agrees that the courts of England are the most appropriate
and convenient courts to settle Disputes and accordingly no party
will argue to the contrary.
This Clause 23.1 is for the benefit of the Agent and the Lenders
only. As a result, no such party shall be prevented from taking
proceedings relating to a Dispute in any other courts with
jurisdiction. To the extent allowed by law, any such party may take
concurrent proceedings in any number of jurisdictions.
23.2 The Borrowers may not, without the Co-ordinator's prior written
consent, terminate the appointment of the Process Agent; if the
Process Agent resigns or its appointment ceases to be effective, the
Borrowers shall within fourteen (14) days appoint a company which
has premises in London and has been approved by the Co-ordinator to
act as the Borrowers' process agent with unconditional authority to
receive and acknowledge service on behalf of each Borrower of all
process or other documents connected with proceedings in the English
courts which relate to this Agreement.
23.3 For the purpose of securing its obligations under Clause 23.2, each
of the Borrowers irrevocably agrees that, if it for any reason fails
to appoint a process agent within the period specified in Clause
23.2, the Co-ordinator may appoint any person (including a company
controlled by or associated with the Agent or any Lender) to act as
that Borrower's process agent in England with the unconditional
authority described in Clause 23.2.
91
23.4 No neglect or default by a process agent appointed or designated
under this Clause (including a failure by it to notify the Borrowers
of the service of any process or to forward any process to the
Borrowers) shall invalidate any proceedings or judgment.
23.5 The Borrowers appoint in the case of the courts of England the
Process Agent to receive, for and on behalf of themselves, service
of process in England of any legal proceedings with respect to this
Agreement and any other Security Document.
23.6 A judgment relating to this Agreement which is given or would be
enforced by an English court shall be conclusive and binding on the
Borrowers and may be enforced without review in any other
jurisdiction.
23.7 Nothing in this Clause shall exclude or limit any right which the
Agent or a Lender may have (whether under the laws of any country,
an international convention or otherwise) with regard to the
bringing of proceedings, the service of process, the recognition or
enforcement of a judgment or any similar or related matter in any
jurisdiction.
23.8 In this Clause "JUDGMENT" includes order, injunction, declaration
and any other decision or relief made or granted by a court.
IN WITNESS whereof the parties hereto have caused this Agreement to be duly
executed as a deed on the day first written above.
SIGNED SEALED and DELIVERED as a DEED ) P A Turner
By PAUL TURNER )
for and on behalf of )
NORWEGIAN STAR LIMITED )
in the presence of: )
R Cheung
Regina Cheung
Trainee Solicitor
Stephenson Harwood
One, St. Paul's Churchyard
London EC4M 8SH
92
SIGNED SEALED and DELIVERED as a DEED ) P A Turner
By PAUL TURNER )
for and on behalf of )
NORWEGIAN DAWN LIMITED )
in the presence of: )
R Cheung
as above
SIGNED SEALED and DELIVERED as a DEED ) J Clegg
By JULIE CLEGG )
for and on behalf of )
COMMERZBANK AKTIENGESELLSCHAFT )
Emden Branch )
as an Arranger and a Lender )
in the presence of: )
R Cheung
as above
SIGNED SEALED and DELIVERED as a DEED ) J Clegg
By JULIE CLEGG )
for and on behalf of )
NORDDEUTSCHE LANDESBANK )
GIROZENTRALE )
as an Arranger and a Lender )
in the presence of: )
R Cheung
as above
SIGNED SEALED and DELIVERED as a DEED ) J Clegg
By JULIE CLEGG )
for and on behalf of )
KFW )
as an Arranger and a Lender )
in the presence of: )
R Cheung
as above
SIGNED SEALED and DELIVERED as a DEED ) J Clegg
By JULIE CLEGG )
for and on behalf of )
BREMER BANK NIEDERLASSUNG DER )
DRESDNER BANK AKTIENGESELLSCHAFT )
Bremen )
in the presence of: )
R Cheung
as above
93
SIGNED SEALED and DELIVERED as a DEED ) J Clegg
By JULIE CLEGG )
for and on behalf of )
DEUTSCHE SCHIFFSBANK )
AKTIENGESELLSCHAFT )
Bremen and Hamburg )
in the presence of: )
R Cheung
as above
SIGNED SEALED and DELIVERED as a DEED ) J Clegg
By JULIE CLEGG )
for and on behalf of )
THE BANK OF NOVA SCOTIA )
Singapore Branch )
in the presence of: )
R Cheung
as above
SIGNED SEALED and DELIVERED as a DEED ) J Clegg
By JULIE CLEGG )
for and on behalf of )
HSH NORDBANK AG )
in the presence of: )
R Cheung
as above
SIGNED SEALED and DELIVERED as a DEED ) J Clegg
By JULIE CLEGG )
for and on behalf of )
COMMERZBANK AKTIENGESELLSCHAFT )
Hamburg Branch )
as the Co-ordinator )
in the presence of: )
R Cheung
as above
SIGNED SEALED and DELIVERED as a DEED ) J Clegg
By JULIE CLEGG )
for and on behalf of )
COMMERZBANK INTERNATIONAL S.A. )
in the presence of: )
R Cheung
as above
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SCHEDULE 1
PARTICULARS OF ARRANGERS AND UNDERWRITERS
UNDERWRITTEN UNDERWRITTEN
AMOUNT AMOUNT AS A
IN USD PERCENTAGE
------------ ------------
COMMERZBANK 201,600,000 33.3333%
AKTIENGESELLSCHAFT
Emden Branch
Am Delft 24
26721 Emden
Federal Republic of Germany
Attn: Mr Eckhard Landau
Email: siegfried.hoffmann@commerzbank.com
NORDDEUTSCHE LANDESBANK 201,600,000 33.3333%
GIROZENTRALE
30151 Hannover
Federal Republic of Germany
Attn: Mr Willy Idler/
Mr Thomas Schramme
Email: shipping@nordlb.de
KFW 201,600,000 33.3333%
(formerly Kreditanstalt fur Wiederaufbau)
Palmengartenstrasse 5-9
60325 Frankfurt am Main
Federal Republic of Germany
Attn: Mrs Clare Dooley/
Mr Wolfgang Pfisterer
Email: wolfgang.pfisterer@kfw.de
95
SCHEDULE 2
PARTICULARS OF CO-ORDINATOR, AGENT AND LENDERS
NAME AND ADDRESS
CO-ORDINATOR
COMMERZBANK AKTIENGESELLSCHAFT
Hamburg Branch
Ness 7-9
20457 Hamburg
Federal Republic of Germany
Fax: +49 40 3683 4068
Attn: Mr Stefan Kuch/Mr Christian Renke
Email: shipfinance@commerzbank.com
AGENT
COMMERZBANK INTERNATIONAL S.A.
25 rue Edward Steichen
L-2540 Luxembourg
Fax: +352 477911 2386
Attn: Mrs Eva-Maria Orschel/Mr Nicolaas van de Roemer
Email: ZCB-Agency@commerzbank.lu
NAME AND ADDRESS CONTRIBUTION
IN USD
LENDERS
COMMERZBANK 69,036,054
AKTIENGESELLSCHAFT
Emden Branch
Am Delft 24
26721 Emden
Federal Republic of Germany
Fax: +49 4921 800313/+49 421 3633-390
Attn: Mr Eckhard Landau/Mr Siegfried Hoffmann
Email: siegfried.hoffmann@commerzbank.com
96
NORDDEUTSCHE LANDESBANK 208,974,000
GIROZENTRALE
30151 Hannover
Federal Republic of Germany
Fax: +49 511 361 4785
Attn: Mr Willy Idler/Mr Thomas Schramme
Email: shipping@nordlb.de
KFW 208,974,000
(formerly Kreditanstalt fur Wiederaufbau)
Palmengartenstrasse 5-9
60325 Frankfurt am Main
Federal Republic of Germany
Fax: +49 69 7431 4110
Attn: Mrs Clare Dooley/Wolfgang Pfisterer
Email: wolfgang.pfisterer@kfw.de
BREMER BANK 51,828,868
NIEDERLASSUNG DER DRESDNER BANK
AKTIENGESELLSCHAFT
Bremen
Jungfernstieg 22
20354 Hamburg
Federal Republic of Germany
Fax: +49 40 3501 4007
Attn: Mr Thomas Witte
Email: thomas.witte@dresdner-bank.com
DEUTSCHE SCHIFFSBANK AKTIENGESELLSCHAFT 25,914,434
Bremen and Hamburg
Domshof 17
28195 Bremen
Federal Republic of Germany
Fax: +49 421 323539
Attn: Ms Veronica Katenkamp
Email: veronica.katenkamp@schiffsbank.com
THE BANK OF NOVA SCOTIA 31,097,322
Singapore Branch
10 Collyer Quay
15-01 Ocean Building
Singapore 049315
Fax: +65 6438 5314/6532 2440
Attn: Ms W S Seong Koon/Mr Allan Ng
Email: brenda_leo@scotiacapital.com
97
HSH NORDBANK AG 31,097,322
(formerly known as Landesbank
Schleswig-Holstein Girozentrale)
Gerhart-Hauptmann-Platz 50
20095 Hamburg
Federal Republic of Germany
Fax: +49 40 3333-34307
Attn: Ms Uta Urbaniak/Ms Frauke Hay
Email: uta.urbaniak@hsh-nordbank.com/
frauke.hay@hsh-nordbank.com
98
SCHEDULE 3
NOTICE OF DRAWDOWN
CLAUSE 2.3
FROM: NORWEGIAN STAR LIMITED
NORWEGIAN DAWN LIMITED
both of International House
Castle Hill
Victoria Road
Douglas, Isle of Man
British Isles
TO: COMMERZBANK INTERNATIONAL S.A.
11 rue Notre-Dame
L-2240 Luxembourg
with copy to
COMMERZBANK AKTIENGESELLSCHAFT
Ness 7-9
20457 Hamburg
Federal Republic of Germany
200[ ]
Dear Sirs
LOAN AGREEMENT DATED 26 JUNE 1999 AND AMENDED AND RESTATED BY AN AGREEMENT DATED
23 OCTOBER 2001 (THE "LOAN AGREEMENT")
We refer to the Loan Agreement pursuant to which you have agreed to advance to
us the Facility on the terms and conditions set out therein.
Terms and expressions defined in the Loan Agreement shall have the same
respective meanings when used in this notice.
We hereby give you notice that we wish to draw down the amount of [ ] Dollars
(USD[ ]) being the amount of Tranche [1][2] under Clause 2.3 of the Loan
Agreement on [ ] 200[ ].
Tranche [1][2] is to be paid as to [ ] Dollars (USD[ ]) to the Builder at:
99
[ ]
and as to one million seven hundred and eighty seven thousand Dollars
(USD1,787,000) to [ ] at :
[ ]
We confirm that:
(i) all of the representations and warranties contained in Clause 9 of the
Loan Agreement remain true and correct;
(ii) no Possible Event of Default or Event of Default has occurred;
(iii) the first Interest Period shall be of [three (3) six (6) twelve (12)]
months' duration;
(iv) Tranche [1][2] will be applied in financing the delivery instalment due to
the Builder pursuant to the relevant Building Contract;
(v) the scheduled Delivery Date of the [Norwegian Star/Norwegian Dawn] Vessel
is [ ] 200[ ]; and
(vi) upon application of Tranche [1][2] hereby requested to be drawn down in
the manner hereinbefore appearing all sums owing to the Builder under the
relevant Building Contract shall have been fully and finally paid.
Yours faithfully
NORWEGIAN STAR LIMITED
NORWEGIAN DAWN LIMITED
By: __________________
100
SCHEDULE 4
CONDITIONS PRECEDENT
CLAUSE 2.5
The Loan is expressly conditional upon the Co-ordinator having received in such
form and substance as it shall require:
A. ON 26 JUNE 1999
THE BORROWERS
1. Certified Copies of any consents required from any ministry, governmental,
financial or other authority for the execution of and performance by the
Borrowers of their obligations under this Agreement and each of the
Security Documents or if no such consents are required a secretary's
certificate of each of the Borrowers to this effect confirming that no
such consents are required.
2. Notarially attested secretary's certificate for each Borrower:
(A) attaching a copy of its Certificate of Incorporation and Memorandum
and Articles of Association evidencing power to:
(i) enter into the transactions contemplated in this Agreement and
in the other Security Documents and to buy ships and enter
into arrangements for the chartering and management thereof;
and
(ii) borrow money in the amount referred to in this Agreement and
as security therefor to mortgage or charge assets;
(B) giving the names of the present officers and directors;
(C) setting out specimen signatures of persons who would be authorised
to sign documents or otherwise perform that Borrower's obligations
under the Security Documents;
(D) giving the legal and beneficial owners of the Shares and the number
of Shares held by each Shareholder;
101
(E) attaching copies of resolutions passed at a duly convened meeting of
the directors authorising the borrowing of the Loan, the granting of
the relevant Mortgage and the execution of this Agreement and such
of the other Security Documents to which that Borrower is a party
and the issue of any power of attorney to execute the same; and
(F) containing a declaration of solvency as at the date of the
secretary's certificate.
3. Where the secretary's certificate referred to in paragraph 2 of this
Schedule 4 is dated more than five (5) Business Days prior to 26 June
1999, a bringdown certificate, which need not be notarially attested if
signed by the same person that signed the secretary's certificate referred
to in paragraph 2 of this Schedule 4.
4. The original powers of attorney issued pursuant to (A) the resolutions
referred to above and (B) paragraph 2(C) above, notarially attested.
STAR
5. Notarially attested secretary's certificate:
(A) attaching a copy of its Certificate of Incorporation and Memorandum
and Articles of Association evidencing power to enter into the
transactions contemplated by this Agreement;
(B) giving the names of the present officers and directors;
(C) setting out specimen signatures of persons who would be authorised
to sign documents or otherwise perform obligations under the
Security Documents;
(D) attaching copies of resolutions passed at a duly convened meeting of
the directors approving the granting and the execution of the
documents whose execution is contemplated hereby, insofar as they
relate to it and the issue of any power of attorney to execute the
same; and
(E) containing a declaration of solvency as at the date of the
secretary's certificate.
6. Where the secretary's certificate referred to in paragraph 5 of this
Schedule 4 is dated more than five (5) Business Days prior to 26 June
1999, a bringdown certificate, which
102
need not be notarially attested if signed by the same person that signed
the secretary's certificate referred to in paragraph 5 of this Schedule 4.
7. The original powers of attorney issued pursuant to (A) the resolutions
referred to above and (B) paragraph 5(C) above, notarially attested.
GENERAL
8. Confirmation from the Process Agent that it will act for each of the
Obligors as agent for service of process in England.
9. Opinions from lawyers appointed by the Co-ordinator including English,
Isle of Man and Bahamian lawyers as to any of the foregoing matters or
otherwise as the Co-ordinator may require in the form required by the
Co-ordinator.
10. Certified Copy of the Building Contracts including all addenda.
11. [Blank]
12. [Blank]
13. [Blank]
14. [Blank]
15. [Blank]
16. Agency and Co-ordination Deed duly executed.
17. Star Guarantee duly executed.
18. [Blank]
19. [Blank]
20. Debentures duly executed.
21. Copies of the audited consolidated report and accounts of Star for 1998
and the unaudited consolidated accounts of the Group and the unaudited
accounts of the Borrower for the financial year quarter to 31 March 1999.
22. Copies of all Companies Acts forms for filing of charges in the Isle of
Man.
103
23. Payment of all fees under Clause 15.
B. AT LEAST FIVE (5) BUSINESS DAYS BEFORE EACH DRAWDOWN DATE
24. Drawdown notice duly executed by the Borrowers in the form of Schedule 3.
25. Certified Copy of such documents as are received by the relevant Borrower
from the Builder pursuant to the Building Contract in evidence of the
instalment due.
26. Issue of the relevant Lower Saxony Guarantee.
27. Acknowledgement by the Borrowers of the terms and conditions of the
relevant Lower Saxony Guarantee.
C. ON OR BEFORE THE SECOND RESTATEMENT DATE
28. Deed of Covenants in respect of the Norwegian Dawn Vessel duly executed.
29. Earnings Assignment in respect of the Norwegian Dawn Vessel duly executed.
30. Insurance Assignment in respect of the Norwegian Dawn Vessel duly
executed.
31. A co-ordination deed between the Agent and HSBC in respect of the
Norwegian Dawn Second Security Documents.
D. ON A DELIVERY DATE
32. Such evidence as the Co-ordinator may require that the relevant Vessel is:
(A) provisionally registered in the name of the relevant Borrower under
the Bahamian flag, with a certificate of registry free from all
liens and encumbrances except the relevant Mortgage;
(B) classified with the highest classification available free of all
recommendations and qualifications with Det Norske Veritas;
(C) insured in accordance with the terms of the Security Documents; and
(D) managed by the Manager pursuant to the relevant NCLL Management
Agreement.
33. Certified Copy of the Builder's Certificate.
104
34. Certified Copy of the unconditional protocol of delivery and acceptance
duly signed by the Builder and the relevant Borrower.
35. Certified Copy of the certificate of warranty from the Builder stating
that the Vessel is free from all encumbrances on the Delivery Date.
36. Copies of valid trading and other certificates to be produced by the
Builder pursuant to the relevant Building Contract.
37. Mortgage over the Vessel duly executed and lodged for registration at the
Bahamas Maritime Authority in London.
38. On the Norwegian Star Vessel Delivery Date only, Earnings Assignment duly
executed.
39. On the Norwegian Star Vessel Delivery Date only, Insurance Assignment duly
executed.
40. Reinsurance Assignment duly executed.
37. Account Charge duly executed.
38. Management Agreement Assignment duly executed.
39. Telefax confirmations from the insurance brokers for marine risks (hull
and machinery) and the managers of any protection and indemnity or war
risks association through whom any Insurances or Reinsurance Policies have
been placed in respect of the Vessel that the Insurances and Reinsurance
Policies have been placed and upon receipt of a notice of assignment of
the Insurances or the Reinsurance Policies (as the case may be) they will
issue letters of undertaking in the form approved by the Co-ordinator.
40. Opinions from Bahamian lawyers appointed by the Co-ordinator as to due
registration of the Vessel and due registration of the Mortgage and from
Bahamian and Singaporean lawyers appointed by the Co-ordinator as to any
of the foregoing matters or otherwise as the Co-ordinator may require in
the form required by the Co-ordinator.
41. Written confirmation from the Co-ordinator's insurance advisers that the
Insurances and the Reinsurance Policies are in a form satisfactory to the
Co-ordinator.
42. Notarially attested bringdown certificate in respect of the relevant
Borrower.
105
NCLL AND STIRRUP (OR ANY OTHER AFFILIATE OF THE RELEVANT BORROWER) (IF
APPLICABLE)
43. Notarially attested secretary's certificate for each of the above:
(A) attaching a copy of its Certificate of Incorporation and Memorandum
and Articles of Association (or equivalent documents) evidencing
power to enter into the transactions contemplated by this Agreement;
(B) giving the names of the present officers and directors;
(C) setting out specimen signatures of persons who would be authorised
to sign documents or otherwise perform obligations under the
Security Documents;
(D) giving the legal and beneficial owners of its issued shares and the
number of shares held by each shareholder;
(E) attaching copies of resolutions passed at a duly convened meeting of
the directors approving the granting and the execution of the
documents whose execution is contemplated hereby, insofar as they
relate to it and the issue of any power of attorney to execute the
same; and
(F) containing a declaration of solvency as at the date of the
secretary's certificate.
44. Where the secretary's certificate referred to in paragraph 43 of this
Schedule 4 is dated more than five (5) Business Days prior to the Delivery
Date, a bringdown certificate, which need not be notarially attested if
signed by the same person that signed the secretary's certificate referred
to in paragraph 43 of this Schedule 4.
45. The original powers of attorney issued pursuant to (A) the resolutions
referred to above and (B) paragraph 43(C) above, notarially attested.
GENERAL
46. Copies of Companies Acts forms for filing of charges in the Isle of Man.
47. Payment of all fees due under Clause 15.
106
SCHEDULE 5
CONFIDENTIALITY UNDERTAKING
[On Bank's Headed Paper]
TO: NORWEGIAN STAR LIMITED
NORWEGIAN DAWN LIMITED
(the "BORROWERS")
COMMERZBANK AKTIENGESELLSCHAFT
Hamburg Branch
Ness 7-9
20457 Hamburg
Federal Republic of Germany
(the "CO-ORDINATOR")
NORWEGIAN STAR LIMITED/NORWEGIAN DAWN LIMITED
USD626,922,000 TERM LOAN (THE "FACILITY")
FORM OF CONFIDENTIALITY UNDERTAKING
1. We hereby undertake that we will keep confidential and will not make use
of for any purposes (other than for the purposes of the Facility) all
information delivered to us in connection with the Facility and all
information obtained by us in the course of discussions with the
Co-ordinator, the Borrowers or any other party involved with the Facility
(collectively the "INFORMATION") until and save to the extent that the
Information has been released into the public domain by persons duly
authorised by the Borrowers to do so. However, we shall be entitled to
supply the Information to:
(A) professional advisers solely for use in connection with the Facility
after drawing to the attention of those advisers the content of the
undertaking as to confidentiality given by us and after obtaining
similar undertakings from them; and
(B) any third party where we have been authorised in writing to do so by
the Borrowers; and
(C) subject to giving reasonable prior notice to the Borrowers, to any
banking or regulatory authority to which we are subject after
drawing to the attention of such authority the content of the
undertaking as to confidentiality given by us; and
107
(D) pursuant to subpoena or other legal process and pursuant to any law
or regulation having the force of law.
2. We further undertake that if we decide not to participate in the Facility,
we will return to the Co-ordinator the originals and additional copies or
extracts made therefrom and all documentary Information delivered to us by
the Co-ordinator in relation to the Facility and/or the Borrowers
(including any supplied to third parties as contemplated in paragraph 1).
For and on behalf of
BANK NAME:
By: __________________
Date:
108
SCHEDULE 6
TRANSFER CERTIFICATE
Lenders are advised not to employ Transfer Certificates or otherwise to assign
or transfer interests in the Loan Agreement without further ensuring that the
transaction complies with all applicable laws and requisitions, including the
Financial Services Act 1986 and regulations made thereunder and similar statutes
which may be in force in other jurisdictions.
TO: COMMERZBANK INTERNATIONAL S.A. (the "AGENT") as agent on its own
behalf and for and on behalf of the Arrangers, the Co-ordinator, the
Borrowers, the Guarantor and the Lenders as defined in the Loan
Agreement referred to below
ATTENTION: Mrs Eva-Maria Orschel
Date:
This certificate (the "TRANSFER CERTIFICATE") relates to a loan agreement dated
26 June 1999 and amended and restated by agreements dated 23 October 2001, 21
March 2002 and 2004 (as the same may from time to time have been or may be
further amended, supplemented and/or novated the "LOAN AGREEMENT") made between
(among others) (1) Norwegian Star Limited and Norwegian Dawn Limited as joint
and several borrowers (the "BORROWERS") (2) the banks and financial institutions
referred to therein as lenders (the "LENDERS") (3) the Agent and (4) Commerzbank
Aktiengesellschaft, Hamburg Branch (the "CO-ORDINATOR") whereby the Lenders have
agreed to make available to the Borrowers a term loan facility in the amount of
up to six hundred and twenty six million nine hundred and twenty two thousand
Dollars (USD626,922,000). Terms defined in the Loan Agreement shall, unless
otherwise defined herein, have the same meanings herein as therein.
In this Transfer Certificate:
the "TRANSFEROR" means [full name] of [lending branch];
the "TRANSFEREE" means [full name] of [lending branch].
1. The Transferor with full title guarantee transfers to the Transferee
absolutely in accordance with Clause 19.5 of the Loan Agreement all rights
and interests (present, future or contingent) which the Transferor has as
Lender under or by virtue of the Loan Agreement and all the other Security
Documents insofar as such rights and interests relate to [that portion of
its Contribution to the Loan in an amount equal to
109
[ ] Dollars (USD[ ]) out of its total Contribution which at the date
hereof is [ ] Dollars (USD[ ])] and/or [that portion of its Commitment to
the Facility in an amount equal to [ ] Dollars (USD[ ]) out of its total
Commitment which at the date hereof is [ ] Dollars (USD[ ])].
2. By virtue of this Transfer Certificate and Clause 19.5 of the Loan
Agreement, the Transferor is discharged entirely with effect from the
Transfer Date from [that portion of its Contribution to the Loan and its
obligations relating thereto to the extent of [ ] Dollars (USD[ ]) out of
its total Contribution at such date] and/or [that portion of its
Commitment to the Facility and its obligations relating thereto to the
extent of [ ] Dollars (USD[ ]) out of its total Commitment at such date].
3. The Transferee hereby requests:
(A) the Borrowers, the Guarantor, the Co-ordinator, the Agent, the
Arrangers and the Lenders to accept the executed copies of this
Transfer Certificate as being delivered pursuant to and for the
purposes of Clause 19.5 of the Loan Agreement; and
(B) the Agent to execute this Transfer Certificate on behalf of itself
and the other said parties pursuant to Clause 19.8 of the Loan
Agreement so that this Transfer Certificate will take effect in
accordance with the terms thereof on [specify date of transfer] [or]
[the date on which the Agent receives a certificate signed by [the
Transferor] confirming that the following conditions have been
fulfilled [specify conditions to transfer].
4. The Transferee:
(A) confirms that it has received a copy of the Loan Agreement, the
Agency and Co-ordination Deed, the other Security Documents and the
Lower Saxony Guarantees together with such other documents and
information as it has required in connection with the transaction
contemplated thereby;
(B) confirms that it has not relied and will not hereafter rely on the
Transferor, the Co-ordinator, the Agent, the Arrangers or the
Lenders to check or enquire on its
110
behalf into the legality, validity, effectiveness, adequacy,
accuracy or completeness of the Loan Agreement, the Agency and
Co-ordination Deed, any other of the Security Documents or the Lower
Saxony Guarantees or any other documents or information;
(C) agrees that it has not relied and will not rely on the Transferor,
the Co-ordinator, the Agent, the Arrangers or the Lenders to assess
or keep under review on its behalf the financial condition,
creditworthiness, condition, affairs, status or nature of the
Borrowers or any other party to the Loan Agreement or any other of
the Security Documents (save as otherwise expressly provided
therein) or the German State of Lower Saxony;
(D) warrants that it has power and authority to become a party to the
Loan Agreement and the Agency and Co-ordination Deed and has taken
all necessary action to authorise execution of this Transfer
Certificate and to obtain all necessary approvals and consents to
the assumption of its obligations under the Loan Agreement, the
Agency and Co-ordination Deed and the other Security Documents;
(E) if not already a Lender, appoints the Agent to act as its agent and
the Co-ordinator to act as its co-ordinator as provided in the Loan
Agreement, the Agency and Co-ordination Deed and the other Security
Documents and agrees to be bound by the terms of Clause 19.8 of the
Loan Agreement and by all the terms of the Agency and Co-ordination
Deed.
5. The Transferor:
(A) warrants to the Transferee that it has full power to enter into this
Transfer Certificate and has taken all corporate action necessary to
authorise it to do so;
(B) warrants to the Transferee that this Transfer Certificate is binding
on the Transferor under the laws of England the country in which the
Transferor is incorporated and the country in which its Lending
Branch is located;
(C) agrees that it will, at its own expense, execute any documents which
the Transferee reasonably requests for perfecting in any relevant
jurisdiction the Transferee's title under this Transfer Certificate
or for any similar purpose; and
111
(D) agrees that it will, at its own expense, execute any documents which
the Transferee reasonably requests for assigning to the Transferee
all the Transferor's right and title to and interest in the Lower
Saxony Guarantees.
6. The Transferee hereby undertakes to the Transferor and each of the other
parties to the Loan Agreement and the Agency and Co-ordination Deed that
it will perform in accordance with its terms all those obligations which
by the terms of the Loan Agreement and the Agency and Co-ordination Deed
will be assumed by it after the transfer contemplated by this Transfer
Certificate has taken effect.
7. If a Transferor and a Transferee effect a transfer in accordance with
Clause 3 of this Transfer Certificate during an Interest Period, the Agent
shall make all payments which would have become due to the Transferor
under the Loan Agreement during the relevant Interest Period to the
Transferor, as if no such transfer had been effected by the Transferor to
the Transferee, according to the percentages of the Transferor's
Contribution and/or Commitment transferred and retained pursuant to
Clauses 1 and 2 of this Transfer Certificate, and the Transferor and the
Transferee shall be responsible for paying to each other pro rata all
amounts (if any) due to them from each other for such Interest Period. On
and from the commencement of the immediately succeeding Interest Period,
the Agent shall make all payments due under the Loan Agreement for the
account of the Transferor, to the Transferor, and shall make all payments
due under the Loan Agreement for the account of the Transferee, to the
Transferee. This provision is for administrative convenience only and
shall not affect the rights of the Transferor and the Transferee under the
Loan Agreement.
8. None of the Transferor, the Agent, the Co-ordinator, the Arrangers or the
Lenders:
(A) makes any representation or warranty nor assumes any responsibility
with respect to the legality, validity, effectiveness, adequacy or
enforceability of the Loan Agreement, the Agency and Co-ordination
Deed, any other of the Security Documents or the Lower Saxony
Guarantees or any document relating thereto;
(B) assumes any responsibility for the financial condition of either of
the Borrowers or the German State of Lower Saxony or any other party
to the Loan Agreement, the Agency and Co-ordination Deed or any
other of the Security Documents or any such other document or for
the performance and observance by the Borrowers or any other party
to the Loan Agreement, the Agency and Co-ordination Deed
112
or any other of the Security Documents or any such other document
(save as otherwise expressly provided therein) and any and all such
conditions and warranties, whether expressed or implied by law or
otherwise, are hereby excluded (except as aforesaid).
9. The Transferor and the Transferee each undertakes that it will on demand
fully indemnify the Agent in respect of any claim, proceeding, liability
or expense which relates to or results from this Transfer Certificate or
any matter connected with or arising out of it unless caused by the
Agent's gross negligence or wilful misconduct, as the case may be.
10. The agreements and undertaking of the Transferee in this Transfer
Certificate are given to and for the benefit of and made with each of the
other parties to the Loan Agreement.
11. This Transfer Certificate shall be governed by, and construed in
accordance with, English law.
IN WITNESS whereof the Transferor, the Transferee and the Agent (as agent for
and on behalf of itself as Agent, the Co-ordinator, the Arrangers, the
Borrowers, the Guarantor and the Lenders (other than the Transferor)) have
caused this Transfer Certificate to be executed on the day first written above.
THE TRANSFEROR
SIGNED by )
)
for and on behalf of )
[ ] )
in the presence of: )
THE TRANSFEREE
SIGNED by )
)
for and on behalf of )
[ ] )
in the presence of: )
113
THE AGENT
SIGNED by )
)
for and on behalf of )
[ ] )
as agent for and on behalf )
of itself as Agent, the Co-ordinator, )
the Arrangers, the Borrowers, )
the Guarantor and the Lenders )
in the presence of: )
Note: The execution of this Transfer Certificate alone may not transfer a
proportionate share of the Transferor's interest in the security
constituted by the Security Documents in the Transferor's or Transferee's
jurisdiction. It is the responsibility of each individual Lender to
ascertain whether any other documents are required to perfect a transfer
of such a share in the Transferor's interest in such security in any such
jurisdiction, and, if so, to seek appropriate advice and arrange for
execution of the same.
114
SCHEDULE
ADMINISTRATIVE DETAILS OF TRANSFEREE
Name of Transferee:
Lending Branch:
Contact Person
(Loan Administration Department):
Telephone:
Fax:
Email:
Contact Person
(Credit Administration Department):
Telephone:
Fax:
Email:
Account for Payments:
115
SCHEDULE 7
LOWER SAXONY GUARANTEE
116
SCHEDULE 8
CHARTERING OF THE SIX VESSELS (AS DEFINED IN CLAUSE 10.6(D))
VESSEL NEW OWNER DAILY HIRE REDELIVERING TRANSFER VALUE
- ----------------- --------------------- ---------- ------------ --------------
Norwegian Sea Ocean Pacific Limited [***] [Confidential Treatment]
Norwegian Majesty Ocean Voyager Limited [***] [Confidential Treatment]
Norwegian Wind Crown Wind Limited [***] [Confidential Treatment]
Norwegian Crown Crown Odyssey Limited [***] [Confidential Treatment]
Norwegian Dream Ocean Dream Limited [***] [Confidential Treatment]
Marco Polo Ocean World Limited [***] [Confidential Treatment]
117
CONFORMED COPY
DATED 23 APRIL 2004
NCL CORPORATION LTD.
TO
COMMERZBANK INTERNATIONAL S.A.
-------------------------
GUARANTEE
-------------------------
STEPHENSON HARWOOD
ONE ST PAUL'S CHURCHYARD
LONDON EC4M 8SH
TEL: +44 (0)20 7329 4422
FAX: +44 (0)20 7606 0822
REF: 1253/42-02557
CONTENTS
Page
----
1 Definitions.................................................................................2
2 Guarantee and Indemnity.....................................................................4
3 Survival of Guarantor's Liability...........................................................5
4 Continuing Guarantee........................................................................6
5 Exclusion of the Guarantor's Rights.........................................................7
6 Payments....................................................................................8
7 Enforcement.................................................................................8
8 Representations and Warranties..............................................................9
9 General Undertakings: Positive Covenants...................................................12
10 General Undertakings: Negative Covenants...................................................15
11 Financial Undertakings and Ownership and Control of the Guarantor..........................19
12 Discharge..................................................................................26
13 Assignment and Transfer....................................................................26
14 Miscellaneous Provisions...................................................................27
15 Waiver of Immunity.........................................................................27
16 Notices....................................................................................28
17 Governing Law..............................................................................29
18 Jurisdiction...............................................................................29
Schedule 1 Quarterly Compliance Certificate...........................................................31
Schedule 2 Letter of Instruction......................................................................34
DEED OF GUARANTEE AND INDEMNITY
DATED 23 APRIL 2004
BY:
(1) NCL CORPORATION LTD. being a company incorporated in and under the laws
of Bermuda with its registered office at Reid Hall, 3 Reid Street,
Hamilton HM 11, Bermuda as guarantor (the "Guarantor");
IN FAVOUR OF:
(2) COMMERZBANK INTERNATIONAL S.A., a company incorporated in and under the
laws of the Grand-Duchy of Luxembourg whose office is at 25 rue Edward
Steichen, L-2540 Luxembourg as agent for and on behalf of the Lenders
(as defined herein) (the "AGENT" which expression shall include its
successors and assigns).
WHEREAS:
(A) By a loan agreement dated 26 June 1999 as amended by four (4) transfer
certificates of various dates between (among others) Commerzbank AG,
Emden Branch as transferor and a first supplemental agreement dated 17
August 2000 and as amended and restated by a second supplemental
agreement dated 23 October 2001 and a third supplemental agreement
dated 21 March 2002 (the "ORIGINAL LOAN AGREEMENT") made between (among
others) (1) the Agent as agent (acting as agent to the lenders (the
"LENDERS") set out in Schedule 2 to the Loan Agreement (as hereinafter
defined) pursuant to clause 1.3 of the Loan Agreement and an agency and
co-ordination deed dated 26 June 1999, amended and restated by an
agreement dated 23 October 2001 and as amended by an agreement dated 21
March 2002 (the "AGENCY AND CO-ORDINATION DEED") made between the
Agent, Commerzbank Aktiengesellschaft as co-ordinator (the
"CO-ORDINATOR") and the Lenders) (2) the Co-ordinator acting as
co-ordinator for the Lenders pursuant to clause 1.3 of the Loan
Agreement and the Agency and Co-ordination Deed as co-ordinator (3) the
Lenders as lenders and (4) Norwegian Star Limited (formerly Superstar
Libra Limited) and Norwegian Dawn Limited (formerly Superstar Scorpio
Limited) as joint and several borrowers (the "BORROWERS") and to be
amended and restated by an agreement dated 23 APRIL 2004 (the "FOURTH
SUPPLEMENTAL AGREEMENT" and together with the Original Loan Agreement
the "LOAN AGREEMENT") between (a) the parties to the Original Loan
Agreement (b) Star Cruises Limited (the "ORIGINAL GUARANTOR") and (c)
the Guarantor,
the Lenders agreed to make available to the Borrowers a loan facility
(the "Facility") of up to six hundred and twenty six million nine
hundred and twenty two thousand United States Dollars (USD626,922,000)
on the terms and conditions therein contained.
(B) Pursuant to the Fourth Supplemental Agreement the Lenders agreed to
release the Original Guarantor from its guarantee dated 26 June 1999 as
amended and/or restated from time to time of the obligations of the
Borrowers under the Original Loan Agreement (the "ORIGINAL GUARANTEE")
on the condition that the Guarantor enters into this Deed.
THIS DEED WITNESSES:
1 DEFINITIONS
1.1 In this Deed the following terms and expressions shall have
the meanings set out below; in addition, terms and expressions
not defined herein but whose meanings are defined in the Loan
Agreement shall have the meanings set out therein.
"ACCOUNTS" means the audited consolidated profit and loss
account, cash flow statements and balance sheet (including all
additional information and notes thereto) of the Guarantor and
its consolidated Subsidiaries together with the relative
directors' and auditors' reports;
"BONDS" means bonds in an aggregate amount of at least two
hundred million Dollars (USD200,000,000) and with a life of
ten (10) years but which may be redeemed by the Guarantor at
an earlier date, to be issued by the Guarantor in one (1) or
more tranches, in the first instance to qualified
institutional buyers as unregistered privately placed bonds
and thereafter as bonds registered with the Securities
Exchange Commission of the United States of America;
"EVENT OF DEFAULT" means any of the events specified in clause
13 of the Loan Agreement or specified as such in Clause 11;
and
"OUTSTANDING INDEBTEDNESS" means all sums of any kind at any
time owing, actually or contingently, by any Obligor to the
Agent and/or the Lenders under or pursuant to the Loan
Agreement and each other Security Document to which any of the
Obligors is a party (whether by way of repayment of principal,
payment of interest or default interest, payment upon any
indemnity or counter-indemnity, reimbursement for fees, costs
or expenses or otherwise howsoever).
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1.2 In this Deed unless the context otherwise requires:
(A) clause headings are inserted for convenience of
reference only and shall be ignored in the
construction of this Deed;
(B) references to Clauses and to Schedules are to be
construed as references to clauses of and schedules
to this Deed unless otherwise stated and references
to this Deed are to be construed as references to
this Deed including its Schedules;
(C) references to (or to any specified provision of) this
Deed or any other document shall be construed as
references to this Deed, that provision or that
document as from time to time amended, supplemented
or novated;
(D) references to any Act or any statutory instrument
shall be construed as references to that Act or that
statutory instrument as from time to time re-enacted,
amended or supplemented;
(E) references to any party to this Deed or any other
document shall include reference to such party's
successors and permitted assigns;
(F) words importing the plural shall include the singular
and vice versa;
(G) references to a person shall be construed as
references to an individual, firm, company,
corporation, unincorporated body of persons or any
state or any agency thereof;
(H) where any matter requires the approval or consent of
the Agent or the Co-ordinator such approval or
consent shall not be deemed to have been given unless
given in writing; where any matter is required to be
acceptable to the Agent or the Co-ordinator, the
Agent or the Co-ordinator (as the case may be) shall
not be deemed to have accepted such matter unless its
acceptance is communicated in writing; each of the
Agent and the Co-ordinator may give or withhold its
consent, approval or acceptance at its unfettered
discretion;
(I) a certificate by the Agent as to any amount due or
calculation made hereunder shall be conclusive except
for manifest error.
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1.3 The provisions of clause 1.3 of the Loan Agreement shall apply
hereto (mutatis mutandis) as if set out herein.
2 GUARANTEE AND INDEMNITY
2.1 In consideration of the Lenders agreeing at the request of the
Original Guarantor to release it from its obligations under
the Original Guarantee and to continue to make the Facility
available to the Borrowers jointly and severally in accordance
with the terms of the Loan Agreement, the payment by the Agent
to the Guarantor of ten Dollars (USD10) and other good and
valuable consideration (the receipt and adequacy of which the
Guarantor hereby acknowledges) the Guarantor:
(A) as primary obligor as and for its own debt and not
merely as surety hereby undertakes to the Agent to be
responsible for and hereby guarantees to the Agent on
behalf of the Lenders:
(i) the due and punctual payment by each of the
Obligors to the Agent on behalf of the
Lenders (as and when due by acceleration,
demand or otherwise howsoever) of the
Outstanding Indebtedness and every part
thereof; and
(ii) the due and punctual performance of all the
obligations to be performed by each of the
Obligors under or pursuant to the Loan
Agreement and the other Security Documents;
and
(B) unconditionally and irrevocably undertakes
immediately on demand by the Agent from time to time
to pay and/or perform its obligations under Clause
2.1(A).
2.2 For the same consideration as referred to in Clause 2.1 the
Guarantor (as a separate and independent obligation)
unconditionally and irrevocably undertakes immediately on
demand by the Agent from time to time to indemnify the Agent
and/or the Lenders and hold each of them harmless in respect
of:
(A) any loss incurred by the Agent and/or the Lenders as
a result of the Loan Agreement and each other
Security Document to which any of the Obligors is a
party or any provision thereof becoming invalid,
void,
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voidable or unenforceable for any reason whatsoever
after execution hereof; and
(B) any loss or damage of any kind arising directly or
indirectly from any failure on the part of any of the
Obligors to perform any obligation to be performed by
any of the Obligors under and pursuant to the Loan
Agreement and each other Security Document to which
any of the Obligors is a party.
3 SURVIVAL OF GUARANTOR'S LIABILITY
3.1 The Guarantor's liability to the Agent under this Deed shall
not be discharged, impaired or otherwise affected by reason of
any of the following events or circumstances (regardless of
whether any such events or circumstances occur with or without
the Guarantor's knowledge or consent):
(A) any time, forbearance or other indulgence given or
agreed by the Agent, the Co-ordinator and/or the
Lenders to or with any of the Obligors in respect of
any of their obligations under the Loan Agreement and
each other Security Document to which any of the
Obligors is a party; or
(B) any legal limitation, disability or incapacity
relating to any of the Obligors; or
(C) any invalidity, irregularity, unenforceability,
imperfection or avoidance of or any defect in any
security granted by, or the obligations of any of the
Obligors under, the Loan Agreement and each other
Security Document to which any of the Obligors is a
party or any amendment to or variation thereof or of
any other document or security comprised therein; or
(D) any change in the name, constitution or otherwise of
any of the Obligors or the merger of any of the
Obligors with any other corporate entity; or
(E) the liquidation, bankruptcy or dissolution (or
proceedings analogous thereto) of any of the Obligors
or the appointment of a receiver or administrative
receiver or administrator or trustee or similar
officer of any of the assets of any of the Obligors
or the occurrence of any circumstances whatsoever
affecting any Obligor's liability to discharge its
obligations
5
under the Loan Agreement and each other Security
Document to which it is a party; or
(F) any challenge, dispute or avoidance by any liquidator
of any of the Obligors in respect of any claim by the
Guarantor by right of subrogation in any such
liquidation; or
(G) any release of any other Obligor or any renewal,
exchange or realisation of any security or obligation
provided under or by virtue of any of the Security
Documents or the provision to the Agent or any of the
Lenders at any time of any further security for the
obligations of the Borrowers under any of the
Security Documents; or
(H) the release of any co-guarantor and/or indemnitor who
is now or may hereafter become under a joint and
several liability with the Guarantor under this Deed
or the release of any other guarantor, indemnitor or
other third party obligor in respect of the
obligations of any Obligor under any of the Security
Documents; or
(I) any failure on the part of the Agent or any of the
Lenders (whether intentional or not) to take or
perfect any security agreed to be taken under or in
relation to any of the Security Documents or to
enforce any of the Security Documents; or
(J) any other act, matter or thing (save for repayment in
full of the Outstanding Indebtedness) which might
otherwise constitute a legal or equitable discharge
of any of the Guarantor's obligations under this
Deed.
4 CONTINUING GUARANTEE
4.1 This Deed shall be:
(A) a continuing guarantee remaining in full force and
effect until irrevocable payment in full has been
received by the Agent on behalf of the Lenders of
each and every part and the ultimate balance of the
Outstanding Indebtedness in accordance with the Loan
Agreement and each other Security Document to which
any of the Obligors is a party; and
6
(B) in addition to and not in substitution for or in
derogation of any other security held by the Agent
from time to time in respect of the Outstanding
Indebtedness or any part thereof.
4.2 Any satisfaction of obligations by the Guarantor to the Agent
or any discharge given by the Agent to the Guarantor or any
other agreement reached between the Agent and the Guarantor in
relation to this Deed shall be, and be deemed always to have
been, void ab initio if any act satisfying any of the said
obligations or on the faith of which any such discharge was
given or any such agreement was entered into is subsequently
avoided in whole or in part by or pursuant to any provision of
any applicable law whatsoever.
4.3 This Deed shall remain the property of the Agent on behalf of
the Lenders and, notwithstanding that all monies and
liabilities due or incurred by any of the Obligors to the
Agent and/or the Lenders which are guaranteed hereunder shall
have been paid or discharged, the Agent shall be entitled not
to discharge this Deed or any security held by the Agent for
the obligations of the Guarantor hereunder for such period as
may in the reasonable opinion of the Agent be necessary or
appropriate under any applicable insolvency law after the last
of such monies and liabilities have been paid or discharged
and in the event of bankruptcy, winding-up or any similar
proceedings being commenced in respect of any of the Obligors,
the Agent shall be at liberty not to discharge this Deed or
any security held by the Agent for the obligations of the
Guarantor hereunder for and during such further period as the
Agent may determine at its sole discretion.
5 EXCLUSION OF THE GUARANTOR'S RIGHTS
5.1 Until the obligations of any Obligor under the Loan Agreement
and each other Security Document to which any Obligor is a
party have been fully performed, the Guarantor shall not:
(A) be entitled to share in or succeed to or benefit from
(by subrogation or otherwise) any rights which the
Agent may have in respect of the Outstanding
Indebtedness or any security therefor or all or any
of the proceeds of such rights or security; or
(B) without the prior written consent of the Agent:
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(i) exercise in respect of any amount paid by it
hereunder any right of indemnity,
subrogation, contribution or any other right
or remedy which it may have in respect
thereof; or
(ii) claim payment of any other monies for the
time being due to it or to which it may
become entitled or exercise or enforce or
benefit from any other right, remedy or
security in respect thereof; or
(iii) prove in a liquidation of any Obligor in
competition with the Agent and/or the
Lenders for any monies owing to the
Guarantor by any other Obligor on any
account whatsoever,
PROVIDED ALWAYS that if the Guarantor, in breach of this
Clause, receives or recovers any monies pursuant to any such
exercise, claim or proof, such monies shall be held by the
Guarantor as trustee upon trust for the Agent and the Lenders
to apply the same as if they were monies received or recovered
by the Agent under this Deed.
6 PAYMENTS
6.1 Each payment to be made by the Guarantor hereunder shall be
made in immediately available funds in the currency in which
such payment is due without set-off, counterclaim, deduction
or retention of any kind by payment to the account referred to
in clause 7.1 of the Loan Agreement or such account of the
Agent with such other bank or financial institution as the
Agent may from time to time notify to the Guarantor in
writing.
6.2 The certificate of the Agent from time to time as to sums owed
by any Obligor under the Security Documents and sums owed by
the Guarantor hereunder shall, save for manifest error, be
conclusive and binding for all purposes and prima facie
evidence of the existence and extent of such debts in any
legal action or proceedings arising in connection herewith.
7 ENFORCEMENT
The Agent shall not be obliged before taking steps to enforce this Deed
to take any action whatsoever against any of the Obligors under the
Loan Agreement or any other Security Documents to which they are a
party and the Guarantor hereby waives all such formalities
8
or rights to which it would otherwise be entitled or which the Agent
would otherwise first be required to satisfy or fulfil before
proceeding or making demand against the Guarantor hereunder provided
that the Agent shall not be entitled to enforce its rights under this
Deed otherwise than in circumstances which would constitute an Event of
Default.
8 REPRESENTATIONS AND WARRANTIES
8.1 The Guarantor represents and warrants to the Agent and the
Lenders that:
(A) it is a limited liability exempt company, duly
incorporated and validly existing under the laws of
Bermuda, possessing perpetual corporate existence,
the capacity to sue and be sued in its own name and
the power to own its assets and carry on its business
as it is now being conducted;
(B) it has the power to enter into and perform this Deed
and all necessary corporate or other action has been
taken to authorise the entry into and performance of
this Deed;
(C) this Deed constitutes its legal, valid and binding
obligations enforceable in accordance with its terms;
(D) the entry into and performance of this Deed and the
transactions contemplated hereby do not and will not
be a breach of or conflict with:
(i) any law or regulation or any official or
judicial order; or
(ii) its constitutional documents; or
(iii) any agreement or document to which it is a
party or which is binding upon it or any of
its assets,
nor result in the creation or imposition of any
Encumbrance on any of its assets pursuant to the
provisions of any such agreement or document;
(E) no event has occurred and is continuing which
constitutes a default under or in respect of any
agreement or document to which the Guarantor is a
party or by which it may be bound (including, inter
alia, this Deed) and no event has occurred which,
with the giving of notice, lapse of time,
9
determination of materiality or other condition would
or might constitute a default under or in respect of
any such agreement or document;
(F) all authorisations, approvals, consents, licences,
exemptions, filings, registrations, notarisations and
other matters, official or otherwise, required in
connection with the entry into, performance, validity
and enforceability of this Deed and the transactions
contemplated hereby have been obtained or effected
and are in full force and effect;
(G) all information furnished by or on behalf of the
Guarantor or any of its subsidiaries relating to the
business and affairs of any member of the NCLC Group
in connection with this Deed was and remains true and
correct in all material respects and there are no
other material facts or considerations the omission
of which would render any such information
misleading;
(H) the Guarantor has fully disclosed in writing to the
Lenders through the Agent all facts relating to the
NCLC Group which it knows or should reasonably know
and which might reasonably be expected to influence
the Lenders in deciding whether or not to enter into
the Fourth Supplemental Agreement;
(I) the Accounts for the financial year ended 31 December
2004 (which accounts will be prepared in accordance
with GAAP) will fairly represent the consolidated
financial condition of the NCLC Group as at 31
December 2004 and from that date there will be no
material adverse change in the consolidated financial
condition of the NCLC Group as shown in such audited
accounts save as disclosed in writing to the
Co-ordinator (in this Clause 8.1(I) "NCLC GROUP"
shall have the meaning ascribed to it in Clause
11.4);
(J) the claims of the Agent and the Lenders against the
Guarantor under this Deed will rank at least pari
passu with the claims of all other unsecured
creditors of the Guarantor other than claims of such
creditors to the extent that the same are statutorily
preferred;
10
(K) no member of the NCLC Group has taken any corporate
action nor have any other steps been taken or legal
proceedings been started or (to the best of the
Guarantor's knowledge and belief) threatened against
any member of the NCLC Group for its winding-up or
dissolution or for the appointment of a liquidator,
administrator, receiver, administrative receiver,
trustee or similar officer of it or any or all of its
assets or revenues nor has any member of the NCLC
Group sought any other relief under any applicable
insolvency or bankruptcy law;
(L) no litigation, arbitration or administrative
proceedings are current or pending or (to the best of
the Guarantor's knowledge and belief) threatened,
which might, if adversely determined, have a material
adverse effect on the business, assets or financial
condition of the Guarantor or any other member of the
NCLC Group;
(M) each member of the NCLC Group has complied with all
taxation laws in all jurisdictions in which it is
subject to Taxation and has paid all Taxes due and
payable by it; no material claims are being asserted
against any member of the NCLC Group with respect to
Taxes which might, if such claims were successful,
have a material adverse effect on its business,
assets or financial condition;
(N) neither the Guarantor nor any of its assets enjoys
any right of immunity from set-off, suit or execution
in respect of its obligations under this Deed;
(O) all amounts payable by the Guarantor hereunder may be
made free and clear of and without deduction for or
on account of any Taxes;
(P) the Shares and all the shares of the Manager are
legally and beneficially owned by the Shareholder,
all the shares of the Shareholder are legally and
beneficially owned by Arrasas and all the shares of
Arrasas are legally and beneficially owned by the
Guarantor and such structure shall remain so
throughout the Security Period. Further, no Event of
Default has occurred under Clause 11.2 in respect of
the ownership and/or control of the shares of the
Guarantor;
11
(Q) the Guarantor does not have a place of business in
any jurisdiction which would require this Deed to be
filed or registered (if it had a place of business in
that jurisdiction) to ensure the validity of this
Deed; and
(R) it has reviewed and agrees to all the terms and
conditions of the Loan Agreement and each other
Security Document to which any Obligor is a party.
8.2 The representations and warranties set out in Clause 8.1 other
than those set out in Clauses 8.1(D)(i), 8.1(H), 8.1(O) and
8.1(R) shall survive the execution of this Deed and shall be
deemed to be repeated, with reference mutatis mutandis to the
facts and circumstances then subsisting, on each day until the
actual and contingent obligations of each Obligor has been
performed in full.
9 GENERAL UNDERTAKINGS: POSITIVE COVENANTS
9.1 The undertakings contained in this Clause 9 shall remain in
full force from the date of this Deed until the end of the
Security Period.
9.2 The Guarantor will provide to the Co-ordinator:
(A) as soon as practicable (and in any event within one
hundred and twenty (120) days after the close of each
of its financial years) a Certified Copy of its
Accounts (commencing with the audited accounts made
up to 31 December 2004);
(B) as soon as practicable (and in any event within forty
five (45) days after the close of each quarter of
each financial year) a Certified Copy of the
unaudited consolidated accounts of the NCLC Group for
that quarter (commencing with the unaudited accounts
made up to 31 March 2004);
(C) as soon as practicable (and in any event within forty
five (45) days after the close of each quarter of
each financial year), beginning with the quarter
ending 31 March 2004, monthly cash flow projections
on a consolidated basis of the NCLC Group showing
advance ticket sales (for at least twelve (12) months
following the date of such statement) for the NCLC
Group, together with a certificate of the NCLC
Group's chief financial officer stating that no Event
of Default or Possible Event of
12
Default has occurred and is continuing, or setting
forth in detail any such Event of Default or Possible
Event of Default and any steps being taken by the
Guarantor or any other Obligor to cure the same;
(D) as soon as practicable (and in any event not later
than 31 January of each financial year):
(i) a budget for the NCLC Group for such new
financial year including a twelve (12) month
liquidity budget for such new financial
year; and
(ii) updated financial projections of the NCLC
Group for at least the next five (5) years
(including an income statement and projected
results for the operation of the vessels
owned and/or operated by any member of the
NCLC Group) and an outline of the
assumptions supporting such budget and
financial projections and details of any
scheduled dry-docking of any of the vessels
owned and/or operated by companies in the
NCLC Group during such new financial year;
(E) from time to time (but at intervals no more
frequently than semi-annually at the Guarantor's
expense) within fifteen (15) days of receiving any
request to that effect from the Co-ordinator, a
valuation of each of the vessels in the NCLC Fleet
obtained in accordance with the provisions of clause
10.18 of the Loan Agreement;
(F) as soon as practicable (and in any event within forty
five (45) days after the close of each quarter of its
financial year) a statement signed by the NCLC
Group's chief financial officer in the form of
Schedule 1 (commencing with the first quarter of the
financial year ending 31 December 2004);
(G) promptly, such further information in its possession
or control regarding its financial condition and
operations and those of any company in the NCLC Group
as the Co-ordinator may request;
(H) details of any material litigation, arbitration or
administrative proceedings which affect any Obligor
as soon as the same are instituted and served, or,
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to the knowledge of the Guarantor, threatened (and
for this purpose proceedings shall be deemed to be
material if they involve a claim in an amount
exceeding one million Dollars (USD1,000,000) or the
equivalent in another currency); and
(I) promptly, such information as the Co-ordinator may
request regarding the Bonds, either before their
issue or during their lifetime.
All accounts required under this Clause 9.2 shall be prepared
in accordance with GAAP and shall fairly represent the
financial condition of the relevant company. In this Clause
9.2 "NCLC GROUP" shall have the meaning ascribed to it in
Clause 11.4.
9.3 Subject to the provisions of Clause 11.3, the Guarantor will
procure that any dividends or other distributions and interest
paid or payable in connection therewith received by the
Shareholder and/or Arrasas will be paid to the Guarantor by
way of dividend promptly on receipt.
9.4 The Guarantor will keep proper books of record and account in
which proper and correct entries shall be made of all
financial transactions and the assets, liabilities and
business of the Guarantor in accordance with GAAP.
9.5 The Guarantor will notify the Co-ordinator of any Event of
Default or Possible Event of Default forthwith upon the
Guarantor becoming aware of the occurrence thereof.
9.6 The Guarantor will procure that all such authorisations,
approvals, consents, licences and exemptions as may be
required under any applicable law or regulation to enable it
to perform its obligations under, and ensure the validity or
enforceability of, this Deed are obtained and promptly renewed
from time to time and will promptly furnish certified copies
thereof to the Co-ordinator and will procure that the terms of
the same are complied with at all times.
9.7 The Guarantor will do all such things as are necessary to
maintain its corporate existence in good standing and will
ensure that it has the right and is duly qualified to conduct
its business as it is conducted in all applicable
jurisdictions and will obtain and maintain all franchises and
rights necessary for the conduct of its business.
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9.8 Forthwith upon the execution of this Deed, and as a condition
precedent to the amendment and restatement of the Original
Loan Agreement, the Guarantor shall deliver to the Agent a
letter addressed to the Agent irrevocably and unconditionally
authorising and instructing the Agent forthwith to execute on
behalf of the Guarantor each Transfer Certificate delivered to
the Agent pursuant to clause 19 of the Loan Agreement, such
letter to be in the form of Schedule 2.
10 GENERAL UNDERTAKINGS: NEGATIVE COVENANTS
10.1 The undertakings contained in this Clause 10 shall remain in
full force from the date of this Deed until the end of the
Security Period.
10.2 Except with the prior written consent of the Co-ordinator, the
Guarantor will not, and will procure that no other member of
the NCLC Group will, either in a single transaction or in a
series of transactions whether related or not and whether
voluntarily or involuntarily, agree to or actually sell,
assign, abandon or otherwise transfer or dispose of all or any
of its assets or any share or interest therein except that:
(A) either of the Borrowers may agree to sell its Vessel
on the condition that contemporaneously with the
completion of such sale the Loan is prepaid in
accordance with the provisions of clause 4.6 of the
Loan Agreement;
(B) either of the Borrowers may let its Vessel on charter
in accordance with the provisions of clause 10 of the
Loan Agreement;
(C) disposals may be made in the ordinary course of
trading of the disposing entity (excluding disposal
of ships) including without limitation, the payment
of cash as consideration for the purchase or
acquisition of any asset or service or in the
discharge of any obligation incurred for value in the
ordinary course of trading;
(D) disposals of cash raised or borrowed may be made for
the purposes for which such cash was raised or
borrowed;
(E) disposals of assets in exchange for other assets
comparable or superior as to type and value may be
made;
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(F) a vessel owned by any member of the NCLC Group (other
than a Borrower) may be sold provided such sale is on
a willing seller willing buyer basis at or about
market rate and at arm's length subject always to the
provisions of any loan documentation for the
financing of such vessel and NCLL may, following the
sale of its shares by Arrasas to IOL, a wholly owned
Subsidiary of the Original Guarantor, transfer to
other wholly owned Subsidiaries of the Original
Guarantor its vessels "NORWEGIAN WIND", "NORWEGIAN
DREAM", "NORWEGIAN SEA", "NORWEGIAN MAJESTY",
"NORWEGIAN CROWN" and "MARCO POLO" (the "SIX
VESSELS") for their net book values as set out in
schedule 8 to the Loan Agreement and sell m.v.
"NORWAY" to a third party and, prior to the sale of
its shares as aforesaid, transfer its vessel
"NORWEGIAN SKY" to Pride of Aloha Inc., a wholly
owned Subsidiary of NCL America Holdings;
(G) the Shareholder may assign, pledge or charge the
Shares as security for the obligations of the
Borrowers under the Loan Agreement; and
(H) Arrasas may transfer its shares in NCLL to IOL and
the Original Guarantor may transfer its shares in
Arrasas to the Guarantor.
10.3 Except with the prior written consent of the Co-ordinator, the
Guarantor will not, and will procure that no other member of
the NCLC Group will, make any loan or advance or extend credit
to any person, firm or corporation (except any loan, advance
or credit made available to passengers on board a vessel for
gambling purposes or to ship's agents and except any loan,
advance or credit to the Guarantor or a wholly-owned
Subsidiary of the Guarantor, which loan, advance or credit is
fully subordinated to the rights of the Lenders under the
Security Documents).
10.4 The Guarantor will not, and will procure that no other member
of the NCLC Group will, issue or enter into any guarantee or
indemnity or otherwise become directly or contingently liable
for the obligations of any other person, firm or corporation
without first notifying the Co-ordinator with full details of
the amounts and the period(s) of the guarantee(s) or
indemnity(ies), if such is or are in excess of (in aggregate
(if applicable)) the amount of twenty million Dollars
(USD20,000,000).
16
10.5 Except with the prior written consent of the Co-ordinator, the
Guarantor will not, and will procure that no other member of
the NCLC Group will, make or threaten to make any substantial
change in its business as presently conducted, or carry on any
other business which is substantial in relation to its
business as presently conducted PROVIDED THAT NCLL may
transfer the Six Vessels (as defined in Clause 10.2(F)) to
wholly owned Subsidiaries of the Original Guarantor and m.v.
"NORWEGIAN SKY" to Pride of Aloha Inc., a wholly owned
Subsidiary of NCL America Holdings as aforesaid, sell m.v.
"NORWAY" to a third party, cease to be either an owner or
manager of ships and conduct such business as is contemplated
by the restructure and recapitalisation of the Group as more
particularly described in the letter dated 19 December 2003
from NCLL to the Co-ordinator.
10.6 Except with the prior written consent of the Co-ordinator, the
Guarantor will not, and will procure that no other member of
the NCLC Group will, enter into any amalgamation, merger or
consolidation or anything analogous to the foregoing. Further,
no member of the NCLC Group will acquire any equity, share
capital or obligations of any corporation or other entity
PROVIDED THAT the Shareholder or NCL America Holdings may so
acquire equity, share capital or obligations of a corporation
or entity whose business is the ownership, operation or
management of cruise vessels and PROVIDED FURTHER THAT:
(A) Arrasas may form two (2) wholly owned Subsidiaries,
namely the Shareholder and NCL America Holdings;
(B) the existing shareholders of the owners of the
Bahamas flag vessels in the NCLC Fleet may transfer
their shares in such owners to the Shareholder;
(C) the existing shareholders of the owners of the US
flag vessels in the NCLC Fleet may transfer their
shares in such owners to NCL America Holdings;
(D) the Shareholder may form a wholly owned Subsidiary,
namely the Manager, to operate the Bahamas flag
vessels in the NCLC Fleet and to charter in each of
the Six Vessels (as defined in Clause 10.2(F)) on
demise or bareboat charter for the period and at the
charterhire rate set out in schedule 8 to the Loan
Agreement; and
17
(E) NCL America Holdings may form two (2) wholly owned
Subsidiaries, namely NCL America, to operate the US
flag vessels in the NCLC Fleet and Pride of Aloha
Inc., to own m.v. "NORWEGIAN SKY".
However, the prior consent of the Co-ordinator shall not be
required in respect of any consolidation, reorganisation or
restructure involving wholly owned (whether directly or
indirectly) Subsidiaries of the Guarantor only which does not
imperil the security created by any of the Security Documents
or affect the ability of any Obligor duly to perform any of
its obligations under any Security Document to which it may be
a party at any time, provided that the Guarantor has first
consulted with the Co-ordinator with regard to the proposed
consolidation, reorganisation or restructure, provides
evidence satisfactory to the Majority Lenders that the
Guarantor will be in compliance with the financial
undertakings contained in Clause 11 after any such
consolidation, reorganisation or restructure and, if so
required, procures the transfer of the Operating Account to
the Agent SUBJECT TO:
(F) Clause 8.1(P);
(G) the continuation in full force and effect of this
Deed; and
(H) the cash flows from which the Outstanding
Indebtedness will be repaid remaining comparable as
to amount (relative to the amount of the Outstanding
Indebtedness) and accessibility for the Borrowers to
the cash flows as at the date of this Deed, in the
sole discretion of the Lenders.
For the avoidance of doubt, the acquisition by a member of the
NCLC Group of any shares in any company or corporation shall
not in itself constitute a merger or consolidation with such
company or corporation for the purpose of this Clause 10.6
provided that the Co-ordinator is satisfied the Guarantor will
be in compliance with the financial undertakings contained in
Clause 11 after any such merger or consolidation.
10.7 Except with the prior written consent of the Co-ordinator, the
Guarantor will not alter its financial year end.
10.8 The Guarantor has not taken and shall not take from any other
Obligor any security or counter-security in respect of any of
its obligations under this Deed
18
PROVIDED ALWAYS that if the Guarantor, in breach of this
Clause, takes any security or counter-security as aforesaid,
such security shall be held by the Guarantor as trustee upon
trust for the Agent and the Lenders.
11 FINANCIAL UNDERTAKINGS AND OWNERSHIP AND CONTROL OF THE GUARANTOR
11.1 The Guarantor will ensure that:
(A) at all times the minimum Cash Balance will be not
less than fifty million Dollars (USD50,000,000);
(B) as at 31 December 2004 and as at the end of each
subsequent financial quarter either:
(i) the ratio of Consolidated EBITDA to
Consolidated Debt Service for the NCLC Group
for the period of twelve (12) months ending
as at the end of the relevant financial
quarter shall not be less than:
(a) for the financial quarter ending on
31 December 2004, one point two
(1.2) to one (1.0); and
(b) for each subsequent financial
quarter, one point two five (1.25)
to one (1.0); or
(ii) the NCLC Group has maintained a minimum Cash
Balance during such period of twelve (12)
months ending as at the end of the relevant
financial quarter in an amount which is not
less than whichever is the greater of:
(a) one hundred million Dollars
(USD100,000,000); and
(b) seven point five per cent (7.5%) of
Total Funded Debt as at the end of
the relevant financial quarter and
each of the three (3) preceding
financial quarters; and
(C) as at 31 December 2004 and as at the end of each
subsequent financial quarter, the ratio of Total Net
Funded Debt to Total Capitalisation of the NCLC Group
shall not exceed:
19
(i) nought point seven (0.7) to one (1.0) for
financial quarters ending on or before 31
December 2006; and
(ii) nought point six five (0.65) to one (1.0)
for each subsequent financial quarter.
Amounts available for drawing under any revolving or
other credit facilities of the NCLC Group which
remain undrawn at the time of the relevant
calculation shall not be counted as cash or
indebtedness for the purposes of this ratio.
11.2 It will be an Event of Default if:
(A) at any time when the ordinary share capital of the
Guarantor is not publicly listed on an Approved Stock
Exchange, the Lim Family together or individually do
not, directly or indirectly, control the Guarantor
and beneficially own, directly or indirectly, at
least fifty one per cent (51%) of the issued share
capital of, and equity interest in, the Guarantor; or
(B) at any time following the listing of the ordinary
share capital of the Guarantor on an Approved Stock
Exchange:
(i) any Third Party:
(a) owns more than thirty three per
cent (33%) of the ordinary share
capital of the Guarantor; or
(b) owns shares in the ordinary share
capital of the Guarantor
representing more than thirty three
per cent (33%) of all the voting
rights attributable to such ordinary
share capital; or
(c) gains control of more than thirty
three per cent (33%) of such voting
rights
and, at the same time as any of the events
described in paragraphs (a), (b) or (c) of
this Clause have occurred and are
continuing, the Lim Family together or
individually do not, directly or indirectly,
control the Guarantor and beneficially own,
directly or indirectly,
20
at least fifty one per cent (51%) of the
issued share capital of, and equity interest
in, the Guarantor; or
(ii) the Guarantor ceases to be a listed
company on an Approved Stock
Exchange without the prior written
consent of the Agent,
(and, for the purpose of this Clause 11.2(B)
"CONTROL" of any company, limited partnership or
other legal entity (a "BODY CORPORATE") by a member
of the Lim Family, means that one (1) or more members
of the Lim Family has, directly or indirectly, the
power to direct the management and policies of such a
body corporate, whether through the ownership of more
than fifty per cent (50%) of the issued voting
capital of that body corporate or by contract, trust
or other arrangement).
11.3 During any financial year of the Guarantor until the date on
which the Guarantor becomes a listed company on an Approved
Stock Exchange (on which date the restriction contained in
this Clause 11.3 shall cease to apply), the Guarantor shall
not and shall procure that no other member of the NCLC Group
shall, pay any dividends or make any other distributions in
respect of its share capital to any person or make any
repayments of capital or payments of interest in respect of
Financial Indebtedness to an Affiliate of the Guarantor (other
than to the Guarantor and/or its wholly owned Subsidiaries)
which during any financial year of the Guarantor in aggregate
exceeds fifty per cent (50%) of the Consolidated Net Income
(if positive) of the NCLC Group for such financial year,
PROVIDED HOWEVER THAT the NCLC Group shall not be entitled to
pay any dividend or make any distribution in respect of any of
its share capital or make any repayments of capital or
payments of interest if an Event of Default has occurred and
is continuing or would occur as a result of the payment of
such dividend or the making of such distribution.
11.4 In Clause 11.1, Clause 11.2, Clause 11.3 and Schedule 1:
(A) "AFFILIATE" means, with respect to any person, any
other person controlling, controlled by or under
common control with, such person and for purposes of
this definition, "CONTROL" (including, with
correlative meanings, the terms "controlling",
"CONTROLLED BY" and "UNDER COMMON CONTROL WITH"), as
applied to any person, means the possession, directly
or
21
indirectly, of the power to vote ten per cent (10%)
or more of the securities having voting power for the
election of directors of such person, or otherwise to
direct or cause the direction of the management and
policies of that person, whether through the
ownership of voting securities or by contract or
otherwise;
(B) "APPROVED STOCK EXCHANGE" means the New York Stock
Exchange, NASDAQ or such other stock exchange in the
United States of America as is approved in writing by
the Agent;
(C) "CASH BALANCE" means the unencumbered and otherwise
unrestricted cash and cash equivalents as set forth
on the consolidated balance sheet of the NCLC Group
prepared in accordance with GAAP at the end of every
month;
(D) "CONSOLIDATED DEBT SERVICE" means, for any relevant
period, the sum (without double counting), determined
in accordance with GAAP, of:
(i) the aggregate principal payable or paid
during such period on any Indebtedness for
Borrowed Money of any member of the NCLC
Group, other than:
(a) principal of any such Indebtedness
for Borrowed Money prepaid at the
option of the relevant member of
the NCLC Group;
(b) principal of any such Indebtedness
for Borrowed Money prepaid upon the
sale or Total Loss of any vessel
owned or leased under a capital
lease by any member of the NCLC
Group; and
(c) balloon payments of any such
Indebtedness for Borrowed Money
payable during such period (and for
the purpose of this paragraph (c) a
"BALLOON PAYMENT" shall not include
any scheduled repayment instalment
of such Indebtedness for Borrowed
Money which forms part of the
balloon);
(ii) Consolidated Interest Expense for such
period;
22
(iii) the aggregate amount of any dividend or
distribution of present or future assets,
undertakings, rights or revenues to any
shareholder of any member of the NCLC Group
(other than the Guarantor or one of its
wholly owned Subsidiaries) or any
distribution in respect of share capital
during such period ("DISTRIBUTIONS"); and
(iv) all rent under any capital lease obligations
by which the Guarantor or any consolidated
Subsidiary is bound which are payable or
paid during such period and the portion of
any debt discount that must be amortised in
such period,
as calculated in accordance with GAAP and derived
from the then latest unaudited consolidated accounts
of the NCLC Group delivered to the Agent in the case
of any period ending at the end of any of the first
three (3) financial quarters of each financial year
of the Guarantor and the then latest Accounts
delivered to the Agent in the case of the final
quarter of each such financial year;
(E) "CONSOLIDATED EBITDA" means, for any relevant period,
the aggregate of:
(i) Consolidated Net Income (but excluding (i)
gains and losses from the sale of assets or
reserves relating thereto and (ii) items
classified as extraordinary or non
recurring) from the Guarantor's operations
for such period;
(ii) the aggregate amounts deducted in
determining Consolidated Net Income for such
period in respect of depreciation,
amortisation, deferred income tax expense
and any other non-cash charges for such
period, Consolidated Interest Expense;
(F) "CONSOLIDATED INTEREST EXPENSE" means, for any
relevant period, the consolidated interest expense
(excluding capitalised interest accrued and not
payable during such period) of the NCLC Group for
such period;
(G) "CONSOLIDATED NET INCOME" means, for any relevant
period, the consolidated net income (or loss) of the
NCLC Group for such period as determined in
accordance with GAAP;
23
(H) "INTANGIBLE ASSETS" means, at any date of
determination, the amounts (to the extent reflected
in determining at such date consolidated
stockholders' equity of the NCLC Group) determined in
accordance with GAAP of:
(i) all shareholdings other than any
shareholdings of shares which are publicly
quoted and which are not subject to any
restrictions on sale or other disposition
thereof;
(ii) treasury stock (to the extent not deducted
in the determination of consolidated
stockholders' equity of the NCLC Group); and
(iii) all unamortised debt discount and expenses,
unamortised deferred charges, goodwill,
patents, trademarks, service marks, trade
names, copyrights, organisational or
development expenses and other intangible
items,
all as calculated in accordance with GAAP and derived
from the then latest unaudited and consolidated
accounts of the NCLC Group delivered to the Agent in
the case of the first three (3) quarters of each
financial year and the then latest Accounts delivered
to the Agent in the case of the final quarter of each
financial year;
(I) "LIM FAMILY" means:
(i) Tan Sri Lim Goh Tong;
(ii) his spouse;
(iii) his direct lineal descendants;
(iv) the personal estate of any of the above
persons; and
(v) any trust created for the benefit of one or
more of the above persons and their estates;
(J) "NCLC GROUP" means, for the purposes of this Clause
11, the Guarantor, its Subsidiaries and any other
entity which is required to be consolidated in the
Guarantor's accounts in accordance with GAAP;
24
(K) "TANGIBLE ASSETS" means, at any date of
determination, the total assets of the NCLC Group (as
stated in the then latest unaudited and consolidated
accounts of the Guarantor delivered to the Agent)
less the Intangible Assets of the NCLC Group at such
date;
(L) "TANGIBLE NET WORTH" means, at any date of
determination, the consolidated stockholders' equity
of the NCLC Group at such date determined in
accordance with GAAP less:
(i) Intangible Assets of the NCLC Group; and
(ii) (to the extent included) any amount set
aside for taxation, deferred taxation or (to
the extent that the full amount receivable
in respect of any bad debts is shown in the
balance sheet as an asset of the NCLC Group)
bad debts,
at such date all as calculated in accordance with
GAAP and derived from the then latest unaudited and
consolidated accounts of the NCLC Group delivered to
the Agent in the case of the first three (3) quarters
of each financial year and the then latest Accounts
delivered to the Agent in the case of the final
quarter of each financial year;
(M) "THIRD PARTY" means any person or group of persons
acting in concert (as the expression "ACTING IN
CONCERT" is defined in the City Code on Take-overs
and Mergers) who or which is not a member of the Lim
Family;
(N) "TOTAL CAPITALISATION" means, as at any relevant
date, Total Funded Debt plus Tangible Net Worth as at
such date;
(O) "TOTAL FUNDED DEBT" means, as at any relevant date:
(i) Indebtedness for Borrowed Money of the NCLC
Group; and
(ii) the amount of any Indebtedness for Borrowed
Money of any person which is not a member of
the NCLC Group but which is guaranteed by a
member of the NCLC Group as at such date;
25
(P) "TOTAL NET FUNDED DEBT" means, as at any relevant
date, the Total Funded Debt less an amount equal to
any Cash Balance as at such date in excess of fifty
million Dollars (USD50,000,000).
11.5 Save as specified in Clause 11.1(B), the ratios referred to in
Clause 11.1 will be measured on a quarterly basis by reference
to the consolidated accounts of the NCLC Group.
12 DISCHARGE
Subject to Clause 4.3, following the irrevocable repayment or payment
to the Agent of all the Outstanding Indebtedness the Agent will at the
Guarantor's request return this Deed to the Guarantor and shall, at the
request and cost of the Guarantor, transfer to the Guarantor such
rights as the Agent may at such time have in the security for the
Outstanding Indebtedness and to the proceeds of any such rights or
security.
13 ASSIGNMENT AND TRANSFER
13.1 This Deed shall be binding upon and enure to the benefit of
the Guarantor, the Agent, the Lenders and each of their
respective successors and assigns including, in the case of
the Lenders, any Transferee.
13.2 The Guarantor shall not be entitled to assign or transfer all
or any part of its rights, benefits or obligations under this
Deed.
13.3 The Agent and each Lender may assign or transfer its
respective rights hereunder to any person (including any other
Lending Branch) to whom the rights, or the rights and
obligations, of the Agent or that Lender under the Loan
Agreement are wholly or partially assigned or transferred in
accordance with the Loan Agreement.
13.4 Any Lender may disclose to any actual or potential assignee or
Transferee or to any person who may otherwise enter or propose
to enter into contractual relations with such Lender in
relation to the Loan Agreement and this Deed any information
about the Obligors and the NCLC Group as such Lender shall
reasonably consider necessary for the purposes of inviting
expressions of interest from other banks or financial
institutions SUBJECT ALWAYS to the relevant
26
Lender procuring the execution by the potential assignee or
Transferee or any other person as aforesaid of a
Confidentiality Undertaking.
13.5 A person (including any body of persons) who is not a party to
this Deed has no right under the Contracts (Rights of Third
Parties) Act 1999 to enforce any term of this Deed but this
does not affect any right or remedy of a third party which
exists or is available apart from that Act.
14 MISCELLANEOUS PROVISIONS
14.1 No failure to exercise and no delay in exercising on the part
of the Agent or any of the Lenders any right or remedy under
this Deed or under any other of the Security Documents shall
operate as a waiver thereof, nor shall any single or partial
exercise of any right or remedy preclude any other or further
exercise thereof or the exercise of any other right or remedy.
No waiver by the Agent or any of the Lenders shall be
effective unless it is in writing.
14.2 The rights and remedies of the Agent and each of the Lenders
provided herein and in the other Security Documents are
cumulative and not exclusive of any rights or remedies
provided by law.
14.3 If any provision of this Deed or the Loan Agreement or any
other Security Document to which any Obligor is a party is
prohibited or unenforceable in any jurisdiction, such
prohibition or unenforceability shall not invalidate the
remaining provisions hereof or thereof or affect the validity
or enforceability of such provision in any other jurisdiction.
14.4 Time is of the essence in respect of all of the obligations of
the Guarantor under this Deed.
15 WAIVER OF IMMUNITY
The Guarantor irrevocably and unconditionally:
15.1 waives any right of immunity which it or its assets now has or
may hereafter acquire in relation to any legal proceedings
(including, but without limitation, actions in rem and/or in
personam) brought against it or its assets by the Agent or the
Lenders in relation to this Deed; and
27
15.2 consents generally in respect of any such proceedings to the
giving of any relief including, without limitation, the issue
of any process in connection with such proceedings and the
making, enforcement or execution against any property
whatsoever (irrespective of its use or intended use) of any
order or judgment which may be made or given in such
proceedings.
16 NOTICES
16.1 Each notice, demand or other communication to be made under
this Deed shall be made in writing which, unless otherwise
stated, includes telex or telefax.
16.2 Any notice, demand or other communication to be made or
delivered by the Agent to the Guarantor pursuant to this Deed
shall (unless the Guarantor has by fifteen (15) days' written
notice to the Agent specified another address) be made or
delivered to the Guarantor at 7665 Corporation Center Drive,
Miami, Florida 33126, United States of America marked for the
attention of Mr Lamarr Cooler (telefax no. +1 305 436 4117)
and the Legal Department (telefax no. +1 305 436 4140) with a
copy to the Guarantor at 25th Floor, Wisma Genting, Jalan
Sultan Ismail, 50250 Kuala Lumpur, Malaysia marked for the
attention of Mr Gerard Lim (telefax no. +60 3 2161 3621) and
shall be deemed to have been made or delivered (in the case of
telefax) when transmission of such telefax communication has
been completed or (in the case of any letter) when delivered
to the aforesaid address or (as the case may be) five (5) days
after being deposited in the post first class postage prepaid
in an envelope addressed to it at that address. Any notice,
demand or other communication to be made or delivered by the
Guarantor to the Agent or the Lenders pursuant to this Deed
shall (unless the Agent has by fifteen (15) days' written
notice to the Guarantor specified another address) be made or
delivered to the Agent at its office for the time being which
is at present at 25 rue Edward Steichen, L-2540 Luxembourg
(telex no. 1293 answerback CBKLU LU telefax no. +352 477911
2386) and shall be deemed to have been made or delivered (in
the case of telex) when the Agent's answerback shall have been
received at the end of the transmission thereof or (in the
case of telefax) when transmission of such telefax
communication has been completed or (in the case of any
letter) when delivered to the aforesaid address or (as the
case may be) five (5) days after being deposited in the post
first class postage prepaid in an envelope addressed to it at
that address.
28
16.3 Each notice, demand or other communication made or delivered
by one (1) party to the other pursuant to this Deed shall be
in the English language or accompanied by a certified English
translation.
17 GOVERNING LAW
This Deed shall be governed by and construed in accordance with English
law.
18 JURISDICTION
18.1 For the exclusive benefit of the Agent and the Lenders, the
Guarantor agrees that any legal action or proceeding arising
out of this Deed may be brought in the High Court of Justice
in England and irrevocably submits to the jurisdiction of that
court. The submission by the Guarantor to such jurisdiction
shall not limit the right of the Agent and/or the Lenders to
commence any proceedings arising out of this Deed in
whatsoever jurisdiction they may choose, nor shall the
commencement of any such legal action or proceeding in one (1)
jurisdiction preclude the Agent and/or the Lenders from
beginning any further or other such legal action or proceeding
in the same or any other jurisdiction.
18.2 The Guarantor appoints in the case of the courts of England
the Process Agent to receive, for and on its behalf, service
of process in England of any legal proceedings with respect to
this Deed.
29
IN WITNESS whereof this Deed of Guarantee and Indemnity has been executed by the
parties hereto on the day first written above.
SIGNED SEALED and DELIVERED )
as a DEED by PAUL TURNER ) P A TURNER
for and on behalf of )
NCL CORPORATION LTD. )
in the presence of: REGINA CHEUNG
TRAINEE SOLICITOR
STEPHENSON HARWOOD
ONE, ST. PAUL'S CHURCHYARD
LONDON EC4M 8SH
SIGNED SEALED and DELIVERED )
as a DEED by JULIE CLEGG )
for and on behalf of ) J CLEGG
COMMERZBANK INTERNATIONAL S.A. )
in the presence of: REGINA CHEUNG
TRAINEE SOLICITOR
STEPHENSON HARWOOD
ONE, ST. PAUL'S CHURCHYARD
LONDON EC4M 8SH
30
SCHEDULE 1
QUARTERLY COMPLIANCE CERTIFICATE
TO: COMMERZBANK AKTIENGESELLSCHAFT
Hamburg Branch
Ness 7-9
20457 Hamburg
Federal Republic of Germany
ATTN: Mr Stefan Kuch/Mr Christian Renke
We refer to clause 11 of the guarantee dated 2004 (the "GUARANTEE") issued
by us in your favour. Terms defined in the Guarantee, whether by reference to
the Loan Agreement (as therein defined) or otherwise, shall have the same
meanings herein.
We hereby certify the amounts set out in the attached schedule as at the last
day of the financial quarter ending 2[ ] for NCL Corporation Ltd. (the
"GUARANTOR") and its subsidiaries on a consolidated basis. We also hereby
certify that the Guarantor is in compliance with all the financial covenants set
out in clauses 11.1 and 11.3 of the Guarantee.
Chief Financial Officer
NCL CORPORATION LTD.
- --------------------------
By:
Dated: 20[ ]
31
SCHEDULE
STATEMENT OF FINANCIAL COVENANTS AS OF [ ] 20[ ] (IN USD'000)
Clause (Of
Guarantee) as of [o] Required Covenants
11.1(A) CASH BALANCE A A>USD50,000,000
11.1(B) CONSOLIDATED EBITDA: B >1.2 for 2004
>1.25:1 thereafter
CONSOLIDATED DEBT SERVICE C
11.1(C) TOTAL NET FUNDED DEBT: D <0.7 up to 31 December 2006
<0.65:1 thereafter
TOTAL CAPITALISATION E
CONSOLIDATED EBITDA
Consolidated Net Income (loss) x
Deduct: (Gain)/Loss on sale of assets or reserves x
Add: Consolidated Interest Expense x
Amortisation of intangible assets x
Depreciation of tangible assets x
Deferred income tax expense x
Other non-recurring charge (gain) x
X B
---------------
CONSOLIDATED DEBT SERVICE
Add: Principal paid/payable (excluding balloon payments,
voluntary prepayments/repayments on sale/total loss of
an NCLC Fleet vessel) x
Consolidated Interest Expense x
Distributions x
Rent under capitalised leases x
X C
----------------
CASH BALANCE X A
---------------
TOTAL FUNDED DEBT
Add: Indebtedness for Borrowed Money x
Guarantees of non-NCLC Group members' obligations X
---------------
X
Deduct: Unencumbered and otherwise unrestricted cash in excess (X)
--------------
of USD50,000,000
TOTAL NET FUNDED DEBT (X) D
--------------
32
TOTAL CAPITALISATION
Add: Total Funded Debt x
Consolidated stockholders' equity x
Deduct: Intangible Assets (X)
Provision for taxation, deferred taxation, bad debts (X)
-------------
TANGIBLE NET WORTH x
-------------
TOTAL CAPITALISATION x E
-------------
For and on behalf of NCL CORPORATION LTD.
- ------------------------------
[ ]
I, [ ], the officer primarily responsible for the financial management of
the NCLC Group, hereby declare that, to the best of knowledge and belief, the
above Statement of Financial Covenants as of [ ] 20[ ], in my opinion, is
true and correct.
- ------------------------------
[ ]
Chief Financial Officer
NCL CORPORATION LTD.
Dated: 20[ ]
33
SCHEDULE 2
LETTER OF INSTRUCTION
TO: COMMERZBANK INTERNATIONAL S.A.
25 rue Edward Steichen
L-2540 Luxembourg
ZCB AGENCY GROUP
ATTN: MS EVA-MARIA ORSCHEL/MR NICOLAAS VAN DER ROEMER
Date
Dear Sirs
DEED OF GUARANTEE AND INDEMNITY DATED 2004
(THE "GUARANTEE")
We refer to the Guarantee executed by us in favour of Commerzbank International
S.A. (the "AGENT") as agent on behalf of the Lenders (as hereinafter defined) as
security for the obligations of the Borrowers under the loan agreement dated 26
June 1999 and amended and restated by agreements dated 23 October 2001, 21 March
2002 and 2004 (the "LOAN AGREEMENT") made by and between (among others) (1)
Norwegian Star Limited and Norwegian Dawn Limited as joint and several borrowers
(the "BORROWERS") (2) the banks and financial institutions therein referred to
as lenders (the "LENDERS") (3) yourselves as agent for the Lenders and (4) the
Co-ordinator as co-ordinator for the Lenders.
Unless the context requires otherwise, words and expressions used herein shall
have the same meanings as ascribed to them in the Loan Agreement.
We refer to:
1. clause 14.3 of the Guarantee which provides that the Agent and each
Lender may assign or transfer its respective rights under the Guarantee
to any person to whom the rights, or the rights and obligations, of the
Agent or that Lender under the Loan Agreement are wholly or partially
assigned or transferred in accordance with the Loan Agreement; and
2. clause 19.5 of the Loan Agreement whereby the rights, benefits and/or
obligations of any Lender thereunder may be transferred by means of a
Transfer Certificate.
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In consideration of the Lenders agreeing at our request to continue to make the
Facility available to the Borrowers in accordance with the terms of the Loan
Agreement, we hereby irrevocably and unconditionally authorise and instruct the
Agent forthwith to execute on our behalf each Transfer Certificate delivered to
the Agent pursuant to clause 19.5 of the Loan Agreement without the Agent being
under any obligation to take any further instructions from us or to give any
prior notice to us before doing so.
This letter shall be governed by, and construed in accordance with, English law.
Yours faithfully
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NCL CORPORATION LTD.
By:
Title:
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