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EXHIBIT 2.26
GUARANTEE
GUARANTEE, dated as of January 29, 1996, made by NASSAU SPIRIT INC., a
Bahamian corporation (the "Guarantor"), in favor of United States Trust Company
of New York, a bank and trust company organized under the New York Banking Law
(the "Trustee"), as Trustee pursuant to, and for the benefit of the Holders of
the Securities (as defined in the Indenture hereinafter defined) issued under,
that certain Indenture, dated as of the date hereof, among Teekay Shipping
Corporation, a Liberian Corporation (the "Company"), certain of the Company's
subsidiaries named therein (the "Guarantors") and the Trustee (the "Indenture";
terms used herein and not otherwise defined herein being used herein as defined
in the Indenture).
The Company, the Guarantors and the Trustee have entered into the Indenture
to secure, among other things, payment of the principal of (and premium, if any)
and interest on all the Securities issued and to be issued under the Indenture.
Securities, in an aggregate principal amount of $225,000,000, have been
authorized under the Indenture and designated the 8.32% First Preferred Ship
Mortgage Notes, the form of which is included in the Indenture, which Securities
are originally being executed, authenticated and delivered on the date hereof.
The Guarantor, a wholly owned subsidiary of the Company, in order to guarantee
the payment of the principal of (and premium, if any) and interest on the
Securities, and the payment of all fees, expenses and other sums of money from
time to time payable by the Company under the Indenture, and the payment of all
sums of money payable by the other Guarantors under their respective Subsidiary
Guarantees and Guarantor Security Documents (collectively, the "Obligations"),
and to guarantee as well the performance and observance of all agreements,
covenants and provisions contained in this Guarantee and of the Company and the
Guarantors in the Indenture and the Security Documents, has duly authorized the
execution and delivery of this Guarantee.
In order to induce the Trustee to enter into the Indenture and the
transactions contemplated thereby and the Holders to accept the Securities, the
Guarantor hereby agrees as follows:
SECTION 1. Guarantee. The Guarantor hereby unconditionally guarantees the
punctual payment when due, whether at stated maturity, by acceleration or
otherwise, of the Obligations and performance and observance of all agreements,
covenants and provisions contained in this Guarantee and the Indenture, and
agrees to pay any and all expenses (including reasonable counsel fees and
expenses) incurred by the Trustee in enforcing any rights under this Guarantee
or the Indenture. Without limiting the generality of the
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foregoing, the Guarantor's liability shall extend to all amounts which
constitute part of the Obligations and would be owed by the Company under the
Indenture but for the fact that they are unenforceable or not allowable due to
the existence of a bankruptcy, reorganization or similar proceeding involving
the Company.
SECTION 2. Guarantee Absolute. The Guarantor guarantees that the
Obligations will be paid strictly in accordance with their respective terms,
regardless of any law, regulation or order now or hereafter in effect in any
jurisdiction affecting any of such terms or the rights of the Trustee with
respect thereto. The obligations of the Guarantor under this Guarantee are
independent of the Obligations, and a separate action or actions may be brought
and prosecuted against the Guarantor to enforce this Guarantee, irrespective of
whether any action is brought against the Company or whether the Company is
joined in any such action or actions. The liability of the Guarantor under this
Guarantee shall be absolute and unconditional irrespective of:
(i) any lack of validity or enforceability of any Obligation or any
other agreement or instrument relating thereto;
(ii) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Obligations, or any other amendment or
waiver of or any consent to departure from the Indenture or any Security or
any other agreement or instrument delivered pursuant or relating thereto,
including, without limitation, any increase in the Obligations resulting
from the extension of additional credit to the Company or any of its
subsidiaries or otherwise;
(iii) any taking, exchange, release or non-perfection of any
collateral, or any taking, release or amendment or waiver of or consent to
departure from any other guarantee, for all or any of the Obligations;
(iv) any manner of application of collateral, or proceeds thereof, to
all or any of the Obligations, or any manner of sale or other disposition
of any collateral for all or any of the Obligations or any other assets of
the Company or any of its subsidiaries;
(v) any change, restructuring or termination of the corporate
structure or existence of the Company or any of its subsidiaries; or
(vi) any other circumstance which might otherwise constitute a defense
available to, or a discharge of, the Company or a Guarantor;
provided, however that, notwithstanding the foregoing, the liability of the
Guarantor under this Guarantee shall not exceed the greatest of (a) 95% of the
Adjusted Net Assets of the
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Guarantor on the date of delivery hereof, (b) 95% of the Adjusted Net Assets of
the Guarantor on the date of any payment hereunder and (c) the total amount of
the proceeds received by the Guarantor from the Company from the sale of the
Securities. "Adjusted Net Assets" of the Guarantor at any date means the lesser
of (i) the amount by which the fair value of the property of the Guarantor
exceeds the total amount of liabilities, including, without limitation,
contingent liabilities, but excluding liabilities under this Guarantee, of the
Guarantor at such date and (ii) the amount by which the present fair saleable
value of the assets of the Guarantor at such date exceeds the amount that will
be required to pay the probable liability of the Guarantor on its debts,
excluding debt in respect of this Guarantee, as they become absolute and
matured.
This Guarantee shall continue to be effective or be reinstated, as the case
may be, if at any time any payment of any of the Obligations is rescinded or
must otherwise be returned upon the insolvency, bankruptcy or reorganization of
the Company or otherwise, all as though such payment had not been made.
SECTION 3. Waiver. The Guarantor hereby waives promptness, diligence,
notice of acceptance and any other notice with respect to any of the Obligations
and this Guarantee and any requirement that the Trustee protect, secure, perfect
or insure any security interest or lien or any property subject thereto or
exhaust any right or take any action against the Company or any other person or
entity or any collateral.
SECTION 4. Subrogation. The Guarantor hereby irrevocably waives any claim
or other rights that it may now or hereafter acquire against the Company that
arise from the existence, payment, performance or enforcement of the Guarantor's
Obligations under this Guarantee or the Indenture, including, without
limitation, any right of subrogation, reimbursement, exoneration, contribution
or indemnification and any right to participate in any claim or remedy of the
Trustee against the Company, any other Guarantor, or a Vessel, whether or not
such claim, remedy or right arises in equity or under contract, statute or
common law, including, without limitation, the right to take or receive from the
Company or any other Guarantor, directly or indirectly, in cash or other
property or by set-off or in any other manner, payment or security on account of
such claim, remedy or right. If any amount shall be paid to the Guarantor in
violation of the preceding sentence at any time prior to the later of the
payment in full of the Obligations and all other amounts payable under this
Guarantee and the Stated Maturity, such amount shall be held in trust for the
benefit of the Trustee and shall forthwith be paid to the Trustee to be credited
and applied to the Obligations and other amounts payable under this Guarantee,
whether matured or unmatured, in accordance with the terms of the Indenture, or
to be held as collateral for any Obligations or other amounts payable under this
Guarantee thereafter arising. The Guarantor acknowledges that it will receive
direct and indirect benefits from the financing arrangements contemplated by the
Indenture and that the waiver set forth in this subsection is knowingly made in
contemplation of such benefits.
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SECTION 5. Taxes. In the event that the Guarantor is required by any
applicable law to make, with respect to any payment to be made pursuant to this
Guarantee, any deduction or withholding for or on account of any taxes,
assessments or other governmental charges imposed on such payment by any
governmental or taxing authority (other than the United States of America or any
political subdivision or taxing authority thereof or therein, including the
Commonwealth of Puerto Rico, any territory or possession of the United States of
America or other area subject to its jurisdiction), the Guarantor shall pay such
additional amount as may be necessary in order that the net amount received by
the Trustee in respect of such payment will be not less than the amount of the
payment the Trustee would have received had no deduction or withholding been
required; provided, however, that the Guarantor shall not be required to pay any
additional amount on account of a tax, assessment or other governmental charge
imposed by reason of any present or former connection between a Holder of
Securities (or between a fiduciary, settlor, beneficiary, member or shareholder
of, or possessor of a power over, such Holder, if such Holder is an estate,
trust, partnership or corporation) and the governmental or taxing authority,
including without limitation such Holder (or a fiduciary, settlor, beneficiary,
member or shareholder of, or possessor of a power over, such Holder) having been
a citizen or resident thereof or treated as a resident thereof or being or
having been engaged in a trade or business therein or having or having had a
permanent establishment therein.
SECTION 6. Consent to Jurisdiction. (a) The Guarantor hereby irrevocably
submits to the non-exclusive jurisdiction of any New York State or Federal court
sitting in New York City and any appellate court from any thereof, for the
purposes of (and solely for the purposes of) any suit, action or other
proceeding arising out of or relating to this Guarantee or any of the
transactions contemplated hereby, and the Guarantor hereby irrevocably agrees
that all claims in respect of such action or proceeding may be heard and
determined in such New York State court or in such Federal court. The Guarantor
hereby (to the fullest extent it may effectively do so) irrevocably waives and
agrees not to assert, by way of motion, as a defense, or otherwise in any such
suit, action or proceeding, any claim that it is not personally subject to the
jurisdiction of the above-named courts for any reason whatsoever, that such
suit, action or proceeding is brought in an inconvenient forum or that the venue
of such suit, action or proceeding is improper, or that this Guarantee or the
subject matter hereof may not be enforced in such courts. The Guarantor hereby
irrevocably appoints Haight Gardner, Poor & Havens (the "Process Agent"), with
an office on the date hereof at 195 Broadway, New York, New York 10007, United
States, as its agent to receive on behalf of the Guarantor and its property
service of copies of the summons and complaint and any other process which may
be served in any such suit, action or proceeding and in any suit, action or
proceeding arising out of or relating to any other Security Document to which
the Guarantor is a party. Such service may be made by mailing or delivering a
copy of such process to the Guarantor in care of the Process Agent at the
Process Agent's above address, and the Guarantor hereby irrevocably authorizes
and directs the Process Agent to accept such service on its behalf. As an
alternative method of service, the Guarantor also irrevocably
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consents to the service of any and all process in any such suit, action or
proceeding by the mailing of copies of such process to the Guarantor at its
address specified in Section 9. The Guarantor agrees that a final judgment in
any such suit, action or proceeding shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other manner provided by
law.
(b) Nothing in this Section shall affect the right of the Trustee to serve
legal process in any other manner permitted by law or affect the right of the
Trustee to bring any action or proceeding against the Guarantor or its property
in the courts of any other jurisdiction.
SECTION 7. Representations and Warranties. The Guarantor hereby
represents and warrants that (a) the execution, delivery and performance of this
Guarantee are within its corporate powers, have been duly authorized by all
necessary action, including, without limitation, authorization by its sole
shareholder, and do not contravene any law of any country or any contractual
restriction binding on or affecting the Guarantor; (b) no authorization or
approval (including exchange control approval) or other action by, and no notice
to or filing with, any governmental authority or regulatory body in any country
is required for the due execution, delivery and performance by the Guarantor of
this Guarantee; (c) this Guarantee is a legal, valid and binding obligation of
the Guarantor enforceable against the Guarantor in accordance with its terms;
(d) there is no pending or threatened action or proceeding affecting the
Guarantor or any of its subsidiaries before any court, governmental agency or
arbitrator in any country, which may materially adversely affect the financial
condition or operations of the Guarantor or any such subsidiary; and (e) there
is no tax, levy, impost, deduction, charge or withholding imposed by the
Commonwealth of the Bahamas or any political subdivision or taxing authority
thereof either (i) on or by virtue of the execution or delivery of this
Guarantee or (ii) on any payment which may be made by the Guarantor hereunder.
SECTION 8. Amendments, Etc. No amendment or waiver of any provision of
this Guarantee, and no consent to any departure by the Guarantor herefrom, shall
in any event be effective unless the same shall be in writing and signed by the
Trustee, and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given.
SECTION 9. Addresses for Notices. All notices and other communications
provided for hereunder shall be in writing (including telephonic telecopier,
telex or cable communication) and mailed, telephonically telecopied, telexed,
cabled or delivered to it, if to the Guarantor, at its address specified in the
Indenture, and if to the Trustee, at its address specified in the Indenture, or,
as to either party, at such other address as shall be designated by such party
in a written notice to the other party. All such notices and other
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communications pursuant to this Guarantee shall be effective (i) if sent by
telex, cable or telephonic telecopier, upon transmission to the intended
addressee, whether or not receipt is acknowledged, and (ii) if delivered by hand
(including by independent courier service) upon delivery to the addresses and
(iii) if sent by first-class mail, postage prepaid, on the fifth (5th) calendar
day after the date of mailing.
SECTION 10. No Waiver; Remedies. No failure on the part of the Trustee to
exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any right hereunder
preclude any other or further exercise thereof or the exercise of any other
right. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law.
SECTION 11. Continuing Guarantee; Assignments. This Guarantee is a
continuing guarantee and shall (i) remain in full force and effect until (x) the
payment in full of the Obligations and all other amounts payable under this
Guarantee or (y) the Termination and Release shall have occurred, (ii) be
binding upon the Guarantor, it successors and assigns, and (iii) inure to the
benefit of, and be enforceable by, the Trustee and its successors, transferees
and assigns.
SECTION 12. GOVERNING LAW. THIS GUARANTEE SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, UNITED STATES OF
AMERICA.
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IN WITNESS WHEREOF, the Guarantor has caused this Guarantee to be duly
executed and delivered by its officer thereunto duly authorized as of the date
first above written.
NASSUA SPIRIT INC.
By: /s/ Anthony Gurnee
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Name: Anthony Gurnee
Title: Attorney-in-Fact
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SCHEDULE TO EXHIBIT 2.26
The Guarantees not required to be filed because each of them is
substantially identical to Exhibit 2.26, and the material details by which each
such Guarantee differs from such Exhibit are as follows:
1. Guarantee dated January 29, 1996 by VSSI Atlantic Inc. in favor of United
States Trust Company of New York, as Trustee.
a. Name of Guarantor: VSSI Atlantic Inc.
b. Jurisdiction of Organization: Republic of Liberia
2. Guarantee dated January 29, 1996 by VSSI Appian Inc. in favour of United
States Trust Company of New York, as Trustee.
a. Name of Guarantor: VSSI Appian Inc.
b. Jurisdiction of Organization: Republic of Liberia
3. Guarantee dated January 29, 1996 by Senang Spirit Inc. in favor of United
States Trust Company of New York, as Trustee.
a. Name of Guarantor: Senang Spirit Inc.
4. Guarantee dated January 29, 1996 by Exuma Spirit Inc. in favor of United
States Trust Company of New York, as Trustee.
a. Name of Guarantor: Exuma Spirit Inc.
5. Guarantee dated January 29, 1996 by Andros Spirit Inc. in favor of United
States Trust Company of New York, as Trustee.
a. Name of Guarantor: Andros Spirit Inc.
6. Guarantee dated January 29, 1996 by VSSI Oceans Inc. in favor of United
States Trust Company of New York, as Trustee.
a. Name of Guarantor: VSSI Oceans Inc.
b. Jurisdiction of Organization: Republic of Liberia