EX-4.51 26 exhibit451.htm EX-4.51 exhibit451
Dated ____ June 2023
JEMO SHIPPING COMPANY INC.
GUAM SHIPPING COMPANY INC.
PALAU SHIPPING COMPANY
 
INC.
MAKUR SHIPPING COMPANY INC.
as joint and several Borrowers
and
THE BANKS AND FINANCIAL INSTITUTIONS
listed in Schedule 1
as Lenders
and
NORDEA BANK ABP
as Swap Bank
and
NORDEA BANK ABP,
 
FILIAL I NORGE
as Agent, Bookrunner, Security Trustee
 
and Lead Arranger
LOAN AGREEMENT
relating to
relating to a term loan facility of up to $22,500,000
 
Index
Clause
 
Page
Schedules
THIS AGREEMENT
is made on ____ June 2023
PARTIES
(1)
JEMO SHIPPING COMPANY INC.,
 
GUAM SHIPPING COMPANY
 
INC., PALAU
 
SHIPPING COMPANY
INC.
and
MAKUR
 
SHIPPING
 
COMPANY
 
INC.
,
 
as
 
joint
 
and
 
several
 
borrowers
 
(together,
 
the
"
Borrowers
")
(2)
THE BANKS AND FINANCIAL INSTITUTIONS
listed in
, as Lenders
(3)
NORDEA BANK ABP,
as Swap Bank
(4)
NORDEA BANK ABP,
 
FILIAL I NORGE,
as Agent
(5)
NORDEA BANK ABP,
 
FILIAL I NORGE,
as Bookrunner
(6)
NORDEA BANK ABP,
 
FILIAL I NORGE,
as Lead Arranger
(7)
NORDEA BANK ABP,
 
FILIAL I NORGE,
as Security Trustee
BACKGROUND
(A)
The
 
Lenders
 
have
 
agreed
 
to
 
make
 
available
 
to
 
the
 
Borrowers
 
a
 
term
 
loan
 
facility
 
of
 
up
 
to
$22,500,000,
 
for
 
the
 
purpose
 
of
 
(i)
 
re-financing
 
the
 
Existing
 
Indebtedness
 
and
 
(ii)
 
for
 
the
Borrowers'
 
general corporate and working capital purposes.
(B)
The Swap Bank has agreed to
 
enter into interest
 
rate swap transactions
 
with the Borrowers from
time to time to
 
hedge the Borrowers'
 
exposure under this
 
Agreement to interest rate fluctuations.
(C)
The Lenders and
 
the Swap Bank
 
have agreed
 
to share pari
 
passu in the
 
security to be
 
granted to
the Security Trustee pursuant to this Agreement.
OPERATIVE PROVISIONS
1
INTERPRETATION
 
1.1
Definitions
Subject to Clause
 
(
General interpretation
), in this Agreement:
"
Accounts Pledges
" means,
 
together,
 
the Earnings
 
Account Pledges
 
in the
 
Agreed Form
 
and, in
the singular, means any of them.
"
Agency and
 
Trust Deed
" means
 
the agency
 
and trust
 
deed dated
 
the same
 
date as
 
this Agreement
and made between the same parties.
"
Agent
"
 
means
 
Nordea
 
Bank
 
Abp,
 
filial
 
i
 
Norge,
 
acting
 
in
 
such
 
capacity
 
through
 
its
 
office
 
at
Essendrops
 
gate
 
7,
 
Postboks
 
1166,
 
Sentrum,
 
0107
 
Oslo,
 
920058817
 
MVA,
 
Norway,
 
or
 
any
successor of it appointed under clause 5 of the Agency and Trust Deed.
"
Agreed Form
" means in
 
relation to any
 
document, that
 
document in the
 
form approved in
 
writing
by the Agent
 
(acting on
 
the instructions of
 
all the Lenders)
 
or as otherwise
 
approved in accordance
with any other approval procedure specified in any relevant provision of any Finance Document.
"
Annex VI
" means
 
Annex VI
 
of the
 
Protocol
 
of 1997
 
to amend
 
the International
 
Convention
 
for
the Prevention of Pollution
 
from Ships 1973 (Marpol),
 
as modified by
 
the Protocol of 1978
 
relating
thereto.
"
Approved
 
Broker
"
 
means
 
Arrow
 
Sale
 
&
 
Purchase
 
(UK)
 
Limited,
 
Breamar
 
Seascope
 
Limited,
 
H.
Clarkson
 
&
 
Company
 
Limited,
 
Fearnleys
 
AS,
 
Maersk
 
Brokers
 
K.S.,
 
Simpson
 
Spence
 
&
 
Young
(London)
 
Ltd.
 
and
 
VesselsValue.Com
 
or
 
any
 
other
 
any
 
reputable
 
sale
 
and
 
purchase
 
broker
approved and appointed by the Agent subject to the prior written consent of the Borrowers.
"
Approved
 
Flag
" means
 
the Marshall
 
Islands flag
 
or any
 
other flag
 
that the
 
Agent may
 
approve
that the Ship is registered (such approval not to be unreasonably withheld or delayed).
 
"
Approved Flag State
" means the Republic of the Marshall Islands or any other
 
state in which the
Agent may,
 
at the request of
 
the Borrowers, approve
 
that a Ship is
 
registered (such approval
 
not
to be unreasonably withheld or delayed).
"
Approved Manager
" means, in relation to each Ship:
 
(a)
Diana
 
Shipping
 
Services
 
S.A.,
 
a
 
company
 
incorporated
 
and
 
existing
 
under
 
the
 
laws
 
of
Panama having its
 
registered office at
 
Edificio Universal, Piso 12,
 
Avenida Federico Boyd,
Panama,
 
Republic
 
of
 
Panama
 
and
 
maintaining
 
an
 
office
 
at
 
16
 
Pendelis
 
Street,
 
175
 
64,
Palaio Faliro, Greece; or
(b)
in relation to any Ship in respect of which the
 
relevant Borrower exercises its rights
 
under
Clause
 
(
Change of Approved Manager
), Diana Wilhelmsen Management Limited,
 
a
company
 
incorporated
 
and existing
 
under the
 
laws of
 
the Republic
 
of Cyprus
 
having
 
its
registered office
 
at 21 Vasili
 
Michailidi Street, 3026
 
Limassol, Cyprus and
 
maintaining an
office at 350 Syngrou Avenue, Kalithea, Greece; or
(c)
any other company which the Agent may,
 
with the authorisation of the Lenders, approve
from
 
time
 
to
 
time
 
as
 
the
 
technical
 
and/or
 
commercial
 
manager
 
of
 
each
 
Ship
 
(such
approval not to be unreasonably withheld or delayed).
"
Article
 
55
 
BRRD
"
 
means
 
Article
 
55
 
of
 
Directive
 
2014/59/EU
 
establishing
 
a
 
framework
 
for
 
the
recovery and resolution of credit institutions and investment firms.
"
Availability Period
" means the
 
period commencing
 
on the date
 
of this Agreement
 
and ending
 
on:
(a)
30 June 2023 (or such later date as the Agent may,
 
with the authorisation of the Lenders,
agree with the Borrowers); or
(b)
if
 
earlier,
 
the
 
date
 
on
 
which
 
the
 
Total
 
Commitments
 
are
 
fully
 
borrowed,
 
cancelled
 
or
terminated.
"
Bail-In Action
" means the exercise of any Write-down and Conversion Powers.
"
Bail-In Legislation
" means:
(a)
in
 
relation
 
to
 
an
 
EEA
 
Member
 
Country
 
which
 
has
 
implemented,
 
or
 
which
 
at
 
any
 
time
implements, Article 55 BRRD, the relevant implementing
 
law or regulation as described in
the EU Bail-In Legislation Schedule from time to time;
 
(b)
in relation to any state other than such
 
an EEA Member Country and
 
the United Kingdom,
any analogous law or regulation from time
 
to time which requires contractual recognition
of any Write-down and Conversion Powers contained
 
in that law or regulation; and
in relation to the United Kingdom, the UK Bail
-In Legislation.
"
Basel III
" means, together:
(a)
the
 
agreements
 
on
 
capital
 
requirements,
 
a
 
leverage
 
ratio
 
and
 
liquidity
 
standards
contained in "Basel
 
III: A
 
global regulatory framework
 
for more resilient
 
banks and
 
banking
systems",
 
"Basel
 
III:
 
International
 
framework
 
for
 
liquidity
 
risk
 
measurement,
 
standards
and
 
monitoring"
 
and
 
"Guidance
 
for
 
national
 
authorities
 
operating
 
the
 
countercyclical
capital
 
buffer"
 
published by
 
the Basel
 
Committee
 
on
 
Banking
 
Supervision in
 
December
2010, each as amended, supplemented or restated;
(b)
the
 
rules
 
for
 
global
 
systemically
 
important
 
banks
 
contained
 
in
 
"Global
 
systemically
important
 
banks:
 
assessment
 
methodology
 
and
 
the
 
additional
 
loss
 
absorbency
requirement
 
- Rules
 
text"
 
published by
 
the Basel
 
Committee
 
on
 
Banking Supervision
 
in
November 2011, as amended, supplemented or restated; and
(c)
any
 
further
 
guidance
 
or
 
standards
 
published
 
by
 
the
 
Basel
 
Committee
 
on
 
Banking
Supervision relating to "Basel III".
"
Bookrunner
" means Nordea Bank Abp,
 
filial i Norge, acting in
 
such capacity through its office
 
at
Essendrops gate 7, Postboks 1166,
 
Sentrum, 0107 Oslo,
 
920058817 MVA,
 
Norway.
 
"
Borrower
" means each of Jemo, Guam, Palau and Makur and in the plural means, all of them.
"
Break Costs
" means the amount (if any) by which:
(a)
the interest which
 
a Lender should have
 
received for the period
 
from the date of
 
receipt
of all
 
or any
 
part of
 
its participation in
 
the Loan or
 
an Unpaid Sum
 
to the
 
last day
 
of the
current Interest Period in
 
relation to the
 
Loan, the relevant
 
part of
 
the Loan or
 
that Unpaid
Sum, had the principal amount or Unpaid Sum
 
received been paid on the last day
 
of that
Interest Period
exceeds
(b)
the amount which that Lender would be able
 
to obtain by placing an amount equal to
 
the
principal amount or Unpaid
 
Sum received by it on
 
deposit with a
 
leading bank for a
 
period
starting on
 
the Business Day
 
following receipt
 
or recovery
 
and ending on
 
the last
 
day of
the current Interest Period.
"
Business
 
Day
"
 
means
 
a
 
day
 
(other
 
than
 
a
 
Saturday
 
or
 
Sunday)
 
on
 
which
 
banks
 
are
 
open
 
for
general business in London, Athens and Oslo; and
(a)
New York;
 
and
(b)
(in relation to the fixing of an interest rate) which is a US Government Securities Business
Day.
"
Change of Control
" means the occurrence of
 
any of the following
 
acts, events or circumstances
without the prior written consent of the Agent:
 
(a)
a change in
 
the ownership of
 
any Borrower
 
from the date
 
of this Agreement
 
resulting in
such
 
Borrower
 
not being
 
a direct
 
or
 
indirect
 
wholly-owned subsidiary
 
of
 
the
 
Corporate
Guarantor;
 
and/or
(b)
the Palios
 
Family (either
 
directly or indirectly
 
through companies
 
legally and beneficially
owned)
 
ceases
 
to
 
own
 
at
 
least
 
12.5
 
per
 
cent.
 
of
 
the
 
common
 
stock
 
in
 
the
 
Corporate
Guarantor;
 
and/or
(c)
the Palios
 
Family (either
 
directly or indirectly
 
through companies
 
legally and beneficially
owned) ceases
 
to control at
 
least 25 per
 
cent. of
 
the maximum
 
number of
 
votes that might
be
 
cast
 
in
 
respect
 
of
 
any
 
matter
 
submitted
 
to
 
the
 
vote
 
of
 
the
 
shareholders
 
of
 
the
Corporate Guarantor;
 
and/or
(d)
Semiramis
 
Paliou
 
ceases
 
to
 
hold
 
Chief
 
Executive
 
Officer
 
position
 
in
 
the
 
Corporate
Guarantor and
 
active role
 
in the decision making
 
in respect of
 
the Corporate
 
Guarantor;
and/or
(e)
the shares of the Corporate Guarantor cease to be listed
 
on the New York Stock Exchange
or any other stock exchange acceptable to the Agent.
"
Charter
" means,
 
in relation
 
to each
 
Ship, any
 
time charter
 
or other
 
contract of
 
employment in
respect
 
of
 
that
 
Ship
 
with
 
a
 
duration
 
exceeding
 
(or
 
capable
 
of
 
exceeding)
 
24
 
months
 
or
 
any
bareboat charter in respect of such Ship and, in the plural, means all of them.
"
Charterer
" means any entity
 
which has entered into, or
 
will enter into,
 
a Charter with a
 
Borrower
in respect of the Ship owned by it.
"
Charterparty Assignment
" means,
 
in relation
 
to each
 
Charter,
 
a specific deed
 
of assignment
 
of
the
 
rights
 
of
 
the
 
Borrower
 
who
 
is
 
a
 
party
 
to
 
that
 
Charter
 
executed
 
or
 
to
 
be
 
executed
 
by
 
that
Borrower in favour
 
of the
 
Security Trustee in
 
the Agreed
 
Form and,
 
in the
 
plural, means
 
all of
 
them.
"
Code
" means the US Internal Revenue Code of 1986.
"
Commitment
" means,
 
in relation
 
to a
 
Lender,
 
the amount
 
set opposite
 
its name in
,
or,
 
as
 
the
 
case
 
may
 
require,
 
the
 
amount
 
specified
 
in
 
the
 
relevant
 
Transfer
 
Certificate,
 
as
 
that
amount may be reduced, cancelled or terminated in accordance
 
with this Agreement (and "
Total
Commitments
" means the aggregate of the Commitments of all the Lenders).
"
Confirmation
"
 
and
 
"
Early
 
Termination
 
Date
",
 
in
 
relation
 
to
 
any
 
continuing
 
Designated
Transaction, have the meanings given in the Master Agreement.
"
Contractual Currency
" has the meaning given in Clause
 
(
Currency indemnity
).
"
Contribution
" means, in relation to a Lender, the part of the Loan which is owing to that Lender.
"
Corporate Guarantee
" means a
 
corporate guarantee
 
of the obligations
 
of the Borrowers
 
under
this Agreement, the Master Agreement and the other Finance Documents.
"
Corporate
 
Guarantor
"
 
mean
 
Diana
 
Shipping
 
Inc.,
 
a
 
corporation
 
domesticated
 
in
 
the
 
Marshall
Islands
 
whose
 
registered
 
address
 
is
 
at
 
Trust
 
Company
 
Complex,
 
Ajeltake
 
Road,
 
Ajeltake
 
Island,
Majuro MH96960, Marshall Islands.
"
CRD IV
" means:
(a)
Regulation (EU)
 
No 575/2013
 
of the
 
European Parliament
 
and of
 
the Council
 
of 26
 
June
2013
 
on
 
prudential
 
requirements
 
for
 
credit
 
institutions
 
and
 
investment
 
firms
 
and
amending regulation (EU) No. 648/2012,
 
as amended by Regulation (EU) 2019/876;
(b)
Directive 2013/36/EU of the
 
European Parliament and
 
of the Council of 26
 
June 2013 on
access
 
to
 
the
 
activity
 
of
 
credit
 
institutions
 
and
 
the
 
prudential
 
supervision
 
of
 
credit
institutions
 
and
 
investment
 
firms,
 
amending
 
Directive
 
2002/87/EC
 
and
 
repealing
Directives 2006/48/EC and 2006/49/EC, as amended by Directive (EU) 2019/878;
 
and
(c)
any other law or regulation which implements Basel III.
"
Creditor Party
" means the
 
Agent, the Lead
 
Arranger,
 
the Bookrunner,
 
the Security Trustee,
 
the
Swap Bank or any Lender, whether as at the date of this Agreement or at any later time.
"
Designated Transaction
" means a Transaction which fulfils the following requirements:
(a)
it is
 
entered into by
 
the Borrowers pursuant
 
to the
 
Master Agreement with
 
the Swap
 
Bank;
(b)
its purpose is the hedging
 
of all or part of
 
the Borrowers'
 
exposure to fluctuations in Term
SOFR under this Agreement for a period expiring no later than the Termination Date;
 
and
(c)
it is designated by the Borrowers, by delivery
 
by the Borrowers to the Agent of a notice
 
of
designation
 
in
 
the
 
form
 
set
 
out
 
in
 
(
Designation
 
Notice
),
 
as
 
a
 
Designated
Transaction for the purposes of the Finance Documents.
"
Dollars
" and "
$
" means the lawful currency for the time being of the United States of America.
"
Drawdown
 
Date
" means,
 
in relation
 
to the
 
Loan, the
 
date requested
 
by the
 
Borrowers
 
for the
Loan to be advanced,
 
or (as the context requires)
 
the date on which
 
the Loan is actually
 
advanced.
"
Drawdown Notice
" means a
 
notice in
 
the form
 
set out
 
in
 
(
Drawdown Notice
) (or in
any other form which the Agent approves or reasonably requires).
"
Earnings
" means, in
 
relation to a
 
Ship, all moneys
 
whatsoever which are
 
now,
 
or later
 
become,
payable
 
(actually
 
or
 
contingently)
 
to
 
the
 
relevant
 
Borrower
 
owning
 
that
 
Ship
 
or
 
the
 
Security
Trustee and which arise out of the use or operation of that Ship, including (but not limited to):
(a)
except to the extent that they fall within paragraph
(i)
all freight, hire and passage moneys;
(ii)
compensation
 
payable
 
to
 
a
 
Borrower
 
or
 
the
 
Security
 
Trustee
 
in
 
the
 
event
 
of
requisition of a Ship for hire;
(iii)
remuneration for salvage and towage services;
(iv)
demurrage and detention moneys;
(v)
damages for breach
 
(or payments for
 
variation or
 
termination) of
 
any charterparty
or other contract for the employment of a Ship; and
(vi)
all moneys which are at any
 
time payable under any Insurances in
 
respect of loss
of hire; and
(b)
if
 
and
 
whenever
 
a
 
Ship
 
is
 
employed
 
on
 
terms
 
whereby
 
any
 
moneys
 
falling
 
within
paragraphs
 
to
 
are pooled or
 
shared with any other
 
person, that proportion
 
of the
net receipts
 
of the
 
relevant pooling
 
or sharing
 
arrangement which
 
is attributable
 
to the
Ship.
"
Earnings Account
" means an
 
account in the
 
name of each
 
Borrower with the
 
Agent designated
"[
name
 
of the
 
Borrower
] -
 
Earnings
 
Account",
 
or
 
any
 
other
 
account
 
which
 
is designated
 
by
 
the
Agent as an Earnings Account for the purposes of this Agreement.
"
Earnings Account Pledge
" means, in
 
respect of each Earnings
 
Account, a deed
 
creating security
in the Agreed Form.
 
"
EEA Member Country
" means any
 
member state of
 
the European Union,
 
Iceland, Liechtenstein
and Norway.
"
Environmental Claim
" means:
(a)
any
 
claim
 
by
 
any
 
governmental,
 
judicial
 
or
 
regulatory
 
authority
 
which
 
arises
 
out
 
of
 
an
Environmental
 
Incident
 
or
 
an
 
alleged
 
Environmental
 
Incident
 
or
 
which
 
relates
 
to
 
any
Environmental Law; or
(b)
any claim by any other person
 
which relates to an Environmental Incident or
 
to an alleged
Environmental Incident,
and
"
claim
" means a claim for
 
damages, compensation, fines, penalties or
 
any other payment
 
of
any
 
kind whether
 
or
 
not similar
 
to
 
the foregoing;
 
an order
 
or
 
direction
 
to
 
take,
 
or
 
not to
 
take,
certain
 
action
 
or
 
to
 
desist
 
from
 
or
 
suspend
 
certain
 
action;
 
and
 
any
 
form
 
of
 
enforcement
 
or
regulatory action, including the arrest or attachment of any asset.
"
Environmental Incident
" means:
(a)
any release of Environmentally Sensitive Material from the Ship; or
(b)
any incident
 
in which
 
Environmentally Sensitive
 
Material is
 
released from
 
a vessel other
than a Ship and
 
which involves a
 
collision between a Ship
 
and such other vessel
 
or some
other incident of navigation
 
or operation, in either
 
case, in connection with which a
 
Ship
is actually
 
or potentially
 
liable to
 
be arrested,
 
attached,
 
detained or
 
injuncted and/or
 
a
Ship and/or the Borrower and/or any operator or
 
manager of a Ship
 
is at fault or allegedly
at fault or otherwise liable to any legal or administrative action; or
(c)
any other incident in which Environmentally Sensitive
 
Material is released otherwise than
from
 
a
 
Ship
 
and
 
in
 
connection
 
with
 
which
 
a
 
Ship
 
is
 
actually
 
or
 
potentially
 
liable
 
to
 
be
arrested and/or where any Borrower and/or any operator
 
or manager of a Ship is at fault
or allegedly at fault or otherwise liable to any legal or administrative action.
"
Environmental Law
" means
 
any law relating to
 
pollution or
 
protection of the
 
environment, to the
carriage
 
of
 
Environmentally
 
Sensitive
 
Material
 
or
 
to
 
actual
 
or
 
threatened
 
releases
 
of
Environmentally Sensitive Material.
"
Environmentally Sensitive Material
" means oil, oil products
 
and any other substance
 
(including
any
 
chemical, gas
 
or
 
other
 
hazardous
 
or
 
noxious
 
substance)
 
which is
 
(or
 
is capable
 
of
 
being or
becoming) polluting, toxic or hazardous.
"
EU Bail-In
 
Legislation Schedule
" means
 
the document
 
described as
 
such and
 
published by
 
the
Loan Market Association (or any successor organisation) from time to time.
"
EU Ship Recycling Regulation
" means Regulation (EU)
 
No 1257/2013 of
 
the European Parliament
and
 
of
 
the
 
Council
 
of
 
20
 
November
 
2013
 
on
 
ship
 
recycling
 
and
 
amending
 
Regulation
 
(EC)
 
No
1013/2006 and Directive 2009/16/EC.
 
"
Event of Default
" means any of
 
the events or circumstances
 
described in Clause
 
(
Events of
Default
).
"
Executive Order
"
means an order issued by the president of the United States of America.
"
Existing Facility Agreement
" means loan
 
agreement dated 7 May
 
2020 and made
 
between (i) the
Borrowers as joint and several borrowers, (ii) the banks and financial
 
institutions listed therein, as
lenders,
 
(iii) Nordea
 
Bank ABP
 
as swap
 
bank and
 
(iv) Nordea
 
Bank ABP,
 
Filial I
 
Norge
 
Branch as
agent,
 
lead
 
arranger
 
and
 
security
 
trustee
 
in
 
respect
 
of
 
a
 
loan
 
facility
 
of
 
(originally)
 
up
 
to
$55,848,000, as such
 
loan agreement
 
may have
 
been further amended,
 
supplemented, novated
and/or restated from time to time.
"
Existing
 
Indebtedness
"
 
means,
 
at
 
any
 
date,
 
the
 
outstanding
 
Financial
 
Indebtedness
 
of
 
the
Borrowers
 
under the
 
Existing Facility
 
Agreement,
 
amounting to
 
$20,933,626 at
 
the date
 
of this
Agreement.
"
Existing
 
Security
 
Interests
"
 
means
 
any
 
Security
 
Interests
 
created
 
to
 
secure
 
the
 
Existing
Indebtedness under the Existing Facility Agreement.
"
Facility Office
" means
 
the office
 
or offices
 
notified by
 
a Lender
 
to the
 
Agent in
 
writing on
 
or before
the date it becomes a Lender (or,
 
following that date, by not less than five Business Days'
 
written
notice) as the office or offices through which it will perform its obligations under this Agreement.
"
Fallback Interest Period
" means one Month.
"
FATCA
"
means:
(a)
sections 1471 to 1474 of the Code or any associated regulations;
(b)
any treaty, law or regulation of any other jurisdiction, or relating to an intergovernmental
agreement between the
 
US and
 
any other jurisdiction,
 
which (in
 
either case)
 
facilitates the
implementation of any law or regulation referred to in paragraph
 
above; or
(c)
any agreement pursuant
 
to the implementation of
 
any treaty,
 
law or regulation referred
to in paragraphs
 
or
 
above with the
 
US Internal Revenue Service,
 
the US government
or any governmental or taxation authority in any other jurisdiction.
"
FATCA
 
Deduction
" means
 
a deduction
 
or withholding
 
from a payment
 
under a
 
Finance Document
required by FATCA.
"
FATCA
 
Exempt Party
" means
 
a Party
 
that is
 
entitled to
 
receive payments
 
free from
 
any FATCA
Deduction.
"
Finance Documents
" means:
 
(a)
this Agreement;
(b)
the Agency and Trust Deed;
(c)
the Master Agreement;
(d)
the Master Agreement Assignment;
(e)
the Corporate Guarantee;
(f)
the General Assignments;
(g)
the Mortgages;
(h)
the Accounts Pledges;
(i)
the Shares Pledges;
(j)
the Manager's Undertakings;
 
(k)
any Charterparty Assignment; and
(l)
any other document (whether
 
creating a Security Interest or
 
not) which is
 
executed at any
time
 
by
 
any
 
Borrower,
 
the
 
Corporate
 
Guarantor,
 
the
 
Approved
 
Manager
 
or
 
any
 
other
person as security for, or to establish any form of subordination or priorities arrangement
in
 
relation
 
to,
 
any
 
amount
 
payable
 
to
 
the
 
Lenders
 
and/or
 
the
 
Swap
 
Bank
 
under
 
this
Agreement or any of the other documents referred to in this definition.
"
Financial Indebtedness
" means, in relation to a person (the "
debtor
"), a liability of the debtor:
 
(a)
for
 
principal, interest
 
or
 
any
 
other
 
sum
 
payable
 
in
 
respect of
 
any
 
moneys
 
borrowed
 
or
raised by the debtor;
 
(b)
under any loan stock, bond, note or other security issued by the debtor;
 
(c)
under
 
any
 
acceptance
 
credit,
 
guarantee
 
or
 
letter
 
of
 
credit
 
facility
 
or
 
dematerialised
equivalent made available to the debtor;
 
(d)
under
 
a
 
financial
 
lease,
 
a
 
deferred
 
purchase
 
consideration
 
arrangement
 
or
 
any
 
other
agreement having the
 
commercial effect of
 
a borrowing
 
or raising of
 
money by the
 
debtor;
 
(e)
under any foreign
 
exchange transaction, any
 
interest or currency
 
swap or any other
 
kind
of derivative transaction entered into by the debtor or, if the agreement under which any
such transaction
 
is entered
 
into
 
requires netting
 
of mutual
 
liabilities, the
 
liability of
 
the
debtor for the net amount; or
 
(f)
under a guarantee,
 
indemnity or similar obligation
 
entered into
 
by the debtor
 
in respect
of
 
a
 
liability
 
of
 
another
 
person
 
which
 
would
 
fall
 
within
 
paragraphs
 
to
 
if
 
the
references to the debtor referred
 
to the other person.
"
Financial Year
" means,
 
in relation to
 
the Corporate Guarantor, each period
 
of 1
 
year commencing
on 1 January in respect of which its annual audited accounts are or ought to be prepared.
"
Fleet Vessels
" means all of the
 
vessels (including, but not
 
limited to, the Ships) from time
 
to time
wholly owned by members of the Group (each a "
Fleet Vessel
").
"
Funding
 
Rate
"
 
means
 
any
 
individual
 
rate
 
notified
 
by
 
a
 
Lender
 
to
 
the
 
Agent
 
pursuant
 
to
 
sub-
paragraph
 
of paragraph
 
of Clause
 
(
Cost of funds
).
"
GAAP
"
 
means,
 
at
 
any
 
time,
 
the
 
most
 
recent
 
and
 
updated
 
generally
 
accepted
 
accounting
principles in the United States of America.
"
General Assignment
" means,
 
in relation
 
to each
 
Ship, a first
 
priority general
 
assignment of
 
the
Earnings, the Insurances and any Requisition Compensation
 
in the Agreed Form and,
 
in the plural,
means all of them.
"
Group
" means the Corporate Guarantor and all its subsidiaries (including, but not limited to, the
Borrowers)
 
from
 
time
 
to
 
time
 
during the
 
Security Period
 
and
 
"
member of
 
the Group
"
 
shall
 
be
construed accordingly.
 
"
Guam
" means
 
Guam Shipping Company
 
Inc., a
 
corporation incorporated
 
in the
 
Republic of
 
the
Marshall Islands whose registered
 
address is at
 
Trust Company
 
Complex, Ajeltake Road,
 
Ajeltake
Island, Majuro MH96960, Marshall Islands.
"
Hong
 
Kong
 
Convention
"
 
means
 
the
 
International
 
Maritime
 
Organization's
 
convention
 
for
 
the
Safe and Environmentally Sound Recycling
 
of Ships, 2009
 
together with the
 
guidelines to be
 
issued
by the International Maritime Organization in connection with such convention.
"
IACS
" means the International Association of Classification Societies.
 
"
Insurances
" means, in relation to a Ship:
(a)
all policies and contracts of
 
insurance, including entries of the Ship in
 
any protection and
indemnity
 
or
 
war
 
risks
 
association,
 
effected
 
in
 
respect
 
of
 
the
 
Ship,
 
its
 
Earnings
 
or
otherwise in relation to the Ship whether before,
 
on or after the date of
 
this Agreement;
and
 
(b)
all rights and other assets relating to, or derived from, any of the foregoing, including any
rights to a return of
 
a premium and any rights in
 
respect of any claim whether or not
 
the
relevant
 
policy,
 
contract of
 
insurance or
 
entry has
 
expired on
 
or before
 
the date
 
of this
Agreement.
"
Interest Period
" means, in relation to the Loan
 
or any part of the Loan, each
 
period determined
in
 
accordance
 
with
 
Clause
 
6
 
(
Interest
 
Periods
)
 
and,
 
in
 
relation
 
to
 
an
 
Unpaid
 
Sum,
 
each
 
period
determined in accordance with Clause
 
(
Default interest
).
"
Interpolated
 
Term
 
SOFR
"
 
means,
 
in
 
relation
 
to
 
the
 
Loan
 
or
 
any
 
part
 
of
 
the
 
Loan,
 
the
 
rate
(rounded to
 
the same number of
 
decimal places as Term
 
SOFR) which results
 
from interpolating
on a linear basis between:
(a)
either
(i)
the
 
applicable Term
 
SOFR (as
 
of
 
the
 
Quotation
 
Day)
 
for
 
the longest
 
period (for
which Term SOFR is available) which is less than
 
the Interest Period of the Loan
 
or
that part of the Loan; or
(ii)
if no such
 
Term SOFR is available for a
 
period which is
 
less than the
 
Interest Period
of the Loan
 
or that part
 
of the
 
Loan, SOFR for
 
the day which
 
is two US
 
Government
Securities Business Days before the Quotation Day;
 
and
(b)
the
 
applicable
 
Term
 
SOFR (as
 
of
 
the
 
Quotation
 
Day)
 
for
 
the
 
shortest
 
period (for
 
which
Term
 
SOFR is available) which exceeds
 
the Interest Period
 
of the Loan or that
 
part of the
Loan.
"
Inventory
 
of
 
Hazardous
 
Material
"
 
means,
 
in
 
relation
 
to
 
each
 
Ship, an
 
inventory
 
certificate
 
or
statement
 
of
 
compliance
 
(as
 
applicable)
 
issued
 
by
 
the
 
Ship's
 
classification
 
society
 
which
 
is
supplemented by a
 
list of any
 
and all materials
 
known to be
 
potentially hazardous utilised
 
in the
construction of such Ship pursuant to the requirements of the EU Ship Recycling Regulation.
 
"
ISM
 
Code
"
 
means
 
the
 
International
 
Safety
 
Management
 
Code
 
(including
 
the
 
guidelines
 
on
 
its
implementation),
 
adopted
 
by
 
the
 
International
 
Maritime
 
Organisation,
 
as
 
the
 
same
 
may
 
be
amended
 
or
 
supplemented
 
from
 
time
 
to
 
time
 
(and
 
the
 
terms
 
"
safety
 
management
 
system
",
"
Safety Management Certificate
" and "
Document of
 
Compliance
" have the
 
same meanings
 
as are
given to them in the ISM Code).
"
ISPS
 
Code
"
 
means
 
the
 
International
 
Ship
 
and
 
Port
 
Facility
 
Security
 
Code
 
as
 
adopted
 
by
 
the
International Maritime
 
Organisation, as
 
the same may
 
be amended or
 
supplemented from
 
time
to time.
"
ISSC
" means
 
a valid
 
and current
 
International Ship
 
Security Certificate
 
issued under
 
the ISPS
 
Code.
 
"
Jemo
"
 
means
 
Jemo Shipping
 
Company
 
Inc.,
 
a
 
corporation
 
incorporated
 
in
 
the Republic
 
of
 
the
Marshall Islands whose registered
 
address is at
 
Trust Company
 
Complex, Ajeltake Road,
 
Ajeltake
Island, Majuro MH96960, Marshall Islands.
"
Lead Arranger
" means Nordea Bank
 
Abp, filial i Norge,
 
acting in such capacity through
 
its office
at Essendrops gate 7, Postboks 1166,
 
Sentrum, 0107 Oslo,
 
920058817 MVA,
 
Norway.
 
"
Lender
" means
 
a bank
 
or financial
 
institution listed
 
in
 
(
Lenders and
 
Commitments
)
and
 
acting
 
through
 
its
 
branch
 
indicated
 
in
 
(
Lenders
 
and Commitments
)
 
(or
 
through
another
 
branch
 
notified
 
to
 
the
 
Agent
 
under
 
Clause
 
(
Change
 
of
 
Facility
 
Office
))
 
or
 
its
transferee, successor or assign and, in the plural, means all of them.
"
Loan
" means
 
the aggregate
 
principal amount outstanding
 
under this Agreement
 
and a "
part of
the Loan
" means any part of the Loan as the context may require.
"
Major Casualty
" means,
 
in relation
 
to a
 
Ship, any
 
casualty to
 
that Ship
 
in respect
 
of which
 
the
claim
 
or
 
the
 
aggregate
 
of
 
the
 
claims
 
against
 
all
 
insurers,
 
before
 
adjustment
 
for
 
any
 
relevant
franchise or deductible, exceeds $1,000,000 or the equivalent in any other currency.
 
"
Majority Lenders
" means:
 
(a)
before
 
the Loan
 
has been advanced,
 
Lenders whose
 
Commitments total
 
66.67 per
 
cent.
of the Total
 
Commitments; and
 
(b)
after the Loan
 
has been advanced,
 
Lenders whose Contributions
 
total 66.67
 
per cent. of
the Loan.
"
Makur
" means Makur Shipping Company Inc.,
 
a corporation incorporated
 
in the Republic of the
Marshall Islands whose registered
 
address is at
 
Trust Company
 
Complex, Ajeltake Road,
 
Ajeltake
Island, Majuro MH96960, Marshall Islands.
"
Management Agreement
" means,
 
in relation
 
to each
 
Ship, an
 
agreement made
 
or to
 
be made
between the Borrower who is
 
the owner of such
 
Ship and the
 
Approved Manager in respect
 
of the
commercial and technical management of such Ship in the Agreed Form and, in the
 
plural, means
all of them.
"
Manager's Undertaking
" means, in relation
 
to each Ship, a
 
letter of undertaking executed
 
or to
be
 
executed
 
by
 
the
 
Approved
 
Manager
 
in
 
favour
 
of
 
the
 
Security
 
Trustee
 
in
 
the
 
Agreed
 
Form
agreeing certain matters in relation
 
to the management of that Ship and subordinating the rights
of the Approved
 
Manager against
 
that Ship and
 
the Borrower
 
which is the
 
owner thereof to
 
the
rights of the Security Trustee under the Finance Documents and, in the plural, means all of them.
"
Margin
" means 2.25 per cent. per annum.
"
Market Disruption Rate
" means the Reference Rate.
"
Market Value
" means,
 
in relation
 
to each
 
Ship (and
 
each other
 
Fleet Vessel),
 
the market
 
value
thereof determined in accordance with Clause
 
(
Valuation of Ships
).
"
Master
 
Agreement(s)
"
 
means
 
each
 
master
 
agreement
 
(on
 
the
 
2002
 
ISDA
 
Master
 
Agreement
form) in the Agreed Form made or to be made between (i) any of the Borrowers and (ii) the
 
Swap
Bank
 
and
 
includes
 
all
 
Designated
 
Transactions
 
from
 
time
 
to
 
time
 
entered
 
into,
 
and
 
all
Confirmations of such Designated Transactions
 
from time to time exchanged,
 
under such master
agreements.
"
Master Agreement Assignment
" means the assignment of the Master Agreement in the Agreed
Form.
"
Month
" means a period starting
 
on one day in a
 
calendar month and ending on the
 
numerically
corresponding day in the next calendar month, except that:
(a)
(subject to
 
paragraph
 
below) if
 
the numerically
 
corresponding
 
day
 
is not
 
a Business
Day,
 
that period shall end on the next
 
Business Day in that calendar month
 
in which that
period is to
 
end if there
 
is one, or
 
if there is
 
not, on the immediately
 
preceding Business
Day;
(b)
if there is no numerically corresponding day in the calendar month
 
in which that period is
to end, that period shall end on the last Business Day in that calendar month; and
(c)
if an
 
Interest
 
Period
 
begins on
 
the last
 
Business Day
 
of
 
a calendar
 
month, that
 
Interest
Period
 
shall
 
end
 
on
 
the last
 
Business Day
 
in
 
the calendar
 
month
 
in which
 
that
 
Interest
Period is to end.
The above rules will only apply to the last Month of any period.
"
Mortgage
" means, in
 
relation to a Ship,
 
the first preferred Marshall Islands
 
ship mortgage on
 
that
Ship in the Agreed Form and, in the plural, means all of them.
"
Namorik
" means Namorik Shipping Company Inc., a corporation incorporated
 
in the Republic of
the
 
Marshall
 
Islands
 
whose
 
registered
 
address
 
is
 
at
 
Trust
 
Company
 
Complex,
 
Ajeltake
 
Road,
Ajeltake Island, Majuro MH96960, Marshall Islands.
"
Notifying Lender
" has
 
the meaning
 
given in
 
Clause
Illegality
) or
 
Clause
Increased costs
)
as the context requires.
"
Palau
" means
 
Palau
 
Shipping Company
 
Inc., a
 
corporation
 
incorporated
 
in the
 
Republic of
 
the
Marshall Islands whose registered
 
address is at
 
Trust Company
 
Complex, Ajeltake Road,
 
Ajeltake
Island, Majuro MH96960, Marshall Islands.
"Palios Family
" means, together, each
 
of the following:
(a)
Mr.
 
Simeon Palios;
 
(b)
all the lineal descendants in direct line of Mr. Simeon Palios;
(c)
a husband or wife or widower or widow of any of the above persons;
(d)
the
 
estates,
 
trusts
 
or
 
legal
 
representatives
 
of
 
which
 
any
 
of
 
the
 
above
 
persons
 
are
 
the
beneficiaries; and
(e)
each company
 
legally or
 
beneficially owned
 
or (as
 
the case
 
may
 
be) controlled
 
by one
 
or
more
 
of
 
the
 
persons
 
or
 
entities
 
which
 
would
 
fall
 
within
 
paragraphs
 
(a)
 
to
 
(d)
 
of
 
this
definition,
and each one of the above shall be referred to as "
a member of the Palios Family
";
"
Participating
Member
State
" means any member state of the European Union that has the euro
as its
 
lawful currency in
 
accordance with
 
legislation of the
 
European Union relating
 
to Economic
and Monetary Union.
"
Party
"
means a party to this Agreement.
"
Payment Currency
" has the meaning given in Clause
 
(
Currency indemnity
).
"
Permitted Security Interests
" means:
(a)
Security Interests created by the Finance Documents;
(b)
until the Drawdown Date, the Existing Security Interests;
(c)
liens for unpaid master's and crew's wages in accordance with usual maritime practice;
(d)
liens for salvage;
(e)
liens arising
 
by operation
 
of law
 
for not
 
more than
 
two months'
 
prepaid hire
 
under any
charter in relation to a Ship not prohibited by this Agreement;
(f)
liens for master's disbursements incurred in the ordinary
 
course of trading and any other
lien arising
 
by operation of
 
law or
 
otherwise in
 
the ordinary
 
course of the
 
operation, repair
or maintenance of a
 
Ship, provided such liens do not
 
secure amounts more than 30
 
days
overdue (unless the overdue amount is being contested by the
 
relevant Borrower in good
faith by appropriate
 
steps) and subject, in
 
the case of liens
 
for repair or
 
maintenance, to
Clause
 
(
Restriction on chartering, appointment of managers etc.
);
(g)
any
 
Security Interest
 
created
 
in favour
 
of a
 
plaintiff or
 
defendant in
 
any proceedings
 
or
arbitration as security for costs
 
and expenses where the Borrower is
 
actively prosecuting
or defending such proceedings or arbitration in good faith; and
(h)
Security Interests arising by operation of
 
law in respect of
 
taxes which are not overdue for
payment or in
 
respect of taxes
 
being contested in
 
good faith by appropriate
 
steps and in
respect of which appropriate reserves have been made.
"
Pertinent Document
" means:
(a)
any Finance Document;
(b)
any policy or
 
contract of insurance
 
contemplated by or
 
referred to in Clause
Insurance
)
or any other provision of this Agreement or another Finance Document;
(c)
any other document contemplated by or referred to in any Finance Document; and
(d)
any
 
document
 
which
 
has
 
been
 
or
 
is
 
at
 
any
 
time
 
sent
 
by
 
or
 
to
 
a
 
Servicing
 
Bank
 
in
contemplation of or
 
in connection with any
 
Finance Document or any
 
policy, contract
 
or
document falling within paragraphs
 
or
"
Pertinent Jurisdiction
", in relation to a company, means:
(a)
England and Wales;
(b)
the country under the laws of which the company is incorporated or formed;
(c)
a
 
country
 
in
 
which
 
the
 
company
 
has
 
the
 
centre
 
of
 
its
 
main
 
interests
 
or
 
in
 
which
 
the
company's central management and control is or has recently been exercised;
(d)
a country
 
in which
 
the overall
 
net income
 
of the
 
company is
 
subject to
 
corporation tax,
income tax or any similar tax;
(e)
a
 
country
 
in which
 
assets of
 
the company
 
(other than
 
securities issued
 
by,
 
or
 
loans to,
related
 
companies)
 
having
 
a
 
substantial
 
value
 
are
 
situated,
 
in
 
which
 
the
 
company
maintains a branch or
 
permanent place of
 
business, or in
 
which a Security
 
Interest created
by the company must
 
or should be
 
registered in order to
 
ensure its validity
 
or priority; and
(f)
a country
 
the courts
 
of which
 
have jurisdiction
 
to make
 
a winding
 
up, administration
 
or
similar
 
order
 
in
 
relation
 
to
 
the
 
company,
 
whether
 
as
 
main
 
or
 
territorial
 
or
 
ancillary
proceedings, or which would have
 
such jurisdiction if their assistance
 
were requested
 
by
the courts of a country referred to in paragraphs
 
or
"
Pertinent Matter
" means:
(a)
any
 
transaction
 
or
 
matter
 
contemplated
 
by,
 
arising
 
out
 
of,
 
or
 
in
 
connection
 
with
 
a
Pertinent Document; or
(b)
any statement relating to
 
a Pertinent
 
Document or
 
to a transaction
 
or matter falling
 
within
paragraph
and covers
 
any such
 
transaction, matter
 
or statement,
 
whether entered
 
into, arising
 
or made at
any time before the signing of this Agreement or on or at any time after that signing.
"
Poseidon
 
Principles
"
 
means
 
the
 
financial
 
industry
 
framework
 
for
 
assessing
 
and
 
disclosing
 
the
climate alignment of ship finance portfolios published in June 2019
 
as the same may be amended
or replaced from time to time.
"
Potential Event of Default
" means an event or
 
circumstance which, with the
 
giving of any notice,
the lapse of
 
time, a determination of
 
the Lenders and/or
 
the satisfaction of
 
any other condition,
would constitute an Event of Default.
"
Quotation Day
" means, in relation to
 
any period for which
 
an interest rate
 
is to be determined,
two
 
US
 
Government
 
Securities Business
 
Days
 
before
 
the
 
first
 
day
 
of
 
that
 
period unless
 
market
practice
 
differs
 
in the
 
relevant
 
syndicated
 
loan market
 
in which
 
case the
 
Quotation Day
 
will be
determined
 
by
 
the
 
Agent
 
in
 
accordance
 
with
 
that
 
market
 
practice
 
(and
 
if
 
quotations
 
would
normally be given on more than one day, the Quotation Day will be the last of those days).
"
Reference Rate
" means, in relation to the Loan or any part of the Loan:
(a)
the applicable Term
 
SOFR as of the Quotation Day and for a
 
period equal in length to the
Interest Period of the Loan or that part of the Loan; or
(b)
as otherwise determined pursuant to Clause
 
(
Unavailability of Term SOFR
),
and if, in either case, that rate is less than zero,
 
the Reference Rate shall be deemed to be zero
.
"
Relevant
 
Market
"
 
means
 
the
 
market
 
for
 
overnight
 
cash
 
borrowing
 
collateralised
 
by
 
US
Government Securities.
"
Relevant Nominating
 
Body
" means
 
any applicable
 
central bank,
 
regulator or
 
other supervisory
authority or
 
a group
 
of
 
them, or
 
any
 
working
 
group or
 
committee
 
sponsored
 
or
 
chaired
 
by,
 
or
constituted at the request of, any
 
of them or the Financial Stability Board.
"
Relevant Person
" has the meaning given in Clause
 
(
Relevant Persons
).
"
Repayment
Date
" means
 
a date
 
on which
 
a repayment
 
is required
 
to be
 
made under
 
Clause
(
Repayment and Prepayment
).
"
Repayment Instalment
" means any
 
repayment instalment
 
referred to
 
in Clause
 
(
Amount of
repayment instalments
).
"
Requisition Compensation
" includes all
 
compensation or other
 
moneys payable by reason
 
of any
act or event such as is referred to in paragraph
 
of the definition of "
Total Loss
".
"
Resolution
 
Authority
"
 
means
 
any
 
body
 
which
 
has
 
authority
 
to
 
exercise
 
any
 
Write-down
 
and
Conversion Powers.
"
Restricted Party
" means a person:
(a)
that
 
is listed
 
on
 
any
 
Sanctions List
 
(whether designated
 
by
 
name or
 
by reason
 
of
 
being
included in a class of person);
(b)
located, organised or resident in a country
 
or territory that is the target of Sanctions that
broadly
 
prohibit
 
dealings
 
with
 
that
 
country
 
or
 
territory
 
(currently,
 
Crimea,
 
Cuba,
 
Iran,
North Korea, Syria, Donetsk and Luhansk); or
(c)
that is directly
 
or indirectly owned or
 
controlled by a
 
person referred
 
to in (a) and/or
 
(b)
above; or
(d)
with which any
 
Lender is prohibited
 
from dealing or
 
otherwise engaging in a
 
transaction
with by any Sanctions.
"
Sanctions Authority
" means the Norwegian State,
 
the United Nations, the European
 
Union, the
member states of the European
 
Union, the United Kingdom,
 
the United States of America
 
and any
authority,
 
official
 
institution
 
or
 
agency
 
acting
 
on
 
behalf
 
of
 
any
 
of
 
them
 
in
 
connection
 
with
Sanctions.
"
Sanctions
"
 
means
 
the
 
economic
 
or
 
financial
 
Sanctions
 
and/or
 
regulations,
 
trade
 
embargoes,
prohibitions,
 
restrictive
 
measures,
 
decisions,
 
Executive
 
Orders
 
or
 
notices
 
from
 
regulators
implemented,
 
adapted,
 
imposed,
 
administered,
 
enacted
 
and/or
 
enforced
 
by
 
any
 
Sanctions
Authority.
"
Sanctions List
" means a
 
list of
 
persons or
 
entities published in
 
connection with Sanctions
 
by or
on behalf of any Sanctions Authority.
"
Secured
 
Liabilities
"
 
means
 
all
 
liabilities
 
which
 
the
 
Borrowers,
 
the
 
Corporate
 
Guarantor,
 
the
Security Parties or any
 
of them have, at
 
the date of this Agreement
 
or at any
 
later time or times,
under
 
or
 
in
 
connection
 
with
 
any
 
Finance
 
Document
 
or
 
any
 
judgment
 
relating
 
to
 
any
 
Finance
Document; and for this purpose, there shall be disregarded any total or partial discharge of these
liabilities, or variation of their terms, which is effected
 
by, or
 
in connection with, any bankruptcy,
liquidation, arrangement or other procedure under
 
the insolvency laws of any country.
"
Security Interest
" means:
 
(a)
a mortgage, charge (whether
 
fixed or floating)
 
or pledge, any
 
maritime or
 
other lien
 
or any
other security interest of any kind;
 
(b)
the security rights of a plaintiff under an action
in rem
; and
 
(c)
any
 
arrangement
 
entered
 
into
 
by
 
a
 
person
 
(A)
 
the
 
effect
 
of
 
which
 
is
 
to
 
place
 
another
person
 
(B)
 
in a
 
position which
 
is
 
similar,
 
in economic
 
terms,
 
to
 
the
 
position in
 
which
 
B
would have been had he held a security interest over an asset of A; but this paragraph
does not apply to a right of set off or
 
combination of accounts conferred by the
 
standard
terms of business of a bank or financial institution.
"
Security Party
" means
 
the Corporate
 
Guarantor,
 
the Approved
 
Manager and
 
any other
 
person
(except
 
a
 
Creditor
 
Party)
 
who,
 
as
 
a
 
surety
 
or
 
mortgagor,
 
as
 
a
 
party
 
to
 
any
 
subordination
 
or
priorities
 
arrangement,
 
or
 
in
 
any
 
similar
 
capacity,
 
executes
 
a
 
document
 
falling
 
within
 
the
 
last
paragraph of the definition of "
Finance Documents
".
"
Security Period
" means the
 
period commencing
 
on the date
 
of this Agreement
 
and ending on
 
the
date on which
 
the Agent notifies
 
the Borrowers, the
 
Security Parties and
 
the other
 
Creditor Parties
that:
 
(a)
all amounts which have become due for
 
payment by the Borrowers
 
or any Security Party
under the Finance Documents have been paid;
(b)
no amount is owing
 
or has accrued (without yet
 
having become due for
 
payment) under
any Finance Document;
(c)
neither
 
a
 
Borrower
 
nor
 
any
 
Security
 
Party
 
has
 
any
 
future
 
or
 
contingent
 
liability
 
under
Clause
 
(
Fees and expenses
),
 
(
Indemnities
) or
 
(
No set-off or Tax Deduction
) below
or any other provision of this Agreement or another Finance Document; and
(d)
the Agent,
 
the Security Trustee
 
and the Majority
 
Lenders do not
 
consider that there
 
is a
significant risk that
 
any payment or
 
transaction under a Finance
 
Document would be
 
set
aside,
 
or
 
would
 
have
 
to
 
be
 
reversed
 
or
 
adjusted,
 
in
 
any
 
present
 
or
 
possible
 
future
bankruptcy
 
of
 
the
 
Borrowers
 
or
 
a
 
Security
 
Party
 
or
 
in
 
any
 
present
 
or
 
possible
 
future
proceeding relating to
 
a Finance Document or
 
any asset covered
 
(or previously covered)
by a Security Interest created by a Finance Document.
"
Security Trustee
" means Nordea
 
Bank Abp, filial
 
i Norge, acting in
 
such capacity through its
 
office
at
 
Essendrops
 
gate
 
7,
 
Postboks
 
1166,
 
Sentrum,
 
0107
 
Oslo,
 
920058817
 
MVA,
 
Norway,
 
or
 
any
successor of it appointed under clause 5 of the Agency and Trust Deed.
"
Selection Notice
" means a
 
notice substantially in
 
the form set
 
out in Schedule
 
6 (
Selection Notice
)
given in accordance with Clause 6 (
Interest Periods
).
"
Servicing Bank
" means the Agent or the Security Trustee.
"
Shares
 
Pledge
"
 
means,
 
in
 
relation
 
to
 
each
 
Borrower,
 
a
 
deed
 
executed
 
by
 
the
 
Corporate
Guarantor,
 
creating security
 
over the
 
share capital
 
of that
 
Borrower in
 
the Agreed
 
Form and,
 
in
the plural, means all of them.
"
Ship
 
A
"
 
means
 
the
 
2010-built
 
Panamax
 
bulk
 
carrier
 
vessel
 
of
 
81,297
 
deadweight
 
tonnage
registered in the ownership of Jemo under the Marshall Islands flag under IMO No. 9397731 with
the name of "LETO".
"
Ship B
" means
 
the 2012-built
 
Post-Panamax
 
bulk carrier
 
vessel of
 
98,697 deadweight
 
tonnage
registered in the ownership of Guam
 
under the Marshall Islands
 
flag under IMO No.
 
9599157 with
the name of "AMPHITRITE".
"
Ship C
" means
 
the 2012-built
 
Post-Panamax
 
bulk carrier
 
vessel of
 
98,704 deadweight
 
tonnage
registered in the ownership of Palau under the Marshall Islands flag under IMO No. 9598660 with
the name of "POLYMNIA".
"
Ship
 
D
"
 
means
 
the
 
2010-built
 
Kamsarmax
 
bulk
 
carrier
 
vessel
 
of
 
82,117
 
deadweight
 
tonnage
registered in the ownership
 
of Makur under
 
the Marshall Islands
 
flag under IMO
 
No. 9422940
 
with
the name of "MYRSINI".
"
Ships
" means, together, Ship A, Ship
 
B, Ship C and
 
Ship D and, in
 
the singular, means any of them.
"
SOFR
" means the
 
secured overnight
 
financing rate
 
(SOFR) administered by
 
the Federal
 
Reserve
Bank of New
 
York (or any other person which
 
takes over the administration of
 
that rate) published
(before any correction, recalculation or
 
republication by the
 
administrator) by the
 
Federal Reserve
Bank of New York (or any other person which takes over the publication of that rate).
"
Statement
 
of Compliance
"
 
means
 
a
 
Statement
 
of
 
Compliance related
 
to
 
fuel oil
 
consumption
pursuant to regulations 6.6 and 6.7 of Annex VI.
"
Swap Bank
" means Nordea Bank Abp.
"
Swap Exposure
" means, as
 
at any
 
relevant date,
 
the amount certified
 
by the
 
Swap Bank
 
to the
Agent to be the aggregate net amount in Dollars which would be payable by the
 
Borrowers to the
Swap Bank
 
under (and
 
calculated in
 
accordance with)
 
section 6(e)
 
(
Payments on Early
 
Termination
)
of
 
the
 
Master
 
Agreement
 
if
 
an
 
Early
 
Termination
 
Date
 
had
 
occurred
 
on
 
the
 
relevant
 
date
 
in
relation to all outstanding Designated Transactions
 
.
"
Termination
 
Date
" means the date falling on
 
the fifth anniversary of the Drawdown
 
Date of the
Loan.
"
Term
 
SOFR
"
 
means
 
the
 
term
 
SOFR
 
reference
 
rate
 
administered
 
by
 
CME
 
Group
 
Benchmark
Administration Limited (or any other person which
 
takes over the administration
 
of that rate) for
the
 
relevant
 
period
 
published
 
(before
 
any
 
correction,
 
recalculation
 
or
 
republication
 
by
 
the
administrator) by CME Group
 
Benchmark Administration Limited
 
(or any other
 
person which takes
over the publication of that rate).
"
Total Loss
" means, in relation to a Ship
(a)
actual, constructive, compromised, agreed or arranged total loss of the Ship;
(b)
any
 
expropriation,
 
confiscation,
 
requisition
 
or
 
acquisition
 
of
 
the
 
Ship,
 
whether
 
for
 
full
consideration,
 
a
 
consideration
 
less
 
than
 
its
 
proper
 
value,
 
a
 
nominal
 
consideration
 
or
without any consideration, which is effected by any government
 
or official authority or
 
by
any person
 
or persons
 
claiming to
 
be or
 
to represent
 
a government
 
or official
 
authority
(excluding a requisition
 
for hire for
 
a fixed period not
 
exceeding 1 year
 
without any right
to
 
an
 
extension)
 
unless
 
it
 
is
 
within
one
 
month
 
redelivered
 
to
 
the
 
full
 
control
 
of
 
the
Borrower owning that Ship;
(c)
any condemnation of the Ship by any tribunal or by any person
 
or person claiming to be a
tribunal; and
(d)
any
 
arrest,
 
capture,
 
seizure
 
or
 
detention
 
of
 
the
 
Ship
 
(including
 
any
 
hijacking
 
or
 
theft)
unless it is within 30 days redelivered to the full control of the Borrower owning the Ship.
"
Total Loss Date
" means, in relation to a Ship:
(a)
in the
 
case of
 
an actual
 
loss of
 
the Ship,
 
the date
 
on which
 
it occurred
 
or, if that is
 
unknown,
the date when the Ship was last heard of;
(b)
in the case of a constructive, compromised, agreed or arranged
 
total loss of the Ship, the
earliest of:
(i)
the date on which a notice of abandonment is given to the insurers; and
(ii)
the date of any compromise, arrangement or agreement made by or on behalf of
the Borrower owning the Ship with the
 
Ship's insurers in which the insurers agree
to treat the Ship as a total loss; and
(c)
in the case of any other type of
 
total loss, on the date (or the most likely date) on which it
appears to the Agent that the event constituting the total loss occurred.
"
Transaction
" has the meaning given in the Master Agreement.
"
Transfer Certificate
" has the meaning given in Clause
 
(
Transfer by a Lender
).
 
"
Trust Property
" has the meaning given in clause 3.1 of the Agency and Trust Deed.
 
"
UK Bail-In Legislation
" means Part 1 of the United Kingdom Banking Act 2009 and any other law
or
 
regulation
 
applicable
 
in
 
the
 
United
 
Kingdom
 
relating
 
to
 
the
 
resolution
 
of
 
unsound or
 
failing
banks,
 
investment
 
firms
 
or
 
other
 
financial
 
institutes
 
or
 
their
 
affiliates
 
(otherwise than
 
through
liquidation, administration or other insolvency proceedings).
"
Unpaid Sum
" means any sum due and payable but unpaid by a Security Party under
 
the Finance
Documents.
"
US
" means the United States of America.
"
US Government Securities Business Day
" means any day other than:
(a)
a Saturday or a Sunday; and
(b)
a day on
 
which the Securities
 
Industry and Financial
 
Markets Association (or
 
any successor
organisation) recommends
 
that the fixed
 
income departments of
 
its members be
 
closed
for the entire day for purposes of trading in US Government securities.
"
US Tax Obligor
" means:
(a)
a person which is resident for tax purposes in the US; or
(b)
a person some or all of
 
whose payments under the Finance Documents
 
are from sources
within the US for US federal income tax purposes.
"
Write-down and Conversion Powers
" means:
(a)
in relation to
 
any Bail-In Legislation described
 
in the EU Bail-In Legislation
 
Schedule from
time to time, the powers described as such in relation to that Bail-In Legislation in the EU
Bail-In Legislation Schedule;
(b)
in relation
 
to the
 
UK Bail-In
 
Legislation, any
 
powers under
 
that UK
 
Bail-In Legislation
 
to
cancel, transfer
 
or dilute
 
shares issued
 
by a
 
person that
 
is a
 
bank or
 
investment
 
firm or
other
 
financial
 
institution
 
or
 
affiliate
 
of
 
a
 
bank,
 
investment
 
firm
 
or
 
other
 
financial
institution, to cancel, reduce, modify or
 
change the form of a liability of
 
such a person or
any contract
 
or instrument under
 
which that liability
 
arises, to convert
 
all or part
 
of that
liability into shares,
 
securities or
 
obligations of that
 
person or any
 
other person, to
 
provide
that any such
 
contract or instrument
 
is to have
 
effect as if
 
a right
 
had been
 
exercised under
it or to suspend any
 
obligation in respect of that
 
liability or any of the powers
 
under that
UK Bail-In Legislation that are related to or ancillary to any of those powers; and
(c)
in relation to any other applicable Bail-In Legislation:
(i)
any powers under
 
that Bail-In
 
Legislation to
 
cancel, transfer or
 
dilute shares
 
issued
by
 
a
 
person
 
that
 
is
 
a
 
bank
 
or
 
investment
 
firm
 
or
 
other
 
financial
 
institution
 
or
affiliate of a bank,
 
investment firm or
 
other financial institution,
 
to cancel, reduce,
modify
 
or
 
change
 
the
 
form
 
of
 
a
 
liability
 
of
 
such
 
a
 
person
 
or
 
any
 
contract
 
or
instrument under which
 
that liability arises,
 
to convert
 
all or part
 
of that liability
into shares, securities
 
or obligations of
 
that person
 
or any
 
other person,
 
to provide
that
 
any
 
such
 
contract
 
or
 
instrument
 
is
 
to
 
have
 
effect
 
as
 
if
 
a
 
right
 
had
 
been
exercised under it or to suspend
 
any obligation in respect of
 
that liability or any of
the powers under that Bail-In Legislation
 
that are related to or
 
ancillary to any of
those powers; and
(ii)
any similar or analogous powers under that Bail-In Legislation.
1.2
Construction of certain terms
In this Agreement:
"
administration
 
notice
"
 
means
 
a
 
notice
 
appointing
 
an
 
administrator,
 
a
 
notice
 
of
 
intended
appointment and
 
any other notice
 
which is required
 
by law
 
(generally or
 
in the case
 
concerned)
to be filed with the court or given to a person
 
prior to, or in connection with, the appointment of
an administrator.
 
"
approved
" means, for the purposes of Clause
 
(
Insurance
), approved in writing by the Agent.
"
asset
" includes
 
every kind
 
of property,
 
asset, interest
 
or right,
 
including any
 
present, future
 
or
contingent right to any revenues or other payment.
a Lender's
 
"
cost of
 
funds
" in
 
relation to
 
its participation
 
in the
 
Loan or
 
any part
 
of the
 
Loan is
 
a
reference
 
to
 
the
 
average
 
cost
 
(determined
 
either
 
on
 
an
 
actual
 
or
 
a
 
notional
 
basis)
 
which
 
that
Lender would
 
incur if
 
it were to
 
fund, from
 
whatever source(s) it
 
may reasonably select,
 
an amount
equal to the amount of that participation in the Loan
 
or that part of the Loan for a period equal
 
in
length to the Interest Period of the Loan or that part of the Loan.
"
company
" includes any partnership, joint venture and unincorporated association.
"
consent
"
 
includes
 
an
 
authorisation,
 
consent,
 
approval,
 
resolution,
 
licence,
 
exemption,
 
filing,
registration, notarisation and legalisation.
"
contingent liability
" means
 
a liability
 
which is
 
not certain
 
to arise
 
and/or the
 
amount of
 
which
remains unascertained.
"
document
" includes a deed; also a letter or fax.
"
excess risks
" means, in
 
relation to
 
a Ship, the
 
proportion of claims
 
for general
 
average,
 
salvage
and salvage charges
 
not recoverable under
 
the hull and machinery policies in
 
respect of the Ship
in consequence of its insured value being less than the value at which the Ship is assessed for the
purpose of such claims.
"
expense
"
 
means
 
any
 
kind
 
of
 
cost,
 
charge
 
or
 
expense
 
(including
 
all
 
legal
 
costs,
 
charges
 
and
expenses) and any applicable value added or other tax.
"
law
" includes any order or
 
decree, any form
 
of delegated legislation, any
 
treaty or international
convention and any
 
regulation or resolution of
 
the Council of the European
 
Union, the European
Commission, the United Nations or its Security Council.
"
legal or administrative action
" means any legal proceeding or arbitration and any administrative
or regulatory action or investigation.
"
liability
" includes
 
every kind
 
of debt or
 
liability (present or
 
future, certain or
 
contingent), whether
incurred as principal or surety or otherwise.
"
obligatory insurances
" means,
 
in relation
 
to a
 
Ship, all
 
insurances effected, or
 
which the
 
Borrower
owning the
 
Ship is
 
obliged to
 
effect,
 
under Clause
 
(
Insurance
) or
 
any
 
other provision
 
of this
Agreement or another Finance Document.
"
parent company
" has the meaning given in Clause
 
(
Meaning of "subsidiary"
).
"
person
" includes any
 
company; any
 
state, political
 
sub-division of a state
 
and local or municipal
authority; and any international organisation.
"
policy
",
 
in
 
relation
 
to
 
any
 
insurance,
 
includes
 
a
 
slip,
 
cover
 
note,
 
certificate
 
of
 
entry
 
or
 
other
document evidencing the contract of insurance or its terms.
"
protection
 
and indemnity
 
risks
" means
 
the usual
 
risks covered
 
by a
 
protection and
 
indemnity
association managed in
 
London, including pollution risks
 
and the proportion
 
(if any) of
 
any sums
payable to
 
any other
 
person or
 
persons in
 
case of
 
collision which are
 
not recoverable
 
under the
hull and machinery policies
 
by reason of the incorporation in them
 
of clause 6 of the
 
International
Hull Clauses (1/11/02
 
or 1/11/03), clause
 
8 of the
 
Institute Time Clauses
 
(Hulls) (1/11/95)
 
or clause
8 of
 
the Institute Time
 
Clauses (Hulls) (1/10/83)
 
or the Institute
 
Amended Running Down
 
Clause
(1/10/71) or any equivalent provision.
"
regulation
" includes any regulation,
 
rule, official directive, request
 
or guideline (either
 
having the
force of law or compliance
 
with which is reasonable
 
in the ordinary
 
course of business of
 
the party
concerned) whether
 
or
 
not having
 
the force
 
of law
 
of any
 
governmental,
 
intergovernmental
 
or
supranational
 
body,
 
agency,
 
department
 
or
 
regulatory,
 
self-regulatory
 
or
 
other
 
authority
 
or
organisation.
"
subsidiary
" has the meaning given in Clause
 
(
Meaning of "subsidiary"
).
 
"
successor
" includes
 
any person
 
who is
 
entitled (by
 
assignment, novation,
 
merger or
 
otherwise)
to
 
any person's
 
rights under
 
this Agreement
 
or any
 
other Finance
 
Document (or
 
any interest
 
in
those rights) or who, as administrator, liquidator or otherwise, is entitled to exercise those rights;
and in particular references to a successor include a person to whom those rights (or any interest
in those
 
rights) are
 
transferred
 
or pass
 
as a
 
result of
 
a merger,
 
division, reconstruction
 
or other
reorganisation of it or any other person.
 
"
tax
" includes any present or future tax, duty, impost, levy or charge of any kind
 
which is imposed
by any state, any political sub-division of a state or any
 
local or municipal authority (including any
such imposed in connection with exchange controls), and any connected penalty, interest or
 
fine.
"
war
 
risks
"
 
includes
 
the
 
risk
 
of
 
mines
 
and
 
all
 
risks
 
excluded
 
by
 
clauses
 
29,
 
30
 
or
 
31
 
of
 
the
International Hull Clauses (1/11/02),
 
clauses 29 or 30 of
 
the International Hull Clauses (1/11/03),
clauses 24, 25
 
or 26 of
 
the Institute Time
 
Clauses (Hulls) (1/11/95) or
 
clauses
 
23, 24 or
 
25 of the
Institute Time Clauses (Hulls) (1/10/83) or any equivalent provision.
1.3
Meaning of "subsidiary"
A company (S) is a subsidiary of another company (P) if:
(a)
a majority of
 
the issued shares
 
in S (or
 
a majority of the
 
issued shares in
 
S which carry
 
unlimited
rights to capital and income distributions) are directly owned by P or are indirectly attributable to
P; or
(b)
P has direct
 
or indirect control
 
over a majority of
 
the voting rights
 
attaching to
 
the issued shares
of S; or
(c)
P has the direct or indirect power to appoint or remove a majority of the directors of S; or
(d)
P
 
otherwise
 
has
 
the
 
direct
 
or
 
indirect
 
power
 
to
 
ensure
 
that
 
the
 
affairs
 
of
 
S
 
are
 
conducted
 
in
accordance with the wishes of P,
and any company of which S is a subsidiary is a parent company of S.
1.4
General Interpretation
In this Agreement:
(a)
references to,
 
or to a provision of,
 
a Finance Document or any other
 
document are references
 
to
it as amended or supplemented, whether before the date of this Agreement or otherwise;
(b)
references
 
to, or
 
to a
 
provision of,
 
any law
 
include any amendment,
 
extension, re-enactment
 
or
replacement, whether made before the date of this Agreement or otherwise;
 
(c)
words denoting the singular number shall include the plural and vice versa; and
(d)
Clauses
 
to
 
apply unless the contrary intention appears.
1.5
Headings
In interpreting a Finance Document or any provision
 
of a Finance Document, all
 
clause, sub-clause
and other headings in that and any other Finance Document shall be entirely disregarded.
2
FACILITY
 
2.1
Amount of facility
Subject
 
to
 
the
 
other
 
provisions
 
of
 
this
 
Agreement,
 
the
 
Lenders
 
shall
 
make
 
available
 
to
 
the
Borrowers,
 
in one
 
advance,
 
a term
 
loan facility
 
of
 
up to
 
$22,500,000, for
 
the purpose
 
of
 
(i) re-
financing
 
the
 
Existing
 
Indebtedness
 
and
 
(ii)
 
for
 
the
 
Borrowers'
 
general
 
corporate
 
and
 
working
capital purposes.
 
2.2
Lenders' participations in the Loan
Subject to the other provisions of this Agreement, each Lender shall participate in the Loan in the
proportion which, as at the Drawdown Date, its Commitment bears to the Total
 
Commitments.
2.3
Purpose of the Loan
The Borrowers undertake
 
with each Creditor Party to use
 
the Loan only for the purpose stated
 
in
the preamble to this Agreement.
3
POSITION OF THE LENDERS, THE SWAP BANK AND THE MAJORITY LENDERS
3.1
Interests of Lenders and Swap Bank several
The rights of
 
the Lenders and
 
the Swap Bank under
 
this Agreement and the
 
Master Agreement are
several; accordingly:
(a)
each Lender
 
shall be
 
entitled to
 
sue for
 
any amount
 
which has
 
become due
 
and payable
 
by the
Borrowers to it under this Agreement; and
(b)
the Swap Bank shall be entitled to sue for any amount which has become due and payable by the
Borrowers to it under the Master Agreement,
without joining the Agent,
 
the Security Trustee, any other Lender and
 
the Swap Bank as additional
parties in the proceedings.
3.2
Proceedings by individual Lender or Swap Bank
However,
 
without the
 
prior consent of
 
the Majority Lenders,
 
no Lender
 
nor the Swap
 
Bank may
bring proceedings in respect of:
(a)
any
 
other
 
liability or
 
obligation
 
of
 
any
 
Borrower
 
or a
 
Security Party
 
under or
 
connected
 
with
 
a
Finance Document; or
(b)
any misrepresentation or breach of warranty by any
 
Borrower or a Security Party in or connected
with a Finance Document.
3.3
Obligations several
The obligations
 
of the
 
Lenders and
 
the Swap
 
Bank under
 
this Agreement
 
and of
 
the Swap
 
Bank
under the Master
 
Agreement are several;
 
and a failure
 
of a Lender or
 
the Swap Bank
 
to perform
its
 
obligations
 
under
 
this
 
Agreement
 
or
 
of
 
the
 
Swap
 
Bank
 
to
 
perform
 
its
 
obligations
 
under
 
the
Master Agreement shall not result in:
(a)
the obligations of the other Lenders or (as the case may be) the Swap Bank being increased; nor
(b)
any Borrower, any Security Party or any other Creditor Party being
 
discharged (in whole
 
or in part)
from its obligations under any Finance Document,
and in
 
no circumstances
 
shall a
 
Lender or
 
the Swap
 
Bank have
 
any responsibility
 
for a
 
failure of
another Lender or the
 
Swap Bank to
 
perform its obligations
 
under this Agreement or
 
the Master
Agreement.
3.4
Parties bound by certain actions of Majority Lenders
Every Lender,
 
the Swap Bank, each Borrower and each Security Party shall be bound by:
(a)
any determination made,
 
or action
 
taken, by the
 
Majority Lenders
 
under any
 
provision of
 
a Finance
Document;
(b)
any instruction or authorisation
 
given by the
 
Majority Lenders to the
 
Agent or the
 
Security Trustee
under
 
or
 
in
 
connection
 
with
 
any
 
Finance
 
Document (subject
 
always
 
to
 
Clause
 
(
Variations,
waivers etc. by Majority Lenders)
);
(c)
any
 
action
 
taken
 
(or
 
in
 
good
 
faith
 
purportedly
 
taken)
 
by
 
the
 
Agent
 
or
 
the
 
Security
 
Trustee
 
in
accordance with such an instruction or authorisation.
3.5
Reliance on action of Agent
However,
 
each Borrower and each Security Party:
(a)
shall
 
be
 
entitled
 
to
 
assume
 
that
 
the
 
Majority
 
Lenders
 
have
 
duly
 
given
 
any
 
instruction
 
or
authorisation which,
 
under any
 
provision
 
of
 
a Finance
 
Document, is
 
required
 
in relation
 
to
 
any
action which the Agent has taken or is about to take; and
(b)
shall not
 
be entitled
 
to require
 
any evidence
 
that such
 
an instruction
 
or authorisation
 
has been
given.
3.6
Construction
In Clauses
 
(
Parties bound by certain actions of Majority Lenders
) and
 
(
Reliance on action of
Agent
)
 
references
 
to
 
action
 
taken
 
include
 
(without
 
limitation)
 
the
 
granting
 
of
 
any
 
waiver
 
or
consent, an approval of any document and an agreement to any matter.
4
DRAWDOWN
 
4.1
Request for the Loan
Subject to the following conditions, the Borrowers
 
may request the Loan to
 
be made by ensuring
that the Agent receives a completed
 
Drawdown Notice not later than 11.00
 
a.m. (Oslo time) three
Business Days (or such shorter period as the
 
Agent may,
 
in its absolute discretion, agree) prior to
the intended Drawdown Date.
4.2
Availability
The conditions referred to in Clause
 
(
Request for the Loan
) are that:
(a)
the Drawdown Date has to be a Business Day during the Availability Period;
 
(b)
the amount of the Loan shall not exceed an amount of up to $22,500,000; and
(c)
the Loan shall
 
be made available
 
in one advance
 
and shall be
 
applied in re-financing
 
the Existing
Indebtedness.
4.3
Notification to Lenders of receipt of a Drawdown Notice
The
 
Agent
 
shall
 
promptly
 
notify
 
the
 
Lenders
 
that
 
it has
 
received
 
a
 
Drawdown
 
Notice
 
and
 
shall
inform each Lender of:
(a)
the amount of the Loan and the Drawdown Date;
(b)
the amount of that Lender's participation in the Loan; and
(c)
the duration of the first Interest Period.
4.4
Drawdown Notice irrevocable
A
 
Drawdown
 
Notice
 
must
 
be
 
signed
 
by
 
a
 
director
 
or
 
an
 
authorised
 
representative
 
of
 
each
Borrower; and once
 
served, a Drawdown
 
Notice cannot be revoked
 
without the prior consent
 
of
the Agent, acting on the authority of the Majority Lenders.
4.5
Lenders to make available Contributions
Subject to
 
the provisions
 
of this
 
Agreement, each
 
Lender shall,
 
on and
 
with value
 
on the
 
Drawdown
Date,
 
make
 
available
 
to
 
the Agent
 
for
 
the account
 
of the
 
Borrowers
 
the amount
 
due from
 
that
Lender on the Drawdown Date under Clause
 
(
Lenders' participations
 
in the Loan
).
4.6
Disbursement of the Loan
Subject to
 
the provisions
 
of this
 
Agreement,
 
the Agent
 
shall on
 
the Drawdown
 
Date
 
pay
 
to the
Borrowers the
 
amounts which the Agent
 
receives from the
 
Lenders under Clause
 
(
Lenders to
make available Contributions
); and that payment to the Borrowers shall be made:
(a)
to the account which the Borrowers specify in the Drawdown Notice; and
(b)
in the like funds as the Agent received the payments from the Lenders.
4.7
Disbursement of the Loan to third party
The payment by
 
the Agent
 
under Clause
Disbursement of
 
the Loan
) shall
 
constitute the making
of the Loan
 
and the Borrowers shall
 
at that time
 
become indebted, as
 
principal and
 
direct obligors,
to each Lender in an amount equal to that Lender's Contribution.
4.8
Designated Transactions under the Master Agreement
(a)
The Borrowers
 
may at
 
any time
 
conclude Designated Transactions
 
with the Swap
 
Bank pursuant
to
 
the
 
Master
 
Agreement
 
for
 
the
 
purpose
 
of
 
swapping
 
their
 
interest
 
payment
 
obligations
 
and
managing exposure to interest
 
rate fluctuations under this Agreement. The Borrower
 
s
 
agree that
signature
 
of
 
the
 
Master
 
Agreement
 
does
 
not
 
commit
 
the
 
Swap
 
Bank
 
to
 
conclude
 
Designated
Transactions, or even to offer terms
 
for doing so, but
 
does provide a
 
contractual framework within
which Designated Transactions may
 
be concluded
 
and secured,
 
assuming that
 
mutually acceptable
terms can be agreed at the relevant time.
(b)
The
 
Lenders
 
agree
 
that,
 
to
 
enable
 
the
 
Borrowers
 
to
 
secure
 
their
 
obligations
 
to
 
the
 
Swap
 
Bank
under the
 
Master Agreement,
 
the security
 
of the
 
other Finance
 
Documents shall
 
be held
 
by the
Security Trustee
 
not only to secure the Borrowers' obligations
 
under this Agreement but also the
Borrowers' obligations under the
 
Master Agreement on
 
the terms set
 
out in Clause
Application
of receipts
).
5
INTEREST
 
5.1
Calculation of interest
The rate of interest on the Loan or any part of the Loan for each Interest Period is the percentage
rate per annum which is the aggregate of the applicable:
(a)
Margin; and
(b)
Reference Rate.
5.2
Payment of interest
(a)
The Borrowers
 
shall pay
 
accrued interest
 
on the
 
Loan or
 
any part
 
of the
 
Loan on the
 
last day
 
of
each Interest Period.
(b)
If
 
an
 
Interest
 
Period
 
is
 
longer
 
than
 
three
 
Months,
 
the
 
Borrowers
 
shall
 
also
 
pay
 
interest
 
then
accrued on the
 
Loan or the
 
relevant part of the
 
Loan on the
 
dates falling at three
 
Monthly intervals
after the first day of the Interest Period.
5.3
Default interest
(a)
If a Security Party
 
fails to pay any amount payable by
 
it under a Finance
 
Document on its due
 
date,
interest shall accrue on the Unpaid
 
Sum from the due date up
 
to the date of actual
 
payment (both
before
 
and after
 
judgment) at
 
a rate
 
which, subject to
 
paragraph
 
below,
 
is two
 
per cent. per
annum higher
 
than the
 
rate which
 
would have
 
been payable
 
if the
 
Unpaid Sum
 
had, during
 
the
period
 
of
 
non-payment,
 
constituted
 
part
 
of
 
the
 
Loan
 
in
 
the
 
currency
 
of
 
the
 
Unpaid
 
Sum
 
for
successive Interest Periods, each of a duration selected by
 
the Agent.
 
Any interest accruing under
this Clause
Default interest
) shall be
 
immediately payable by the
 
Borrowers on demand by the
Agent.
(b)
If an Unpaid Sum consists of all or part
 
of the Loan which became due on a day which
 
was not the
last day of an Interest Period relating to the Loan or that part of the Loan:
(i)
the first Interest
 
Period for that Unpaid Sum shall have
 
a duration equal to the unexpired
portion of the current Interest Period relating to the Loan or that part of the Loan; and
(ii)
the rate
 
of interest
 
applying to that
 
Unpaid Sum during that
 
first Interest
 
Period shall be
two
 
per cent.
 
per annum
 
higher than
 
the rate
 
which would
 
have
 
applied if
 
that Unpaid
Sum had not become due.
 
(c)
Default interest (if unpaid) arising on an Unpaid Sum will
 
be compounded with the Unpaid
 
Sum at
the end
 
of each
 
Interest Period
 
applicable to
 
that Unpaid
 
Sum but
 
will remain
 
immediately due
and payable.
(d)
For the avoidance
 
of doubt,
 
this Clause
Default interest
) does
 
not apply
 
to any
 
amount payable
under the Master Agreement in respect of any continuing Designated Transaction as to which the
relevant provisions of the Master Agreement shall apply.
5.4
Notification of rates of interest
(a)
The Agent shall promptly
 
notify the Lenders and
 
the Borrowers
 
of the determination of
 
a rate of
interest under this Agreement.
(b)
The Agent shall promptly notify the Borrowers
 
of each Funding Rate relating to the Loan, any part
of the Loan or any Unpaid Sum.
6
INTEREST PERIODS
 
6.1
Selection of Interest Periods
(a)
The Borrowers
 
may select
 
the Interest Period
 
for the
 
Loan in
 
the Drawdown Notice.
 
The Borrowers
may select each subsequent Interest Period in respect of the Loan in a Selection Notice.
(b)
Each Selection Notice is
 
irrevocable and must be
 
delivered to the Agent
 
by the Borrowers
 
not later
than five Business Days before the expiry of the preceding Interest Period.
(c)
If
 
the
 
Borrowers
 
fail
 
to
 
select
 
an
 
Interest
 
Period
 
in
 
the
 
Drawdown
 
Notice
 
or
 
fails
 
to
 
deliver
 
a
Selection
 
Notice
 
to
 
the
 
Agent
 
in
 
accordance
 
with
 
paragraphs
 
and
 
above,
 
the
 
relevant
Interest Period will be three Months.
(d)
Subject to this
 
Clause 6 (
Interest Periods
), the Borrowers
 
may select
 
an Interest Period
 
of one or
three Months
 
or any
 
other period
 
agreed between
 
the Borrowers
 
and the
 
Agent (acting
 
on the
instructions of all the Lenders).
(e)
An
 
Interest
 
Period
 
in
 
respect
 
of
 
the
 
Loan
 
or
 
any
 
part
 
of
 
the
 
Loan
 
shall
 
not
 
extend
 
beyond
 
the
Termination Date
 
.
(f)
The
 
first
 
Interest
 
Period
 
for
 
the
 
Loan
 
shall
 
start
 
on
 
the
 
Drawdown
 
Date
 
and
 
each
 
subsequent
Interest Period shall start on the last day of the preceding Interest Period.
(g)
The Loan shall have one Interest Period only at any time.
6.2
Non-Business Days
If an Interest
 
Period would otherwise
 
end on a
 
day which is
 
not a
 
Business Day, that Interest Period
will instead end on the next Business Day in that calendar
 
month (if there is one) or the preceding
Business Day (if there is not).
CHANGES TO THE CALCULATION OF INTEREST
7.1
Unavailability of Term SOFR
(a)
Interpolated Term
 
SOFR
:
 
If no
 
Term
 
SOFR is
 
available for
 
the Interest
 
Period of
 
the Loan
 
or any
part of the Loan,
 
the applicable Reference
 
Rate shall be the
 
Interpolated Term
 
SOFR for a
 
period
equal in length to the Interest Period of the Loan or that part of the Loan.
(b)
Shortened Interest Period
:
 
If no Term SOFR is
 
available for the Interest Period
 
of a Loan
 
or any part
of the Loan
 
and it is
 
not possible to
 
calculate the Interpolated
 
Term
 
SOFR, the Interest
 
Period of
that Loan or that part of the Loan shall (if it is longer than the
 
applicable Fallback Interest Period)
be shortened to the applicable Fallback Interest Period and the
 
applicable Reference Rate for that
shortened Interest Period shall be determined pursuant to the definition of "
Reference Rate
".
(c)
Cost
 
of
 
funds
:
 
If
 
paragraph
 
above
 
applies
 
but
 
no
 
Term
 
SOFR
 
is
 
available
 
for
 
the
 
applicable
Fallback
 
Interest
 
Period
 
or
 
the
 
Interest
 
Period
 
is
 
shorter
 
than
 
the
 
applicable
 
Fallback
 
Interest
Period, there shall be
 
no Reference Rate
 
for the Loan or that
 
part of the Loan (as applicable)
 
and
Clause
 
(
Cost of funds
) shall apply to the Loan or that part of the Loan for that Interest Period.
7.2
Market disruption
If before
 
close of
 
business in
 
London on
 
the Quotation
 
Day for
 
the relevant
 
Interest Period
 
,
 
the
Agent
 
receives
 
notification
 
from
 
a
 
Lender
 
or
 
Lenders
 
(whose
 
participations
 
in
 
the
 
Loan
 
or
 
the
relevant part of the Loan exceed
 
50 per cent. of the Loan or that part of the Loan as appropriate)
that its cost
 
of funds relating
 
to its participation
 
in the Loan or
 
that part of
 
the Loan would
 
be in
excess of the Market Disruption Rate
 
then Clause
 
(
Cost of funds
) shall apply
 
to the Loan
 
or that
part of the Loan (as applicable) for the relevant Interest Period.
7.3
Cost of funds
(a)
If this Clause
 
(
Cost of funds
) applies, the rate of interest on each Lender's share of the Loan or
the
 
relevant
 
part
 
of
 
the
 
Loan
 
for
 
the
 
relevant
 
Interest
 
Period
 
shall
 
be
 
the
 
percentage
 
rate
 
per
annum which is the sum of:
(i)
the Margin; and
(ii)
the
 
weighted
 
average
 
of
 
the
 
rates
 
notified
 
to
 
the
 
Agent
 
by
 
each
 
Lender
 
as
 
soon
 
as
practicable and
 
in any
 
event before
 
interest
 
is due
 
to be
 
paid in
 
respect of
 
that Interest
Period to be
 
that which expresses
 
as a percentage
 
rate per annum its
 
cost of funds
 
relating
to its participation in the Loan or that part of the Loan.
(b)
If this Clause
 
(
Cost of funds
) applies and the
 
Agent or the Borrowers
 
so requires, the Agent and
the Borrowers
 
shall enter into negotiations (for a period of not more than 30 days) with a view to
agreeing
 
a
 
substitute
 
basis
 
for
 
determining
 
the
 
rate
 
of
 
interest
 
or
 
(as
 
the
 
case
 
may
 
be)
 
an
alternative basis for funding.
(c)
Subject
 
to
 
Clause
 
(
Changes
 
to
 
reference
 
r
ates
),
 
any
 
substitute
 
or
 
alternative
 
basis
 
agreed
pursuant to paragraph
 
above shall, with
 
the prior consent
 
of all the
 
Lenders and the
 
Borrowers,
be binding on all Parties.
(d)
If paragraph
 
below does not apply and any rate notified to the
 
Agent under sub-paragraph
of paragraph
 
above is less than zero, the relevant rate shall be deemed to be zero.
(e)
If this Clause
 
(
Cost of funds
) applies pursuant to Clause
 
(
Market disruption
) and:
(i)
a Lender's Funding Rate is less than the Market Disruption Rate; or
(ii)
a Lender does not notify a rate by the time specified
 
in sub-paragraph
 
of paragraph
above,
that Lender's cost of funds relating to its participation in the Loan or the relevant part of the Loan
for that Interest Period
 
shall be
 
deemed, for
 
the purposes
 
of paragraph
 
above, to be
 
the Market
Disruption Rate.
(f)
If this Clause
 
(
Cost of funds
) applies but any Lender does not notify a rate
 
to the Agent by the
time specified in sub-paragraph
 
of paragraph
 
above the rate of
 
interest shall be calculated
on the basis of the rates notified by the remaining Lenders.
7.4
Break Costs
(a)
The Borrowers
 
shall, within
 
three Business
 
Days of demand
 
by a
 
Creditor Party, pay to
 
that Creditor
Party its
 
Break Costs
 
attributable to
 
all or any
 
part of the
 
Loan or Unpaid
 
Sum being paid
 
by the
Borrowers
 
on a day prior to the
 
last day of an Interest Period for the Loan, the
 
relevant part of the
Loan or that Unpaid Sum.
(b)
Each
 
Lender
 
shall,
 
as
 
soon
 
as
 
reasonably
 
practicable
 
after
 
a
 
demand
 
by
 
the
 
Agent,
 
provide
 
a
certificate
 
confirming the
 
amount
 
of its
 
Break Costs
 
for
 
any
 
Interest
 
Period
 
in
 
respect of
 
which
they become or may become payable.
8
REPAYMENT
 
AND PREPAYMENT
 
8.1
Amount of repayment instalments
The
 
Borrowers
 
shall
 
repay
 
the
 
Loan
 
by
 
20
 
equal
 
consecutive
 
quarterly
 
instalments
 
(each,
 
a
"
Repayment Instalment
" and, in the
 
plural means, all of them) each
 
in the amount of $1,125,000.
8.2
Repayment Dates
The first
 
Repayment
 
Instalment
 
in respect
 
of the
 
Loan shall
 
be repaid
 
on
 
the date
 
falling
 
three
Months after the first Drawdown
 
Date, each subsequent Repayment Instalment
 
in respect of the
Loan shall be repaid
 
at quarterly intervals
 
thereafter and the
 
last Repayment
 
Instalment shall be
repaid on the Termination Date
 
.
8.3
Final Repayment Date
On the final Repayment Date, the Borrowers shall additionally pay to the Agent for the account of
the Creditor Parties all other sums then accrued or owing under any Finance Document.
8.4
Voluntary prepayment
Subject to the following conditions, the Borrowers
 
may prepay the whole or
 
any part of the Loan
on the last day of an Interest Period applicable to it.
8.5
Conditions for voluntary prepayment
The conditions referred to in Clause
 
(
Voluntary prepayment
) are that:
(a)
a partial prepayment shall be $500,000 or a higher integral multiple of $500,000;
(b)
the Agent has received from the Borrowers at least three days'
 
prior written notice specifying the
amount to be prepaid and the date on which the prepayment is to be made;
 
(c)
the Borrowers have provided evidence satisfactory to the Agent that any consent required by any
Borrower or any Security
 
Party in connection
 
with the
 
prepayment has been
 
obtained and remains
in force,
 
and that
 
any regulation
 
relevant
 
to this
 
Agreement which
 
affects
 
any Borrower
 
or any
Security Party has been complied with; and
(d)
the Borrowers have complied with
 
Clause
 
(
Unwinding of Designated
 
Transactions
) on or
 
prior
to the date of prepayment.
8.6
Effect of notice of prepayment
A prepayment notice may not be withdrawn or amended without the consent of the Agent, given
with the
 
authorisation of
 
the Majority
 
Lenders, and
 
the amount
 
specified in
 
the prepayment notice
shall
 
become
 
due
 
and
 
payable
 
by
 
the
 
Borrowers
 
on
 
the
 
date
 
for
 
prepayment
 
specified
 
in
 
the
prepayment notice.
8.7
Notification of notice of prepayment
The Agent shall
 
notify the
 
Lenders promptly upon
 
receiving a
 
prepayment notice, and
 
shall provide
any
 
Lender which
 
so
 
requests
 
with a
 
copy
 
of
 
any
 
document
 
delivered
 
by
 
the
 
Borrowers
 
under
Clause
 
(
Conditions for voluntary prepayment
).
8.8
Mandatory prepayment
The Borrowers
 
shall be
 
obliged to
 
prepay the
 
whole of
 
the Relevant
 
Amount if
 
a Ship
 
is sold
 
or
becomes a Total Loss:
(a)
in the case of a sale, on or before the date on which the Mortgage on that Ship is released; or
(b)
in the case of a Total
 
Loss, on the earlier of the date falling 180 days after the Total
 
Loss Date and
the date of receipt
 
by the Security
 
Trustee of the proceeds of insurance
 
relating to such Total Loss.
In
 
this
 
Clause
 
(
Mandatory prepayment
)
 
"
Relevant
 
Amount
" means
 
an
 
amount achieved
 
by
dividing the Market Value of the Ship which has been sold or become Total
 
Loss by the aggregate
of
 
the
 
Market
 
Value
 
of
 
all
 
Ships
 
(including
 
the
 
Ship
 
that
 
has
 
become
 
sold
 
or
 
Total
 
Loss)
 
and
multiplying it by the Loan on the date that the relevant Ship is sold or becomes a Total Loss.
 
8.9
Mandatory prepayment upon Change of Control
 
If a Change of Control occurs:
(a)
the Borrower shall promptly notify the Agent upon becoming aware of that event; and
(b)
if the Majority Lenders so require,
 
the Agent shall, by not
 
less than 10 Business Days' notice
 
to the
Borrower,
 
cancel the
 
Total
 
Commitments and
 
declare the
 
Loan, together
 
with accrued
 
interest,
and
 
all
 
other
 
amounts
 
accrued
 
under
 
the
 
Finance
 
Documents
 
immediately
 
due
 
and
 
payable,
whereupon
 
the
 
Total
 
Commitments
 
will
 
be
 
cancelled
 
and
 
the
 
Loan
 
and
 
all
 
such
 
outstanding
interest and other amounts will become immediately due and payable.
8.10
Amounts payable on prepayment
A prepayment shall be
 
made together with
 
accrued interest (and any
 
other amount payable under
Clause
 
(
Indemnities
) or otherwise) in respect of the amount prepaid
 
and, subject to any Break
Costs without premium or penalty.
 
8.11
Application of partial prepayment
Each partial
 
prepayment made
 
pursuant to
 
Clauses
 
(
Voluntary
 
prepayment
), 8.8 (
Mandatory
prepayment
) and 8.9
 
(
Mandatory prepayment upon
 
Change of Control
) shall be
 
applied pro
 
rata
against the then outstanding Repayment Instalments.
8.12
No re-borrowing
No amount prepaid may be re-borrowed.
8.13
Unwinding of Designated Transactions
On
 
or
 
prior to
 
any
 
repayment
 
or
 
prepayment
 
of
 
the Loan
 
under this
 
Clause
 
(
Repayment
 
and
prepayment
)
 
or
 
any
 
other
 
provision
 
of
 
this
 
Agreement,
 
each
 
Borrower
 
shall
 
wholly
 
or
 
partially
reverse,
 
offset,
 
unwind
 
or
 
otherwise
 
terminate
 
one
 
or
 
more
 
of
 
the
 
continuing
 
Designated
Transactions
 
so
 
that
 
the
 
notional
 
principal
 
amount
 
of
 
the
 
continuing
 
Designated
 
Transactions
thereafter
 
remaining
 
does
 
not
 
and
 
will
 
not
 
in
 
the
 
future
 
(taking
 
into
 
account
 
the
 
scheduled
amortisation) exceed
 
the amount of the
 
Loan as reducing from
 
time to time
 
thereafter pursuant
to Clause
 
(
Amount of repayment instalments
).
9
CONDITIONS PRECEDENT
 
9.1
Documents, fees and no default
Each Lender's obligation
 
to contribute to
 
the Loan is
 
subject to the
 
following conditions precedent:
 
(a)
that, on or before the service of the Drawdown Notice, the Agent receives:
(i)
the documents described in
 
of
 
(
Condition precedent documents
) in form
and substance satisfactory to the Agent and its lawyers; and
(ii)
the arrangement fee referred to in Clause
 
(a) (
Fees
);
(b)
that, on or before
 
the Drawdown Date but prior to
 
the making of the Loan, the Agent receives or
is
 
satisfied
 
that
 
it will
 
receive
 
on
 
the making
 
of
 
the Loan
 
the documents
 
described in
 
of
 
(
Condition
 
precedent
 
documents
)
 
in
 
form
 
and
 
substance
 
satisfactory
 
to
 
it
 
and
 
its
lawyers;
(c)
that,
 
on
 
or
 
before
 
the
 
service
 
of
 
the
 
Drawdown
 
Notice,
 
the
 
Agent
 
receives
 
payment
 
of
 
any
expenses payable pursuant to Clause
Costs of negotiation,
 
preparation etc
.) which is
 
due and
payable on the Drawdown Date;
(d)
that both at the date of the Drawdown Notice and at the Drawdown Date:
(i)
no Event
 
of Default
 
or Potential
 
Event
 
of Default
 
has occurred
 
or would
 
result from
 
the
borrowing of the Loan;
 
(ii)
the representations and warranties in Clause
 
(
General
) and those of any Borrower or
any Security
 
Party which
 
are set
 
out in
 
the other
 
Finance Documents would
 
be true and
not
 
misleading
 
if
 
repeated
 
on
 
each of
 
those
 
dates
 
with reference
 
to
 
the
 
circumstances
then existing;
 
(iii)
none of the
 
circumstances contemplated
 
by Clause
 
(
Market disruption
) has occurred
and is continuing; and
(iv)
there has
 
been no
 
material adverse
 
change in
 
the financial
 
condition, state
 
of affairs
 
or
prospects
 
of
 
the
 
Borrowers
 
(or
 
any
 
of
 
them),
 
the
 
Corporate
 
Guarantor
 
or
 
any
 
other
Security Party since 26
 
May 2023 in the
 
light of which the Agent
 
considers that there is a
significant risk that the Borrowers, the
 
Corporate Guarantor or any other Security
 
Party is,
or
 
will later
 
become, unable
 
to
 
discharge
 
its liabilities
 
under the
 
Finance Documents
 
to
which it is a party as they fall due;
(e)
that, if
 
the ratio
 
set out
 
in Clause
Minimum required
 
security cover
) were
 
applied immediately
following
 
the
 
making
 
of
 
the
 
Loan,
 
the
 
Borrowers
 
would
 
not
 
be
 
obliged
 
to
 
provide
 
additional
security or prepay part of the Loan under that Clause; and
(f)
that
 
the
 
Agent
 
has
 
received,
 
and
 
found
 
to
 
be
 
acceptable
 
to
 
it,
 
any
 
further
 
opinions,
 
consents,
agreements and documents
 
in connection
 
with the Finance
 
Documents which
 
the Agent may, with
the
 
authorisation
 
of
 
the
 
Majority
 
Lenders,
 
request
 
by
 
notice
 
to
 
the
 
Borrowers
 
prior
 
to
 
the
Drawdown Date.
9.2
Waiver of conditions precedent
If the Majority Lenders, at
 
their discretion, permit the Loan
 
to be borrowed before
 
certain of the
conditions referred to in Clause
 
(
Documents, fees and no default
) are satisfied, the Borrowers
shall ensure that those
 
conditions are satisfied within
 
five Business Days after the
 
Drawdown Date
(or such longer period as the Agent may, with the authorisation of the Majority Lenders, specify).
10
REPRESENTATIONS
 
AND WARRANTIES
10.1
General
Each Borrower represents and warrants to each Creditor Party as follows.
10.2
Status
(a)
Each Borrower is duly incorporated and validly
 
existing and in good standing under
 
the laws of the
Marshall Islands.
10.3
Shares and ownership
(a)
Each Borrower is authorised to issue five hundred
 
(500) registered shares with par value of $0,01
each.
(b)
The legal title and beneficial ownership
 
of all those shares is held, free
 
of any Security Interest or
other claim, by the Corporate Guarantor.
10.4
Corporate power
Each
 
Borrower
 
has
 
the
 
corporate
 
capacity,
 
and
 
has
 
taken
 
all
 
corporate
 
action and
 
obtained
 
all
consents necessary for it:
(a)
to register permanently the Ship owned by it in its name under the Approved Flag;
(b)
to execute the Finance Documents to which that Borrower is a party; and
(c)
to
 
borrow
 
under
 
this
 
Agreement,
 
to
 
enter
 
into
 
Designated
 
Transactions
 
under
 
the
 
Master
Agreement
 
and to
 
make
 
all the
 
payments
 
contemplated
 
by,
 
and to
 
comply with,
 
those Finance
Documents to which it is a party.
10.5
Consents in force
All
 
the
 
consents
 
referred
 
to
 
in
 
Clause
 
(
Corporate
 
power
)
 
remain
 
in
 
force
 
and
 
nothing
 
has
occurred which makes any of them liable to revocation.
10.6
Legal validity; effective Security Interests
The Finance
 
Documents to
 
which each
 
Borrower is
 
a party,
 
do now or,
 
as the
 
case may
 
be, will,
upon execution
 
and delivery
 
(and, where
 
applicable, registration
 
as provided
 
for in
 
the Finance
Documents):
 
(a)
constitute that
 
Borrower's legal,
 
valid and binding obligations
 
enforceable against
 
that Borrower
in accordance with their respective terms; and
(b)
create legal,
 
valid and binding
 
Security Interests
 
enforceable in
 
accordance with their
 
respective
terms over all the assets to which they, by their terms, relate;
subject to any relevant insolvency laws affecting creditors'
 
rights generally.
10.7
No third party Security Interests
Without limiting
 
the generality
 
of Clause
 
(
Legal validity;
 
effective Security
 
Interests
), at
 
the
time of the execution and delivery of each Finance Document to which a Borrower is a party:
 
(a)
each
 
Borrower
 
which
 
is
 
a
 
party
 
to
 
that
 
Finance
 
Document
 
will
 
have
 
the
 
right
 
to
 
create
 
all
 
the
Security Interests which that Finance Document purports to create; and
(b)
no third party will have any
 
Security Interest (except for Permitted Security Interests) or any other
interest, right
 
or claim over,
 
in or in
 
relation to
 
any asset to
 
which any
 
such Security Interest,
 
by
its terms, relates.
10.8
No conflicts
The
 
execution
 
by
 
each
 
Borrower
 
of
 
each
 
Finance
 
Document
 
to
 
which
 
it
 
is
 
a
 
party,
 
and
 
the
borrowing by
 
that Borrower
 
of the
 
Loan (or
 
any part
 
thereof), and
 
its compliance
 
with each
 
Finance
Document to which it is a party will not involve or lead to a contravention of:
(a)
any law or regulation; or
(b)
the constitutional documents of that Borrower; or
(c)
any contractual
 
or other obligation
 
or restriction
 
which is binding
 
on that
 
Borrower or
 
any of
 
its
assets.
10.9
No withholding taxes
All payments which each Borrower is liable to make under the Finance Documents to which it is a
party may be made without deduction or withholding for or on account
 
of any tax payable
 
under
any law of any Pertinent Jurisdiction.
10.10
No default
No Event of Default or Potential Event
 
of Default has occurred.
10.11
Information
All information which
 
has been
 
provided in
 
writing by
 
or on
 
behalf of
 
the Borrowers or
 
any Security
Party to
 
any Creditor
 
Party in connection
 
with any Finance
 
Document satisfied the requirements
of Clause
 
(
Information provided
 
to be
 
accurate
); all
 
audited and
 
unaudited accounts
 
which
have been
 
so provided
 
satisfied the
 
requirements of
 
Clause
 
(
Form of
 
financial statements
);
and there has
 
been no material adverse
 
change in the financial
 
position or state
 
of affairs
 
of any
Borrower from that disclosed in the latest of those accounts.
10.12
No litigation
No legal or
 
administrative action involving
 
any Borrower
 
(including action relating to
 
any alleged
or
 
actual
 
breach
 
of
 
the
 
ISM
 
Code
 
or
 
the
 
ISPS
 
Code)
 
has
 
been
 
commenced
 
or
 
taken
 
or,
 
to
 
any
Borrower's knowledge, is likely to be commenced or taken.
10.13
Compliance with certain undertakings
At the date of this Agreement, the Borrowers
 
are in compliance with Clauses
 
(
Title; negative
pledge
),
No other
 
liabilities or
 
obligations to
 
be incurred
),
Consents
) and
Principal
place of business
).
10.14
Taxes
 
paid
Each Borrower
 
has paid all taxes
 
applicable to, or
 
imposed on or in
 
relation to that
 
Borrower,
 
its
business or the Ship owned by it.
10.15
ISM Code and ISPS Code compliance
All requirements of the
 
ISM Code and
 
the ISPS Code
 
as they relate to the
 
Borrowers, the Approved
Manager and the Ships have been complied with.
10.16
No money laundering
Without
 
prejudice
 
to
 
the
 
generality
 
of
 
Clause
 
(
Purpose
 
of
 
the
 
Loan
),
 
in
 
relation
 
to
 
the
borrowing by the Borrowers
 
of the Loan, the performance
 
and discharge of their obligations
 
and
liabilities under the Finance
 
Documents, and the transactions and
 
other arrangements affected or
contemplated by
 
the Finance Documents
 
to which
 
a Borrower
 
is a party,
 
the Borrowers
 
confirm
(i) that
 
they are
 
acting for their
 
own account;
 
(ii) that they
 
will use the
 
proceeds of
 
the Loan for
their own benefit, under their
 
full responsibility and exclusively
 
for the purposes specified
 
in this
Agreement; (iii)
 
that no
 
Borrower and
 
no Security
 
Party nor
 
any of
 
their respective
 
subsidiaries,
directors, or officers, or, to the best of the Borrowers'
 
knowledge, any affiliate, agent or employee
thereof has
 
engaged
 
in any
 
activity or
 
conduct which
 
would violate
 
any
 
applicable anti-bribery,
anti-corruption
 
or
 
anti-money
 
laundering
 
laws
 
or
 
regulations
 
in
 
any
 
applicable
 
jurisdiction
 
and
each
 
Borrower
 
and
 
each
 
Security
 
Party
 
has
 
instituted
 
and
 
maintains
 
policies
 
and
 
procedures
designated to prevent
 
violation of such laws regulations
 
and rules and (iv) that the
 
foregoing will
not involve or lead
 
to a contravention of
 
any law, official requirement or other
 
regulatory measure
or
 
procedure
 
implemented
 
to
 
combat
 
"money
 
laundering"
 
(as
 
defined
 
in
 
Article
 
1
 
of
 
Directive
2005/60/EC of the European Parliament and of the Council).
 
10.17
No immunity
No Borrower,
 
nor any
 
of their
 
assets are
 
entitled to
 
immunity on
 
the grounds
 
of sovereignty
 
or
otherwise
 
from
 
any
 
legal
 
action
 
or
 
proceeding
 
(which
 
shall
 
include,
 
without
 
limitation,
 
suit
attachment prior to judgement, execution or other enforcement).
10.18
Sanctions
(a)
Each
 
Borrower,
 
Security
 
Party
 
and
 
member
 
of
 
the
 
Group
 
and
 
their
 
respective
 
subsidiaries,
directors,
 
officers,
 
employees,
 
and
 
to
 
the
 
best
 
of
 
each
 
Borrower's
 
knowledge,
 
their
 
respective
agents or representatives has been and is in compliance with Sanctions.
(b)
No Borrower, Security Party or member of the Group, none of their subsidiaries and none of their
respective directors, officers,
 
employees, and to the best of
 
each Borrower's knowledge, none of
their respective agents or representatives:
(i)
is a Restricted Party,
 
or is involved in any
 
transaction through which it is likely
 
to become
a Restricted
 
Party or
 
result in
 
the imposition of
 
Sanctions against
 
any party
 
to a
 
Finance
Document; or
(ii)
is
 
subject to
 
or
 
involved
 
in
 
any
 
inquiry,
 
claim,
 
action,
 
suit,
 
proceedings
 
or
 
investigation
against it with respect to Sanctions by any Sanctions Authority.
10.19
Compliance with applicable laws
Each Borrower
 
is at
 
all times
 
in compliance
 
with all
 
applicable laws
 
or regulations,
 
including but
not limited to all Environmental Laws.
11
GENERAL UNDERTAKINGS
 
11.1
General
Each Borrower undertakes with each
 
Creditor Party to comply with
 
the following provisions of
 
this
Clause
 
(
General undertakings
) at all times during the Security Period except as the Agent
 
may,
with the authorisation of the Majority Lenders, otherwise permit.
11.2
Title; negative pledge
Each Borrower will:
(a)
hold the legal
 
title to, and
 
own the entire
 
beneficial interest in
 
the Ship
 
owned by it,
 
the Insurances
and Earnings, free
 
from all Security
 
Interests and
 
other interests
 
and rights of
 
every kind, except
for
 
those
 
created
 
by
 
the
 
Finance
 
Documents
 
and
 
the
 
effect
 
of
 
assignments
 
contained
 
in
 
the
Finance Documents and except for Permitted Security Interests; and
(b)
not create
 
or permit
 
to arise
 
any Security
 
Interest (except
 
for Permitted
 
Security Interests)
 
over
any other asset, present or future (including, but not limited
 
to, that Borrower's rights against the
Swap
 
Bank
 
under
 
the
 
Master
 
Agreement
 
or
 
all
 
or
 
any
 
part
 
of
 
that
 
Borrower's
 
interest
 
in
 
any
amount payable to that Borrower by the Swap Bank under the Master Agreement).
11.3
No disposal of assets
No Borrower will transfer,
 
lease or otherwise dispose of:
(a)
all
 
or
 
a
 
substantial
 
part
 
of
 
its
 
assets,
 
whether
 
by
 
one
 
transaction
 
or
 
a
 
number of
 
transactions,
whether related or not; or
(b)
any debt payable to it
 
or any other
 
right (present, future
 
or contingent right) to
 
receive a payment,
including any right to damages or compensation,
but paragraph
 
does not apply to any charter of a Ship as to
 
which Clause
 
(
Restriction on
chartering, appointment of managers etc.
) applies.
11.4
No other liabilities or obligations to be incurred
No Borrower will incur any liability or obligation except:
(a)
under the Finance Documents to which it is a party;
 
(b)
liabilities
 
or
 
obligations
 
reasonably
 
incurred
 
in
 
the
 
ordinary
 
course
 
of
 
owning,
 
operating
 
and
chartering the Ship;
 
(c)
in respect of the Designated Transactions;
 
and
(d)
until the Drawdown Date, any liabilities incurred under the Existing Facility Agreement.
11.5
Information provided to be accurate
All financial
 
and other information
 
which is provided
 
in writing
 
by or
 
on behalf
 
of a Borrower
 
under
or in connection with any Finance
 
Document will be true and
 
not misleading and will
 
not omit any
material fact or consideration.
11.6
Provision of financial statements
Each Borrower will send or procure that are to be sent to the Agent:
(a)
as soon as possible, but in no event later than 180 days after the end of
 
each Financial Year of the
Corporate
 
Guarantor
 
the
 
audited
 
annual
 
consolidated
 
financial
 
statements
 
of
 
the
 
Corporate
Guarantor
 
for
 
that
 
Financial
 
Year
 
of
 
the
 
Corporate
 
Guarantor
 
(commencing
 
with
 
the
 
financial
statements for the year ending on 31 December 2023);
 
(b)
as soon as possible, but in no
 
event later than 90
 
days after the end of
 
each Financial Year
 
of the
Corporate
 
Guarantor
 
the
 
unaudited
 
annual
 
consolidated
 
financial
 
statements
 
of
 
the
 
Corporate
Guarantor
 
for
 
that
 
Financial
 
Year
 
of
 
the
 
Corporate
 
Guarantor
 
(commencing
 
with
 
the
 
financial
statements for the year ending on 31 December 2023);
(c)
as soon as possible, but
 
in no event later
 
than 90 days after
 
30 June in each Financial Year
 
of the
Corporate
 
Guarantor
 
the
 
unaudited
 
semi-annual
 
consolidated
 
financial
 
statements
 
of
 
the
Corporate Guarantor for the
 
first six-month period
 
of such
 
Financial Year and
 
in the
 
form published
in the relevant
 
press release
 
(commencing with the financial statements
 
for the 6-month period
ending
 
on
 
30
 
June
 
2023)
 
certified
 
as
 
to
 
their
 
correctness
 
by
 
the
 
chief
 
financial
 
officer
 
of
 
the
Corporate Guarantor; and
(d)
promptly after a request by
 
the Agent, such further
 
financial or other
 
information in respect of
 
the
Borrowers, the
 
Ships, the Corporate
 
Guarantor,
 
the other Security
 
Parties, the
 
Fleet Vessels
 
and
the Group (including, but not limited to, charter arrangements, Financial Indebtedness, operating
expenses) as the Agent may reasonably require.
11.7
Form of financial statements
All accounts delivered under Clause
 
(
Provision of financial statements
) will:
(a)
be prepared in accordance with all applicable laws and GAAP consistently applied;
(b)
give a true
 
and fair view
 
of the state
 
of affairs
 
of the Group
 
at the date
 
of those accounts
 
and of
its profit for the period to which those accounts relate; and
(c)
fully disclose or provide for all significant liabilities of the Group.
11.8
Shareholder and creditor notices
Each
 
Borrower
 
will
 
send
 
the
 
Agent,
 
at
 
the
 
same
 
time
 
as
 
they
 
are
 
despatched,
 
copies
 
of
 
all
communications which
 
are despatched
 
to that
 
Borrower's shareholders
 
or creditors
 
or any
 
class
of them.
11.9
Consents
Each
 
Borrower
 
will
 
maintain
 
in
 
force
 
and
 
promptly
 
obtain
 
or
 
renew,
 
and
 
will
 
promptly
 
send
certified copies to the Agent of, all consents required:
(a)
for that Borrower to perform its obligations under any Finance Document to which it is a party;
 
(b)
for the validity or enforceability of any Finance Document to which it is a party; and
(c)
for that Borrower to continue to own and operate the Ship owned by it,
and that Borrower will comply with the terms of all such consents.
11.10
Maintenance of Security Interests
Each Borrower will:
(a)
at its own cost, do all that is necessary to ensure that any Finance Document to which it is a party
validly creates the obligations and the Security Interests which it purports to create; and
(b)
without limiting the generality
 
of paragraph
, at its
 
own cost, promptly
 
register,
 
file, record or
enrol
 
any
 
Finance
 
Document
 
with
 
any
 
court
 
or
 
authority
 
in
 
all
 
Pertinent
 
Jurisdictions, pay
 
any
stamp, registration or similar tax in all Pertinent Jurisdictions in respect of
 
any Finance Document,
give
 
any
 
notice or
 
take
 
any
 
other
 
step
 
which,
 
in
 
the opinion
 
of
 
the Majority
 
Lenders,
 
is
 
or
 
has
become necessary or
 
desirable for
 
any Finance Document
 
to be
 
valid, enforceable
 
or admissible
in evidence or to ensure or protect the priority of any Security Interest which it creates.
 
11.11
Notification of litigation
Each Borrower
 
will provide
 
the Agent
 
with details
 
of any
 
legal or
 
administrative action
 
involving
that Borrower, any Security Party,
 
the Approved Manager or the Ship
 
owned by it, the Earnings or
the Insurances as soon as such action is instituted
 
or it becomes apparent to that Borrower that it
is
 
likely
 
to
 
be
 
instituted,
 
unless
 
it
 
is
 
clear
 
that
 
the
 
legal
 
or
 
administrative
 
action
 
cannot
 
be
considered material in the context of any Finance Document.
 
11.12
No amendment to Master Agreement
No
 
Borrower
 
will
 
agree
 
to
 
any
 
amendment
 
or
 
supplement
 
to,
 
or
 
waive
 
or
 
fail
 
to
 
enforce,
 
the
Master Agreement or any of its provisions.
11.13
Principal place of business
No Borrower will establish,
 
or do anything
 
as a result
 
of which it
 
would be deemed
 
to have, a place
of business in the United Kingdom or the US.
11.14
Confirmation of no default
Each Borrower will, within
 
two Business Days after
 
service by the
 
Agent of a
 
written request, serve
on the Agent a notice which is signed by two directors of that Borrower and which:
(a)
states that no Event of Default or Potential
 
Event of Default has occurred; or
(b)
states that
 
no Event
 
of Default
 
or Potential
 
Event of
 
Default has
 
occurred, except
 
for a
 
specified
event or matter,
 
of which all material details are given.
The Agent may
 
serve requests under
 
this Clause
 
(
Confirmation of no
 
default
) from time
 
to
time but only
 
if asked to do
 
so by a
 
Lender or
 
Lenders having Contributions
 
exceeding ten per
 
cent.
of the Loan or (if the Loan hasn't been drawn) Commitments exceeding
 
ten per cent. of the Total
Commitments; and this Clause
 
(
Confirmation of no default
) does not
 
affect the
 
Borrowers'
obligations under Clause
 
(
Notification of default
).
11.15
Notification of default
Each Borrower will notify the Agent as soon as that Borrower becomes aware of:
(a)
the occurrence of an Event of Default or a Potential Event of Default; or
(b)
any
 
matter
 
which
 
indicates
 
that
 
an
 
Event
 
of
 
Default
 
or
 
a
 
Potential
 
Event
 
of
 
Default
 
may
 
have
occurred,
and will keep the Agent fully up to date with all developments.
11.16
Provision of further information
Each Borrower will, as soon as practicable after receiving the request, provide the Agent with any
additional financial or other information relating:
(a)
to the
 
Borrowers,
 
the Group,
 
the Corporate
 
Guarantor,
 
the Ships,
 
the other
 
Fleet Vessels,
 
their
Insurances
 
or
 
their
 
Earnings
 
(including,
 
but
 
not
 
limited
 
to,
 
any
 
sales
 
or
 
purchases
 
of
 
any
 
Fleet
Vessels,
 
the
 
incurrence
 
of
 
Financial
 
Indebtedness
 
by
 
members
 
of
 
the
 
Group,
 
details
 
of
 
the
employment of the Fleet Vessels) as the Agent may require; or
(b)
to any other matter relevant to, or to any
 
provision of, a Finance Document,
which may be requested
 
by the Agent,
 
the Security Trustee,
 
the Swap Bank or
 
any Lender at any
time.
11.17
Provision of copies and translation of documents
Each Borrower will supply the Agent with
 
a sufficient number of copies
 
of the documents referred
to above
 
to provide
 
one copy
 
for each
 
Creditor Party;
 
and if
 
the Agent
 
so requires
 
in respect
 
of
any of
 
those documents, the
 
Borrowers will
 
provide a certified
 
English translation prepared
 
by a
translator approved by the Agent.
11.18
Know your customer
Promptly
 
upon
 
the
 
Agent's
 
request
 
each
 
Borrower
 
will
 
supply,
 
or
 
procure
 
the
 
supply
 
of,
 
such
documentation
 
and
 
other
 
evidence
 
as
 
is
 
reasonably
 
requested
 
by
 
the
 
Agent
 
in
 
order
 
for
 
each
Creditor Party to
 
carry out and be satisfied with
 
the results of all necessary "know your
 
client" or
other checks which it is
 
required to carry out
 
in relation to the
 
transactions contemplated by
 
the
Finance
 
Documents
 
and
 
to
 
the
 
identity
 
of
 
any
 
parties
 
to
 
the
 
Finance
 
Documents
 
(other
 
than
Creditor Parties) and their directors and officers.
11.19
Payment of taxes
Each Borrower shall pay
 
when due all taxes
 
applicable to, or imposed on,
 
its business or the Ship
owned by it.
11.20
Bribery and anti-corruption laws
(a)
No Borrower shall use the
 
proceeds of the Loan for
 
any purpose which would breach
 
the Bribery
Act 2010,
 
the United
 
States
 
Foreign
 
Corrupt Practices
 
Act of
 
1977 or
 
other similar
 
legislation in
other jurisdictions.
(b)
Each Borrower shall
 
(and shall procure that
 
each other Security Party
 
and each other member of
the Group shall):
(i)
conduct its businesses in compliance with applicable anti-corruption laws; and
(ii)
maintain policies and procedures designed to promote and achieve compliance with such
laws.
11.21
Sanctions
(a)
Each Borrower
 
shall ensure that
 
none of them or
 
the Security Parties
 
nor any of
 
their respective
subsidiaries or any
 
member of the
 
Group, their
 
respective directors,
 
officers, employees,
 
agents
or representatives or any
 
other persons acting
 
on any of
 
their behalf, is or
 
will become a
 
Restricted
Party.
(b)
Each Borrower
 
shall supply to the
 
Agent, promptly upon
 
becoming aware of
 
them, the details
 
of
any inquiry, claim, action, suit, proceeding or
 
investigation pursuant to Sanctions by any Sanctions
Authority against a Borrower, any Security Party,
 
any of their respective direct or indirect owners,
their respective
 
subsidiaries or
 
any
 
member of
 
the Group,
 
any
 
of their
 
joint ventures
 
or any
 
of
their respective
 
directors, officers,
 
employees, agents
 
or representatives,
 
as well
 
as information
on what steps are being taken with regards to answer or oppose such.
(c)
Each Borrower shall (and shall procure that the other members of the Group will) implement and
maintain in effect
 
policies and procedures
 
designed to promote
 
and ensure compliance
 
by them
and their
 
respective directors,
 
officers and
 
employees acting
 
on their
 
behalf with
 
Sanctions and
anti-corruption laws and regulations.
11.22
Use of proceeds
(a)
No proceeds of
 
the Loan or any
 
part of the Loan
 
shall be made available,
 
directly or indirectly
 
to
or for the benefit of a Restricted Party nor shall they be otherwise directly
 
or indirectly, applied in
a manner or
 
for a
 
purpose prohibited by
 
Sanctions or could
 
result in the
 
imposition of sanctions
against any party to any Finance Document.
(b)
The Borrowers shall not repay or prepay the
 
Loan or any part thereof
 
or fund all or
 
any part of any
payment
 
under
 
this
 
Agreement
 
(i)
 
out
 
of
 
proceeds
 
from
 
funds
 
or
 
assets
 
that
 
(A)
 
constitute
property of, or that are beneficially owned directly or indirectly by,
 
any Restricted Party or (B) are
obtained or
 
derived from
 
transactions with
 
or relating
 
to any
 
Restricted Party
 
or transactions
 
in
violation
 
of
 
Sanctions
 
or
 
(ii)
 
in
 
any
 
manner
 
that
 
would
 
cause
 
any
 
Lender
 
to
 
be
 
in
 
violation
 
of
Sanctions.
12
CORPORATE UNDERTAKINGS
 
12.1
General
Each Borrower
 
also undertakes
 
with each Creditor
 
Party to
 
comply with the
 
following provisions
of this
 
Clause
 
(
Corporate Undertakings
) at
 
all times
 
during the
 
Security Period
 
except
 
as the
Agent may,
 
with the authorisation of the Majority Lenders, otherwise permit.
12.2
Maintenance of status
(a)
Each Borrower will
 
maintain its separate
 
corporate existence
 
and remain in good
 
standing under
the
 
laws
 
of
 
the
 
Marshall
 
Islands
 
and
 
will,
 
and
 
shall
 
procure
 
that
 
any
 
other
 
Security
 
Party
 
(as
applicable)
 
will,
 
comply
 
in
 
all
 
respects
 
with
 
the
 
Republic
 
of
 
the
 
Marshall
 
Islands
 
Economic
Substance Regulations 2018 (as amended from time to time).
12.3
Negative undertakings
No Borrower will:
(a)
carry on any
 
business other than
 
the ownership,
 
chartering and operation
 
of the Ship
 
owned by
that Borrower; or
 
(b)
pay
 
any
 
dividend
 
or
 
make
 
any
 
other
 
form
 
of
 
distribution
 
or
 
effect
 
any
 
form
 
of
 
redemption,
purchase or return of share
 
capital (the "
Distribution
") if an Event
 
of Default has occurred at
 
any
relevant time which is continuing or an Event of Default will result from the Distribution; or
(c)
provide any form of credit or financial assistance to:
(i)
a person who is directly
 
or indirectly interested in that Borrower's share or
 
loan capital; or
(ii)
any
 
company
 
in
 
or
 
with
 
which
 
such
 
a
 
person
 
is
 
directly
 
or
 
indirectly
 
interested
 
or
connected,
or enter
 
into any
 
transaction with or
 
involving such a
 
person or company
 
on terms which
 
are, in
any respect, less favourable
 
to that Borrower than
 
those which it could obtain in
 
a bargain made
at arms' length; or
(d)
open or
 
maintain any account
 
with any bank
 
or financial
 
institution except accounts
 
with the
 
Agent
and the Security Trustee for the purposes of the Finance Documents; or
(e)
issue, allot or
 
grant any person a right
 
to any shares in
 
its capital or repurchase
 
or reduce its issued
share capital; or
(f)
acquire any shares or
 
other securities other
 
than US or
 
UK Treasury bills and certificates
 
of deposit
issued by major
 
North American or European
 
banks, or enter
 
into any transaction
 
in a derivative
other than the Designated Transactions; or
(g)
enter
 
into
 
any
 
form
 
of
 
amalgamation,
 
merger
 
or
 
de-merger
 
or
 
any
 
form
 
of
 
reconstruction
 
or
reorganisation.
13
INSURANCE
 
13.1
General
Each Borrower
 
also undertakes
 
with each Creditor
 
Party to
 
comply with the
 
following provisions
of this Clause
 
(
Insurance
) at all times during the Security Period except as the Agent may,
 
with
the authorisation of the Majority Lenders, otherwise permit.
13.2
Maintenance of obligatory insurances
Each Borrower shall keep the Ship owned by it insured at the expense of that Borrower against:
(a)
fire and usual marine risks (including hull and machinery and excess risks);
(b)
war risks (including terrorism, piracy and confiscation);
(c)
protection and indemnity risks (other than loss of hire or political risks); and
(d)
any other risks against which the Security Trustee
 
considers, having regard to practices and other
circumstances prevailing
 
at the
 
relevant time,
 
it would
 
in the
 
opinion of
 
the Security
 
Trustee
 
be
reasonable for that
 
Borrower to insure
 
and which are specified
 
by the Security Trustee
 
by notice
to that Borrower.
13.3
Terms of obligatory
 
insurances
Each Borrower shall effect such insurances:
(a)
in Dollars;
(b)
in the case of fire and
 
usual marine risks and
 
war risks, (including hull
 
interest and freight interest)
in such amount as shall from time to time be approved
 
by the Security Trustee but in any event in
an amount
 
not less
 
than the
 
greater
 
of (i)
 
an amount
 
which when
 
aggregated
 
with the
 
insured
value of
 
the other
 
Ships then
 
subject to
 
a Mortgage,
 
120 per
 
cent. of
 
the aggregate
 
of the
 
Loan
and (ii) the Market Value of the Ship owned by it;
 
(c)
in the
 
case of
 
hull and
 
machinery policy
 
at an
 
agreed insured
 
value
 
(excluding hull
 
interest
 
and
freight interest) in an amount of not less
 
than an amount which when
 
aggregated with the agreed
insured values under all
 
the other hull and machinery policies
 
for the other Ships then
 
subject to
a Mortgage is
 
not less than the
 
principal amount of the Loan
Provided that
 
the Borrowers are
 
in
compliance with their obligations under paragraph
 
above at all times;
 
(d)
in the case
 
of oil pollution
 
liability risks,
 
for an aggregate
 
amount equal
 
to the highest
 
level of cover
from
 
time
 
to
 
time
 
available
 
under
 
basic
 
protection
 
and
 
indemnity
 
club
 
entry
 
and
 
in
 
the
international marine insurance market;
(e)
in relation to protection and indemnity risks in respect of the full tonnage of the Ship;
(f)
on approved terms; and
(g)
through approved brokers and with approved insurance companies
 
and/or underwriters or, in the
case of
 
war
 
risks and
 
protection
 
and indemnity
 
risks, in
 
approved
 
war
 
risks and
 
protection
 
and
indemnity risks associations.
13.4
Further protections for the Creditor Parties
In addition
 
to
 
the terms
 
set out
 
in Clause
 
(
Terms
 
of obligatory
 
insurances
), each
 
Borrower
shall procure that the obligatory insurances effected by it shall:
(a)
subject always to
 
paragraph
, name
 
that Borrower as
 
the sole
 
named assured
 
unless the
 
interest
of every other named assured is limited:
(i)
in respect of any obligatory insurances for hull and machinery and war risks;
(A)
to any
 
provable out-of-pocket
 
expenses that it
 
has incurred and which
 
form part
of any recoverable claim on underwriters; and
 
(B)
to any
 
third party
 
liability claims
 
where cover
 
for
 
such claims
 
is provided
 
by the
policy (and then only in respect of discharge of any claims made against it); and
 
(ii)
in
 
respect
 
of
 
any
 
obligatory
 
insurances
 
for
 
protection
 
and
 
indemnity
 
risks,
 
to
 
any
recoveries it is entitled to make by way of reimbursement following discharge of
 
any third
party liability claims made specifically against it
and every other named assured has undertaken in writing
 
to the Security Trustee (in such form as
it
 
requires)
 
that
 
any
 
deductible
 
shall
 
be
 
apportioned
 
between
 
that
 
Borrower
 
and
 
every
 
other
named assured in proportion to
 
the gross claims made or
 
paid by each of them
 
and that it shall
 
do
all things necessary
 
and provide all
 
documents, evidence and
 
information to
 
enable the Security
Trustee
 
to
 
collect
 
or
 
recover
 
any
 
moneys
 
which
 
at
 
any
 
time
 
become
 
payable
 
in
 
respect
 
of
 
the
obligatory insurances;
(b)
whenever the
 
Security Trustee
 
requires, name (or
 
be amended to
 
name) the Security Trustee
 
as
additional named assured for its rights
 
and interests, warranted
 
no operational interest
 
and with
full waiver of rights
 
of subrogation against
 
the Security Trustee,
 
but without the Security Trustee
thereby being
 
liable to pay
 
(but having the
 
right to pay)
 
premiums, calls or
 
other assessments in
respect of such insurance;
(c)
name the Security Trustee as
 
loss payee with such directions for payment
 
as the Security Trustee
may specify;
(d)
provide that
 
all payments
 
by or
 
on behalf of
 
the insurers
 
under the obligatory
 
insurances to
 
the
Security
 
Trustee
 
shall
 
be
 
made
 
without
 
set-off,
 
counterclaim
 
or
 
deductions
 
or
 
condition
whatsoever;
(e)
provide that such obligatory
 
insurances shall be primary without right of contribution from
 
other
insurances which may be carried by the Security Trustee or any other Creditor Party; and
(f)
provide that the Security Trustee may make
 
proof of loss if that Borrower fails to do so.
13.5
Renewal of obligatory insurances
Each Borrower shall:
(a)
at least 21 days before the expiry of any obligatory insurance effected
 
by it:
(i)
notify
 
the
 
Security
 
Trustee
 
of
 
the
 
brokers
 
(or
 
other
 
insurers)
 
and
 
any
 
protection
 
and
indemnity
 
or
 
war
 
risks
 
association
 
through
 
or
 
with
 
whom
 
that
 
Borrower
 
proposes
 
to
renew that obligatory insurance and of the proposed terms of renewal; and
(ii)
obtain the Security Trustee's approval to the matters
 
referred to in paragraph
(b)
at least 14 days
 
before the expiry of
 
any obligatory insurance,
 
renew that obligatory insurance
 
in
accordance with the Security Trustee's approval pursuant to paragraph
; and
(c)
procure that the
 
approved brokers and/or the war
 
risks and
 
protection and indemnity
 
associations
with which such a renewal is effected shall promptly after the renewal notify the Security Trustee
in writing of the terms each conditions of the renewal.
13.6
Copies of policies; letters of undertaking
Each Borrower shall ensure that all approved brokers provide the Security Trustee with pro forma
copies of all policies relating to the obligatory insurances which they are to effect or renew and of
a
 
letter
 
or
 
letters
 
of
 
undertaking
 
in
 
a
 
form
 
required
 
by
 
the
 
Security
 
Trustee
 
and
 
including
undertakings by the approved brokers that:
(a)
they will have endorsed
 
on each policy, immediately upon
 
issue, a loss
 
payable clause and
 
a notice
of assignment
 
complying with
 
the provisions
 
of Clause
 
(
Further protections
 
for the
 
Creditor
Parties
);
 
(b)
they will hold
 
such policies,
 
and the benefit
 
of such insurances,
 
to the order
 
of the Security
 
Trustee
in accordance with the said loss payable clause;
 
(c)
they
 
will
 
advise
 
the
 
Security
 
Trustee
 
immediately
 
of
 
any
 
material
 
change
 
to
 
the
 
terms
 
of
 
the
obligatory insurances;
 
(d)
they
 
will
 
notify the
 
Security
 
Trustee,
 
not
 
less
 
than
 
14
 
days
 
before
 
the
 
expiry
 
of
 
the
 
obligatory
insurances,
 
in
 
the
 
event
 
of
 
their
 
not
 
having
 
received
 
notice
 
of
 
renewal
 
instructions
 
from
 
that
Borrower or its agents
 
and, in the
 
event of their receiving
 
instructions to renew, they will promptly
notify the Security Trustee of the terms of the instructions; and
(e)
they will not set
 
off against any
 
sum recoverable
 
in respect of a
 
claim relating to the
 
Ship owned
by that Borrower under
 
such obligatory insurances any
 
premiums or other amounts due to them
or
 
any
 
other
 
person
 
whether
 
in
 
respect
 
of
 
that
 
Ship
 
or
 
otherwise,
 
they
 
waive
 
any
 
lien
 
on
 
the
policies, or any sums received under them, which they
 
might have in respect of such premiums or
other amounts, and they will
 
not cancel such obligatory
 
insurances by reason of
 
non-payment of
such premiums or other amounts, and will arrange for a separate policy to be issued in respect of
that Ship forthwith upon being so requested by the Security Trustee.
13.7
Copies of certificates of entry
Each
 
Borrower
 
shall ensure
 
that
 
any
 
protection
 
and indemnity
 
and/or
 
war
 
risks
 
associations
 
in
which the Ship owned by it is entered provides the Security Trustee with:
(a)
a certified copy of the certificate of entry for that Ship owned by it;
(b)
a letter or letters of undertaking in such form as may be required by the Security Trustee; and
(c)
a
 
certified
 
copy
 
of
 
each
 
certificate
 
of
 
financial
 
responsibility
 
for
 
pollution
 
by
 
oil
 
or
 
other
Environmentally
 
Sensitive Material
 
issued by
 
the relevant
 
certifying authority
 
in relation
 
to that
Ship.
13.8
Deposit of original policies
Each
 
Borrower
 
shall
 
ensure
 
that
 
all
 
policies
 
relating
 
to
 
obligatory
 
insurances
 
effected
 
by
 
it
 
are
deposited with the approved brokers through which the insurances are effected or renewed.
13.9
Payment of premiums
Each Borrower shall
 
punctually pay
 
all premiums
 
or other
 
sums payable in
 
respect of
 
the obligatory
insurances
 
effected
 
by
 
it
 
and
 
produce
 
all
 
relevant
 
receipts
 
when
 
so
 
required
 
by
 
the
 
Security
Trustee.
13.10
Guarantees
Each Borrower
 
shall ensure
 
that any
 
guarantees
 
required by
 
a protection
 
and indemnity
 
or war
risks association are promptly issued and remain in full force and effect.
13.11
Restrictions on employment
No Borrower shall employ its Ship, nor shall permit it to be employed, outside the cover provided
by any obligatory insurances.
13.12
Compliance with terms of insurances
No Borrower
 
shall do nor
 
omit to
 
do (nor permit
 
to be
 
done or not
 
to be
 
done) any
 
act or thing
which would or might render any obligatory insurance invalid,
 
void, voidable or unenforceable or
render
 
any
 
sum
 
payable
 
under
 
an
 
obligatory
 
insurance
 
repayable
 
in
 
whole
 
or
 
in
 
part;
 
and,
 
in
particular:
(a)
each Borrower
 
shall take
 
all necessary action
 
and comply with
 
all requirements
 
which may
 
from
time
 
to
 
time
 
be
 
applicable
 
to
 
the
 
obligatory
 
insurances,
 
and
 
(without
 
limiting
 
the
 
obligation
contained in Clause
 
(
Copies of policies; letters
 
of undertaking
)) ensure that
 
the obligatory
insurances are not made subject
 
to any exclusions
 
or qualifications to which the Security
 
Trustee
has not given its prior approval;
(b)
no
 
Borrower
 
shall
 
make
 
any
 
changes
 
relating
 
to
 
the
 
classification
 
or
 
classification
 
society
 
or
manager
 
or
 
operator
 
of
 
the
 
Ship
 
owned
 
by
 
it
 
approved
 
by
 
the
 
underwriters
 
of
 
the
 
obligatory
insurances;
(c)
each
 
Borrower
 
shall
 
make
 
(and
 
promptly
 
supply
 
copies
 
to
 
the
 
Agent
 
of)
 
all
 
quarterly
 
or
 
other
voyage declarations
 
which may
 
be required
 
by the
 
protection and
 
indemnity risks association
 
in
which the Ship
 
owned by it
 
is entered to
 
maintain cover for trading
 
to the United
 
States of America
and Exclusive Economic
 
Zone (as defined in the
 
United States Oil Pollution
 
Act 1990 or any
 
other
applicable legislation); and
(d)
no Borrower
 
shall employ
 
the Ship
 
owned by
 
it, nor
 
allow it
 
to be
 
employed, otherwise
 
than in
conformity with the terms and conditions of the obligatory insurances, without
 
first obtaining the
consent of the insurers and complying with any requirements (as
 
to extra premium or otherwise)
which the insurers specify.
13.13
Alteration to terms of insurances
(a)
No Borrower shall make
 
nor agree to any
 
alteration to the
 
terms of any
 
obligatory insurance nor
waive any right relating to any obligatory insurance.
 
(b)
Without limiting
 
the generality
 
of the
 
foregoing,
 
no Borrower
 
shall either
 
make or
 
agree to
 
any
alteration
 
to
 
the
 
terms
 
of
 
any
 
war
 
risks
 
and
 
allied
 
perils
 
coverage
 
(including
 
piracy
 
coverage)
whereby
 
trading
 
to
 
conditional
 
(excluded)
 
areas
 
not
 
declared
 
on
 
the
 
annual
 
policy
 
would
 
be
altered without the consent of the Agent.
13.14
Settlement of claims
No Borrower
 
shall settle,
 
compromise or
 
abandon any
 
claim under
 
any obligatory
 
insurance for
Total
 
Loss or
 
for
 
a Major
 
Casualty,
 
and shall
 
do all
 
things necessary
 
and provide
 
all documents,
evidence and information
 
to enable the Security
 
Trustee
 
to collect or
 
recover any moneys
 
which
at any time become payable in respect of the obligatory insurances.
13.15
Provision of copies of communications
Each Borrower shall provide the Security Trustee, at the time of each
 
such communication, copies
of all written communications between a Borrower and:
(a)
the approved brokers;
 
(b)
the approved protection and indemnity and/or war risks associations; and
(c)
the approved insurance companies and/or underwriters, which relate directly or indirectly to:
(i)
that
 
Borrower's
 
obligations
 
relating
 
to
 
the
 
obligatory
 
insurances
 
including,
 
without
limitation, all requisite declarations and payments of additional premiums or calls; and
 
(ii)
any credit arrangements made between that Borrower and any of
 
the persons referred to
in paragraphs
 
or
 
relating
 
wholly or
 
partly to
 
the effecting
 
or maintenance
 
of the
obligatory insurances.
13.16
Provision of information
In addition,
 
each Borrower
 
shall promptly
 
provide the
 
Security Trustee
 
(or any
 
persons which
 
it
may designate) with any
 
information which the Security
 
Trustee
 
(or any such designated
 
person)
requests for the purpose of:
(a)
obtaining
 
or
 
preparing
 
any
 
report
 
from
 
an
 
independent
 
marine
 
insurance
 
broker
 
as
 
to
 
the
adequacy of the obligatory insurances effected or proposed to be effected; and/or
(b)
effecting,
 
maintaining
 
or
 
renewing
 
any
 
such
 
insurances
 
as
 
are
 
referred
 
to
 
in
 
Clause
(
Mortgagee's interest insurances
) below or dealing
 
with or considering
 
any matters relating to any
such insurances,
and the Borrowers shall, forthwith
 
upon demand, indemnify the Security Trustee
 
in respect of all
fees and other expenses incurred by or for the account of the Security Trustee in connection with
any such report as is referred to in paragraph
13.17
Mortgagee's interest insurances
The
 
Security
 
Trustee
 
shall
 
be
 
entitled
 
from
 
time
 
to
 
time
 
to
 
effect,
 
maintain
 
and
 
renew
 
a
mortgagee's
 
interest
 
marine
 
insurance
 
policy
 
in
 
such
 
amounts,
 
on
 
such
 
terms,
 
through
 
such
insurers
 
and
 
generally
 
in
 
such manner
 
as the
 
Security Trustee
 
may
 
from
 
time to
 
time consider
appropriate and each Borrower shall upon demand fully indemnify the Creditor Parties in respect
of
 
all
 
premiums
 
and
 
other
 
expenses
 
which
 
are
 
incurred
 
in
 
connection
 
with
 
or
 
with
 
a
 
view
 
to
effecting, maintaining or renewing any such insurance or dealing with, or considering, any matter
arising out of any such insurance.
 
13.18
Review of insurance requirements
The Agent shall be entitled to review
 
the requirements of this Clause
 
(
Insurance
) from time to
time in
 
order to
 
take
 
account of
 
any changes
 
in circumstances
 
after the
 
date of
 
this Agreement
which the Agent
 
reasonably considers significant
 
and capable
 
of affecting the Borrowers,
 
the Ships
and
 
their
 
Insurances
 
(including,
 
without
 
limitation,
 
changes
 
in
 
the
 
availability
 
or
 
the
 
cost
 
of
insurance
 
coverage
 
or
 
the
 
risks
 
to
 
which
 
each
 
Borrower
 
may
 
be
 
subject),
 
and
 
may
 
appoint
insurance consultants in relation to this review at the cost of that Borrower.
13.19
Modification of insurance requirements
The Agent shall notify the Borrowers of any proposed modification under Clause
 
(
Review of
insurance
 
requirements
)to
 
the
 
requirements
 
of
 
this
 
Clause
 
(
Insurance
)
 
which
 
the
 
Agent
reasonably considers appropriate in the circumstances, and such modification shall take effect on
and from the date
 
it is notified
 
in writing to the
 
relevant Borrower as an
 
amendment to this
 
Clause
 
(
Insurance
) and shall bind that Borrower accordingly.
13.20
Compliance with mortgagee's instructions
The Agent shall
 
be entitled
 
(without prejudice
 
to or limitation
 
of any other
 
rights which
 
it may have
or acquire under
 
any Finance Document)
 
to require a Ship
 
to remain at any
 
safe port or to
 
proceed
to
 
and
 
remain
 
at
 
any
 
safe
 
port
 
designated
 
by
 
the
 
Agent
 
until
 
the
 
Borrower
 
owning
 
that
 
Ship
implements
 
any
 
amendments
 
to
 
the
 
terms
 
of
 
the
 
obligatory
 
insurances
 
and
 
any
 
operational
changes
 
required
 
as
 
a
 
result
 
of
 
a
 
notice
 
served
 
under
 
Clause
 
(
Modification
 
of
 
insurance
requirements
).
14
SHIP COVENANTS
 
14.1
General
Each Borrower
 
also undertakes
 
with each Creditor
 
Party to
 
comply with the
 
following provisions
of this Clause
 
(
Ship covenants
) at all times during the Security Period except as the Agent, with
the authorisation of the Majority Lenders, may
 
otherwise permit (and in the case of Clauses
(
Ship's name and registration
) and
 
(
Restrictions on chartering, appointment of managers
etc
.), such permission not to be unreasonably withheld).
14.2
Ship's name and registration
Each Borrower shall
 
keep the Ship
 
owned by it
 
registered in its
 
name under an
 
Approved Flag; shall
not do,
 
omit to
 
do or
 
allow to
 
be done
 
anything as
 
a result
 
of which
 
such registration
 
might be
cancelled or imperilled; and shall not change the name or port
 
of registry of the Ship owned by it.
14.3
Repair and classification
Each Borrower shall keep the Ship owned by it in a good and safe condition and state of repair:
(a)
consistent with first class ship ownership and management practice;
(b)
so
 
as
 
to
 
maintain
 
the
 
highest
 
class
 
free
 
of
 
overdue
 
recommendations
 
and
 
conditions
 
with
 
a
classification society which is a member of IACS acceptable to the Agent; and
(c)
so
 
as
 
to
 
comply
 
with
 
all
 
laws
 
and
 
regulations
 
applicable
 
to
 
vessels
 
registered
 
at
 
ports
 
in
 
the
applicable
 
Approved
 
Flag State
 
or
 
to
 
vessels
 
trading
 
to
 
any
 
jurisdiction to
 
which that
 
Ship may
trade from time to time, including but not limited to the ISM Code and the ISPS Code.
14.4
Classification society undertaking
Each
 
Borrower
 
shall
 
instruct
 
the
 
classification
 
society
 
referred
 
to
 
in
 
Clause
 
(
Repair
 
and
classification
):
(a)
to send to
 
the Security Trustee,
 
following receipt of
 
a written request
 
from the Security
 
Trustee,
certified true copies of
 
all original class records
 
held by the classification
 
society in relation
 
to its
Ship;
(b)
to
 
allow the
 
Security Trustee
 
(or
 
its agents),
 
at
 
any
 
time and
 
from
 
time to
 
time, to
 
inspect the
original class and related
 
records of its
 
Ship at the offices of
 
the classification society and to
 
take
copies of them;
(c)
to notify the Security Trustee immediately in writing if the classification society:
(i)
receives notification
 
from that
 
Borrower or
 
any other person
 
that its Ship's
 
classification
society is to be changed; or
(ii)
becomes aware of
 
any facts or matters
 
which may result in
 
or have resulted
 
in a change,
suspension, discontinuance,
 
withdrawal
 
or expiry
 
of that
 
Ship's class
 
under the
 
rules or
terms
 
and
 
conditions
 
of
 
that
 
Borrower's
 
or
 
its
 
Ship's
 
membership
 
of
 
the
 
classification
society; and
(d)
following receipt of a written request from the Security Trustee:
(i)
to confirm that
 
a Borrower is
 
not in default
 
of any of
 
its contractual obligations
 
or liabilities
to the
 
classification society and,
 
without limiting the
 
foregoing, that
 
it has paid
 
in full all
fees or other charges due and payable to the classification society; or
(ii)
if
 
a
 
Borrower
 
is
 
in
 
default
 
of
 
any
 
of
 
its
 
contractual
 
obligations
 
or
 
liabilities
 
to
 
the
classification society,
 
to specify to
 
the Security Trustee
 
in reasonable detail
 
the facts and
circumstances of such default,
 
the consequences of such default,
 
and any remedy period
agreed or allowed by the classification society.
14.5
Modification
No Borrower shall make any modification or repairs to, or replacement of,
 
any Ship or equipment
installed
 
on
 
it
 
which
 
would
 
or
 
might
 
materially
 
alter
 
the
 
structure,
 
type
 
or
 
performance
characteristics of that Ship or materially reduce its value.
14.6
Removal of parts
No Borrower
 
shall remove
 
any material
 
part of
 
any Ship,
 
or any
 
item of
 
equipment installed
 
on,
any Ship unless the part or item so removed is forthwith
 
replaced by a suitable part or item which
is in
 
the same
 
condition as
 
or better
 
condition than
 
the part
 
or item
 
removed, is
 
free from
 
any
Security Interest or any right in favour of any person
 
other than the Security
 
Trustee and becomes
on
 
installation
 
on
 
the
 
relevant
 
Ship
 
the
 
property
 
of
 
the
 
relevant
 
Borrower
 
and
 
subject
 
to
 
the
security constituted
 
by the
 
relevant
 
Mortgage
Provided that
 
a Borrower
 
may
 
install equipment
owned by a third
 
party if the equipment can
 
be removed without any
 
risk of damage to
 
the Ship
owned by it.
14.7
Surveys
Each Borrower shall submit the Ship owned by it regularly to all periodical or other surveys which
may be required for classification purposes and, if so required by the Security Trustee provide the
Security Trustee, with copies of all survey reports.
14.8
Inspection
Each Borrower shall permit the
 
Security Trustee (by surveyors or other persons appointed
 
by it for
that purpose) to
 
board the Ship owned
 
by it at
 
all reasonable times to
 
inspect its condition or
 
to
satisfy themselves about
 
proposed or executed repairs
 
and shall afford all
 
proper facilities for such
inspections.
14.9
Prevention of and release from arrest
Each Borrower shall promptly discharge:
(a)
all liabilities which give
 
or may give
 
rise to maritime or
 
possessory liens on or claims enforceable
against the Ship owned by it, the Earnings or the Insurances;
(b)
all taxes, dues and other amounts
 
charged in respect of the Ship owned by
 
it, the Earnings or the
Insurances; and
(c)
all other outgoings whatsoever in respect of the Ship owned by it, the Earnings or the Insurances,
and, forthwith
 
upon receiving notice
 
of the
 
arrest of
 
the Ship
 
owned by
 
it, or of
 
its detention
 
in
exercise
 
or
 
purported
 
exercise
 
of
 
any
 
lien
 
or
 
claim,
 
that
 
Borrower
 
shall
 
procure
 
its
 
release
 
by
providing bail or otherwise as the circumstances may require.
14.10
Compliance with laws etc.
Each Borrower shall:
(a)
comply,
 
or
 
procure
 
compliance
 
with
 
the
 
ISM
 
Code,
 
the
 
ISPS
 
Code,
 
all
 
Environmental
 
Laws,
 
all
Sanctions
 
and
 
all
 
other
 
laws
 
or
 
regulations
 
relating
 
to
 
the
 
Ship
 
owned
 
by
 
it,
 
its
 
ownership,
operation and management or to the business of that Borrower;
(b)
not employ the Ship owned by
 
it nor allow its employment
 
in any manner contrary
 
to any law
 
or
regulation in any relevant jurisdiction
 
including but not
 
limited to the ISM
 
Code, the ISPS
 
Code and
all Sanctions; and
(c)
in the event
 
of hostilities in
 
any part of
 
the world (whether
 
war is
 
declared or not),
 
not cause or
permit the
 
Ship owned
 
by it
 
to enter
 
or trade
 
to any
 
zone which
 
is declared
 
a war
 
zone by
 
any
government
 
or
 
by
 
the Ship's
 
war
 
risks
 
insurers
 
unless the
 
prior written
 
consent
 
of
 
the Security
Trustee
 
has been given and that
 
Borrower has (at
 
its expense) effected
 
any special, additional or
modified insurance cover which the Security Trustee may require.
14.11
Provision of information
Each Borrower shall promptly provide the Security Trustee with any information which it requests
regarding:
(a)
the Ship owned by it, its employment, position and engagements;
(b)
the Earnings and payments and amounts due to the master and crew of the Ship owned by it;
 
(c)
any expenses incurred, or likely to be incurred, in connection with the operation, maintenance or
repair of the Ship owned by it and any payments made in respect of that Ship;
(d)
any towages and salvages; and
(e)
its compliance, the Approved
 
Manager's compliance and the compliance
 
of the Ship owned
 
by it
with the ISM Code, the ISPS Code and all Sanctions,
and, upon the
 
Security Trustee's request, provide copies of
 
any current charter relating
 
to the Ship
owned
 
by
 
it,
 
of
 
any
 
current
 
charter
 
guarantee
 
and
 
copies
 
of
 
the
 
Borrower's
 
or
 
the
 
Approved
Manager's Document of Compliance.
14.12
Notification of certain events
Each Borrower shall immediately notify the Security Trustee by fax, confirmed forthwith, by letter
of:
(a)
any casualty which is or is likely to be or to become a Major Casualty;
(b)
any occurrence as a result of which the Ship owned by it
 
has become or is, by the passing of time
or otherwise, likely to become a Total Loss;
(c)
any
 
requirement
 
or
 
recommendation
 
made
 
by
 
any
 
insurer
 
or
 
classification
 
society
 
or
 
by
 
any
competent authority which is not immediately complied with;
(d)
any arrest or detention
 
of the Ship owned by it, any
 
exercise or purported exercise
 
of any lien on
that Ship or its Earnings or any requisition of that Ship for hire;
(e)
any intended dry docking of the Ship owned by it;
(f)
any Environmental Claim made against that Borrower or in connection with the Ship owned by it,
or any Environmental Incident;
(g)
any
 
claim
 
for
 
breach
 
of
 
the
 
ISM
 
Code
 
or
 
the
 
ISPS
 
Code
 
being
 
made
 
against
 
the
 
Borrower,
 
the
Approved Manager or otherwise in connection with the Ship owned by it; or
(h)
any other matter,
 
event or incident, actual or threatened, the effect of which will or could lead to
the ISM Code or the ISPS Code not being complied with
and that Borrower shall keep the Security Trustee advised in writing on
 
a regular basis and in such
detail
 
as
 
the
 
Security Trustee
 
shall
 
require
 
of
 
that
 
Borrower's,
 
the
 
Approved
 
Manager's
 
or
 
any
other person's response to any of those events or matters.
14.13
Restrictions on chartering, appointment of managers etc.
No Borrower shall, in relation to the Ship owned by it:
(a)
let that Ship on demise charter for any period;
(b)
enter into any time
 
or consecutive voyage charter
 
in respect of
 
that Ship for
 
a term which
 
exceeds,
or which by virtue of any optional extensions may exceed, 18 months;
(c)
enter
 
into any
 
charter in
 
relation to
 
that Ship
 
under which
 
more than
 
two months'
 
hire (or
 
the
equivalent) is payable in advance;
(d)
charter that
 
Ship otherwise
 
than on
 
bona fide
 
arm's length
 
terms at
 
the time
 
when that
 
Ship is
fixed;
(e)
appoint a
 
manager of
 
that Ship
 
other than
 
the Approved
 
Manager or
 
agree to
 
any alteration
 
to
the terms of the Approved Manager's appointment;
(f)
de activate or lay-up that Ship; or
(g)
put that Ship into
 
the possession of any person
 
for the purpose of work
 
being done upon it in an
amount exceeding or likely to
 
exceed $1,000,000 (or the equivalent in any other currency) unless
that
 
person
 
has
 
first
 
given
 
to
 
the
 
Security
 
Trustee
 
and
 
in
 
terms
 
satisfactory
 
to
 
it
 
a
 
written
undertaking not
 
to exercise
 
any lien
 
on that
 
Ship or
 
its Earnings
 
for the
 
cost of
 
such work
 
or for
any other reason.
14.14
Notice of Mortgage
Each Borrower shall keep the relevant Mortgage registered against the Ship owned by it as a valid
first
 
priority
 
or
 
preferred
 
mortgage,
 
carry
 
on
 
board
 
that
 
Ship
 
a
 
certified
 
copy
 
of
 
the
 
relevant
Mortgage and place and maintain in a conspicuous place in the navigation room and the Master's
cabin of that Ship a framed printed notice stating that that Ship is mortgaged by that Borrower to
the Security Trustee.
14.15
Sharing of Earnings
No Borrower shall:
(a)
enter into any agreement or arrangement for the sharing of any Earnings;
 
(b)
enter into any
 
agreement or
 
arrangement for the
 
postponement of
 
any date on
 
which any
 
Earnings
are due; and
(c)
the reduction of the amount of any Earnings or otherwise for
 
the release or adverse alteration of
any right of a Borrower to any Earnings.
 
14.16
ISPS Code
Each Borrower shall comply with the ISPS Code and in particular, without limitation, shall:
(a)
procure
 
that
 
the
 
Ship
 
owned
 
by
 
that
 
Borrower
 
and
 
the
 
company
 
responsible
 
for
 
that
 
Ship's
compliance with the ISPS Code comply with the ISPS Code;
 
(b)
maintain for that Ship an ISSC; and
(c)
notify
 
the
 
Agent
 
immediately
 
in
 
writing
 
of
 
any
 
actual
 
or
 
threatened
 
withdrawal,
 
suspension,
cancellation or modification of the ISSC.
14.17
Charterparty Assignment
If a Borrower enters into any Charter (subject to obtaining
 
the consent of the Agent in
 
accordance
with Clause
 
(
Restrictions on
 
chartering, appointment
 
of managers
 
etc
.)), that
 
Borrower
shall
 
at
 
the
 
request
 
of
 
the
 
Agent
 
execute
 
in
 
favour
 
of
 
the
 
Security
 
Trustee
 
(and
 
register,
 
if
applicable) a Charterparty Assignment and shall:
(a)
serve
 
notices
 
of
 
the
 
Charterparty
 
Assignment on
 
the Charterer
 
and
 
procure
 
that
 
the
 
Charterer
acknowledges such notice in such form as the Agent may approve or require; and
 
(b)
deliver to the Agent such other documents equivalent to those referred to at paragraphs 3, 4 and
5 of
 
of
 
(
Conditions precedent documents
), as the Agent may require.
14.18
Poseidon Principles
Each Borrower shall, upon the request by a Lender and at the cost of the Borrowers, on or before
31st July in each calendar year,
 
supply or procure the supply by the relevant
 
classification society
to the
 
Agent of
 
all information
 
necessary in order
 
for such
 
Lender to
 
comply with its
 
obligations
under the
 
Poseidon Principles
 
in respect
 
of the
 
preceding year,
 
including, without
 
limitation, all
ship fuel
 
oil consumption
 
data required to
 
be collected
 
and reported
 
in accordance
 
with Regulation
22A of Annex
 
VI and any
 
Statement of
 
Compliance, in each case
 
relating to
 
the Ship owned by
 
it
for the preceding
 
calendar year
 
provided always that,
 
for the avoidance
 
of doubt,
 
such information
shall
 
be
 
confidential
 
information
 
but
 
the
 
Borrower
 
acknowledges
 
that,
 
in
 
accordance
 
with
 
the
Poseidon Principles,
 
such information
 
will form
 
part of
 
the information
 
published regarding
 
the
relevant Lender's portfolio climate alignment and that a Lender may disclose such information: (i)
either
 
to
 
any
 
classification
 
society
 
or
 
other
 
entity
 
which
 
a
 
Lender
 
has
 
engaged
 
to
 
make
 
the
calculations
 
necessary to
 
enable that
 
Lender to
 
comply with
 
its reporting
 
obligations
 
under the
Poseidon
 
Principles
 
(such
 
calculations
 
to
 
be
 
made
 
at
 
the
 
cost
 
of
 
the
 
relevant
 
Lender)
 
or
 
(ii)
 
as
otherwise permitted under the terms of this Agreement.
14.19
Inventory of Hazardous Material
Each Borrower shall procure that, on the date falling 18 months after the date of this Agreement,
its Ship has obtained an Inventory of Hazardous Material, which shall be maintained until the end
of the Security Period.
 
14.20
Sustainable and socially responsible dismantling of ships
(a)
Each Borrower
 
shall (and shall procure
 
that each other
 
member of the Group
 
shall) procure that
for the duration of the Security Period:
(b)
the Ship owned by it or any other
 
Fleet Vessel shall be recycled at a recycling yard which conducts
its recycling business
 
in a socially
 
and environmentally responsible
 
manner, in accordance with the
provisions of the Hong Kong
 
Convention (in the event
 
that the Approved
 
Flag State is not
 
an EEA
Member Country) or the EU Ship Recycling
 
Regulation (in the event
 
that the Approved Flag State
is an EEA Member Country); or
(c)
where the
 
Ship owned by
 
it or any
 
other Fleet Vessel
 
is sold
 
to an
 
intermediary (whether or
 
not
with
 
the
 
intention
 
of
 
being
 
recycled),
 
it
 
shall
 
provide
 
the
 
intermediary
 
with
 
any
 
ship-relevant
information in its possession which it considers necessary for the development of a ship recycling
plan in accordance with the EU Ship Recycling Regulation.
14.21
Sanctions provisions
 
Without limiting Clause
 
(
Compliance with laws etc.
), each Borrower shall procure:
(a)
each Borrower shall,
 
and shall
 
procure that the
 
Ship owned by
 
it and each
 
Security Party shall,
 
and,
in respect of any charterer,
 
shall use all reasonable endeavours to procure that the Charterer and
any other charterer in respect of its Ship shall, comply in all respects with all laws
 
to which it may
be
 
subject,
 
including,
 
without
 
limitation,
 
all
 
national
 
and
 
international
 
laws,
 
derivatives,
regulations, decrees, rulings and such analogous rules, including, but not limited to, rules relating
to Sanctions.
(b)
Each
 
Borrower undertakes
 
to make
 
the Charterer
 
and all
 
other charterers
 
and operators
 
of the
Ship owned by it aware
 
of the requirements of this
 
Clause and Clause
 
(
Sanctions
) and shall
procure that they act in accordance with these requirements.
14.22
Change of Approved Manager
(a)
Each
 
Borrower
 
may,
 
at
 
its
 
sole
 
discretion,
 
at
 
any
 
time
 
during
 
the
 
Security
 
Period,
 
change
 
the
Approved Manager of its Ship from Diana Shipping
 
Services SA to Diana Wilhelmsen
 
Management
Limited,
provided that
 
the Borrowers shall give the Agent five Business' Days
 
prior written notice
and shall provide the Agent no later than the date of the change with:
(b)
documents of
 
the kind specified
 
in paragraphs
,
,
, and
 
of
 
of
 
(
Condition
precedent documents
) in respect of Diana Wilhelmsen Management Limited;
(c)
the documents
 
referred to in
 
paragraph
 
of
 
of
Condition precedent
 
documents
);
and
(d)
any other documents that the Agent may reasonably require.
15
SECURITY COVER
 
15.1
Minimum required security cover
Clause
 
(
Provision of
 
additional security;
 
prepayment
) applies
 
if,
 
at any
 
relevant time
 
during
the Security Period, the Agent notifies the Borrowers that:
(a)
the aggregate of the Market Value of the Ships then subject to a Mortgage;
 
plus
(b)
the
 
net
 
realisable
 
value
 
of
 
any
 
additional
 
security
 
previously
 
provided
 
under
 
this
 
Clause
(
Security cover
),
is below 125 per cent.
 
of the Loan.
15.2
Provision of additional security; prepayment
If the
 
Agent serves
 
a notice
 
on the
 
Borrowers under Clause
Minimum required
 
security cover
),
the Borrowers shall
 
prepay such part
 
at least of
 
the Loan
 
as will eliminate
 
the shortfall
 
on or before
the date falling one month after the date on which the Agent's notice is served under Clause
(
Minimum required security cover
) (the "
Prepayment Date
") unless at least 1 Business Day before
the Prepayment Date the
 
Borrowers have provided additional security
 
which, in the
 
opinion of the
Majority Lenders,
 
has a
 
net realisable
 
value at
 
least equal
 
to the
 
shortfall and
 
is documented
 
in
such terms as the Agent may, with the authorisation of the Majority Lenders, approve or require.
 
15.3
Valuation of Ships
The Market
 
Value
 
of a
 
Ship (or
 
any other
 
Fleet Vessel)
 
at any
 
date during
 
the Security
 
Period is
that shown by a valuation to be prepared:
(a)
as at a date not more than 14 days previously;
(b)
an Approved Broker (selected by the Borrowers and appointed by the Agent);
(c)
with or without physical inspection of the Ship (as the Agent may require);
(d)
on
 
the basis
 
of
 
a sale
 
for
 
prompt
 
delivery for
 
cash
 
on
 
normal
 
arm's length
 
commercial
terms as between a willing seller and a willing buyer,
 
free of any existing charter or other
contract of employment; and
(e)
after deducting the estimated amount
 
of the usual and
 
reasonable expenses which would
be incurred in connection with the sale,
Provided that
 
if the Agent
 
reasonably determines that
 
the Market
 
Value of
 
the Ship shown
 
by a
valuation
 
prepared in
 
accordance with
 
this Clause
 
(
Valuation
 
of Ships
) does
 
not accurately
reflect the value
 
of that
 
Ship, it
 
shall have the
 
right to
 
appoint (at
 
the Borrowers'
 
expense) a
 
second
Approved
 
Broker
 
to
 
provide
 
a
 
valuation
 
of
 
that
 
Ship
 
addressed
 
to
 
the
 
Agent
 
and
 
prepared
 
in
accordance
 
with
 
the
 
terms
 
of
 
this
 
Agreement
 
and
 
the
 
Market
 
Value
 
of
 
that
 
Ship
 
shall
 
be
 
the
arithmetic average of the two valuations.
15.4
Value of additional security
The net realisable value of
 
any additional security which is
 
provided under Clause
 
(
Provision
of additional security; prepayment
) shall be determined as follows:
(a)
if it consists of a Security Interest over
 
a vessel shall be that shown by a valuation complying with
the requirements of Clause
 
(
Valuation of Ships
); and
(b)
if it consists of cash, the US Dollar amount thereof.
15.5
Valuations binding
Any valuation
 
under Clauses
 
(
Provision of
 
additional security; prepayment
),
 
(
Valuation
of
 
Ships
)
 
or
 
(
Value
 
of
 
additional
 
security
)
 
shall
 
be
 
binding
 
and
 
conclusive
 
as
 
regards
 
the
Borrowers, as
 
shall be any
 
valuation which
 
the Majority Lenders
 
make of
 
any additional security
which does not consist of or include a Security Interest.
15.6
Provision of information
The Borrowers
 
shall promptly
 
provide the
 
Agent and
 
the Approved
 
Broker
 
acting under
 
Clauses
 
(
Valuation
 
of
 
Ships
)
 
or
 
(
Value
 
of
 
additional security
)
 
with
 
any
 
information
 
which
 
the
Agent or the
 
Approved Broker may request
 
for the purposes
 
of the
 
valuation; and,
 
if the
 
Borrowers
fail to provide the information by the date specified in
 
the request, the valuation may be made on
any
 
basis
 
and
 
assumptions
 
which
 
the
 
Approved
 
Broker
 
or
 
the
 
Majority
 
Lenders
 
(or
 
the
 
expert
appointed by them) consider prudent.
15.7
Payment of valuation expenses
Without
 
prejudice
 
to
 
the
 
generality
 
of
 
the
 
Borrowers'
 
obligations
 
under
 
Clauses
 
(
Costs
 
of
negotiation, preparation etc
.),
 
(
Costs of variations, amendments, enforcement etc
.) and
(
Miscellaneous indemnities
), the
 
Borrowers
 
shall, on
 
demand, pay
 
the Agent
 
the amount
 
of the
fees and expenses of the Approved
 
Broker instructed by the Agent
 
under this Clause and all legal
and other
 
expenses incurred
 
by any
 
Creditor Party
 
in connection
 
with any
 
matter
 
arising out
 
of
this Clause
 
(provided that
 
no more
 
than one
 
valuation per
 
Ship subject
 
to a
 
Mortgage
 
per year
and, if required by
 
the Agent pursuant to
 
Clause
Valuation of Ships
), one additional
 
valuation
per
 
such
 
Ship
 
per
 
year
 
shall
 
be
 
payable
 
by
 
the
 
Borrowers,
 
save
 
for
 
if
 
an
 
Event
 
of
 
Default
 
has
occurred which is
 
continuing in which
 
case the Borrower
 
s
 
shall be liable
 
to pay
 
for all
 
valuations
that
 
take
 
place
 
during
 
the
 
period
 
such
 
Event
 
of
 
Default
 
is
 
continuing)
 
and
 
all
 
legal
 
and
 
other
expenses incurred by any Creditor Party in connection with any matter arising out of this Clause.
15.8
Application of prepayment
Clause
Application of partial
 
prepayment
) shall apply
 
in relation to any
 
prepayment pursuant
to Clause
 
(
Security cover
).
16
PAYMENTS
 
AND CALCULATIONS
 
16.1
Currency and method of payments
All payments to
 
be made by the
 
Lenders or by
 
any Borrower
 
under a Finance Document
 
shall be
made to the Agent or to the Security Trustee, in the case of an amount payable to it:
(a)
by not later than 11.00 a.m. (New York City time) on the due date;
(b)
in same day
 
Dollar funds
 
settled through the
 
New York Clearing House
 
Interbank Payments System
(or in
 
such other
 
Dollar funds
 
and/or settled
 
in such
 
other manner
 
as the
 
Agent shall
 
specify as
being
 
customary
 
at
 
the
 
time
 
for
 
the
 
settlement
 
of
 
international
 
transactions
 
of
 
the
 
type
contemplated by this Agreement);
 
(c)
in the case of
 
an amount payable
 
by a Lender to
 
the Agent or
 
by a Borrower
 
to the Agent or
 
any
Lender, to such account as the Agent
 
may from time to time
 
notify to the
 
Borrowers and the other
Creditor Parties; and
 
(d)
in the case of
 
an amount payable to
 
the Security Trustee,
 
to such account as
 
it may from
 
time to
time notify to the Borrowers and the other Creditor Parties.
16.2
Payment on non-Business Day
If any
 
payment
 
by any
 
Borrower
 
under a
 
Finance Document
 
would otherwise
 
fall
 
due on
 
a day
which is not a Business Day:
(a)
the due date shall be extended to the next succeeding Business Day; or
(b)
if the next succeeding
 
Business Day falls in
 
the next calendar
 
Month, the due
 
date shall be brought
forward to the immediately preceding Business Day,
and interest shall be payable during any extension under paragraph
 
at the rate payable on the
original due date.
16.3
Basis for calculation of periodic payments
All interest and commitment fee and any other payments under any Finance
 
Document which are
of an annual
 
or periodic nature
 
shall accrue from
 
day to day
 
and shall be
 
calculated on the
 
basis
of the actual number of days elapsed and a 360 day year.
16.4
Distribution of payments to Creditor Parties
Subject to
 
Clauses
 
(
Permitted
 
deductions by
 
Agent
),
 
(
Agent only
 
obliged to
 
pay when
monies received
) and
 
(
Refund to Agent of monies not received
):
(a)
any amount received
 
by the Agent under
 
a Finance Document for
 
distribution or remittance
 
to a
Lender, the Swap Bank or
 
the Security
 
Trustee shall be made
 
available by the Agent
 
to that Lender,
the Swap
 
Bank or,
 
as the
 
case may
 
be, the
 
Security Trustee
 
by payment,
 
with funds
 
having the
same value
 
as the funds
 
received, to
 
such account as
 
the Lender,
 
the Swap
 
Bank or the
 
Security
Trustee may
 
have notified to the Agent not less than five Business Days previously; and
(b)
amounts to be applied in satisfying amounts
 
of a particular category which are due
 
to the Lenders
and/or the
 
Swap Bank
 
generally shall
 
be distributed
 
by the
 
Agent to
 
each Lender
 
and the
 
Swap
Bank pro rata to the amount in that category which is due to it.
16.5
Permitted deductions by Agent
Notwithstanding any other
 
provision of this
 
Agreement or any
 
other Finance
 
Document, the Agent
may, before making an amount available to a Lender or the
 
Swap Bank, deduct and
 
withhold from
that amount
 
any sum which
 
is then due
 
and payable to
 
the Agent from
 
that Lender or
 
the Swap
Bank under any Finance Document
 
or any sum which the
 
Agent is then entitled under
 
any Finance
Document to require that Lender or the Swap Bank to pay on demand.
16.6
Agent only obliged to pay when monies received
Notwithstanding any other
 
provision of this
 
Agreement or any
 
other Finance
 
Document, the Agent
shall not be obliged
 
to make
 
available to
 
any Borrower or
 
any Lender or the
 
Swap Bank any
 
sum
which the
 
Agent
 
is expecting
 
to
 
receive
 
for
 
remittance
 
or
 
distribution to
 
that Borrower
 
or
 
that
Lender or the Swap Bank until the Agent has satisfied itself that it has received that sum.
16.7
Refund to Agent of monies not received
If and to the extent
 
that the Agent makes
 
available a sum to
 
a Borrower or a Lender or
 
the Swap
Bank, without first having received that sum, that Borrower or (as the case may be) the Lender or
the Swap Bank concerned shall, on demand:
(a)
refund the sum in full to the Agent; and
 
(b)
pay to
 
the Agent
 
the amount
 
(as certified
 
by the
 
Agent) which
 
will indemnify
 
the Agent
 
against
any funding or other loss, liability or expense incurred by the Agent as a result of making the sum
available before receiving it.
 
16.8
Agent may assume receipt
Clause
 
(
Refund to
 
Agent of
 
monies not received
) shall not
 
affect any
 
claim which the
 
Agent
has under
 
the law
 
of restitution,
 
and applies
 
irrespective of
 
whether the
 
Agent had
 
any form
 
of
notice that it had not received the sum which it made available.
16.9
Creditor Party accounts
Each
 
Creditor Party
 
shall maintain
 
accounts showing
 
the amounts
 
owing to
 
it by
 
the Borrowers
and
 
each
 
Security
 
Party
 
under
 
the
 
Finance
 
Documents
 
and
 
all
 
payments
 
in
 
respect
 
of
 
those
amounts made by the Borrowers and any Security Party.
16.10
Agent's memorandum account
The Agent shall maintain a memorandum account showing the amounts advanced
 
by the Lenders
and all other sums owing to the Agent, the Security Trustee
 
and each Lender from the Borrowers
and
 
each
 
Security
 
Party
 
under
 
the
 
Finance
 
Documents
 
and
 
all
 
payments
 
in
 
respect
 
of
 
those
amounts made by the Borrowers and any Security Party.
16.11
Accounts prima facie evidence
If
 
any
 
accounts
 
maintained
 
under
 
Clauses
 
(
Creditor
 
Party
 
accounts
)
 
and
 
(
Agent's
memorandum
 
account
)
 
show
 
an
 
amount
 
to
 
be
 
owing
 
by
 
a
 
Borrower
 
or
 
a
 
Security
 
Party
 
to
 
a
Creditor
 
Party,
 
those
 
accounts
 
shall
 
be
 
prima facie
 
evidence that
 
that
 
amount
 
is
 
owing
 
to
 
that
Creditor Party.
17
APPLICATION OF RECEIPTS
 
17.1
Normal order of application
Except
 
as
 
any
 
Finance
 
Document
 
may
 
otherwise
 
provide,
 
any
 
sums
 
which
 
are
 
received
 
or
recovered by any Creditor Party under or by virtue of any Finance Document shall be applied:
(a)
FIRST:
 
in
 
or
 
towards
 
satisfaction
 
of
 
any
 
amounts
 
then
 
due
 
and
 
payable
 
under
 
the
 
Finance
Documents in the following order and proportions:
(i)
first, in
 
or towards satisfaction
 
pro rata of
 
all amounts
 
then due
 
and payable
 
to the
 
Creditor
Parties under the Finance
 
Documents other than
 
those amounts referred to at
 
paragraphs
 
and
 
(including, but without limitation, all amounts payable by any Borrower under
Clauses
 
(
Fees and
 
expenses
),
 
(
Indemnities
) and
 
(
No set-off
 
or Tax
 
Deduction
) of
this
 
Agreement
 
or
 
by
 
any
 
Borrower
 
or
 
any
 
Security
 
Party
 
under
 
any
 
corresponding
 
or
similar provision in any other Finance Document);
(ii)
secondly,
 
in or towards satisfaction
 
pro rata of
 
any and all amounts of
 
interest or default
interest
 
payable
 
to
 
the
 
Creditor
 
Parties
 
under
 
the
 
Finance
 
Documents
 
(and,
 
for
 
this
purpose, the
 
expression "
interest
" shall
 
include any
 
net amount
 
which a
 
Borrower shall
have
 
become
 
liable
 
to
 
pay
 
or
 
deliver
 
under
 
section
 
2(e)
 
(
Obligations
)
 
of
 
the
 
Master
Agreement
 
but
 
shall
 
have
 
failed
 
to
 
pay
 
or
 
deliver
 
to
 
the
 
Swap
 
Bank
 
at
 
the
 
time
 
of
application or distribution under this Clause
 
(
Application of receipts
)); and
(iii)
thirdly, in or towards
 
satisfaction pro rata of the Loan and the Swap Exposure (in the case
of the latter, calculated as at the actual Early Termination Date applying to each particular
Designated
 
Transaction,
 
or
 
if
 
no
 
such
 
Early
 
Termination
 
Date
 
shall
 
have
 
occurred,
calculated
 
as
 
if
 
an
 
Early
 
Termination
 
Date
 
occurred
 
on
 
the
 
date
 
of
 
application
 
or
distribution hereunder);
(b)
SECONDLY:
 
in retention of
 
an amount equal
 
to any amount
 
not then due and
 
payable under any
Finance Document but which the
 
Agent, by notice to
 
the Borrowers, the
 
Security Parties and the
other Creditor Parties,
 
states in its
 
opinion will
 
either or
 
may become due
 
and payable in
 
the future
and,
 
upon
 
those
 
amounts
 
becoming
 
due
 
and
 
payable,
 
in
 
or
 
towards
 
satisfaction
 
of
 
them
 
in
accordance with the provisions of Clause
 
(
Normal order of application
); and
(c)
THIRDLY:
 
any surplus
 
shall be
 
paid to
 
the Borrowers or
 
to any
 
other person
 
appearing to
 
be entitled
to it.
17.2
Variation of order of application
The Agent
 
may,
 
with the
 
authorisation of the
 
Majority Lenders
 
and the
 
Swap Bank,
 
by notice
 
to
the Borrowers, the Security
 
Parties and the other Creditor
 
Parties provide for
 
a different manner
of application from that
 
set out in
 
Clause
Application of receipts
) either as
 
regards a specified
sum or sums or as regards sums in a specified category or categories.
17.3
Notice of variation of order of application
The Agent may
 
give notices
 
under Clause
Variation of order
 
of application
) from time
 
to time;
and such a notice may be stated to apply not only to sums which may be received or recovered in
the future, but
 
also to any
 
sum which
 
has been
 
received or recovered
 
on or after
 
the third Business
Day before the date on which the notice is served.
 
17.4
Appropriation rights overridden
This Clause
 
(
Application of
 
receipts
) and
 
any notice
 
which the
 
Agent gives
 
under Clause
(
Variation
 
of
 
order
 
of
 
application
)
 
shall
 
override
 
any
 
right
 
of
 
appropriation
 
possessed,
 
and
 
any
appropriation made, by any Borrower or any Security Party.
18
APPLICATION OF EARNINGS
18.1
Payment of Earnings
 
Each Borrower undertakes with
 
each Creditor Party to
 
ensure that, throughout
 
the Security
 
Period
(and subject only to the provisions of the General Assignments) all Earnings of the Ship owned by
it
 
(including
 
but
 
not
 
limited
 
to
 
any
 
sale
 
and/or
 
insurance
 
proceeds)
 
are
 
paid
 
to
 
the
 
Earnings
Account for that Ship.
18.2
Location of accounts
Each Borrower shall promptly:
(a)
comply with any requirement
 
of the Agent as
 
to the location or
 
re location of its
 
Earnings Account;
and
(b)
execute any
 
documents which the Agent
 
specifies to create
 
or maintain in
 
favour of the
 
Security
Trustee
 
a Security Interest
 
over (and/or
 
rights of set-off,
 
consolidation or other
 
rights in relation
to) its Earnings Account.
18.3
Debits for expenses etc.
The
 
Agent
 
shall
 
be
 
entitled
 
(but
 
not
 
obliged)
 
from
 
time
 
to
 
time
 
to
 
debit
 
any
 
Earnings
 
Account
without prior notice in order
 
to discharge any
 
amount due and payable
 
under Clause
 
or
 
to
a Creditor
 
Party or
 
payment of
 
which any
 
Creditor Party
 
has become
 
entitled to
 
demand under
Clause
 
(
Fees and expenses
) or
 
(
Indemnities
).
18.4
Borrowers'
 
obligations unaffected
The provisions of this Clause
 
(
Application of Earnings
) do not affect:
(a)
the liability of the Borrowers to make payments of principal and interest on the due dates; or
(b)
any
 
other
 
liability
 
or
 
obligation
 
of
 
the
 
Borrowers
 
or
 
any
 
Security
 
Party
 
under
 
any
 
Finance
Document.
 
18.5
Earnings Accounts balances
Subject
 
to
 
the
 
other
 
terms
 
of
 
this
 
Agreement
 
(including,
 
without
 
limitation,
 
the
 
terms
 
of
 
this
Clause
 
(
Application of Earnings
)), the monies on the Earnings
 
Account shall be freely available
to the Borrowers to be used in
 
accordance with and in compliance with the terms and conditions
of this
 
Agreement subject
 
to no
 
Event of Default
 
having occurred
 
which is
 
continuing and
 
the Agent
having given notice
 
to the Borrowers
 
that such monies shall
 
not be freely
 
available as a
 
result of
such Event of Default.
19
EVENTS OF DEFAULT
 
19.1
Events of Default
An Event of Default occurs if:
(a)
any Borrower
 
or any
 
Security Party
 
fails to
 
pay when
 
due or
 
(if so
 
payable) on
 
demand any
 
sum
payable under a Finance Document or under any document relating to a Finance Document; or
(b)
any
 
breach
 
occurs
 
of
 
Clauses
 
(
Waiver
 
of
 
conditions precedent
),
 
(
No
 
immunity
),
(
Sanctions
),
Title; negative
 
pledge
),
No disposal
 
of assets
),
Consents
),
Know
your
 
customer
),
 
11.20
 
(
Bribery
 
and
 
anti-corruption
 
laws
),
 
(
Sanctions
),
 
11.22
 
(
Use
 
of
proceeds
),
 
(
Maintenance
 
of
 
status)
,
 
(
Negative
 
undertakings
),
 
(
Maintenance
 
of
obligatory
 
insurances
),
 
(
Terms
 
of
 
obligatory
 
insurances
),
 
(
Minimum
 
required
 
security
cover
),
 
(
Provision
 
of
 
additional
 
security;
 
prepayment
)
 
and
 
12.4
 
(
Compliance
 
Check)
 
of
 
the
Corporate Guarantee; or
(c)
any breach by any
 
Borrower or any Security Party occurs
 
of any provision of a
 
Finance Document
(other
 
than
 
a
 
breach
 
covered
 
by
 
paragraphs
 
or
)
 
which,
 
in
 
the
 
opinion
 
of
 
the
 
Majority
Lenders,
 
is
 
capable
 
of
 
remedy,
 
and
 
such
 
default
 
continues
 
un-remedied
 
ten
 
days
 
after
 
written
notice from the Agent requesting action to remedy the same; or
(d)
(subject
 
to
 
any
 
applicable
 
grace
 
period
 
specified
 
in
 
the
 
Finance
 
Document)
 
any
 
breach
 
by
 
any
Borrower or any
 
Security Party
 
occurs of any
 
provision of
 
a Finance
 
Document (other
 
than a
 
breach
falling within paragraphs
,
 
or
); or
(e)
any representation, warranty or statement made or repeated by, or by an officer of, the Borrower
or
 
a
 
Security
 
Party
 
in
 
a
 
Finance
 
Document
 
or
 
in
 
a
 
Drawdown
 
Notice
 
or
 
any
 
other
 
notice
 
or
document relating
 
to a
 
Finance Document is
 
materially untrue
 
or misleading
 
when it
 
is made or
repeated; or
(f)
any of the
 
following occurs in
 
relation to any
 
Financial Indebtedness of a Relevant
 
Person (in
 
the
case
 
of
 
all
 
Relevant
 
Persons
 
(taken
 
as
 
a
 
whole)
 
exceeding
 
in
 
aggregate
 
$10,000,000
 
(or
 
the
equivalent in any other currency)
 
at any relevant time
Provided that
 
in the case of
 
each Borrower,
individually,
 
any
 
Financial
 
Indebtedness
 
exceeding
 
$500,000
 
(or
 
the
 
equivalent
 
in
 
any
 
other
currency)):
(i)
any Financial Indebtedness of a Relevant Person is not paid when due; or
(ii)
any Financial Indebtedness of
 
a Relevant Person
 
becomes due and payable
 
or capable of
being declared due and payable prior to
 
its stated maturity date as a consequence of
 
any
event of default; or
(iii)
a
 
lease,
 
hire
 
purchase
 
agreement
 
or
 
charter
 
creating
 
any
 
Financial
 
Indebtedness
 
of
 
a
Relevant
 
Person
 
is
 
terminated
 
by
 
the
 
lessor
 
or
 
owner
 
or
 
becomes
 
capable
 
of
 
being
terminated as a consequence of any termination event; or
(iv)
any overdraft,
 
loan, note issuance,
 
acceptance credit, letter
 
of credit, guarantee,
 
foreign
exchange or other facility, or any swap or
 
other derivative contract or transaction,
 
relating
to
 
any
 
Financial
 
Indebtedness
 
of
 
a
 
Relevant
 
Person
 
ceases
 
to
 
be
 
available
 
or
 
becomes
capable of being terminated as
 
a result of any event
 
of default, or cash cover
 
is required,
or becomes capable of being required, in respect of such a facility as a result of any event
of default; or
(v)
any Security
 
Interest
 
securing any
 
Financial Indebtedness
 
of a
 
Relevant Person
 
becomes
enforceable; or
(g)
any of the following occurs in relation to a Relevant Person:
(i)
a Relevant Person becomes, in
 
the opinion of
 
the Majority Lenders,
 
unable to pay its
 
debts
as they fall due; or
(ii)
any assets of a Relevant
 
Person are subject to
 
any form of execution,
 
attachment, arrest,
sequestration or
 
distress in
 
respect of
 
a sum
 
of,
 
or sums
 
exceeding, in
 
aggregate,
 
in the
case of all
 
Relevant Persons (taken as a whole)
 
$10,000,000 (or the
 
equivalent in any other
currency) at
 
any relevant
 
time
 
Provided that
 
in the case
 
of each
 
Borrower,
 
individually,
any
sum
 
of,
 
or
 
sums
 
exceeding,
 
in
 
aggregate
 
$500,000
 
(or
 
the
 
equivalent
 
in
 
any
 
other
currency);
(iii)
any administrative or other receiver is appointed over any asset of a Relevant Person;
 
or
(iv)
an administrator is appointed (whether
 
by the court or
 
otherwise) in respect
 
of a Relevant
Person; or
(v)
any formal declaration of
 
bankruptcy or any
 
formal statement to the
 
effect that a
 
Relevant
Person is
 
insolvent or
 
likely to
 
become insolvent
 
is made by
 
a Relevant
 
Person or
 
by the
directors
 
of a
 
Relevant
 
Person
 
or,
 
in any
 
proceedings, by
 
a lawyer
 
acting for
 
a Relevant
Person; or
 
(vi)
a provisional liquidator is appointed in respect of a Relevant Person, a winding up order is
made in relation
 
to a Relevant
 
Person or
 
a winding up resolution
 
is passed by a
 
Relevant
Person; or
 
(vii)
a resolution is passed, an administration notice is given or filed, an application or petition
to a court is made or presented
 
or any other step is
 
taken by (aa) a
 
Relevant Person, (bb)
the members
 
or directors
 
of a
 
Relevant Person,
 
(cc) a
 
holder of
 
Security Interests
 
which
together
 
relate
 
to
 
all
 
or
 
substantially
 
all
 
of
 
the
 
assets
 
of
 
a
 
Relevant
 
Person,
 
or
 
(dd)
 
a
government
 
minister
 
or
 
public or
 
regulatory
 
authority
 
of
 
a Pertinent
 
Jurisdiction for
 
or
with a view to the winding up of that or another Relevant Person or the appointment of a
provisional
 
liquidator or
 
administrator
 
in respect
 
of that
 
or another
 
Relevant
 
Person,
 
or
that or another
 
Relevant Person
 
ceasing or suspending business
 
operations or
 
payments
to
 
creditors,
 
save
 
that
 
this paragraph
 
does
 
not
 
apply to
 
a
 
fully
 
solvent
 
winding up
 
of
 
a
Relevant Person
 
other than a
 
Borrower or
 
the Corporate
 
Guarantor which
 
is, or is
 
to be,
effected
 
for the
 
purposes of
 
an amalgamation
 
or reconstruction
 
previously approved
 
by
the Majority Lenders and effected
 
not later
 
than three months after the commencement
of the winding up; or
(viii)
an administration
 
notice is given
 
or filed, an
 
application or petition
 
to a court
 
is made or
presented or any
 
other step is
 
taken by a
 
creditor of a
 
Relevant Person (other than
 
a holder
of
 
Security
 
Interests
 
which
 
together
 
relate
 
to
 
all
 
or
 
substantially
 
all
 
of
 
the
 
assets
 
of
 
a
Relevant
 
Person)
 
for
 
the
 
winding
 
up
 
of
 
a
 
Relevant
 
Person
 
or
 
the
 
appointment
 
of
 
a
provisional
 
liquidator
 
or
 
administrator
 
in
 
respect
 
of
 
a
 
Relevant
 
Person
 
in
 
any
 
Pertinent
Jurisdiction, unless
 
the proposed
 
winding up,
 
appointment of
 
a provisional
 
liquidator or
administration is being
 
contested in good
 
faith, on substantial grounds
 
and not
 
with a
 
view
to some
 
other insolvency
 
law procedure
 
being implemented
 
instead and
 
either (aa)
 
the
application
 
or
 
petition
 
is
 
dismissed
 
or
 
withdrawn
 
within
 
30
 
days
 
of
 
being
 
made
 
or
presented, or (bb) within 30
 
days of the administration
 
notice being given or filed, or the
other relevant steps being taken, other action is taken which will ensure that there
 
will be
no
 
administration
 
and
 
(in both
 
cases
 
(aa) or
 
(bb))
 
the
 
Relevant
 
Person
 
will
 
continue
 
to
carry on business in the ordinary way and without being
 
the subject of any actual, interim
or pending insolvency law procedure; or
(ix)
a
 
Relevant
 
Person
 
or
 
its
 
directors
 
take
 
any
 
steps
 
(whether
 
by
 
making
 
or
 
presenting
 
an
application or
 
petition to
 
a court,
 
or submitting
 
or presenting
 
a document
 
setting out
 
a
proposal or proposed terms, or otherwise) with
 
a view to obtaining, in relation
 
to that or
another Relevant
 
Person,
 
any
 
form of
 
moratorium,
 
suspension or
 
deferral
 
of payments,
reorganisation of debt
 
(or certain
 
debt) or
 
arrangement with all
 
or a
 
substantial proportion
(by
 
number
 
or
 
value)
 
of
 
creditors
 
or
 
of
 
any
 
class
 
of
 
them
 
or
 
any
 
such
 
moratorium,
suspension or
 
deferral
 
of payments,
 
reorganisation
 
or arrangement
 
is effected
 
by court
order,
 
by the filing of documents with a court, by means of a contract or in any other way
at all; or
(x)
any
 
meeting
 
of
 
the
 
members
 
or
 
directors,
 
or
 
of
 
any
 
committee
 
of
 
the
 
board
 
or
 
senior
management, of a Relevant Person is held or summoned for the purpose of considering a
resolution or
 
proposal to
 
authorise or
 
take
 
any action
 
of a
 
type described
 
in paragraphs
 
to
 
or a
 
step preparatory
 
to such
 
action, or
 
(with or
 
without such
 
a meeting)
 
the
members,
 
directors
 
or
 
such
 
a
 
committee
 
resolve
 
or
 
agree
 
that
 
such
 
an
 
action
 
or
 
step
should be taken or
 
should be taken if
 
certain conditions materialise or fail
 
to materialise;
or
(xi)
in
 
a
 
country
 
other
 
than
 
England,
 
any
 
event
 
occurs,
 
any
 
proceedings
 
are
 
opened
 
or
commenced or any step is taken which, in the
 
opinion of the Majority
 
Lenders is similar to
any of the foregoing; or
(h)
any Borrower
 
ceases or
 
suspends carrying
 
on its
 
business or
 
a part
 
of its
 
business which,
 
in the
opinion of the Majority Lenders, is material in the context of this Agreement; or
(i)
it becomes unlawful in any Pertinent Jurisdiction or impossible:
(i)
for any Borrower,
 
the Corporate Guarantor or any Security Party to discharge
 
any liability
under
 
a
 
Finance
 
Document
 
or
 
to
 
comply
 
with
 
any
 
other
 
obligation
 
which
 
the
 
Majority
Lenders consider material under a Finance Document;
(ii)
for the
 
Agent, the Security
 
Trustee,
 
the Lenders or
 
the Swap Bank
 
to exercise
 
or enforce
any right under, or to
 
enforce any Security Interest created by,
 
a Finance Document; or
(j)
any official consent necessary to enable any Borrower to own, operate or charter the Ship owned
by
 
it
 
or
 
to
 
enable
 
any
 
Borrower
 
or
 
any
 
Security Party
 
to
 
comply
 
with
 
any
 
provision
 
which
 
the
Majority Lenders consider
 
material of
 
a Finance Document
 
is not granted,
 
expires without
 
being
renewed,
 
is
 
revoked
 
or
 
becomes
 
liable to
 
revocation
 
or
 
any
 
condition
 
of
 
such a
 
consent
 
is
 
not
fulfilled; or
 
(k)
it
 
appears
 
to
 
the
 
Majority Lenders
 
that,
 
without
 
their
 
prior
 
consent,
 
a
 
change
 
has
 
occurred
 
or
probably has occurred after the date of this Agreement in the ownership of any of the shares in a
Borrower or the Approved Manager; or
(l)
any provision which the
 
Majority Lenders consider
 
material of a Finance
 
Document proves to have
been or becomes invalid
 
or unenforceable, or a
 
Security Interest created
 
by a Finance Document
proves
 
to
 
have
 
been or
 
becomes invalid
 
or unenforceable
 
or such
 
a Security
 
Interest
 
proves
 
to
have ranked
 
after,
 
or loses its priority to,
 
another Security Interest or
 
any other third party
 
claim
or interest; or
(m)
the security constituted by a Finance Document is in any way imperilled or in jeopardy; or
(n)
without the prior consent
 
of the Lenders, the
 
shares of the Corporate Guarantor cease
 
to be listed
on the New York Stock Exchange; or
(o)
an Event of Default (as defined in section 14 of the Master Agreement) occurs; or
(p)
the Master
 
Agreement
 
is terminated,
 
cancelled, suspended,
 
rescinded or
 
revoked
 
or otherwise
ceases to remain in full force and effect for any reason except with the consent of the Swap Bank;
or
(q)
any other event occurs or any other circumstances arise or develop including, without limitation:
(i)
a change in the financial position, state of affairs or prospects of any Relevant Person; or
(ii)
any
 
accident
 
or
 
other
 
event
 
involving
 
any
 
Ship
 
or
 
another
 
vessel
 
owned,
 
chartered
 
or
operated by a Relevant Person,
in the light
 
of which the
 
Majority Lenders consider
 
that there is a
 
significant risk that
 
any Borrower
or Corporate Guarantor is,
 
or will later
 
become, unable
 
to discharge its
 
liabilities under
 
the Finance
Documents as they fall due.
19.2
Actions following an Event of Default
On, or at any time after, the occurrence of an Event
 
of Default:
(a)
the Agent may,
 
and if so instructed by the Majority Lenders, the Agent shall:
(i)
serve on
 
the Borrowers
 
a notice
 
stating
 
that all
 
or part
 
of the
 
Commitments and
 
of the
other obligations
 
of each
 
Lender to
 
the Borrowers
 
under this
 
Agreement
 
are cancelled;
and/or
(ii)
serve on the Borrowers a notice stating
 
that all or part of the Loan together with accrued
interest
 
and all
 
other amounts
 
accrued or
 
owing under
 
this Agreement
 
are immediately
due and payable or are due and payable on demand; and/or
(iii)
take any other action which, as a result of the Event of Default or any notice
 
served under
paragraph
 
or
, the Agent and/or
 
the Lenders are
 
entitled to take
 
under any Finance
Document or any applicable law; and/or
(b)
the Security
 
Trustee
 
may,
 
and if
 
so instructed
 
by the Agent,
 
acting with the
 
authorisation of
 
the
Majority
 
Lenders,
 
the
 
Security
 
Trustee
 
shall
 
take
 
any
 
action
 
which,
 
as
 
a
 
result
 
of
 
the
 
Event
 
of
Default or any
 
notice served under paragraph
 
or
, the Security Trustee,
 
the Agent and/or
the
 
Lenders
 
and/or
 
the
 
Swap
 
Bank
 
are
 
entitled
 
to
 
take
 
under
 
any
 
Finance
 
Document
 
or
 
any
applicable law.
19.3
Termination of Commitments
On
 
the
 
service
 
of
 
a
 
notice
 
under
 
Clause
 
(
Actions
 
following
 
an
 
Event
 
of
 
Default
),
 
the
Commitments and
 
all other
 
obligations
 
of each
 
Lender to
 
the Borrowers
 
under this
 
Agreement
shall be cancelled.
19.4
Acceleration of Loan
On the service of a notice
 
under Clause
 
(
Actions
 
following an Event of Default
), all or, as
the case may be, the
 
part of the Loan
 
specified in the notice
 
together with accrued interest and all
other amounts accrued or owing from the Borrowers
 
or any Security Party under this Agreement
and every other
 
Finance Document shall
 
become immediately due
 
and payable or, as the
 
case may
be, payable on demand.
19.5
Multiple notices; action without notice
The Agent
 
may serve
 
notices under
 
Clauses
 
and
Actions following
 
an Event of
 
Default
)
simultaneously
 
or
 
on
 
different
 
dates
 
and
 
it
 
and/or
 
the
 
Security
 
Trustee
 
may
 
take
 
any
 
action
referred
 
to
 
in Clause
 
(
Actions
 
following
 
an Event
 
of Default
) if
 
no such
 
notice
 
is served
 
or
simultaneously with or at any time after the service of both or either of such notices.
19.6
Notification of Creditor Parties and Security Parties
The Agent shall send to each Lender, the Swap Bank, the Security Trustee and each Security Party
a
 
copy
 
or
 
the
 
text
 
of
 
any
 
notice
 
which
 
the
 
Agent
 
serves
 
on
 
the
 
Borrowers
 
under
 
Clause
(
Actions following an Event of Default
); but the notice shall become effective when it is served on
the Borrowers, and no failure or delay by the Agent to send a copy or the text of the
 
notice to any
other person
 
shall invalidate
 
the notice
 
or provide
 
any Borrower
 
or any
 
Security Party
 
with any
form of claim or defence.
19.7
Creditor Party's rights unimpaired
Nothing in
 
this Clause
 
shall be
 
taken to impair
 
or restrict
 
the exercise of
 
any right given
 
to individual
Lenders or
 
the Swap
 
Bank under a
 
Finance Document or
 
the general
 
law; and,
 
in particular,
 
this
Clause is without prejudice to Clause
 
(
Interest of Lenders and Swap Bank several
).
 
19.8
Exclusion of Creditor Party liability
No Creditor Party,
 
and no receiver or
 
manager appointed by
 
the Security Trustee,
 
shall have any
liability to a Borrower or a Security Party:
(a)
for any
 
loss caused by
 
an exercise
 
of rights
 
under,
 
or enforcement
 
of a Security
 
Interest
 
created
by,
 
a Finance
 
Document or
 
by any
 
failure
 
or delay
 
to exercise
 
such a
 
right or
 
to enforce
 
such a
Security Interest; or
(b)
as mortgagee
 
in possession or
 
otherwise, for
 
any income
 
or principal
 
amount which might
 
have
been
 
produced
 
by
 
or
 
realised
 
from
 
any
 
asset
 
comprised
 
in
 
such
 
a
 
Security
 
Interest
 
or
 
for
 
any
reduction (however caused) in the value of such an asset,
except that this does not exempt a Creditor Party or a receiver or manager from liability
 
for losses
shown to have been directly
 
and mainly caused
 
by the dishonesty or
 
the wilful misconduct
 
of such
Creditor Party's own officers and employees
 
or (as the case may be) such receiver's
 
or manager's
own partners or employees and any other member of the Group.
19.9
Relevant Persons
In
 
this
 
Clause
 
(
Events
 
of
 
Default
),
 
a
 
"
Relevant
 
Person
"
 
means
 
a
 
Borrower,
 
the
 
Corporate
Guarantor or a Security Party,
 
and any company which is a subsidiary of the Corporate Guarantor
or
 
a
 
Security
 
Party
 
and
 
any
 
other
 
member
 
of
 
the
 
Group
 
but
 
excluding
 
any
 
company
 
which
 
is
dormant and the value of whose gross assets is $50,000 or less.
19.10
Interpretation
In
 
Clause
 
(
Events
 
of
 
Default
),
 
references
 
to
 
an
 
event
 
of
 
default
 
or
 
a
 
termination
 
event
include
 
any
 
event,
 
howsoever
 
described,
 
which
 
is
 
similar
 
to
 
an
 
event
 
of
 
default
 
in
 
a
 
facility
agreement
 
or
 
a
 
termination
 
event
 
in
 
a
 
finance
 
lease; and
 
in
 
Clause
 
(
Events
 
of
 
Default
),
"
petition
" includes an application.
19.11
Position of Swap Bank
Neither the Agent
 
nor the Security
 
Trustee
 
shall be obliged,
 
in connection with
 
any action
 
taken
or proposed to
 
be taken
 
under or pursuant to
 
the foregoing provisions
 
of this Clause
, to have
any regard to the
 
requirements of the Swap Bank except
 
to the extent that the Swap
 
Bank is also
a Lender.
20
FEES AND EXPENSES
 
20.1
Fees
The Borrowers shall pay to the Agent:
(a)
on the
 
date of
 
this Agreement,
 
a non-refundable
 
arrangement fee
 
computed at
 
the rate
 
of 0.75
per
 
cent.
 
of
 
the
 
Total
 
Commitments
 
for
 
distribution
 
among
 
the
 
Lenders
 
pro
 
rata
 
to
 
their
Commitments.
 
(b)
a commitment fee
 
at a rate
 
equal to
 
35 per
 
cent.
 
of the
 
Margin per annum
 
on the
 
undrawn amount
of the Total
 
Commitments from time to time. The accrued commitment fee is payable on the last
day of each successive period of three Months which ends during the relevant Availability Period,
on the last day of the
 
relevant Availability Period and, if cancelled, on the
 
cancelled amount of the
relevant Lender's Commitment at the time the cancellation is effective.
20.2
Costs of negotiation, preparation etc.
The Borrowers
 
shall pay
 
to the Agent
 
on its
 
demand the amount
 
of all expenses
 
incurred by
 
the
Agent
 
or
 
the
 
Security
 
Trustee
 
in
 
connection
 
with
 
the
 
negotiation,
 
preparation,
 
execution
 
or
registration
 
of
 
any
 
Finance
 
Document
 
or
 
any
 
related
 
document
 
or
 
with
 
any
 
transaction
contemplated by a Finance Document or a related document.
20.3
Costs of variations, amendments, enforcement etc.
The Borrowers shall
 
pay to the
 
Agent, on the
 
Agent's demand, for
 
the account of
 
the Creditor Party
concerned, the amount of all expenses incurred by a Creditor Party in connection with:
 
(a)
any
 
amendment
 
or
 
supplement
 
to
 
a
 
Finance
 
Document
 
(required
 
for
 
the
 
continuation
 
of
 
the
availability of the Loan or
 
as contemplated under Clause
 
(
Changes to reference rates
)), or any
proposal for such an amendment to be made;
 
(b)
any consent or waiver
 
by the Lenders, the Swap
 
Bank, the Majority Lenders or the Creditor
 
Party
concerned under or in connection with a Finance Document, or any request for such a consent or
waiver;
(c)
the valuation
 
of any
 
security provided
 
or offered
 
under Clause
 
(
Security Cover
) or
 
any other
matter relating to such security; or
(d)
where
 
the
 
Security
 
Trustee,
 
in
 
its
 
absolute
 
opinion,
 
considers
 
that
 
there
 
has
 
been
 
a
 
material
change to the
 
insurances in respect
 
of a Ship,
 
the review of
 
the insurances of
 
that Ship pursuant
to Clause
 
(
Review of insurance requirements
); and
(e)
any step
 
taken by
 
the Creditor
 
party concerned or
 
the Swap
 
Bank with a
 
view to
 
the protection,
exercise or enforcement of any right
 
or Security Interest created
 
by a Finance
 
Document or for
 
any
similar purpose.
There shall be
 
recoverable under paragraph
 
the full amount of
 
all legal expenses,
 
whether or
not such as would be allowed under rules of court or any taxation
 
or other procedure carried out
under such rules.
20.4
Extraordinary management time
The Borrowers
 
shall pay
 
to the
 
Agent on
 
its demand compensation
 
in respect
 
of the
 
reasonable
and documented
 
amount of
 
time which
 
the management
 
of either
 
Servicing Bank
 
has spent
 
in
connection with a matter covered
 
by Clause
 
(
Costs of variations, amendments, enforcement
etc.
) and which exceeds
 
the amount of time
 
which would ordinarily be spent
 
in the performance
of the relevant Servicing Bank's routine functions.
 
Any such compensation shall be based on such
reasonable daily or hourly rates as
 
the Agent may notify to the
 
Borrowers and is in addition to any
fee paid or payable to the relevant Servicing Bank.
20.5
Documentary taxes
The Borrowers
 
shall promptly pay
 
any tax
 
payable on or
 
by reference
 
to any
 
Finance Document,
and shall,
 
on the
 
Agent's demand,
 
fully indemnify
 
each Creditor
 
Party against any
 
claims, expenses,
liabilities and losses resulting from any failure or delay by the Borrowers to pay such a tax.
20.6
Financial Services Authority fees
The
 
Borrowers
 
shall
 
pay
 
to
 
the
 
Agent,
 
on
 
the
 
Agent's
 
demand,
 
for
 
the
 
account
 
of
 
the
 
Lender
concerned the amounts
 
which the Agent
 
from time to
 
time notifies the Borrowers
 
that a Lender
has notified
 
the Agent
 
to be
 
necessary to
 
compensate it
 
for the cost
 
attributable to its
 
Contribution
resulting from the
 
imposition from time
 
to time under
 
or pursuant to
 
the Bank
 
of England
 
Act 1998
and/or by the
 
Bank of
 
England and/or
 
by the
 
Financial Services
 
Authority (or
 
other United
 
Kingdom
governmental
 
authorities
 
or
 
agencies)
 
of
 
a
 
requirement
 
to
 
pay
 
fees
 
to
 
the
 
Financial
 
Services
Authority calculated by reference to liabilities used to fund its Contribution.
20.7
Certification of amounts
A notice which is signed by two officers of
 
a Creditor Party,
 
which states that a specified amount,
or
 
aggregate
 
amount,
 
is
 
due
 
to
 
that
 
Creditor
 
Party
 
under
 
this
 
Clause
 
and
 
which
 
indicates
(without necessarily
 
specifying a
 
detailed breakdown) the
 
matters in respect of
 
which the amount,
or aggregate amount, is due shall be prima facie evidence that the amount,
 
or aggregate amount,
is due.
21
INDEMNITIES
 
21.1
Indemnities regarding borrowing and repayment of Loan
The Borrowers
 
shall fully
 
indemnify the
 
Agent and
 
each Lender
 
on the
 
Agent's demand
 
and the
Security Trustee
 
on its
 
demand in respect
 
of all
 
claims, expenses,
 
liabilities and losses
 
which are
made or
 
brought against or
 
incurred by
 
that Creditor
 
Party, or which
 
that Creditor
 
Party reasonably
and with due diligence estimates that it will incur, as a result of or in connection with:
(a)
the Loan not being borrowed on the date
 
specified in the Drawdown Notice for any
 
reason other
than a default by the Lender claiming the indemnity;
 
(b)
the receipt or recovery of all or
 
any part of the Loan
 
or an overdue sum otherwise than
 
on the last
day of an Interest Period or other relevant period;
(c)
any failure (for
 
whatever reason) by the Borrowers
 
to make payment of
 
any amount due under a
Finance Document on
 
the due date or, if so
 
payable, on demand (after giving
 
credit for any default
interest paid by the Borrowers
 
on the amount
 
concerned under Clause
 
(
Default Interest
)) ; and
(d)
the occurrence
 
of an
 
Event of
 
Default or
 
a Potential
 
Event
 
of Default
 
and/or the
 
acceleration of
repayment of the Loan under Clause
 
(
Events of Default
),
and in respect of
 
any tax (other than tax
 
on its overall net income
 
or a FATCA Deduction) for which
a
 
Creditor
 
Party
 
is liable
 
in connection
 
with any
 
amount paid
 
or
 
payable
 
to
 
that
 
Creditor
 
Party
(whether for its own account or otherwise) under any Finance Document.
21.2
Miscellaneous indemnities
The Borrowers
 
shall fully indemnify each
 
Creditor Party
 
severally on
 
their respective demands in
respect
 
of
 
all
 
claims,
 
expenses,
 
liabilities
 
and
 
losses which
 
may
 
be made
 
or
 
brought
 
against
 
or
incurred by a Creditor Party,
 
in any country, as a result of or in connection with:
(a)
any action
 
taken,
 
or omitted
 
or neglected
 
to be
 
taken,
 
under or
 
in connection
 
with any
 
Finance
Document
 
by
 
the
 
Agent,
 
the
 
Security
 
Trustee
 
or
 
any
 
other
 
Creditor
 
Party
 
or
 
by
 
any
 
receiver
appointed under a Finance Document; or
(b)
any civil penalty or fine against, and
 
all reasonable costs and expenses (including reasonable fees
of counsel and
 
disbursements) incurred in
 
connection with or the
 
defence thereof
 
by,
 
the Agent
or
 
any
 
other
 
Creditor
 
Party
 
as
 
a
 
result
 
of
 
conduct
 
of
 
any
 
Borrower
 
or
 
any
 
of
 
their
 
partners,
directors, officers, employees, agents or advisors, that violates any Sanctions;
 
or
(c)
any other Pertinent Matter,
other
 
than
 
claims,
 
expenses,
 
liabilities
 
and
 
losses
 
which
 
are
 
shown
 
to
 
have
 
been
 
directly
 
and
mainly caused by the dishonesty or wilful misconduct of the officers or employees of the Creditor
Party concerned.
Without prejudice to its
 
generality, this Clause
Miscellaneous indemnities
) covers any claims,
expenses, liabilities
 
and losses which
 
arise, or are
 
asserted, under or
 
in connection with
 
any law
relating to safety at sea, the ISM Code, the ISPS Code or any Environmental Law or any Sanctions.
21.3
Environmental Indemnity
Without
 
prejudice
 
to
 
its
 
generality,
 
Clause
 
(
Miscellaneous
 
indemnities
)
 
covers
 
any
 
claims,
demands,
 
proceedings,
 
liabilities,
 
taxes,
 
losses
 
or
 
expenses
 
of
 
every
 
kind
 
which
 
arise,
 
or
 
are
asserted, under or in connection with any law relating to safety at sea, pollution
 
or the protection
of the environment, the ISM Code or the ISPS Code.
21.4
Currency indemnity
If
 
any
 
sum
 
due
 
from
 
any
 
Borrower
 
or
 
any
 
Security
 
Party
 
to
 
a
 
Creditor
 
Party
 
under
 
a
 
Finance
Document or
 
under any
 
order or
 
judgment relating
 
to a
 
Finance Document
 
has to
 
be converted
from
 
the
 
currency
 
in
 
which
 
the
 
Finance
 
Document
 
provided
 
for
 
the
 
sum
 
to
 
be
 
paid
 
(the
"Contractual Currency") into another currency (the "Payment Currency") for the purpose of:
(a)
making or
 
lodging any
 
claim or
 
proof against
 
any Borrower
 
or any
 
Security Party,
 
whether in
 
its
liquidation, any arrangement involving it or otherwise; or
(b)
obtaining an order or judgment from any court or other tribunal; or
(c)
enforcing any such order or judgment,
the
 
Borrowers
 
shall
 
indemnify
 
the
 
Creditor
 
Party
 
concerned
 
against
 
the
 
loss
 
arising
 
when
 
the
amount of the payment actually received by
 
that Creditor Party is converted
 
at the available rate
of exchange into the Contractual Currency.
In this Clause
 
(
Currency indemnity
), the "
available rate of exchange
" means the rate at
 
which
the Creditor Party concerned is
 
able at the opening
 
of business (London
 
time) on the Business
 
Day
after
 
it
 
receives
 
the
 
sum
 
concerned
 
to
 
purchase
 
the
 
Contractual
 
Currency
 
with
 
the
 
Payment
Currency.
This Clause
 
(
Currency indemnity
)creates a separate liability of the Borrowers which is distinct
from
 
their other
 
liabilities under
 
the Finance
 
Documents and
 
which shall
 
not be
 
merged
 
in any
judgment or order relating to those other liabilities.
21.5
Application to Master Agreement
For
 
the avoidance
 
of doubt,
 
Clause
 
(
Currency indemnity
)does not
 
apply in
 
respect of
 
sums
due from the Borrowers
 
to the Swap Bank under or
 
in connection with the Master Agreement
 
as
to which
 
sums the
 
provisions of
 
section 8 (
Contractual Currency
) of
 
the Master
 
Agreement shall
apply.
21.6
Mandatory Cost
Each Borrower
 
shall, on
 
demand by
 
the Agent,
 
pay to
 
the Agent
 
for the
 
account of
 
the relevant
Lender,
 
such
 
amount
 
which
 
any
 
Lender
 
certifies
 
in
 
a
 
notice
 
to
 
the
 
Agent
 
to
 
be
 
its
 
good
 
faith
determination of the amount necessary to compensate it for complying with:
(a)
in the case
 
of a Lender
 
lending from a
 
Facility Office in
 
a Participating Member
 
State, the minimum
reserve requirements (or other
 
requirements having the same
 
or similar purpose)
 
of the European
Central Bank (or any other
 
authority or agency which
 
replaces all or any of
 
its functions) in respect
of loans made from that Facility Office; and
(b)
in the case of
 
any Lender lending from
 
a Facility Office in
 
the United Kingdom, any
 
reserve asset,
special
 
deposit
 
or
 
liquidity
 
requirements
 
(or
 
other
 
requirements
 
having
 
the
 
same
 
or
 
similar
purpose) of the
 
Bank of England
 
(or any
 
other governmental
 
authority or agency)
 
and/or paying
any
 
fees
 
to
 
the Financial
 
Conduct Authority
 
and/or the
 
Prudential
 
Regulation
 
Authority (or
 
any
other governmental authority or agency which replaces all or any of their functions),
which, in each case, is referable to that Lender's participation in the Loan.
21.7
Certification of amounts
A notice which is signed by two officers of
 
a Creditor Party,
 
which states that a specified amount,
or
 
aggregate
 
amount,
 
is
 
due
 
to
 
that
 
Creditor
 
Party
 
under
 
this
 
Clause
 
and
 
which
 
indicates
(without necessarily
 
specifying a
 
detailed breakdown) the
 
matters in respect of
 
which the amount,
or aggregate amount, is due shall be prima facie evidence that the amount,
 
or aggregate amount,
is due.
21.8
Sums deemed due to a Lender
For the purposes of this Clause
 
(
Indemnities
), a sum payable by the Borrowers
 
to the Agent or
the Security Trustee for distribution to a Lender shall be treated as a sum due to that Lender.
22
NO SET-OFF OR TAX
 
DEDUCTION
 
22.1
No deductions
All amounts due from the Borrowers under a Finance Document shall be paid:
(a)
without any form of set off, cross-claim or condition; and
(b)
free and clear of any tax deduction except a tax deduction which a Borrower is required by law to
make.
22.2
Grossing-up for taxes
If a Borrower is required by law to make a tax deduction from any payment:
(a)
that Borrower shall notify the Agent as soon as it becomes aware of the requirement;
(b)
that Borrower
 
shall pay
 
the tax
 
deducted to
 
the appropriate taxation
 
authority promptly,
 
and in
any event before any fine or penalty arises; and
(c)
the amount due in respect of the
 
payment shall be increased by the
 
amount necessary to ensure
that each Creditor Party receives and retains (free from any
 
liability relating to the tax deduction)
a net amount which, after the tax deduction, is equal to the full
 
amount which it would otherwise
have received.
22.3
Evidence of payment of taxes
Within one
 
month after
 
making any
 
tax
 
deduction, the
 
Borrower concerned
 
shall deliver
 
to the
Agent
 
documentary
 
evidence
 
satisfactory
 
to
 
the
 
Agent
 
that
 
the
 
tax
 
had
 
been
 
paid
 
to
 
the
appropriate taxation authority.
22.4
Exclusion of tax on overall net income
In
 
this
 
Clause
 
(
No
 
set-off
 
or
 
Tax
 
Deduction
)
 
"
tax
 
deduction
"
 
means
 
any
 
deduction
 
or
withholding for or on account of any present or future tax except tax
 
on a Creditor Party's overall
net income, other than a FATCA
 
Deduction.
22.5
Application to Master Agreement
For the
 
avoidance of doubt,
 
Clause
 
(
No set-off
 
or Tax
 
Deduction
) does not
 
apply in respect
 
of
sums
 
due
 
from
 
the
 
Borrowers
 
to
 
the
 
Swap
 
Bank
 
under
 
or
 
in
 
connection
 
with
 
the
 
Master
Agreement as to
 
which sums the provisions of
 
section 2(d) (
Deduction or Withholding for Tax
) of
the Master Agreement shall apply.
22.6
FATCA
 
Information
(a)
Subject to paragraph
 
below, each Party shall, within ten Business Days of a reasonable request
by another Party:
(i)
confirm to that other Party whether it is:
(A)
a FATCA
 
Exempt Party; or
(B)
not a FATCA
 
Exempt Party; and
(ii)
supply to
 
that other
 
Party such
 
forms, documentation
 
and other
 
information relating
 
to
its status
 
under FATCA
 
as that
 
other Party
 
reasonably requests
 
for the
 
purposes of
 
that
other Party's compliance with FATCA;
 
and
(iii)
supply to
 
that other
 
Party such
 
forms, documentation
 
and other
 
information relating
 
to
its status
 
as that
 
other Party
 
reasonably requests
 
for the
 
purposes of
 
that other
 
Party's
compliance with any other law, regulation or exchange
 
of information regime.
(b)
If a Party confirms to another Party pursuant to sub-paragraph
 
of paragraph
 
above that it is
a FATCA
 
Exempt
 
Party
 
and it
 
subsequently becomes
 
aware
 
that it
 
is not,
 
or has
 
ceased to
 
be a
FATCA
 
Exempt Party,
 
that Party shall notify that other Party reasonably promptly.
(c)
Paragraph
 
above shall not
 
oblige any
 
Creditor Party
 
to do
 
anything and sub-paragraph
 
of
paragraph
 
above shall
 
not oblige
 
any other
 
Party to
 
do anything
 
which would
 
or might
 
in its
reasonable opinion constitute a breach of:
(i)
any law or regulation;
(ii)
any fiduciary duty; or
(iii)
any duty of confidentiality.
(d)
If
 
a
 
Party
 
fails
 
to
 
confirm
 
whether
 
or
 
not
 
it
 
is
 
a
 
FATCA
 
Exempt
 
Party
 
or
 
to
 
supply
 
forms,
documentation
 
or
 
other
 
information
 
requested
 
in
 
accordance
 
with
 
sub-paragraphs
 
or
 
of
paragraph
 
above (including, for
 
the avoidance
 
of doubt,
 
where paragraph
 
above applies),
then such Party shall be treated for the purposes of the
 
Finance Documents (and payments under
them) as
 
if it
 
is not
 
a FATCA
 
Exempt Party
 
until such
 
time as
 
the Party
 
in question
 
provides the
requested confirmation, forms, documentation or other information.
(e)
If a Borrower is
 
a US Tax Obligor, or the Agent
 
reasonably believes that
 
its obligations under
 
FATCA
or any other applicable law
 
or regulation require it, each
 
Lender shall, within
 
ten Business Days of:
(i)
where a Borrower is a US Tax Obligor and the relevant Lender is a Lender as
 
of the date of
this Agreement, the date of this Agreement;
(ii)
where a Borrower is a US Tax
 
Obligor on a date where a transfer
 
is effected under Clause
 
(
Transfer
 
by a
 
Lender
) and
 
the relevant
 
Lender is
 
a Transferee
 
Lender,
 
the relevant
date on which such transfer is effected under Clause
 
(
Transfer by a Lender
); or
(iii)
where a Borrower is not a US Tax Obligor,
 
the date of a request from the Agent,
supply to the Agent:
(iv)
a withholding certificate on Form W-8, Form W-9 or any other relevant
 
form; or
(v)
any withholding statement or other
 
document, authorisation or waiver as the Agent may
require to certify or establish
 
the status of such Lender under
 
FATCA
 
or that other law or
regulation.
(f)
The
 
Agent
 
shall
 
provide
 
any
 
withholding
 
certificate,
 
withholding
 
statement,
 
document,
authorisation
 
or
 
waiver
 
it
 
receives
 
from
 
a
 
Lender
 
pursuant
 
to
 
paragraph
 
above
 
to
 
the
Borrowers.
(g)
If any withholding
 
certificate, withholding statement, document,
 
authorisation or
 
waiver provided
to the Agent by
 
a Lender pursuant to paragraph
 
above is or becomes materially
 
inaccurate or
incomplete, that
 
Lender shall
 
promptly update it
 
and provide
 
such updated
 
withholding certificate,
withholding statement,
 
document, authorisation or
 
waiver to
 
the Agent
 
unless it is
 
unlawful for
the Lender
 
to do
 
so (in
 
which case
 
the Lender
 
shall promptly
 
notify the
 
Agent).
 
The Agent
 
shall
provide
 
any
 
such
 
updated
 
withholding
 
certificate,
 
withholding
 
statement,
 
document,
authorisation or waiver to the Borrowers.
(h)
The
 
Agent
 
may
 
rely
 
on
 
any
 
withholding
 
certificate,
 
withholding
 
statement,
 
document,
authorisation or waiver
 
it receives from
 
a Lender pursuant to
 
paragraph
 
or
 
above without
further verification.
 
The Agent shall not be liable
 
for any action taken by it under or in connection
with paragraphs
,
 
or
 
above.
22.7
FATCA
 
Deduction
(a)
Each
 
Party
 
may
 
make
 
any FATCA
 
Deduction it
 
is required
 
to make
 
by FATCA,
 
and any
 
payment
required in connection with that FATCA
 
Deduction, and no Party shall be required to increase any
payment
 
in
 
respect
 
of
 
which
 
it
 
makes
 
such
 
a
 
FATCA
 
Deduction
 
or
 
otherwise
 
compensate
 
the
recipient of the payment for that FATCA
 
Deduction.
(b)
Each Party
 
shall promptly,
 
upon becoming
 
aware that
 
it must
 
make
 
a FATCA
 
Deduction (or
 
that
there is any change in the rate or the basis of such FATCA
 
Deduction), notify the Party to whom it
is making the
 
payment and, in
 
addition, shall notify each
 
Borrower and
 
the Agent and the
 
Agent
shall notify the other Creditor Parties.
23
ILLEGALITY AND SANCTIONS AFFECTING A LENDER
23.1
Illegality
This Clause
 
(
Illegality and Sanctions affecting a Lender
) applies if:
(a)
 
a Lender (the "
Notifying Lender
") notifies the Agent that it has become, or will with effect from a
specified date, become:
(i)
unlawful or prohibited
 
as a result
 
of the introduction of
 
a new law,
 
an amendment to an
existing law or a change in the manner in which an existing law is or will be
 
interpreted or
applied; or
 
(ii)
contrary to, or inconsistent with, any regulation or Sanctions,
for the Notifying Lender
 
to maintain or give
 
effect to
 
any of its
 
obligations under this Agreement
in the
 
manner contemplated
 
by this
 
Agreement or
 
to determine
 
or charge
 
interest
 
rates
 
based
upon Term SOFR;
 
and
(b)
without
 
prejudice
 
to
 
any
 
of
 
the
 
express
 
obligations
 
of
 
the
 
Security
 
Parties
 
under
 
the
 
Finance
Documents, in the opinion of a Lender acting reasonably anything whatsoever is done or omitted
to be done
 
by a Security
 
Party which would
 
result in
 
that Lender
 
being in
 
breach of
 
or made
 
subject
to Sanctions,
 
or at risk of being in breach of or made subject to Sanctions.
23.2
Notification of illegality
The Agent shall promptly
 
notify the Borrowers, the
 
Security Parties, the Security Trustee
 
and the
other
 
Lenders
 
of
 
the
 
notice
 
under
 
Clause
 
(
Illegality
)
 
which
 
the
 
Agent
 
receives
 
from
 
the
Notifying Lender.
23.3
Prepayment; termination of Commitment
On the Agent
 
notifying the Borrowers
 
under Clause
 
(
Notification of illegality
), the
 
Notifying
Lender's
 
Commitment
 
shall
 
terminate;
 
and
 
thereupon
 
or,
 
if
 
later,
 
on
 
the
 
date
 
specified
 
in
 
the
Notifying Lender's
 
notice under
 
Clause
 
(
Illegality
)
 
as
 
the date
 
on
 
which
 
the notified
 
event
would
 
become
 
effective
 
the
 
Borrowers
 
shall
 
prepay
 
the
 
Notifying
 
Lender's
 
Contribution
 
in
accordance with Clause
 
(
Repayment and prepayment
).
23.4
Mitigation
If
 
circumstances
 
arise
 
which
 
would
 
result
 
in
 
a
 
notification
 
under
 
Clause
 
(
Illegality
)
 
then,
without
 
in
 
any
 
way
 
limiting the
 
rights
 
of
 
the
 
Notifying Lender
 
under
 
Clause
 
(
Prepayment;
termination of Commitment
), the Notifying Lender shall
 
use reasonable endeavours to transfer its
obligations,
 
liabilities
 
and
 
rights
 
under
 
this
 
Agreement
 
and
 
the
 
Finance
 
Documents
 
to
 
another
office or financial institution not affected
 
by the circumstances but the Notifying Lender shall not
be under any obligation to take any such action if,
 
in its opinion, to do would or might:
(a)
have an adverse effect on its business, operations or financial condition; or
(b)
involve
 
it
 
in
 
any
 
activity
 
which
 
is
 
unlawful
 
or
 
prohibited
 
or
 
any
 
activity
 
that
 
is
 
contrary
 
to,
 
or
inconsistent with, any regulation; or
(c)
involve it in any expense (unless indemnified to its satisfaction) or tax disadvantage.
24
INCREASED COSTS
 
24.1
Increased costs
This Clause
 
(
Increased costs
) applies if a
 
Lender (the "
Notifying Lender
") notifies the
 
Agent that
the Notifying Lender considers that as a result of:
(a)
the introduction or alteration
 
after the date
 
of this Agreement of
 
a law or an
 
alteration after the
date of
 
this Agreement
 
in the manner
 
in which
 
a law
 
is interpreted
 
or applied
 
(disregarding any
effect which relates to the application to payments under this Agreement of a tax on the Lender's
overall net income); or
(b)
complying with
 
any regulation (including
 
any which
 
relates to capital
 
adequacy or
 
liquidity controls
or
 
which
 
affects
 
the
 
manner
 
in
 
which
 
the
 
Notifying
 
Lender
 
allocates
 
capital
 
resources
 
to
 
its
obligations
 
under
 
this
 
Agreement)
 
which
 
is
 
introduced,
 
or
 
altered,
 
or
 
the
 
interpretation
 
or
application of which is altered, after the date of this Agreement; or
(c)
complying with any regulation (including the "International Convergence of Capital Measurement
and
 
Capital
 
Standards,
 
a
 
Revised
 
Framework"
 
published
 
by
 
the
 
Basel
 
Committee
 
on
 
Banking
Supervision
 
in
 
June
 
2004,
 
in
 
the
 
form
 
existing
 
on
 
the
 
date
 
of
 
this
 
Agreement
 
and
 
any
 
other
regulation which
 
relates to
 
capital adequacy
 
or liquidity
 
controls or
 
which affects
 
the manner
 
in
which
 
the
 
Notifying Lender
 
allocates
 
capital
 
resources
 
to
 
its obligations
 
under this
 
Agreement)
which is introduced,
 
or altered, or
 
the interpretation
 
or application of
 
which is altered,
 
after the
date of this Agreement; or
(d)
the introduction, implementation, application, administration or compliance with Basel III or CRD
IV, or any law or regulation which implements or applies Basel III or
 
CRD IV (regardless of the date
on
 
which it
 
is enacted,
 
adopted
 
or
 
issued and
 
regardless
 
of whether
 
any
 
such implementation,
application or compliance is by a government, regulator,
 
the Creditor Party or any of its affiliates)
after the date of this Agreement,
the Notifying Lender (or a parent company of it) has incurred or will incur an "
increased
cost
".
24.2
Meaning of "increased costs"
In this Clause
 
(
Increased costs
), "
increased costs
" means, in relation to a Notifying Lender:
(a)
an additional or increased cost incurred
 
as a result of, or in connection with, the
 
Notifying
Lender having entered
 
into, or being a
 
party to, this Agreement
 
or a Transfer
 
Certificate,
of funding
 
or maintaining
 
its Commitment
 
or Contribution
 
or performing
 
its obligations
under this Agreement, or of having outstanding all
 
or any part of its Contribution or
 
other
unpaid sums;
 
(b)
a reduction in the amount of any
 
payment to the Notifying Lender under this Agreement
or in the effective
 
return which such a payment
 
represents to the Notifying Lender or on
its capital;
(c)
an
 
additional or
 
increased cost
 
of
 
funding all
 
or maintaining
 
all
 
or
 
any
 
of
 
the advances
comprised
 
in
 
a
 
class
 
of
 
advances
 
formed
 
by
 
or
 
including
 
the
 
Notifying
 
Lender's
Contribution or (as
 
the case may
 
require) the
 
proportion of that
 
cost attributable
 
to the
Contribution; or
(d)
a liability to
 
make a payment, or
 
a return foregone, which
 
is calculated by
 
reference to any
amounts received or receivable by the Notifying Lender under this Agreement,
but not
 
an item
 
attributable to
 
a change
 
in the
 
rate of tax
 
on the
 
overall net income
 
of the
 
Notifying
Lender (or a parent company of it)
 
or an item compensated for by any payment made pursuant
 
to
Clause
 
(
Mandatory
 
cost
)
 
or
 
an
 
item
 
covered
 
by
 
the
 
indemnity
 
for
 
tax
 
in
 
Clause
(
Indemnities
 
regarding
 
borrowing
 
and
 
repayment
 
of
 
Loan
)
 
or
 
by
 
Clause
 
(
No
 
set-off
 
or
 
Tax
Deduction
) or a FATCA
 
Deduction.
For the
 
purposes of
 
this Clause
 
(
Meaning of
 
"increased costs"
) the
 
Notifying Lender may
 
in
good faith allocate or spread costs and/or losses among its assets and liabilities
 
(or any class of its
assets and liabilities) on such basis as it considers appropriate.
24.3
Notification to Borrowers of claim for increased costs
The Agent
 
shall promptly
 
notify the
 
Borrowers
 
and the
 
Security Parties
 
of the
 
notice which
 
the
Agent received from the Notifying Lender under Clause
 
(
Increased costs
).
24.4
Payment of increased costs
The Borrowers
 
shall pay
 
to the
 
Agent, on
 
the Agent's
 
demand, for
 
the account
 
of the
 
Notifying
Lender the amounts which the Agent from
 
time to time notifies the Borrowers
 
that the Notifying
Lender has specified to be necessary to compensate the Notifying Lender for the increased cost.
24.5
Notice of prepayment
If the Borrowers are not willing to continue to compensate the Notifying Lender for the increased
cost under
 
Clause
 
(
Payment of
 
increased costs
), the
 
Borrowers may
 
give the
 
Agent not
 
less
than 14 days'
 
notice of its intention to prepay the Notifying
 
Lender's Contribution at the end
 
of an
Interest Period.
24.6
Prepayment; termination of Commitment
A notice under Clause
 
(
Notice of prepayment
) shall be irrevocable;
 
the Agent shall promptly
notify the Notifying Lender of the Borrowers'
 
notice of intended prepayment; and:
(a)
on the date on which the Agent serves that notice, the Commitment of the Notifying Lender shall
be cancelled; and
(b)
on the date specified in its notice of intended prepayment, the Borrowers shall prepay (subject to
any Break Costs, without premium
 
or penalty) the Notifying Lender's Contribution, together with
accrued interest thereon at the applicable rate plus the Margin and the Mandatory Cost (if any).
24.7
Application of prepayment
Clause
 
(
Repayment and Prepayment
) shall apply in relation to the prepayment.
25
SET OFF
25.1
Application of credit balances
Each Creditor Party may without prior notice:
(a)
apply any balance (whether
 
or not then due)
 
which at any time stands
 
to the credit of any
 
account
in
 
the
 
name
 
of
 
a
 
Borrower
 
at
 
any
 
office
 
in
 
any
 
country
 
of
 
that
 
Creditor
 
Party
 
in
 
or
 
towards
satisfaction
 
of
 
any
 
sum
 
then
 
due
 
from
 
that
 
Borrower
 
to
 
that
 
Creditor
 
Party
 
under
 
any
 
of
 
the
Finance Documents; and
(b)
for that purpose:
(i)
break, or alter the maturity of, all or any part of a deposit of that Borrower;
(ii)
convert or translate all or any part of a deposit or other credit balance into Dollars; and
(iii)
enter into any other
 
transaction or make any
 
entry with regard to
 
the credit balance
 
which
the Creditor Party concerned considers appropriate.
 
25.2
Existing rights unaffected
No Creditor
 
Party shall
 
be obliged
 
to exercise
 
any of
 
its rights
 
under Clause
 
(
Application of
credit balances
); and those rights shall be without prejudice
 
and in addition to any right of set off,
combination of accounts, charge,
 
lien or other
 
right or remedy to
 
which a Creditor
 
Party is entitled
(whether under the general law or any document).
25.3
Sums deemed due to a Lender
For the purposes
 
of this Clause
 
(
Set-off
), a sum
 
payable by
 
the Borrowers
 
to the Agent
 
or the
Security Trustee
 
for distribution to,
 
or for the
 
account of,
 
a Lender shall be treated
 
as a sum due
to that
 
Lender; and
 
each Lender's
 
proportion of
 
a sum
 
so payable
 
for distribution
 
to,
 
or for
 
the
account of, the Lenders shall be treated as a sum due to such Lender.
25.4
No Security Interest
This Clause
 
(
Set-off
) gives the Creditor
 
Parties a contractual
 
right of set-off
 
only, and
 
does not
create any equitable charge or other Security Interest over any credit balance of any Borrower.
 
26
TRANSFERS AND CHANGES IN FACILITY OFFICES
26.1
Transfer by Borrowers
No Borrower may,
 
without the consent of
 
the Agent, given
 
on the instructions of
 
all the Lenders
transfer any of its rights, liabilities or obligations under any Finance Document.
26.2
Transfer by
 
a Lender
Subject to Clause
 
(
Effective Date
 
of Transfer
 
Certificate
), a Lender (the "
Transferor
 
Lender
")
may at any time cause:
 
(a)
its rights in respect of all or part of its Contribution; or
(b)
its obligations in respect of all or part of its Commitment; or
(c)
a combination of (a) and (b),
to be (in
 
the case of
 
its rights) transferred to, or
 
(in the case
 
of its obligations)
 
assumed by, another
bank
 
or
 
financial
 
institution
 
or
 
a
 
trust,
 
fund
 
or
 
other
 
entity
 
which
 
is
 
regularly
 
engaged
 
in
 
or
established for the
 
purpose of
 
making, purchasing
 
or investing in
 
loans, securities
 
or other
 
financial
assets (a "
Transferee
 
Lender
") by delivering
 
to the Agent
 
a completed certificate
 
in the form
 
set
out
 
in
 
with
 
any
 
modifications
 
approved
 
or
 
required
 
by
 
the
 
Agent
 
(a
 
"
Transfer
Certificate
") executed by the Transferor
 
Lender and the Transferee Lender.
 
However any
 
rights and
 
obligations of
 
the Transferor
 
Lender in
 
its capacity
 
as Agent
 
or Security
Trustee will have to
 
be dealt with separately in accordance with the Agency and Trust Deed.
A transfer pursuant to this Clause
 
shall be effected:
(i)
without the consent of the Borrowers:
(A)
following the occurrence of an Event of Default which is continuing; and/or
(B)
if such transfer is to another Lender or an affiliate of a Lender;
(ii)
in
 
all
 
other
 
circumstances
 
with
 
the
 
consent
 
of
 
the
 
Borrowers
 
(such
 
consent
 
not
 
to
 
be
unreasonably withheld or delayed) and the Borrowers will be deemed to have given their
consent
 
five
 
Business
 
Days
 
following
 
the
 
request
 
of
 
the
 
Transferor
 
Lender,
 
unless
 
the
consent is expressly refused by the Borrowers within that time.
26.3
Transfer Certificate,
 
delivery and notification
As
 
soon
 
as
 
reasonably
 
practicable
 
after
 
a
 
Transfer
 
Certificate
 
is
 
delivered
 
to
 
the
 
Agent,
 
it
 
shall
(unless it has reason to believe that the Transfer
 
Certificate may be defective):
(a)
sign the
 
Transfer
 
Certificate on
 
behalf of
 
itself,
 
the Borrowers,
 
the Security
 
Parties, the
 
Security
Trustee, each of the other Lenders and the Swap Bank;
(b)
on behalf of the
 
Transferee Lender,
 
send to each
 
Borrower and each Security
 
Party letters or faxes
notifying them of the Transfer Certificate and attaching a copy of it; and
(c)
send to the Transferee
 
Lender copies of the letters or faxes sent under paragraph
 
above,
but
 
the
 
Agent
 
shall
 
only
 
be
 
obliged
 
to
 
execute
 
a
 
Transfer
 
Certificate
 
delivered
 
to
 
it
 
by
 
the
Transferor
 
Lender and the Transferee Lender once it is satisfied it has complied with all necessary
"know your customer" or other similar
 
checks under all applicable
 
laws and regulations in relation
to the transfer to that Transferee
 
Lender.
26.4
Effective Date of Transfer
 
Certificate
A Transfer Certificate becomes effective on the date, if any,
 
specified in the Transfer Certificate as
its effective
 
date,
 
Provided that
 
it is signed by the
 
Agent under Clause
 
(
Transfer Certificate,
delivery and notification
) on or before that date.
26.5
No transfer without Transfer
 
Certificate
Except as provided in Clause
 
(
Security over Lenders'
 
rights
), no assignment
 
or transfer of any
right or obligation of
 
a Lender under any Finance Document
 
is binding on, or effective
 
in relation
to,
 
any
 
Borrower,
 
any
 
Security
 
Party,
 
the
 
Agent
 
or
 
the
 
Security
 
Trustee
 
unless
 
it
 
is
 
effected,
evidenced or perfected by a Transfer
 
Certificate.
 
26.6
Lender re-organisation; waiver of Transfer
 
Certificate
However,
 
if
 
a
 
Lender
 
enters
 
into
 
any
 
merger,
 
de-merger
 
or
 
other
 
reorganisation
 
as
 
a
 
result
 
of
which all its rights
 
or obligations vest in another person
 
(the "
successor
"), the Agent may, if it sees
fit, by notice to the successor and the Borrowers
 
and the Security Trustee waive
 
the need for the
execution
 
and
 
delivery
 
of
 
a
 
Transfer
 
Certificate;
 
and,
 
upon
 
service
 
of
 
the
 
Agent's
 
notice,
 
the
successor shall
 
become a
 
Lender with
 
the same
 
Commitment and
 
Contribution as
 
were held
 
by
the predecessor Lender.
26.7
Effect of Transfer
 
Certificate
A Transfer
 
Certificate takes effect in accordance with English law as follows:
(a)
to
 
the
 
extent
 
specified
 
in
 
the
 
Transfer
 
Certificate,
 
all
 
rights
 
and
 
interests
 
(present,
 
future
 
or
contingent)
 
which
 
the Transferor
 
Lender has
 
under or
 
by
 
virtue
 
of
 
the
 
Finance Documents
 
are
assigned to
 
the Transferee
 
Lender absolutely,
 
free of any
 
defects in
 
the Transferor
 
Lender's title
and of any rights or equities which any Borrower
 
or any Security Party had against the
 
Transferor
Lender;
(b)
the
 
Transferor
 
Lender's
 
Commitment
 
is
 
discharged
 
to
 
the
 
extent
 
specified
 
in
 
the
 
Transfer
Certificate;
(c)
the Transferee
 
Lender becomes a Lender with the Contribution previously held by
 
the Transferor
Lender and a Commitment of an amount specified in the Transfer Certificate;
(d)
the Transferee
 
Lender becomes bound by all
 
the provisions of the
 
Finance Documents which are
applicable to
 
the Lenders
 
generally,
 
including those
 
about pro
 
rata
 
sharing and
 
the exclusion
 
of
liability on the part of,
 
and the indemnification of, the Agent
 
and the Security Trustee
 
and, to the
extent that the Transferee
 
Lender becomes bound by those provisions
 
(other than those relating
to exclusion of liability), the Transferor
 
Lender ceases to be bound by them;
(e)
any part
 
of the
 
Loan which
 
the Transferee Lender advances
 
after the
 
Transfer Certificate's effective
date ranks
 
in point
 
of priority and
 
security in the
 
same way
 
as it would
 
have ranked
 
had it been
advanced by
 
the transferor,
 
assuming that
 
any defects
 
in the
 
transferor's
 
title and
 
any rights
 
or
equities of any Borrower or any Security Party against the Transferor
 
Lender had not existed;
(f)
the Transferee
 
Lender becomes entitled to all the rights under the
 
Finance Documents which are
applicable
 
to
 
the
 
Lenders
 
generally,
 
including but
 
not
 
limited
 
to
 
those
 
relating
 
to
 
the
 
Majority
Lenders and those under
 
Clause
 
(
Market disruption
) and Clause
 
(
Fees and expenses
), and to
the
 
extent
 
that
 
the
 
Transferee
 
Lender
 
becomes
 
entitled
 
to
 
such
 
rights,
 
the
 
Transferor
 
Lender
ceases to be entitled to them; and
(g)
in
 
respect
 
of
 
any
 
breach
 
of
 
a
 
warranty,
 
undertaking, condition
 
or
 
other
 
provision
 
of
 
a
 
Finance
Document
 
or
 
any
 
misrepresentation
 
made
 
in
 
or
 
in
 
connection
 
with
 
a
 
Finance
 
Document,
 
the
Transferee
 
Lender shall be entitled to recover damages by reference to the loss incurred by it as
 
a
result of the breach or misrepresentation, irrespective of whether the original Lender would have
incurred a loss of that kind or amount.
The rights
 
and equities of
 
any Borrower
 
or any
 
Security Party
 
referred
 
to above
 
include, but are
not limited to, any right of set off and any other kind of cross claim.
26.8
Maintenance of register of Lenders
During the
 
Security Period
 
the Agent
 
shall maintain
 
a register
 
in which
 
it shall
 
record the
 
name,
Commitment, Contribution and
 
administrative details
 
(including the Facility
 
Office) from
 
time to
time of
 
each Lender
 
holding a
 
Transfer Certificate and the
 
effective date (in
 
accordance with
 
Clause
 
(
Effective Date
 
of Transfer
 
Certificate
)) of the Transfer
 
Certificate; and the Agent
 
shall make
the register available for inspection by any Lender, the Security Trustee
 
and the Borrowers during
normal banking hours, subject to receiving at least three Business Days'
 
prior notice.
26.9
Reliance on register of Lenders
The entries
 
on that
 
register shall,
 
in the absence
 
of manifest
 
error,
 
be conclusive
 
in determining
the identities
 
of the
 
Lenders and
 
the amounts
 
of their
 
Commitments and
 
Contributions and
 
the
effective dates of Transfer
 
Certificates and may be relied upon by the Agent and the other parties
to the Finance Documents for all purposes relating to the Finance Documents.
26.10
Authorisation of Agent to sign Transfer Certificates
Each
 
Borrower,
 
the Security
 
Trustee,
 
each Lender
 
and the
 
Swap
 
Bank irrevocably
 
authorise the
Agent to sign Transfer
 
Certificates on its behalf.
26.11
Registration fee
In respect
 
of any
 
Transfer
 
Certificate, the
 
Agent shall
 
be entitled
 
to recover
 
a registration
 
fee of
$5,000 from the Transferor
 
Lender or (at the Agent's option) the Transferee Lender.
26.12
Sub-participation; subrogation assignment
A Lender may sub participate all or any part
 
of its rights and/or obligations under or in
 
connection
with the Finance Documents without the consent of, or any notice to, any Borrower,
 
any Security
Party,
 
the Agent or the Security Trustee
 
or any other Creditor Party;
 
and the Lenders may assign,
in any manner and terms
 
agreed by the Majority Lenders,
 
the Agent and the Security Trustee,
 
all
or any part of those rights to an insurer or surety who has become subrogated to them.
26.13
Disclosure of information
A Lender may disclose
 
to a potential Transferee
 
Lender or sub participant any
 
information which
the Lender has received in relation to any Borrower,
 
any Security Party or their affairs under or in
connection with any Finance Document, unless the information
 
is clearly of a confidential nature.
26.14
Change of Facility Office
A Lender may change its Facility Office by giving notice to the Agent and the change shall become
effective on the later of:
(a)
the date on which the Agent receives the notice; and
(b)
the date, if any, specified in the notice as the date on which the change will come into effect.
26.15
Notification
On receiving
 
such a
 
notice, the
 
Agent
 
shall notify
 
the Borrowers
 
and the
 
Security Trustee;
 
and,
until the Agent receives such
 
a notice, it shall
 
be entitled to assume
 
that a Lender
 
is acting through
the Facility Office of which the Agent last had notice.
26.16
Security over Lenders' rights
In addition to the other rights provided to Lenders under this Clause
 
(
Transfers and changes in
Facility Offices
), each Lender
 
may without consulting
 
with or obtaining
 
consent from any Borrower
or any Security Party,
 
at any time charge, assign or otherwise create a Security Interest
 
in or over
(whether by way of collateral or otherwise) all or any of its rights under any Finance Document to
secure obligations of that Lender including, without limitation:
(a)
any
 
charge,
 
assignment
 
or
 
other
 
Security Interest
 
to
 
secure
 
obligations
 
to
 
a
 
federal
 
reserve
 
or
central bank; and
 
(b)
in the
 
case of
 
any Lender
 
which is
 
a fund,
 
any charge, assignment
 
or other
 
Security Interest granted
to any holders (or trustee or representatives
 
of holders) of obligations owed, or securities issued,
by that Lender as security for those obligations or securities,
except that no such charge, assignment or Security Interest shall:
(i)
release a
 
Lender from
 
any of
 
its obligations
 
under the
 
Finance Documents
 
or substitute
the beneficiary of the relevant charge, assignment or Security Interest for the Lender as a
party to any of the Finance Documents; or
 
(ii)
require any
 
payments to
 
be made by
 
any Borrower
 
or any
 
Security Party or
 
grant to
 
any
person
 
any
 
more
 
extensive
 
rights
 
than
 
those
 
required
 
to
 
be
 
made
 
or
 
granted
 
to
 
the
relevant Lender under the Finance Documents.
27
VARIATIONS
 
AND WAIVERS
 
27.1
Variations, waivers etc.
 
by Majority Lenders
Subject to
 
Clause
 
(
Variations, waivers
 
etc. requiring
 
agreement of
 
all Lenders
), a
 
document
shall be
 
effective
 
to
 
vary,
 
waive,
 
suspend or
 
limit any
 
provision
 
of
 
a Finance
 
Document, or
 
any
Creditor Party's rights or remedies
 
under such a
 
provision or the general law, only if
 
the document
is signed, or specifically agreed
 
to by fax, by the Borrowers, by the Agent
 
on behalf of the
 
Majority
Lenders, by the Agent and the Security
 
Trustee in their own rights, and, if the document relates to
a Finance Document to which a Security Party is party, by that Security Party.
27.2
Variations, waivers etc. requiring agreement of all Lenders
However,
 
as
 
regards
 
the
 
following,
 
Clause
 
(
Variations,
 
waivers
 
etc.
 
by
 
Majority
 
Lenders
)
applies
 
as if
 
the words
 
"by
 
the Agent
 
on
 
behalf of
 
the Majority
 
Lenders" were
 
replaced
 
by the
words "by or on behalf of every Lender and the Swap Bank":
(a)
a reduction in the Margin;
(b)
a
 
postponement
 
to
 
the
 
date
 
for,
 
or
 
a
 
reduction
 
in
 
the
 
amount
 
of,
 
any
 
payment
 
of
 
principal,
interest, fees or other sum payable under this Agreement;
(c)
an increase in any Lender's Commitment;
(d)
a change to the definition of "
Majority Lenders
";
(e)
a change to Clause
 
(
Position of Lenders, the Swap Bank and Majority Lenders
), or this Clause
(
Variations and waivers
);
(f)
any release of, or material variation to, a Security Interest, guarantee, indemnity or subordination
arrangement set out in a Finance Document; and
(g)
any
 
other
 
change
 
or
 
matter
 
as
 
regards
 
which
 
this
 
Agreement
 
or
 
another
 
Finance
 
Document
expressly provides that each Lender's consent is required.
27.3
Exclusion of other or implied variations
Except for
 
a document which
 
satisfies the requirements
 
of Clauses
 
(
Variations, waivers
 
etc.
by Majority Lenders
),
 
(
Exclusion of other or
 
implied variations
) and
 
(
Changes
 
to reference
rates
), no document,
 
and no act,
 
course of conduct,
 
failure or neglect
 
to act, delay
 
or acquiescence
on the part of the Creditor Parties or any of them (or any
 
person acting on behalf of any of them)
shall result in the Creditor
 
Parties or any of
 
them (or any person acting on
 
behalf of any of them)
being
 
taken
 
to
 
have
 
varied,
 
waived,
 
suspended or
 
limited,
 
or
 
being
 
precluded
 
(permanently
 
or
temporarily) from enforcing, relying on or exercising:
(a)
a provision of this Agreement or another Finance Document; or
(b)
an Event of Default; or
 
(c)
a
 
breach
 
by
 
a
 
Borrower
 
or
 
a
 
Security
 
Party
 
of
 
an
 
obligation
 
under
 
a
 
Finance
 
Document
 
or
 
the
general law; or
(d)
any right or remedy conferred by any Finance Document or by the general law,
and there
 
shall not
 
be implied
 
into
 
any
 
Finance Document
 
any
 
term or
 
condition requiring
 
any
such
 
provision
 
to
 
be
 
enforced,
 
or
 
such
 
right
 
or
 
remedy
 
to
 
be
 
exercised,
 
within
 
a
 
certain
 
or
reasonable time.
27.4
Changes to reference rates
(a)
If
 
a
 
Published
 
Rate
 
Replacement
 
Event
 
has
 
occurred
 
in
 
relation
 
to
 
any
 
Published
 
Rate,
 
any
amendment or waiver which relates to:
(i)
providing for the use
 
of a Replacement
 
Reference Rate in place
 
of that Published
 
Rate; and
(ii)
(A)
aligning any
 
provision of
 
any Finance
 
Document to
 
the use
 
of that
 
Replacement
Reference Rate;
(B)
enabling
 
that
 
Replacement
 
Reference
 
Rate
 
to
 
be
 
used
 
for
 
the
 
calculation
 
of
interest
 
under
 
this
 
Agreement
 
(including, without
 
limitation,
 
any
 
consequential
changes required
 
to enable that
 
Replacement Reference
 
Rate to
 
be used for
 
the
purposes of this Agreement);
(C)
implementing
 
market
 
conventions
 
applicable
 
to
 
that
 
Replacement
 
Reference
Rate;
(D)
providing
 
for
 
appropriate
 
fallback
 
(and
 
market
 
disruption)
 
provisions
 
for
 
that
Replacement Reference Rate; or
(E)
adjusting the pricing to reduce or eliminate, to the extent
 
reasonably practicable,
any
 
transfer
 
of
 
economic
 
value
 
from
 
one
 
Party
 
to
 
another
 
as
 
a
 
result
 
of
 
the
application of that Replacement
 
Reference Rate (and if any
 
adjustment or method
for
 
calculating
 
any
 
adjustment
 
has
 
been
 
formally
 
designated,
 
nominated
 
or
recommended
 
by
 
the
 
Relevant
 
Nominating
 
Body,
 
the
 
adjustment
 
shall
 
be
determined on the basis of that designation, nomination or recommendation),
may be made with the consent of the Agent (acting on the instructions of the Majority Lenders)
and the Borrowers.
(b)
If any Lender fails to respond to a request for an amendment
 
or waiver described in paragraph
above
,
or for
 
any other
 
vote
 
of Lenders
 
in relation
 
to,
 
paragraph
 
above within
 
five
 
Business
Days
 
(or such
 
longer time
 
period in
 
relation to
 
any request
 
which the
 
Borrowers and
 
the Agent
may agree) of that request being made:
(i)
its Commitment or its participation in the Loan (as the case may be) shall not be included
for
 
the
 
purpose
 
of
 
calculating
 
the
 
Total
 
Commitments
 
or
 
the
 
amount
 
of
 
the
 
Loan
 
(as
applicable) when ascertaining whether any relevant percentage of Total
 
Commitments or
the aggregate
 
of participations in
 
the Loan (as
 
applicable) has been
 
obtained to approve
that request; and
(ii)
its
 
status
 
as
 
a Lender
 
shall be
 
disregarded
 
for
 
the purpose
 
of
 
ascertaining
 
whether the
agreement of any specified group of Lenders has been obtained to approve that request.
(c)
In this Clause
"
Published Rate
" means:
(a)
SOFR; or
(b)
Term SOFR for
 
any Quoted Tenor.
"
Published Rate Replacement Event
" means, in relation to a Published Rate:
 
(a)
the methodology, formula
 
or other means of determining that Published Rate has, in the
opinion of the Majority Lenders and the Borrowers, materially changed;
(b)
(i)
(A)
the
 
administrator
 
of
 
that
 
Published
 
Rate
 
or
 
its
 
supervisor
 
publicly
announces that such administrator is insolvent; or
(B)
information
 
is
 
published
 
in
 
any
 
order,
 
decree,
 
notice,
 
petition
 
or
 
filing,
however described, of
 
or filed with
 
a court, tribunal,
 
exchange, regulatory
authority
 
or
 
similar
 
administrative,
 
regulatory
 
or
 
judicial
 
body
 
which
reasonably
 
confirms
 
that
 
the
 
administrator
 
of
 
that
 
Published
 
Rate
 
is
insolvent,
provided
 
that, in
 
each case,
 
at that
 
time, there
 
is no
 
successor administrator
 
to
continue to provide that Published Rate;
(ii)
the administrator of that Published Rate publicly announces that it has ceased or
will cease to provide that Published Rate permanently or indefinitely
 
and, at that
time, there
 
is no
 
successor administrator
 
to continue
 
to
 
provide
 
that Published
Rate;
(iii)
the supervisor
 
of the administrator
 
of that
 
Published Rate publicly
 
announces that
such Published Rate has been
 
or will be permanently or
 
indefinitely discontinued;
or
 
(iv)
the
 
administrator
 
of
 
that
 
Published
 
Rate
 
or
 
its
 
supervisor
 
announces
 
that
 
that
Published Rate may no longer be used; or
(c)
the administrator of that Published Rate (or the administrator of an interest rate which is
a constituent element of that Published
 
Rate) determines that that Published Rate should
be calculated in accordance with its reduced submissions
 
or other contingency or fallback
policies
 
or
 
arrangements
 
and
 
the
 
circumstance(s)
 
or
 
event(s)
 
leading
 
to
 
such
determination
 
are
 
not
 
(in
 
the
 
opinion
 
of
 
the
 
Majority
 
Lenders
 
and
 
the
 
Borrowers)
temporary; or
(d)
in the opinion
 
of the
 
Majority Lenders and
 
the Borrowers, that
 
Published Rate is
 
otherwise
no longer appropriate for the purposes of calculating interest under this Agreement.
"
Quoted Tenor
" means,
 
in relation
 
to Term
 
SOFR, any
 
period for
 
which that
 
rate
 
is customarily
displayed on the relevant page or screen of an information service.
"
Replacement Reference Rate
" means a reference rate which is:
(a)
formally designated, nominated
 
or recommended
 
as the
 
replacement for a
 
Published Rate
by:
(i)
the administrator
 
of that Published
 
Rate (provided
 
that the market
 
or economic
reality that
 
such reference
 
rate
 
measures is
 
the same
 
as that
 
measured by
 
that
Published Rate); or
(ii)
any Relevant Nominating Body,
and if
 
replacements have,
 
at the
 
relevant time,
 
been formally
 
designated, nominated
 
or
recommended
 
under
 
both
 
paragraphs,
 
the
 
"
Replacement
 
Reference
 
Rate
"
 
will
 
be
 
the
replacement under paragraph (ii) above;
(b)
in
 
the
 
opinion
 
of
 
the
 
Majority
 
Lenders
 
and
 
the
 
Borrowers,
 
generally
 
accepted
 
in
 
the
international
 
or
 
any
 
relevant
 
domestic
 
syndicated
 
loan
 
markets
 
as
 
the
 
appropriate
successor or alternative to a Published Rate; or
(c)
in the
 
opinion of
 
the Majority
 
Lenders
 
and the
 
Borrowers,
 
an appropriate
 
successor or
alternative to a Published Rate.
28
NOTICES
 
28.1
General
Unless
 
otherwise
 
specifically
 
provided,
 
any
 
notice
 
under
 
or
 
in
 
connection
 
with
 
any
 
Finance
Document
 
shall
 
be
 
given
 
by
 
letter
 
or
 
fax
 
and
 
references
 
in
 
the
 
Finance
 
Documents
 
to
 
written
notices, notices in writing and
 
notices signed by particular
 
persons shall be construed accordingly.
28.2
Addresses for communications
A notice by letter or fax shall be sent:
(a)
to the Borrowers:
 
c/o Approved Manager
16 Pendelis Street
175 64 Paleo Faliro
 
Athens
 
Greece
E-mail: corpgov@dianashippingservices.com
(b)
to a Lender:
 
at the address below its name in
 
or (as the case
may require) in the
relevant Transfer
 
Certificate.
(c)
to the Swap Bank:
 
c/o
 
Nordea Danmark, Filial af Nordea Bank Abp, Finland
7288 Derivatives Services
PO box 850 DK-0900 Copenhagen K, Denmark
Telephone number: +45 55 47 51 71
E-mail: sls.norway@nordea.com
 
(d)
to the Lead Arranger,
 
Agent
 
or the Security Trustee:
 
Essendropsgate 7
0368 Oslo
Norway
Loan administration matters:
Fax No: +47 24013444
Attn: Structured Loan & Collateral Services NO
or to such other address as the relevant party may notify the Agent or,
 
if the relevant party is the
Agent or the
 
Security Trustee, the Borrowers, the
 
Lenders, the Swap Bank
 
and the Security
 
Parties.
28.3
Effective date of notices
Subject to Clauses
 
(
Service outside business hours
) and
 
(
Illegal notices
):
(a)
a notice
 
which is
 
delivered personally
 
or posted
 
shall be
 
deemed to
 
be served,
 
and shall
 
take effect,
at the time when it is delivered; and
(b)
a notice which is sent
 
by fax shall be
 
deemed to be served, and shall take
 
effect, 2 hours
 
after its
transmission is completed.
 
28.4
Service outside business hours
However,
 
if under Clause
 
(
Effective date of notices
) a notice would be deemed to be served:
(a)
on a day which is not a business day in the place of receipt; or
(b)
on such a business day, but after five p.m. local time,
the notice shall (subject to Clause
 
(
Illegible notices
)) be deemed to be served,
 
and shall take
effect, at 9 a.m. on the next day which is such a business day.
28.5
Illegible notices
Clauses
Effective date of notices
) and
Service outside business
 
hours
) do not
 
apply if the
recipient of a notice notifies the sender within one hour after the time at which the notice would
otherwise be deemed to be served
 
that the notice has been received in
 
a form which is illegible in
a material respect.
28.6
Valid notices
A notice
 
under or
 
in connection
 
with a
 
Finance Document
 
shall not
 
be invalid
 
by reason
 
that its
contents or
 
the manner of serving
 
it do not comply
 
with the requirements
 
of this Agreement or,
where appropriate, any other Finance Document under which it is served if:
(a)
the failure
 
to
 
serve it
 
in accordance
 
with the
 
requirements
 
of this
 
Agreement
 
or
 
other Finance
Document, as the case
 
may be, has not caused
 
any party to suffer any significant loss
 
or prejudice;
or
(b)
in the case
 
of incorrect
 
and/or incomplete contents,
 
it should have
 
been reasonably clear
 
to the
party on which the notice was served what the correct or missing particulars should have been.
28.7
Electronic communication
Any
 
communication
 
to
 
be
 
made
 
between
 
the
 
Agent
 
and
 
a
 
Lender
 
or
 
Swap
 
Bank
 
under
 
or
 
in
connection
 
with
 
the
 
Finance
 
Documents
 
may
 
be
 
made
 
by
 
electronic
 
mail
 
or
 
other
 
electronic
means, if the Agent and the relevant Creditor Party:
(a)
agree
 
that,
 
unless
 
and
 
until
 
notified
 
to
 
the
 
contrary,
 
this
 
is
 
to
 
be
 
an
 
accepted
 
form
 
of
communication;
(b)
notify each other in writing of their electronic mail address and/or any other information
required to enable the sending and receipt of information by that means; and
(c)
notify
 
each
 
other
 
of
 
any
 
change
 
to
 
their
 
respective
 
addresses
 
or
 
any
 
other
 
such
information supplied to them.
Any electronic
 
communication made
 
between the
 
Agent and
 
a Lender
 
or the
 
Swap Bank
 
will be
effective
 
only
 
when
 
actually
 
received
 
in
 
readable
 
form
 
and,
 
in
 
the
 
case
 
of
 
any
 
electronic
communication made by a Creditor Party to
 
the Agent, only if it is addressed in
 
such a manner as
the Agent shall specify for this purpose.
28.8
English language
Any notice under or in connection with a Finance Document shall be in English.
28.9
Meaning of "notice"
In
 
this
 
Clause
 
(
Notices
),
 
"
notice
"
 
includes
 
any
 
demand,
 
consent,
 
authorisation,
 
approval,
instruction, waiver or other communication.
 
29
JOINT AND SEVERAL LIABILITY
 
29.1
General
All liabilities and
 
obligations of the
 
Borrowers under
 
this Agreement shall,
 
whether expressed to
be so
 
or not,
 
be several
 
and, if
 
and to
 
the extent
 
consistent with
 
Clause
 
(
No impairment
 
of
Borrower's obligations
), joint.
29.2
No impairment of Borrower's obligations
The liabilities and obligations of a Borrower shall not be impaired by:
(a)
this
 
Agreement
 
being
 
or
 
later
 
becoming
 
void,
 
unenforceable
 
or
 
illegal
 
as
 
regards
 
any
 
other
Borrower;
(b)
any Lender,
 
the Swap Bank or
 
the Security Trustee
 
entering into any
 
rescheduling, refinancing or
other arrangement of any kind with any other Borrower;
(c)
any Lender,
 
the Swap
 
Bank or the
 
Security Trustee
 
releasing any
 
other Borrower
 
or any
 
Security
Interest created by a Finance Document; or
(d)
any combination of the foregoing.
29.3
Principal debtors
Each
 
Borrower
 
declares
 
that
 
it
 
is
 
and
 
will,
 
throughout
 
the
 
Security
 
Period,
 
remain
 
a
 
principal
debtor for all amounts owing under this Agreement and
 
the Finance Documents and no Borrower
shall in any
 
circumstances be
 
construed to be
 
a surety
 
for the obligations
 
of any other
 
Borrower
under this Agreement.
29.4
Subordination
Subject to Clause
 
(
Borrower's required action
), during the Security Period, no Borrower shall:
(a)
claim
 
any
 
amount
 
which
 
may
 
be
 
due
 
to
 
it
 
from
 
any
 
other
 
Borrower
 
whether
 
in
 
respect
 
of
 
a
payment made, or matter arising out of, this Agreement or any Finance Document, or any matter
unconnected with this Agreement or any Finance Document; or
(b)
take or enforce any form of security from any other Borrower for such an amount, or in any other
way seek to have recourse in respect of such an amount against any
 
asset of any other Borrower;
or
(c)
set off such an amount against any sum due from it to any other Borrower; or
(d)
prove
 
or
 
claim
 
for
 
such
 
an
 
amount
 
in
 
any
 
liquidation,
 
administration,
 
arrangement
 
or
 
similar
procedure involving any other Borrower or other Security Party; or
(e)
exercise or assert any combination of the foregoing.
29.5
Borrower's required action
If during
 
the Security
 
Period,
 
the Agent,
 
by
 
notice to
 
a Borrower,
 
requires
 
it to
 
take
 
any
 
action
referred
 
to
 
in
 
paragraphs
 
to
 
of
 
Clause
 
(
Subordination
),
 
in
 
relation
 
to
 
any
 
other
Borrower,
 
that Borrower
 
shall take
 
that action
 
as soon as
 
practicable after
 
receiving the Agent
 
's
notice.
30
SUPPLEMENTAL
30.1
Rights cumulative, non-exclusive
The rights and remedies which the Finance Documents give to each Creditor Party are:
(a)
cumulative;
(b)
may be exercised as often as appears expedient; and
(c)
shall not,
 
unless a
 
Finance Document
 
explicitly and
 
specifically states
 
so, be
 
taken
 
to exclude
 
or
limit any right or remedy conferred by any law.
30.2
Severability of provisions
If any provision of a Finance Document is or subsequently becomes void, unenforceable or illegal,
that shall
 
not affect
 
the validity,
 
enforceability or
 
legality of the
 
other provisions of
 
that Finance
Document or of the provisions of any other Finance Document.
30.3
Counterparts
A Finance Document may be executed in any number of counterparts.
30.4
Third Party rights
A person who is not a
 
Party has no right under the
 
Contracts (Rights of Third Parties)
 
Act 1999 to
enforce or to enjoy the benefit of any term of this Agreement.
31
BAIL-IN
Notwithstanding any other term of any Finance Document or any other agreement,
 
arrangement
or
 
understanding
 
between
 
the
 
parties
 
to
 
a
 
Finance
 
Document,
 
each
 
Party
 
acknowledges
 
and
accepts
 
that
 
any
 
liability
 
of
 
any
 
party
 
to
 
a
 
Finance
 
Document
 
under
 
or
 
in
 
connection
 
with
 
the
Finance
 
Documents
 
may
 
be
 
subject
 
to
 
Bail-In
 
Action
 
by
 
the
 
relevant
 
Resolution
 
Authority
 
and
acknowledges and accepts to be bound by the effect of:
(a)
any Bail-In Action in relation to any such liability, including (without limitation):
(i)
a
 
reduction,
 
in
 
full
 
or
 
in
 
part,
 
in
 
the
 
principal
 
amount,
 
or
 
outstanding
 
amount
 
due
(including any accrued but unpaid interest) in respect of any such liability;
(ii)
a
 
conversion
 
of
 
all,
 
or
 
part
 
of,
 
any
 
such
 
liability
 
into
 
shares
 
or
 
other
 
instruments
 
of
ownership that may be issued to, or conferred on, it; and
(iii)
a cancellation of any such liability; and
(b)
a variation of any term
 
of any Finance Document
 
to the extent necessary to
 
give effect to any Bail-
In Action in relation to any such liability.
32
LAW AND JURISDICTION
 
32.1
English law
This Agreement and any non-contractual obligations arising
 
out of or in
 
connection with it shall
 
be
governed by, and construed in accordance with, English law.
32.2
Exclusive English jurisdiction
Subject to Clause
 
(
Choice of forum for the exclusive
 
benefit of Creditor Parties
), the courts of
England shall have exclusive jurisdiction to settle any Dispute.
32.3
Choice of forum for the exclusive benefit of Creditor Parties
Clause
 
(
Exclusive English jurisdiction
) is for the exclusive benefit of the Creditor
 
Parties, each
of which reserves the rights:
(a)
to
 
commence
 
proceedings
 
in
 
relation
 
to
 
any
 
Dispute
 
in
 
the
 
courts
 
of
 
any
 
country
 
other
 
than
England and which have or claim jurisdiction to that Dispute; and
(b)
to commence
 
such proceedings in
 
the courts of
 
any such country
 
or countries concurrently
 
with
or in addition to proceedings in England or without commencing proceedings in England.
No Borrower shall commence
 
any proceedings in any
 
country other than England in
 
relation to a
Dispute.
32.4
Process agent
Each Borrower irrevocably appoints Hill Dickinson Services (London) Ltd at its registered office for
the time being at The Broadgate
 
Tower,
 
20 Primrose Street,
 
London EC2A 2EW,
 
United Kingdom,
to act
 
as its agent
 
to receive
 
and accept on
 
its behalf any
 
process or other
 
document relating to
any proceedings in the English courts which are connected with a Dispute.
32.5
Creditor Party rights unaffected
Nothing in this Clause
 
(
Law and Jurisdiction
) shall exclude or limit any right which any Creditor
Party may have (whether under the law 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.
32.6
Meaning of "proceedings" and "Dispute"
In this Clause
 
(
Law and Jurisdiction
), "
proceedings
" means proceedings
 
of any
 
kind, including
an application for a provisional
 
or protective measure and a "
Dispute
" means any dispute arising
out of or in connection with this Agreement (including a dispute relating to the existence, validity
or termination of
 
this Agreement) or
 
any non-contractual obligation arising
 
out of
 
or in
 
connection
with this Agreement.
This Agreement has been entered into on the date stated at the beginning of this Agreement.
SCHEDULE 1
LENDERS AND COMMITMENTS
 
Lender
Facility Office
Commitment
(US Dollars)
Nordea Bank Abp, filial i Norge
Essendrops gate 7, Postboks
1166, Sentrum, 0107 Oslo
920058817 MVA
Norway
$22,500,000
 
SCHEDULE 2
DRAWDOWN NOTICE
To:
 
Nordea Bank Abp, filial i Norge
Essendrops gate 7, Postboks
 
1166, Sentrum, 0107 Oslo
 
920058817 MVA,
 
Norway
Attention:
 
[Loans Administration]
 
[●] 2023
DRAWDOWN NOTICE
1
We
 
refer
 
to
 
the
 
loan
 
agreement
 
(the
 
"
Loan
 
Agreement
")
 
dated
 
[●]
 
2023
 
and
 
made
 
between
ourselves, as joint
 
and several
 
Borrowers, the Lenders
 
referred to therein,
 
and yourselves
 
as Agent,
as Security Trustee, as Bookrunner
 
[and] as Lead Arranger and as Swap Bank in connection with a
facility of up
 
to US$22,500,000.
 
Terms defined in the
 
Loan Agreement have
 
their defined
 
meanings
when used in this Drawdown Notice.
2
We request to borrow the Loan as follows:
(a)
Amount: US$[●];
(b)
Drawdown Date: [●] 2023;
(c)
[Duration of the first Interest Period shall be [one][three] Months;] and
(d)
Payment instructions:
 
account in our name and numbered [●] with [●] of [●].
3
We represent and warrant that:
(a)
the
 
representations
 
and
 
warranties
 
in
 
Clause
 
(
Representations
 
and
 
Warranties
)
 
of
 
the
 
Loan
Agreement
 
would
 
remain
 
true
 
and
 
not
 
misleading
 
if
 
repeated
 
on
 
the
 
date
 
of
 
this
 
notice
 
with
reference to the circumstances now existing; and
(b)
no Event of Default or Potential Event of Default has occurred or will result from the borrowing of
the Loan.
4
This notice cannot be revoked without the prior consent of the Majority Lenders.
[Name of Signatory]
Director
for and on behalf of
JEMO SHIPPING COMPANY INC.
GUAM SHIPPING COMPANY INC.
PALAU SHIPPING COMPANY
 
INC.
MAKUR SHIPPING COMPANY INC.
 
SCHEDULE 3
CONDITION PRECEDENT DOCUMENTS
 
PART A
The following are the documents referred to in Clause
Documents, fees and no default
).
1
A duly executed original of:
(a)
this Agreement;
(b)
the Corporate Guarantee;
(c)
the Agency and Trust Deed;
(d)
the Master Agreement;
(e)
the Shares Pledges;
(f)
the Master Agreement Assignment; and
(g)
the Accounts Pledges.
2
Copies
 
of
 
the
 
certificate
 
of
 
incorporation
 
and
 
constitutional
 
documents
 
of
 
each
 
Borrower,
 
the
Corporate Guarantor and any other Security Party.
3
Copies of resolutions of the shareholders and directors
 
of each Borrower and each Security Party
(other than the
 
Corporate Guarantor) authorising the
 
execution of each of
 
the Finance
 
Documents
to which that Borrower or that Security
 
Party is a party and, in the
 
case of a Borrower, authorising
named officers to give the Drawdown Notice.
4
Copies
 
of
 
resolutions
 
of
 
the
 
executive
 
committee
 
of
 
the
 
Corporate
 
Guarantor
 
authorising
 
the
execution of each of the Finance Documents to which it is a party.
5
The original of any
 
power of attorney under which
 
any Finance Document is
 
executed on behalf of
a Borrower,
 
the Corporate Guarantor or any other Security Party.
6
Copies of all
 
consents which any Borrower, the Corporate Guarantor
 
or any Security
 
Party requires
to enter into, or make any payment
 
under, any Finance Document.
7
The originals
 
of
 
any
 
mandates
 
or other
 
documents required
 
in connection
 
with the
 
opening or
operation of the Earnings Accounts.
8
Such
 
documents
 
as
 
the
 
Agent
 
may
 
require
 
for
 
its
 
"Know
 
your
 
customer"
 
and
 
other
 
customary
money laundering and sanctions and counter-terrorist financing checks.
9
Documentary evidence that the agent for service
 
of process named in Clause
 
(
Process Agent)
has accepted its appointment.
10
Favourable
 
legal opinions
 
from lawyers
 
appointed by
 
the Agent
 
on such
 
matters
 
concerning the
laws of Marshall Islands and such other relevant jurisdictions as the Agent may require.
11
If the Agent so requires,
 
in respect of any of
 
the documents referred to
 
above, a certified English
translation prepared by a translator approved by the Agent.
 
PART B
The following
 
are the
 
documents referred
 
to in
 
Clause
 
(
Documents, fees
 
and no
 
default
)required
before
 
the Drawdown
 
Date. In
 
of this
 
(
Condition precedent documents
), the
 
following
definitions have the following meanings:
(a)
"
Relevant Borrower
" means the Borrower which is the owner of the Relevant Ship; and
(b)
"
Relevant Ship
" means the Ship
 
which is to
 
be financed by using
 
the proceeds of
 
the Loan being
drawn on the Drawdown Date.
1
A duly executed original
 
of the Mortgage
 
and the
 
General Assignment relating
 
to the Relevant Ship
and any Charterparty Assignment.
2
Documentary evidence that:
(a)
the Relevant Ship is definitively and
 
permanently registered in the name
 
of the Relevant Borrower
under an Approved Flag;
(b)
the Relevant Ship is in the absolute and unencumbered ownership of the Relevant Borrower save
as contemplated by the Finance Documents;
(c)
the Relevant Ship maintains the class specified in Clause
 
(
Repair and classification
);
(d)
the
 
Mortgage
 
relating
 
to
 
the
 
Relevant
 
Ship
 
has
 
been
 
duly
 
registered
 
or
 
recorded
 
against
 
the
Relevant Ship as
 
a valid first priority
 
or,
 
as the case may
 
be, preferred statutory
 
ship mortgage in
accordance with the laws of the applicable Approved Flag State; and
(e)
the
 
Relevant
 
Ship
 
is
 
insured
 
in
 
accordance
 
with
 
the
 
provisions
 
of
 
this
 
Agreement
 
and
 
all
requirements therein in respect of insurances have been complied with.
3
Documents establishing that the Relevant
 
Ship will, as from the Drawdown
 
Date, be managed by
the Approved Manager on terms acceptable to the Lenders, together with:
(a)
a
 
copy
 
of
 
the
 
Management
 
Agreement
 
and
 
the
 
Manager's
 
Undertaking
 
duly
 
signed
 
by
 
the
Approved Manager; and
(b)
copies
 
of
 
the
 
Approved
 
Manager's
 
Document
 
of
 
Compliance
 
and
 
of
 
the
 
Relevant
 
Ship's
 
Safety
Management
 
Certificate
 
(together
 
with
 
any
 
other
 
details
 
of
 
the
 
applicable
 
safety
 
management
system which the Agent requires) and ISSC.
3.1
Favourable
 
legal opinions
 
from lawyers
 
appointed by
 
the Agent
 
on such
 
matters
 
concerning the
laws of Marshall
 
Islands, the
 
Approved Flag State
 
and such
 
other relevant jurisdictions
 
as the
 
Agent
may require.
 
4
At
 
the
 
cost
 
of
 
the
 
Borrowers
 
a
 
favourable
 
opinion
 
from
 
an
 
independent
 
insurance
 
consultant
acceptable to the Agent on such matters
 
relating to the insurances for
 
the Ship as the Agent may
require.
5
A valuation
 
of each
 
Ship addressed
 
to the
 
Agent
 
and dated
 
not earlier
 
than 40
 
days
 
before
 
the
Drawdown Date and prepared in accordance with
 
Clause
 
(
Valuation of ships
) by an Approved
Broker (selected by the
 
Borrowers and approved by
 
the Agent) which evidences compliance with
Clause
 
(
Minimum required security cover
) immediately after the Drawdown Date.
6
Evidence satisfactory
 
to the Agent that
 
the Existing Indebtedness is repaid
 
in full and each of
 
the
Borrowers is released from all its obligations and liabilities under the Existing Facility Agreement.
 
7
If the Agent so requires,
 
in respect of any of
 
the documents referred to
 
above, a certified English
translation prepared by a translator approved by the Agent.
Each
 
of
 
the documents
 
specified in
 
paragraphs
 
2, 3,
 
5
 
and 9
 
of
 
and every
 
other copy
 
document
delivered under this Schedule
 
shall be certified as
 
a true and up
 
to date copy by a director or
 
the secretary
(or equivalent officer) of each Borrower or a qualified lawyer.
 
SCHEDULE 4
TRANSFER CERTIFICATE
 
The Transferor
 
and the Transferee
 
accept exclusive
 
responsibility for ensuring
 
that this Certificate
 
and
the transaction to which it relates comply
 
with all legal and
 
regulatory requirements applicable to them
respectively.
To:
 
Nordea
 
Bank Abp,
 
filial i
 
Norge
 
for
 
itself and
 
for
 
and on
 
behalf of
 
the Borrower,
 
[each Security
Party], the Security
 
Trustee,
 
each Lender and the Swap
 
Bank, as defined in
 
the Loan Agreement referred
to below.
[●]
1
This Certificate relates to
 
a Loan Agreement
 
(the "
Agreement
") dated [●]
 
2023 and
 
made between
(1) Jemo Shipping Company Inc., Guam
 
Shipping Company Inc., Palau Shipping Company
 
Inc. and
Makur Shipping Company Inc.
 
as joint and several borrowers (the "
Borrowers
"), (2) the banks and
financial institutions named therein, (3) Nordea Bank Abp, filial i Norge as Agent, (4) Nordea Bank
Abp, filial i Norge as
 
Security Trustee, (5) Nordea Bank Abp,
 
filial i Norge as Lead
 
Arranger [and] (6)
Nordea Bank Abp,
 
filial I Norge
 
as Bookrunner and (7)
 
Nordea Bank Abp
 
as Swap Bank
 
for a
 
loan
facility of up to US$22,500,000.
2
In this
 
Certificate,
 
terms defined
 
in the
 
Agreement shall,
 
unless the
 
contrary
 
intention
 
appears,
have the same meanings when used in this Certificate and:
"
Relevant
 
Parties
" means
 
the
 
Agent,
 
the Borrower,
 
[each Security
 
Party],
 
the Security
 
Trustee,
each Lender and the Swap Bank;
"
Transferor
" means [full name] of [facility office]; and
"
Transferee
" means [full name] of [facility office].
3
The effective date of this Certificate is [●],
Provided that
 
this Certificate shall not come into effect
unless it is signed by the Agent on or before that date.
4
[The
 
Transferor
 
assigns
 
to
 
the
 
Transferee
 
absolutely
 
all
 
rights
 
and
 
interests
 
(present,
 
future
 
or
contingent)
 
which the
 
Transferor
 
has as
 
Lender under
 
or by
 
virtue of
 
the Agreement
 
and every
other
 
Finance
 
Document
 
in
 
relation
 
to
 
[●]
 
per
 
cent.
 
of
 
its
 
Contribution,
 
which
 
percentage
represents $[●].]
5
[By virtue
 
of this
 
Transfer
 
Certificate and
 
Clause
 
(
Transfers
 
and changes in
 
Facility Offices
) of
the Loan Agreement, the
 
Transferor
 
is discharged [entirely
 
from its Commitment which amounts
to
 
$[●]
 
[from
 
[●]
 
per
 
cent.
 
of
 
its
 
Commitment,
 
which
 
percentage
 
represents
 
$[●]]
 
and
 
the
Transferee
 
acquires a Commitment of $[●].]
6
The
 
Transferee
 
undertakes
 
with
 
the
 
Transferor
 
and
 
each
 
of
 
the
 
Relevant
 
Parties
 
that
 
the
Transferee will observe and
 
perform all
 
the obligations
 
under the
 
Finance Documents
 
which Clause
 
(
Transfers and Changes in Facility Offices
) of the Loan
 
Agreement provides will become binding
on it upon this Certificate taking effect.
7
The Agent, at the request of
 
the Transferee (which request is hereby made) accepts, for the Agent
itself and for and on behalf of every other Relevant
 
Party,
 
this Certificate as a Transfer
 
Certificate
taking
 
effect
 
in
 
accordance
 
with
 
Clause
 
(
Transfers
 
and
 
changes
 
in
 
Facility
 
Offices
)
 
of
 
the
Agreement.
8
The Transferor:
(a)
warrants to the Transferee
 
and each Relevant Party that:
(i)
the Transferor
 
has full capacity
 
to enter
 
into this transaction
 
and has taken
 
all corporate
action and
 
obtained all
 
consents which
 
are required
 
in connection
 
with this
 
transaction;
and
(ii)
this Certificate is valid and binding as regards the Transferor;
(b)
warrants to the Transferee
 
that the Transferor
 
is absolutely entitled, free of encumbrances, to all
the rights and interests covered by the assignment in paragraph 4; and
(c)
undertakes
 
with
 
the
 
Transferee
 
that
 
the
 
Transferor
 
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 Certificate or for a similar purpose.
9
The Transferee:
(a)
confirms that it has received a copy of the Agreement and each of the other Finance Documents;
(b)
agrees
 
that
 
it
 
will
 
have
 
no
 
rights
 
of
 
recourse
 
on
 
any
 
ground
 
against
 
either
 
the
 
Transferor,
 
the
Agent, the Security Trustee, any Lender or the Swap Bank in the event that:
(i)
any of the Finance Documents prove to be invalid or ineffective;
(ii)
any
 
Borrower
 
or
 
any
 
Security
 
Party
 
fails
 
to
 
observe
 
or
 
perform
 
its
 
obligations,
 
or
 
to
discharge its liabilities, under any of the Finance Documents; and
(iii)
it proves impossible
 
to realise any
 
asset covered by
 
a Security
 
Interest created by
 
a Finance
Document, or the proceeds
 
of such assets are insufficient
 
to discharge the liabilities of
 
the
Borrowers or any Security Party under any of the Finance Documents;
 
(c)
agrees that it
 
will have no
 
rights of recourse
 
on any ground
 
against the Agent, the
 
Security Trustee,
any Lender or the Swap Bank in the event that this Certificate proves to be invalid or ineffective;
 
(d)
warrants to the Transferor
 
and each Relevant Party that:
(i)
it has
 
full capacity
 
to
 
enter into
 
this transaction
 
and has
 
taken
 
all corporate
 
action and
obtained all consents which it needs to take or obtain in connection with this transaction;
and
(ii)
this Certificate is valid and binding as regards the Transferee;
 
and
(e)
confirms the accuracy of the administrative details set out below regarding the Transferee.
10
The
 
Transferor
 
and
 
the
 
Transferee
 
each
 
undertake
 
with
 
the
 
Agent
 
and
 
the
 
Security
 
Trustee
severally,
 
on demand, fully
 
to indemnify the
 
Agent and/or the
 
Security Trustee
 
in respect of
 
any
claim, proceeding, liability or
 
expense (including all legal
 
expenses) which they
 
or either of
 
them
may
 
incur in
 
connection with
 
this Certificate
 
or any
 
matter
 
arising out
 
of
 
it, except
 
such as
 
are
shown to have
 
been mainly
 
and directly caused
 
by the
 
gross and culpable
 
negligence or dishonesty
of the Agent's or the Security Trustee's own officers or employees.
11
The Transferee shall repay to
 
the Transferor on demand
 
so much
 
of any sum
 
paid by
 
the Transferor
under
 
paragraph
 
9
 
as exceeds
 
one-half of
 
the
 
amount
 
demanded by
 
the Agent
 
or
 
the Security
Trustee
 
in
 
respect
 
of
 
a
 
claim,
 
proceeding,
 
liability
 
or
 
expense
 
which
 
was
 
not
 
reasonably
foreseeable at the date of this Certificate; but nothing in this paragraph shall affect the liability of
each of the Transferor and the Transferee
 
to the Agent or the Security Trustee for the full amount
demanded by it.
[Name of Transferor]
 
[Name of Transferee]
By:
 
By:
Date:
 
Date:
Agent
Signed for itself and for and on behalf of itself
as Agent and for every other Relevant Party
[Name of Agent]
By:
Date:
 
Administrative Details of Transferee
Name of Transferee:
 
Facility Office:
 
Contact Person
(Loan Administration Department):
 
Telephone:
 
Fax:
 
Contact Person
(Credit Administration Department):
 
Telephone:
 
Fax:
 
Account for payments:
 
Note
:
 
This
 
Transfer
 
Certificate
 
alone
 
may
 
not
 
be
 
sufficient
 
to
 
transfer
 
a
 
proportionate
 
share
 
of
 
the
Transferor
 
's interest
 
in the security
 
constituted by
 
the Finance Documents
 
in the Transferor
 
's or
Transferee
 
's jurisdiction.
 
It is
 
the responsibility
 
of each
 
Lender to
 
ascertain whether
 
any
 
other
documents are required for this purpose.
 
SCHEDULE 5
DESIGNATION NOTICE
Nordea Bank Abp, filial i Norge
Essendrops gate 7, Postboks
 
1166, Sentrum, 0107 Oslo
920058817 MVA,
 
Norway
 
[●]
Dear Sirs
Loan
 
Agreement
 
dated
 
[●]
 
2023
 
made
 
between
 
(i)
 
Jemo
 
Shipping
 
Company
 
Inc.,
 
Guam
 
Shipping
Company
 
Inc.,
 
Palau
 
Shipping
 
Company
 
Inc.
 
and
 
Makur
 
Shipping
 
Company
 
Inc.
 
as
 
joint
 
and
 
several
Borrowers,
 
(ii) the
 
Lenders, (iii)
 
yourselves
 
as Agent,
 
Security Trustee
 
,
 
Bookrunner and
 
Lead Arranger
and (iv) Nordea Bank Abp as Swap Bank (the "Loan Agreement").
 
We refer to:
1
the Loan Agreement;
 
2
the Master Agreement dated [●] 2023 made between ourselves and the Swap Bank; and
3
a Confirmation delivered pursuant
 
to the said Master Agreement
 
dated [●] and addressed by
 
[●]
to us.
In accordance with the terms of the Loan Agreement, we hereby give you notice of the said Confirmation
and hereby confirm that the Transaction evidenced by it will be designated as a "Designated Transaction"
for the purposes of the Loan Agreement and the Finance Documents.
Yours
 
faithfully,
.................................................
for and on behalf of
JEMO SHIPPING COMPANY INC.
GUAM SHIPPING COMPANY INC.
PALAU SHIPPING COMPANY
 
INC.
MAKUR SHIPPING COMPANY INC.
SCHEDULE 6
SELECTION NOTICE
From:
JEMO SHIPPING COMPANY INC.
GUAM SHIPPING COMPANY INC.
PALAU SHIPPING COMPANY
 
INC.
MAKUR SHIPPING COMPANY INC.
To:
Nordea Bank Abp, filial i Norge
Essendrops gate 7, Postboks
 
1166, Sentrum, 0107 Oslo
 
920058817 MVA,
 
Norway
Dated: [
●
]
Loan
 
Agreement
 
dated
 
[●]
 
2023
 
made
 
between
 
(i)
 
Jemo
 
Shipping
 
Company
 
Inc.,
 
Guam
 
Shipping
Company
 
Inc.,
 
Palau
 
Shipping
 
Company
 
Inc.
 
and
 
Makur
 
Shipping
 
Company
 
Inc.
 
as
 
joint
 
and
 
several
borrowers,
 
(ii) the
 
Lenders, (iii)
 
yourselves as
 
Agent, Security
 
Trustee,
 
Bookrunner and
 
Lead Arranger
and (iv) Nordea Bank Abp as Swap Bank (the "Loan Agreement").
1
We refer to the Loan Agreement.
 
This is a
 
Selection Notice.
 
Terms defined in the Loan Agreement
have the same meaning in this Selection Notice
 
unless given a different meaning
 
in this Selection
Notice.
2
We request [that the next Interest Period
 
for the Loan be [
●
]] OR [ an Interest Period for a part of
the Loan in an amount
 
equal to [
●
] (which is the amount of
 
the Repayment Instalment
 
next due)
ending on [
●
] (which is the Repayment
 
Date relating to
 
that Repayment Instalment)
 
and that the
Interest Period for the remaining part of the Loan shall be [
●
]].
3
This Selection Notice is irrevocable.
Yours
 
faithfully
____________________
[
●
]
authorised signatory for
JEMO SHIPPING COMPANY INC.
GUAM SHIPPING COMPANY INC.
PALAU SHIPPING COMPANY
 
INC.
 
EXECUTION PAGES
THE BORROWERS
SIGNED
 
by
 
)
 
)
for and on behalf of
 
)
JEMO SHIPPING COMPANY INC.
)
in the presence of:
 
)
SIGNED
 
by
 
)
 
)
for and on behalf of
 
)
GUAM SHIPPING COMPANY INC.
 
)
in the presence of:
 
)
SIGNED
 
by
 
)
 
)
for and on behalf of
 
)
PALAU SHIPPING COMPANY
 
INC.
)
in the presence of:
 
)
SIGNED
 
by
 
)
 
)
for and on behalf of
 
)
MAKUR SHIPPING COMPANY INC.
 
)
in the presence of:
 
)
THE LENDERS
SIGNED
 
by
 
)
)
attorney-in-fact
 
)
for and on behalf of
 
)
NORDEA BANK ABP,
 
FILIAL I NORGE
 
)
in the presence of:
 
)
 
THE SWAP BANK
SIGNED
 
by
 
)
)
attorney-in-fact
 
)
for and on behalf of
 
)
NORDEA BANK ABP
 
 
)
in the presence of:
 
)
THE AGENT
SIGNED
 
by
 
)
)
attorney-in-fact
 
)
for and on behalf of
 
)
NORDEA BANK ABP,
 
FILIAL I NORGE
 
)
in the presence of:
 
)
THE SECURITY TRUSTEE
SIGNED
 
by
 
)
)
attorney-in-fact
 
)
for and on behalf of
 
)
NORDEA BANK ABP,
 
FILIAL I NORGE
 
)
in the presence of:
 
)
THE LEAD ARRANGER
SIGNED
 
by
 
)
)
attorney-in-fact
 
)
for and on behalf of
 
)
NORDEA BANK ABP,
 
FILIAL I NORGE
 
)
in the presence of:
 
)
 
THE BOOKRUNNER
SIGNED
 
by
 
)
)
attorney-in-fact
 
)
for and on behalf of
 
)
NORDEA BANK ABP,
 
FILIAL I NORGE
 
)
in the presence of:
 
)