ý | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Republic of Liberia | 98-0081645 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
Large accelerated filer x | Accelerated filer o | Non-accelerated filer o | Smaller reporting company o | |||
Emerging growth company o | (Do not check if a smaller reporting company) |
Page | |
Quarter Ended June 30, | |||||||
2018 | 2017 | ||||||
Passenger ticket revenues | $ | 1,672,570 | $ | 1,581,385 | |||
Onboard and other revenues | 665,035 | 613,889 | |||||
Total revenues | 2,337,605 | 2,195,274 | |||||
Cruise operating expenses: | |||||||
Commissions, transportation and other | 358,305 | 340,331 | |||||
Onboard and other | 142,240 | 132,437 | |||||
Payroll and related | 226,315 | 210,362 | |||||
Food | 128,383 | 121,764 | |||||
Fuel | 172,309 | 170,748 | |||||
Other operating | 286,859 | 281,143 | |||||
Total cruise operating expenses | 1,314,411 | 1,256,785 | |||||
Marketing, selling and administrative expenses | 312,923 | 283,855 | |||||
Depreciation and amortization expenses | 253,376 | 234,937 | |||||
Operating Income | 456,895 | 419,697 | |||||
Other income (expense): | |||||||
Interest income | 13,098 | 5,811 | |||||
Interest expense, net of interest capitalized | (81,864 | ) | (76,632 | ) | |||
Equity investment income | 44,311 | 23,359 | |||||
Other income (expense) | 33,855 | (2,709 | ) | ||||
9,400 | (50,171 | ) | |||||
Net Income | $ | 466,295 | $ | 369,526 | |||
Earnings per Share: | |||||||
Basic | $ | 2.20 | $ | 1.72 | |||
Diluted | $ | 2.19 | $ | 1.71 | |||
Weighted-Average Shares Outstanding: | |||||||
Basic | 211,673 | 215,085 | |||||
Diluted | 212,509 | 216,062 | |||||
Comprehensive Income | |||||||
Net Income | $ | 466,295 | $ | 369,526 | |||
Other comprehensive income (loss): | |||||||
Foreign currency translation adjustments | (11,521 | ) | 5,979 | ||||
Change in defined benefit plans | (1,964 | ) | (3,649 | ) | |||
(Loss) gain on cash flow derivative hedges | (68,900 | ) | 128,954 | ||||
Total other comprehensive (loss) income | (82,385 | ) | 131,284 | ||||
Comprehensive Income | $ | 383,910 | $ | 500,810 |
Six Months Ended June 30, | |||||||
2018 | 2017 | ||||||
Passenger ticket revenues | $ | 3,098,214 | $ | 2,999,608 | |||
Onboard and other revenues | 1,267,147 | 1,204,226 | |||||
Total revenues | 4,365,361 | 4,203,834 | |||||
Cruise operating expenses: | |||||||
Commissions, transportation and other | 648,914 | 650,579 | |||||
Onboard and other | 241,777 | 238,431 | |||||
Payroll and related | 453,471 | 426,097 | |||||
Food | 248,025 | 242,975 | |||||
Fuel | 332,650 | 348,162 | |||||
Other operating | 565,593 | 526,365 | |||||
Total cruise operating expenses | 2,490,430 | 2,432,609 | |||||
Marketing, selling and administrative expenses | 650,284 | 601,320 | |||||
Depreciation and amortization expenses | 493,606 | 470,686 | |||||
Operating Income | 731,041 | 699,219 | |||||
Other income (expense): | |||||||
Interest income | 20,831 | 12,063 | |||||
Interest expense, net of interest capitalized | (149,742 | ) | (156,949 | ) | |||
Equity investment income | 73,063 | 35,239 | |||||
Other income (expense) | 9,755 | (5,320 | ) | ||||
(46,093 | ) | (114,967 | ) | ||||
Net Income | $ | 684,948 | $ | 584,252 | |||
Earnings per Share: | |||||||
Basic | $ | 3.23 | $ | 2.72 | |||
Diluted | $ | 3.21 | $ | 2.71 | |||
Weighted-Average Shares Outstanding: | |||||||
Basic | 212,139 | 214,978 | |||||
Diluted | 213,079 | 215,944 | |||||
Comprehensive Income | |||||||
Net Income | $ | 684,948 | $ | 584,252 | |||
Other comprehensive income (loss): | |||||||
Foreign currency translation adjustments | (10,361 | ) | 8,321 | ||||
Change in defined benefit plans | 5,796 | (4,290 | ) | ||||
Gain on cash flow derivative hedges | 73,630 | 151,415 | |||||
Total other comprehensive income | 69,065 | 155,446 | |||||
Comprehensive Income | $ | 754,013 | $ | 739,698 |
As of | |||||||
June 30, | December 31, | ||||||
2018 | 2017 | ||||||
(unaudited) | |||||||
Assets | |||||||
Current assets | |||||||
Cash and cash equivalents | $ | 108,998 | $ | 120,112 | |||
Trade and other receivables, net | 355,729 | 318,641 | |||||
Inventories | 121,879 | 111,393 | |||||
Prepaid expenses and other assets | 418,817 | 258,171 | |||||
Derivative financial instruments | 94,473 | 99,320 | |||||
Total current assets | 1,099,896 | 907,637 | |||||
Property and equipment, net | 21,429,719 | 19,735,180 | |||||
Goodwill | 288,418 | 288,512 | |||||
Other assets | 1,239,003 | 1,429,597 | |||||
$ | 24,057,036 | $ | 22,360,926 | ||||
Liabilities and Shareholders’ Equity | |||||||
Current liabilities | |||||||
Current portion of long-term debt | $ | 1,177,626 | $ | 1,188,514 | |||
Accounts payable | 418,616 | 360,113 | |||||
Accrued interest | 61,175 | 47,469 | |||||
Accrued expenses and other liabilities | 751,585 | 903,022 | |||||
Derivative financial instruments | 44,203 | 47,464 | |||||
Customer deposits | 3,049,145 | 2,308,291 | |||||
Total current liabilities | 5,502,350 | 4,854,873 | |||||
Long-term debt | 7,341,463 | 6,350,937 | |||||
Other long-term liabilities | 439,525 | 452,813 | |||||
Commitments and contingencies (Note 7) | |||||||
Shareholders’ equity | |||||||
Preferred stock ($0.01 par value; 20,000,000 shares authorized; none outstanding) | — | — | |||||
Common stock ($0.01 par value; 500,000,000 shares authorized; 235,779,344 and 235,198,901 shares issued, June 30, 2018 and December 31, 2017, respectively) | 2,358 | 2,352 | |||||
Paid-in capital | 3,397,561 | 3,390,117 | |||||
Retained earnings | 9,429,784 | 9,022,405 | |||||
Accumulated other comprehensive loss | (265,200 | ) | (334,265 | ) | |||
Treasury stock (25,293,576 and 21,861,308 common shares at cost, June 30, 2018 and December 31, 2017, respectively) | (1,790,805 | ) | (1,378,306 | ) | |||
Total shareholders’ equity | 10,773,698 | 10,702,303 | |||||
$ | 24,057,036 | $ | 22,360,926 |
Six Months Ended June 30, | |||||||
2018 | 2017 | ||||||
Operating Activities | |||||||
Net income | $ | 684,948 | $ | 584,252 | |||
Adjustments: | |||||||
Depreciation and amortization | 493,606 | 470,686 | |||||
Impairment losses | 33,651 | — | |||||
Net deferred income tax (benefit) expense | (893 | ) | 1,084 | ||||
Gain (loss) on derivative instruments not designated as hedges | 29,750 | (34,988 | ) | ||||
Share-based compensation expense | 31,819 | 35,379 | |||||
Equity investment income | (73,063 | ) | (35,239 | ) | |||
Amortization of debt issuance costs | 16,283 | 26,035 | |||||
Gain on sale of property and equipment | — | (30,902 | ) | ||||
Gain on sale of unconsolidated affiliate | (13,680 | ) | — | ||||
Recognition of deferred gain | (21,794 | ) | — | ||||
Changes in operating assets and liabilities: | |||||||
Decrease in trade and other receivables, net | 16,162 | 33,045 | |||||
(Increase) decrease in inventories | (10,485 | ) | 4,682 | ||||
Increase in prepaid expenses and other assets | (152,626 | ) | (36,931 | ) | |||
Increase in accounts payable | 58,842 | 69,634 | |||||
Increase in accrued interest | 13,706 | 5,486 | |||||
Decrease in accrued expenses and other liabilities | (71,254 | ) | (47,189 | ) | |||
Increase in customer deposits | 740,420 | 563,546 | |||||
Dividends received from unconsolidated affiliates | 158,942 | 57,402 | |||||
Other, net | (2,748 | ) | (6,702 | ) | |||
Net cash provided by operating activities | 1,931,586 | 1,659,280 | |||||
Investing Activities | |||||||
Purchases of property and equipment | (2,212,880 | ) | (271,541 | ) | |||
Cash received on settlement of derivative financial instruments | 69,195 | 34,866 | |||||
Cash paid on settlement of derivative financial instruments | (34,898 | ) | — | ||||
Cash received on loans to unconsolidated affiliates | 37,607 | 23,487 | |||||
Proceeds from the sale of property and equipment | — | 230,000 | |||||
Proceeds from the sale of unconsolidated affiliate | 13,215 | — | |||||
Other, net | (13,220 | ) | (9,144 | ) | |||
Net cash (used in) provided by investing activities | (2,140,981 | ) | 7,668 | ||||
Financing Activities | |||||||
Debt proceeds | 3,929,322 | 2,236,000 | |||||
Debt issuance costs | (48,535 | ) | (14,575 | ) | |||
Repayments of debt | (3,029,944 | ) | (3,689,890 | ) | |||
Purchases of treasury stock | (369,476 | ) | — | ||||
Dividends paid | (254,645 | ) | (206,039 | ) | |||
Proceeds from exercise of common stock options | 4,062 | 2,385 | |||||
Other, net | (16,827 | ) | 2,626 | ||||
Net cash provided by (used in) financing activities | 213,957 | (1,669,493 | ) | ||||
Effect of exchange rate changes on cash | (15,676 | ) | 419 | ||||
Net decrease in cash and cash equivalents | (11,114 | ) | (2,126 | ) | |||
Cash and cash equivalents at beginning of period | 120,112 | 132,603 | |||||
Cash and cash equivalents at end of period | $ | 108,998 | $ | 130,477 | |||
Supplemental Disclosure | |||||||
Cash paid during the period for: | |||||||
Interest, net of amount capitalized | $ | 114,061 | $ | 125,007 |
Quarter Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Revenues by itinerary | |||||||||||||||
North America(1) | $ | 1,264,167 | $ | 1,246,103 | $ | 2,611,427 | $ | 2,598,272 | |||||||
Asia/Pacific(2) | 283,198 | 300,891 | 816,177 | 826,747 | |||||||||||
Europe(3) | 597,399 | 467,829 | 597,399 | 467,829 | |||||||||||
Other regions | 101,631 | 94,719 | 178,816 | 159,951 | |||||||||||
Total revenues by itinerary | 2,246,395 | 2,109,542 | 4,203,819 | 4,052,799 | |||||||||||
Other revenues(4) | 91,210 | 85,732 | 161,542 | 151,035 | |||||||||||
Total revenues | $ | 2,337,605 | $ | 2,195,274 | $ | 4,365,361 | $ | 4,203,834 |
(1) | Includes the United States, Canada, Mexico and the Caribbean. |
(2) | Includes Southeast Asia (e.g., Singapore, Thailand and the Philippines), East Asia (e.g., China and Japan), South Asia (e.g., India and Pakistan) and Oceania (e.g., Australia and Fiji Islands) regions. |
(3) | Includes European countries (e.g., Nordics, Germany, France, Italy, Spain and the United Kingdom). |
(4) | Includes revenues primarily related to cancellation fees, vacation protection insurance and pre- and post-cruise tours. Amounts also include revenues related to our bareboat charter, procurement and management related services we perform on behalf of our unconsolidated affiliates. Refer to Note 5. Other Assets for more information on our unconsolidated affiliates. |
Quarter Ended June 30, | |||||
2018 | 2017 | ||||
Passenger ticket revenues: | |||||
United States | 63 | % | 63 | % | |
United Kingdom | 10 | % | 9 | % | |
All other countries (1) | 27 | % | 28 | % |
Six Months Ended June 30, | |||||
2018 | 2017 | ||||
Passenger ticket revenues: | |||||
United States | 62 | % | 62 | % | |
All other countries (1) | 38 | % | 38 | % |
(1) | No other individual country's revenue exceeded 10% for the quarters and six months ended June 30, 2018 and 2017. |
Quarter Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Net income for basic and diluted earnings per share | $ | 466,295 | $ | 369,526 | $ | 684,948 | $ | 584,252 | |||||||
Weighted-average common shares outstanding | 211,673 | 215,085 | 212,139 | 214,978 | |||||||||||
Dilutive effect of stock-based awards and stock options | 836 | 977 | 940 | 966 | |||||||||||
Diluted weighted-average shares outstanding | 212,509 | 216,062 | 213,079 | 215,944 | |||||||||||
Basic earnings per share | $ | 2.20 | $ | 1.72 | $ | 3.23 | $ | 2.72 | |||||||
Diluted earnings per share | $ | 2.19 | $ | 1.71 | $ | 3.21 | $ | 2.71 |
Quarter Ended June 30, 2018 | Quarter Ended June 30, 2017 | Six Months Ended June 30, 2018 | Six Months Ended June 30, 2017 | |||||||||||||
Share of equity income from investments | $ | 44,311 | $ | 23,359 | $ | 73,063 | $ | 35,239 | ||||||||
Dividends received | $ | 121,024 | $ | 29,405 | $ | 158,942 | $ | 57,402 |
As of June 30, 2018 | As of December 31, 2017 | |||||||
Total notes receivable due from equity investments | $ | 277,635 | $ | 314,323 | ||||
Less-current portion(1) | 89,632 | 38,658 | ||||||
Long-term portion(2) | $ | 188,003 | $ | 275,665 |
(1) | Included within Trade and other receivables, net in our consolidated balance sheets. |
(2) | Included within Other assets in our consolidated balance sheets. |
Quarter Ended June 30, 2018 | Quarter Ended June 30, 2017 | Six Months Ended June 30, 2018 | Six Months Ended June 30, 2017 | |||||||||||||
Revenues | $ | 14,157 | $ | 13,318 | $ | 28,230 | $ | 25,933 | ||||||||
Expenses | $ | 3,270 | $ | 4,020 | $ | 6,908 | $ | 7,733 |
Accumulated Other Comprehensive Income (Loss) for the Six Months Ended June 30, 2018 | Accumulated Other Comprehensive Income (Loss) for the Six Months Ended June 30, 2017 | ||||||||||||||||||||||||||||||
Changes related to cash flow derivative hedges | Changes in defined benefit plans | Foreign currency translation adjustments | Accumulated other comprehensive loss | Changes related to cash flow derivative hedges | Changes in defined benefit plans | Foreign currency translation adjustments | Accumulated other comprehensive loss | ||||||||||||||||||||||||
Accumulated comprehensive loss at beginning of the year | $ | (250,355 | ) | $ | (33,666 | ) | $ | (50,244 | ) | $ | (334,265 | ) | $ | (820,850 | ) | $ | (28,083 | ) | $ | (67,551 | ) | $ | (916,484 | ) | |||||||
Other comprehensive income (loss) before reclassifications | 69,932 | 5,082 | (10,361 | ) | 64,653 | 43,408 | (4,847 | ) | 8,321 | 46,882 | |||||||||||||||||||||
Amounts reclassified from accumulated other comprehensive loss | 3,698 | 714 | — | 4,412 | 108,007 | 557 | — | 108,564 | |||||||||||||||||||||||
Net current-period other comprehensive income (loss) | 73,630 | 5,796 | (10,361 | ) | 69,065 | 151,415 | (4,290 | ) | 8,321 | 155,446 | |||||||||||||||||||||
Ending balance | $ | (176,725 | ) | $ | (27,870 | ) | $ | (60,605 | ) | $ | (265,200 | ) | $ | (669,435 | ) | $ | (32,373 | ) | $ | (59,230 | ) | $ | (761,038 | ) |
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income | ||||||||||||||||||
Details About Accumulated Other Comprehensive Income (Loss) Components | Quarter Ended June 30, 2018 | Quarter Ended June 30, 2017 | Six Months Ended June 30, 2018 | Six Months Ended June 30, 2017 | Affected Line Item in Statements of Comprehensive Income (Loss) | |||||||||||||
Gain (loss) on cash flow derivative hedges: | ||||||||||||||||||
Interest rate swaps | $ | (2,138 | ) | $ | (7,863 | ) | $ | (8,976 | ) | $ | (16,720 | ) | Interest expense, net of interest capitalized | |||||
Foreign currency forward contracts | (3,156 | ) | (2,710 | ) | (6,468 | ) | (5,420 | ) | Depreciation and amortization expenses | |||||||||
Foreign currency forward contracts | 14,601 | (4,105 | ) | 14,643 | (7,675 | ) | Other income (expense) | |||||||||||
Foreign currency collar options | — | (602 | ) | — | (1,204 | ) | Depreciation and amortization expenses | |||||||||||
Fuel swaps | (133 | ) | 2,498 | 192 | 4,775 | Other income (expense) | ||||||||||||
Fuel swaps | 2,043 | (41,835 | ) | (3,089 | ) | (81,763 | ) | Fuel | ||||||||||
11,217 | (54,617 | ) | (3,698 | ) | (108,007 | ) | ||||||||||||
Amortization of defined benefit plans: | ||||||||||||||||||
Actuarial loss | (372 | ) | (293 | ) | (714 | ) | (557 | ) | Payroll and related | |||||||||
(372 | ) | (293 | ) | (714 | ) | (557 | ) | |||||||||||
Total reclassifications for the period | $ | 10,845 | $ | (54,910 | ) | $ | (4,412 | ) | $ | (108,564 | ) |
Fair Value Measurements at June 30, 2018 Using | Fair Value Measurements at December 31, 2017 Using | |||||||||||||||||||||||||||||||||||||||
Description | Total Carrying Amount | Total Fair Value | Level 1(1) | Level 2(2) | Level 3(3) | Total Carrying Amount | Total Fair Value | Level 1(1) | Level 2(2) | Level 3(3) | ||||||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||||||||||
Cash and cash equivalents(4) | $ | 108,998 | $ | 108,998 | $ | 108,998 | $ | — | $ | — | $ | 120,112 | $ | 120,112 | $ | 120,112 | $ | — | $ | — | ||||||||||||||||||||
Total Assets | $ | 108,998 | $ | 108,998 | $ | 108,998 | $ | — | $ | — | $ | 120,112 | $ | 120,112 | $ | 120,112 | $ | — | $ | — | ||||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||||||||||||||||
Long-term debt (including current portion of long-term debt)(5) | $ | 8,474,818 | $ | 8,964,142 | $ | — | $ | 8,964,142 | $ | — | $ | 7,506,312 | $ | 8,038,092 | $ | — | $ | 8,038,092 | $ | — | ||||||||||||||||||||
Total Liabilities | $ | 8,474,818 | $ | 8,964,142 | $ | — | $ | 8,964,142 | $ | — | $ | 7,506,312 | $ | 8,038,092 | $ | — | $ | 8,038,092 | $ | — |
Fair Value Measurements at June 30, 2018 Using | Fair Value Measurements at December 31, 2017 Using | |||||||||||||||||||||||||||||||
Description | Total | Level 1(1) | Level 2(2) | Level 3(3) | Total | Level 1(1) | Level 2(2) | Level 3(3) | ||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||
Derivative financial instruments(4) | $ | 296,646 | $ | — | $ | 296,646 | $ | — | $ | 320,385 | $ | — | $ | 320,385 | $ | — | ||||||||||||||||
Investments(5) | — | — | — | — | 3,340 | 3,340 | — | — | ||||||||||||||||||||||||
Total Assets | $ | 296,646 | $ | — | $ | 296,646 | $ | — | $ | 323,725 | $ | 3,340 | $ | 320,385 | $ | — | ||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||||||||
Derivative financial instruments(6) | $ | 103,206 | $ | — | $ | 103,206 | $ | — | $ | 115,961 | $ | — | $ | 115,961 | $ | — | ||||||||||||||||
Total Liabilities | $ | 103,206 | $ | — | $ | 103,206 | $ | — | $ | 115,961 | $ | — | $ | 115,961 | $ | — |
Fair Value Measurements at June 30, 2018 Using | ||||||||||||||||
Description | Total Carrying Amount | Total Fair Value | Level 3 | Total Impairment | ||||||||||||
Equity-method investment - SkySea Holding (1) | $ | — | $ | — | $ | — | $ | 509 | ||||||||
Debt facility and other receivables due from Skysea Holding (2) | 64,667 | 64,667 | 64,667 | 22,834 | ||||||||||||
Total | $ | 64,667 | $ | 64,667 | $ | 64,667 | $ | 23,343 |
Gross Amounts not Offset in the Consolidated Balance Sheet that are Subject to Master Netting Agreements | ||||||||||||||||||||||||||||||||
As of June 30, 2018 | As of December 31, 2017 | |||||||||||||||||||||||||||||||
Gross Amount of Derivative Assets Presented in the Consolidated Balance Sheet | Gross Amount of Eligible Offsetting Recognized Derivative Liabilities | Cash Collateral Received | Net Amount of Derivative Assets | Gross Amount of Derivative Assets Presented in the Consolidated Balance Sheet | Gross Amount of Eligible Offsetting Recognized Derivative Assets | Cash Collateral Received | Net Amount of Derivative Assets | |||||||||||||||||||||||||
Derivatives subject to master netting agreements | $ | 296,646 | $ | (91,084 | ) | $ | — | $ | 205,562 | $ | 320,385 | $ | (104,751 | ) | $ | — | $ | 215,634 | ||||||||||||||
Total | $ | 296,646 | $ | (91,084 | ) | $ | — | $ | 205,562 | $ | 320,385 | $ | (104,751 | ) | $ | — | $ | 215,634 |
Gross Amounts not Offset in the Consolidated Balance Sheet that are Subject to Master Netting Agreements | ||||||||||||||||||||||||||||||||
As of June 30, 2018 | As of December 31, 2017 | |||||||||||||||||||||||||||||||
Gross Amount of Derivative Liabilities Presented in the Consolidated Balance Sheet | Gross Amount of Eligible Offsetting Recognized Derivative Assets | Cash Collateral Pledged | Net Amount of Derivative Liabilities | Gross Amount of Derivative Liabilities Presented in the Consolidated Balance Sheet | Gross Amount of Eligible Offsetting Recognized Derivative Liabilities | Cash Collateral Pledged | Net Amount of Derivative Liabilities | |||||||||||||||||||||||||
Derivatives subject to master netting agreements | $ | (103,206 | ) | $ | 91,084 | $ | — | $ | (12,122 | ) | $ | (115,961 | ) | $ | 104,751 | $ | — | $ | (11,210 | ) | ||||||||||||
Total | $ | (103,206 | ) | $ | 91,084 | $ | — | $ | (12,122 | ) | $ | (115,961 | ) | $ | 104,751 | $ | — | $ | (11,210 | ) |
Debt Instrument | Swap Notional as of June 30, 2018 (In thousands) | Maturity | Debt Fixed Rate | Swap Floating Rate: LIBOR plus | All-in Swap Floating Rate as of June 30, 2018 | ||
Oasis of the Seas term loan | $ | 122,500 | October 2021 | 5.41% | 3.87% | 6.39% | |
Unsecured senior notes | 650,000 | November 2022 | 5.25% | 3.63% | 5.97% | ||
$ | 772,500 |
Debt Instrument | Swap Notional as of June 30, 2018 (In thousands) | Maturity | Debt Floating Rate | All-in Swap Fixed Rate | |||
Celebrity Reflection term loan | $ | 354,521 | October 2024 | LIBOR plus | 0.40% | 2.85% | |
Quantum of the Seas term loan | 520,625 | October 2026 | LIBOR plus | 1.30% | 3.74% | ||
Anthem of the Seas term loan | 543,750 | April 2027 | LIBOR plus | 1.30% | 3.86% | ||
Ovation of the Seas term loan | 691,667 | April 2028 | LIBOR plus | 1.00% | 3.16% | ||
Harmony of the Seas term loan (1) | 674,563 | May 2028 | EURIBOR plus | 1.15% | 2.26% | ||
$ | 2,785,126 |
Fuel Swap Agreements | |||||
As of June 30, 2018 | As of December 31, 2017 | ||||
(metric tons) | |||||
2018 | 342,900 | 673,700 | |||
2019 | 668,500 | 668,500 | |||
2020 | 531,200 | 531,200 | |||
2021 | 224,900 | 224,900 | |||
2022 | — | — |
Fuel Swap Agreements | |||||
As of June 30, 2018 | As of December 31, 2017 | ||||
(% hedged) | |||||
Projected fuel purchases: | |||||
2018 | 50 | % | 50 | % | |
2019 | 47 | % | 46 | % | |
2020 | 36 | % | 36 | % | |
2021 | 14 | % | 14 | % | |
2022 | — | % | — |
Fair Value of Derivative Instruments | ||||||||||||||||||||
Asset Derivatives | Liability Derivatives | |||||||||||||||||||
Balance Sheet Location | As of June 30, 2018 | As of December 31, 2017 | Balance Sheet Location | As of June 30, 2018 | As of December 31, 2017 | |||||||||||||||
Fair Value | Fair Value | Fair Value | Fair Value | |||||||||||||||||
Derivatives designated as hedging instruments under ASC 815-20(1) | ||||||||||||||||||||
Interest rate swaps | Other assets | $ | 49,418 | $ | 7,330 | Other long-term liabilities | $ | 51,917 | $ | 46,509 | ||||||||||
Foreign currency forward contracts | Derivative financial instruments | 21,921 | 68,352 | Derivative financial instruments | 26,677 | — | ||||||||||||||
Foreign currency forward contracts | Other assets | 72,830 | 158,879 | Other long-term liabilities | 4,502 | 6,625 | ||||||||||||||
Fuel swaps | Derivative financial instruments | 62,366 | 13,137 | Derivative financial instruments | 9,098 | 38,488 | ||||||||||||||
Fuel swaps | Other assets | 79,191 | 51,265 | Other long-term liabilities | 2,584 | 13,411 | ||||||||||||||
Total derivatives designated as hedging instruments under 815-20 | 285,726 | 298,963 | 94,778 | 105,033 | ||||||||||||||||
Derivatives not designated as hedging instruments under ASC 815-20 | ||||||||||||||||||||
Foreign currency forward contracts | Derivative financial instruments | $ | 1,930 | $ | 9,945 | Derivative financial instruments | $ | — | $ | 2,933 | ||||||||||
Foreign currency forward contracts | Other assets | 734 | 2,793 | Other long-term liabilities | — | 1,139 | ||||||||||||||
Fuel swaps | Derivative financial instruments | 8,256 | 7,886 | Derivative financial instruments | 8,428 | 6,043 | ||||||||||||||
Fuel swaps | Other Assets | — | 798 | Other long-term liabilities | — | 813 | ||||||||||||||
Total derivatives not designated as hedging instruments under 815-20 | 10,920 | 21,422 | 8,428 | 10,928 | ||||||||||||||||
Total derivatives | $ | 296,646 | $ | 320,385 | $ | 103,206 | $ | 115,961 |
Quarter Ended June 30, 2018 | |||||||||||||||||||||
Fuel Expense | Depreciation and Amortization Expenses | Interest Income (Expense) | Other Income (Expense) | Fuel Expense | Depreciation and Amortization Expenses | Interest Income (Expense) | Other Income (Expense) | ||||||||||||||
Total amounts of income and expense line items presented in the statement of financial performance in which the effects of fair value or cash flow hedges are recorded | 172,309 | 253,376 | (68,766) | 33,855 | 170,748 | 234,937 | (70,821) | (2,709 | ) | ||||||||||||
The effects of fair value and cash flow hedging: | |||||||||||||||||||||
Gain or (loss) on fair value hedging relationships in Subtopic 815-20 | |||||||||||||||||||||
Interest contracts | |||||||||||||||||||||
Hedged items | n/a | n/a | 3,374 | n/a | n/a | n/a | n/a | (4,311 | ) | ||||||||||||
Derivatives designated as hedging instruments | n/a | n/a | (5,310) | n/a | n/a | n/a | 869 | 5,351 | |||||||||||||
Gain or (loss) on cash flow hedging relationships in Subtopic 815-20 | |||||||||||||||||||||
Interest contracts | |||||||||||||||||||||
Amount of gain or (loss) reclassified from accumulated other comprehensive income into income | n/a | n/a | (2,138) | n/a | n/a | n/a | (7,863) | n/a | |||||||||||||
Commodity contracts | |||||||||||||||||||||
Amount of gain or (loss) reclassified from accumulated other comprehensive loss into income | 2,043 | n/a | n/a | (133 | ) | (41,835) | n/a | n/a | 2,498 | ||||||||||||
Foreign exchange contracts | |||||||||||||||||||||
Amount of gain or (loss) reclassified from accumulated other comprehensive income into income | n/a | (3,156) | n/a | 14,601 | n/a | (3,312) | n/a | (4,105 | ) |
Six Months Ended June 30, 2018 | ||||||||||||||||||||||
Fuel Expense | Depreciation and Amortization Expenses | Interest Income (Expense) | Other Income (Expense) | Fuel Expense | Depreciation and Amortization Expenses | Interest Income (Expense) | Other Income (Expense) | |||||||||||||||
Total amounts of income and expense line items presented in the statement of financial performance in which the effects of fair value or cash flow hedges are recorded | 332,650 | 493,606 | (128,911) | 9,755 | 348,162 | 470,686 | (144,886) | (5,320 | ) | |||||||||||||
The effects of fair value and cash flow hedging: | ||||||||||||||||||||||
Gain or (loss) on fair value hedging relationships in Subtopic 815-20 | ||||||||||||||||||||||
Interest contracts | ||||||||||||||||||||||
Hedged items | n/a | n/a | 16,556 | n/a | n/a | n/a | n/a | (1,854 | ) | |||||||||||||
Derivatives designated as hedging instruments | n/a | n/a | (17,880) | n/a | n/a | n/a | 2,042 | 3,820 | ||||||||||||||
Gain or (loss) on cash flow hedging relationships in Subtopic 815-20 | ||||||||||||||||||||||
Interest contracts | ||||||||||||||||||||||
Amount of gain or (loss) reclassified from accumulated other comprehensive income into income | n/a | n/a | (8,976) | n/a | n/a | n/a | (16,720) | n/a | ||||||||||||||
Commodity contracts | ||||||||||||||||||||||
Amount of gain or (loss) reclassified from accumulated other comprehensive loss into income | (3,089) | n/a | n/a | 192 | (81,763 | ) | n/a | n/a | 4,775 | |||||||||||||
Foreign exchange contracts | ||||||||||||||||||||||
Amount of gain or (loss) reclassified from accumulated other comprehensive income into income | n/a | (6,468) | n/a | 14,643 | n/a | (6,624) | n/a | (7,675 | ) |
Carrying Value | ||||||||||
Non-derivative instrument designated as hedging instrument under ASC 815-20 | Balance Sheet Location | As of June 30, 2018 | As of December 31, 2017 | |||||||
Foreign currency debt | Current portion of long-term debt | $ | 79,575 | $ | 70,097 | |||||
Foreign currency debt | Long-term debt | 219,279 | 225,226 | |||||||
$ | 298,854 | $ | 295,323 |
Derivatives and Related Hedged Items under ASC 815-20 Fair Value Hedging Relationships | Location of Gain (Loss) Recognized in Income on Derivative and Hedged Item | Amount of Gain (Loss) Recognized in Income on Derivative | Amount of Gain (Loss) Recognized in Income on Hedged Item | |||||||||||||||||||||||||||||||
Quarter Ended June 30, 2018 | Quarter Ended June 30, 2017 | Six Months Ended June 30, 2018 | Six Months Ended June 30, 2017 | Quarter Ended June 30, 2018 | Quarter Ended June 30, 2017 | Six Months Ended June 30, 2018 | Six Months Ended June 30, 2017 | |||||||||||||||||||||||||||
Interest rate swaps | Interest expense, net of interest capitalized | $ | (5,310 | ) | $ | 869 | $ | (17,880 | ) | $ | 2,042 | $ | 3,374 | $ | — | $ | 16,556 | $ | — | |||||||||||||||
Interest rate swaps | Other income (expense) | — | 5,351 | — | 3,820 | — | (4,311 | ) | — | (1,854 | ) | |||||||||||||||||||||||
$ | (5,310 | ) | $ | 6,220 | $ | (17,880 | ) | $ | 5,862 | $ | 3,374 | $ | (4,311 | ) | $ | 16,556 | $ | (1,854 | ) |
Line Item in the Statement of Financial Position Where the Hedged Item is Included | Carrying Amount of the Hedged Assets/(Liabilities) | Cumulative amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets/(Liabilities) | ||||||||||||||
As of June 30, 2018 | As of December 31, 2017 | As of June 30, 2018 | As of December 31, 2017 | |||||||||||||
Current portion of long-term debt and Long-term debt | $ | 730,462 | $ | 749,155 | $ | (36,648 | ) | $ | (34,813 | ) | ||||||
$ | 730,462 | $ | 749,155 | $ | (36,648 | ) | $ | (34,813 | ) |
Derivatives under ASC 815-20 Cash Flow Hedging Relationships | Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) on Derivative (Effective Portion) | Location of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income (Effective Portion) | Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income (Effective Portion) | |||||||||||||||||||||||||||||||
Quarter Ended June 30, 2018 | Quarter Ended June 30, 2017 | Six Months Ended June 30, 2018 | Six Months Ended June 30, 2017 | Quarter Ended June 30, 2018 | Quarter Ended June 30, 2017 | Six Months Ended June 30, 2018 | Six Months Ended June 30, 2017 | |||||||||||||||||||||||||||
Interest rate swaps | $ | 8,867 | $ | (19,060 | ) | $ | 46,058 | $ | (21,549 | ) | Interest expense, net of interest capitalized | $ | (2,138 | ) | $ | (7,863 | ) | $ | (8,976 | ) | $ | (16,720 | ) | |||||||||||
Foreign currency forward contracts | (193,329 | ) | 97,521 | (97,963 | ) | 99,650 | Depreciation and amortization expenses | (3,156 | ) | (2,710 | ) | (6,468 | ) | (5,420 | ) | |||||||||||||||||||
Foreign currency forward contracts | — | — | — | — | Other income (expense) | 14,601 | (4,105 | ) | 14,643 | (7,675 | ) | |||||||||||||||||||||||
Foreign currency collar options | — | — | — | — | Depreciation and amortization expenses | — | (602 | ) | — | (1,204 | ) | |||||||||||||||||||||||
Fuel swaps | — | — | — | — | Other income (expense) | (133 | ) | 2,498 | 192 | 4,775 | ||||||||||||||||||||||||
Fuel swaps | 126,778 | (4,125 | ) | 121,837 | (34,693 | ) | Fuel | 2,043 | (41,835 | ) | (3,089 | ) | (81,763 | ) | ||||||||||||||||||||
$ | (57,684 | ) | $ | 74,336 | $ | 69,932 | $ | 43,408 | $ | 11,217 | $ | (54,617 | ) | $ | (3,698 | ) | $ | (108,007 | ) |
Gain (Loss) Recognized in Income (Net Investment Excluded Components) | Six Months Ended June 30, 2018 | |||
Net inception fair value at January 1, 2018 | $ | (11,335 | ) | |
Amount of gain recognized in income on derivatives for the period ended June 30, 2018 | 1,488 | |||
Amount of loss remaining to be amortized in accumulated other comprehensive loss, as of June 30, 2018 | (2,205 | ) | ||
Fair value at June 30, 2018 | $ | (12,052 | ) |
Amount of Gain (Loss) Recognized in Other Comprehensive Income (Loss) | ||||||||||||||||
Non-derivative instruments under ASC 815-20 Net Investment Hedging Relationships | Quarter Ended June 30, 2018 | Quarter Ended June 30, 2017 | Six Months Ended June 30, 2018 | Six Months Ended June 30, 2017 | ||||||||||||
Foreign Currency Debt | $ | 15,853 | $ | 21,888 | $ | 7,609 | $ | 26,257 | ||||||||
$ | 15,853 | $ | 21,888 | $ | 7,609 | $ | 26,257 |
Amount of Gain (Loss) Recognized in Income on Derivatives | ||||||||||||||||||
Derivatives Not Designated as Hedging Instruments under ASC 815-20 | Location of Gain (Loss) Recognized in Income on Derivatives | Quarter Ended June 30, 2018 | Quarter Ended June 30, 2017 | Six Months Ended June 30, 2018 | Six Months Ended June 30, 2017 | |||||||||||||
Foreign currency forward contracts | Other income (expense) | $ | (36,894 | ) | $ | 21,256 | $ | (31,259 | ) | $ | 35,068 | |||||||
Fuel swaps | Other income (expense) | 213 | (20 | ) | 183 | (80 | ) | |||||||||||
Fuel swaps | Fuel | (881 | ) | — | 1,326 | — | ||||||||||||
$ | (37,562 | ) | $ | 21,236 | $ | (29,750 | ) | $ | 34,988 |
• | a review of our financial presentation, including discussion of certain operational and financial metrics we utilize to assist us in managing our business; |
• | a discussion of our results of operations for the quarter and six months ended June 30, 2018 compared to the same periods in 2017; |
• | a discussion of our business outlook, including our expectations for selected financial items for the third quarter and full year of 2018; and |
• | a discussion of our liquidity and capital resources, including our future capital and contractual commitments and potential funding sources. |
• | Passenger ticket revenues, which consist of revenue recognized from the sale of passenger tickets and the sale of air transportation to and from our ships; and |
• | Onboard and other revenues, which consist primarily of revenues from the sale of goods and/or services onboard our ships not included in passenger ticket prices, cancellation fees, sales of vacation protection insurance and pre- and post-cruise tours. Onboard and other revenues also includes revenues we receive from independent third party concessionaires that pay us a percentage of their revenues in exchange for the right to provide selected goods and/or services onboard our ships as well as revenues received for our bareboat charter, procurement and management related services we perform on behalf of our unconsolidated affiliates. |
• | Commissions, transportation and other expenses, which consist of those costs directly associated with passenger ticket revenues, including travel agent commissions, air and other transportation expenses, port costs that vary with passenger head counts and related credit card fees; |
• | Onboard and other expenses, which consist of the direct costs associated with onboard and other revenues, including the costs of products sold onboard our ships, vacation protection insurance premiums, costs associated with pre- and post-cruise tours and related credit card fees as well as the minimal costs associated with concession revenues, as the costs are mostly incurred by third-party concessionaires, and costs incurred for the procurement and management related services we perform on behalf of our unconsolidated affiliates; |
• | Payroll and related expenses, which consist of costs for shipboard personnel (costs associated with our shoreside personnel are included in Marketing, selling and administrative expenses); |
• | Food expenses, which include food costs for both guests and crew; |
• | Fuel expenses, which include fuel and related delivery, storage and emission consumable costs and the financial impact of fuel swap agreements; and |
• | Other operating expenses, which consist primarily of operating costs such as repairs and maintenance, port costs that do not vary with passenger head counts, vessel related insurance, entertainment and gains and /or losses related to the sale of our ships, if any. |
• | Total revenues, excluding the favorable effect of changes in foreign currency exchange rates, increased $119.7 million and $100.3 million for the quarter and six months ended June 30, 2018, respectively, as compared to the same periods in 2017. The increase was primarily due to higher pricing on our Europe and Asia/Pacific sailings which are further discussed below. |
• | The effect of changes in foreign currency exchange rates related to our passenger ticket and onboard and other revenue transactions denominated in currencies other than the United States dollar, resulted in an increase in total revenues of $22.6 million and $61.2 million for the quarter and six months ended June 30, 2018, respectively, compared to the same periods in 2017. |
• | Total cruise operating expenses, excluding the unfavorable effect of changes in foreign currency exchange rates, increased $48.7 million and $38.0 million for the quarter and six months ended June 30, 2018, respectively, as compared to the same periods in 2017. The increase for the quarter ended June 30, 2018 was mainly due to the increase in capacity and the increase for the six months ended June 30, 2018 was primarily due to the gain of $30.9 million recognized on the sale of Legend of the Seas in March 2017 that did not recur in 2018. |
• | The effect of changes in foreign currency exchange rates related to our cruise operating expenses, denominated in currencies other than the United States dollar, resulted in an increase in total operating expenses of $9.0 million and $19.8 million for the quarter and six months ended June 30, 2018, respectively, compared to the same periods in 2017. |
• | In April 2018, TUI Cruises, our 50% joint venture, took delivery of a new Mein Schiff 1. Also in April 2018, the original Mein Schiff 1 was sold to an affiliate of TUI AG, which offset the capacity of the new ship delivery. Due to the sale of the original Mein Schiff 1, we recognized a gain of $21.8 million related to a deferred gain from the 2009 sale of Celebrity Galaxy, which served as the original Mein Schiff 1, to TUI cruises. Refer to Note 5. Other Assets to our consolidated financial statements for further information |
• | We recognized an impairment loss of $23.3 million related to the Skysea Holding investment, debt facility and other receivables due, which is reported within Other income (expense) within our consolidated statements of comprehensive income (loss) for the six months ended June 30, 2018. Refer to Note 5. Other Assets to our consolidated financial statements for further discussion on the impairment. |
• | In March 2018, we took delivery of Symphony of the Seas. To finance the purchase, we borrowed $1.2 billion under a previously committed unsecured term loan. Refer to Note 6. Long-Term Debt to our consolidated financial statements for further information. The ship entered service at the end of the first quarter of 2018. |
• | In March 2018, we completed the purchase of Azamara Pursuit. The ship is expected to enter service during the third quarter of 2018. |
• | On July 31, 2018, we acquired a 66.7% equity stake in Silversea Cruises, a privately-owned ultra-luxury cruise line with nine ships operating in all seven continents, for approximately $1.0 billion and contingent consideration payable upon achievement of certain 2019-2020 performance metrics. Refer to Note 1. General to our consolidated financial statements for further information. |
Quarter Ended June 30, | Six months ended June 30, | ||||||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||||||||||||||
% of Total Revenues | % of Total Revenues | % of Total Revenues | % of Total Revenues | ||||||||||||||||||||||||
Passenger ticket revenues | $ | 1,672,570 | 71.6 | % | $ | 1,581,385 | 72.0 | % | $ | 3,098,214 | 71.0 | % | $ | 2,999,608 | 71.4 | % | |||||||||||
Onboard and other revenues | 665,035 | 28.4 | % | 613,889 | 28.0 | % | 1,267,147 | 29.0 | % | 1,204,226 | 28.6 | % | |||||||||||||||
Total revenues | 2,337,605 | 100.0 | % | 2,195,274 | 100.0 | % | 4,365,361 | 100.0 | % | 4,203,834 | 100.0 | % | |||||||||||||||
Cruise operating expenses: | |||||||||||||||||||||||||||
Commissions, transportation and other | 358,305 | 15.3 | % | 340,331 | 15.5 | % | 648,914 | 14.9 | % | 650,579 | 15.5 | % | |||||||||||||||
Onboard and other | 142,240 | 6.1 | % | 132,437 | 6.0 | % | 241,777 | 5.5 | % | 238,431 | 5.7 | % | |||||||||||||||
Payroll and related | 226,315 | 9.7 | % | 210,362 | 9.6 | % | 453,471 | 10.4 | % | 426,097 | 10.1 | % | |||||||||||||||
Food | 128,383 | 5.5 | % | 121,764 | 5.5 | % | 248,025 | 5.7 | % | 242,975 | 5.8 | % | |||||||||||||||
Fuel | 172,309 | 7.4 | % | 170,748 | 7.8 | % | 332,650 | 7.6 | % | 348,162 | 8.3 | % | |||||||||||||||
Other operating | 286,859 | 12.3 | % | 281,143 | 12.8 | % | 565,593 | 13.0 | % | 526,365 | 12.5 | % | |||||||||||||||
Total cruise operating expenses | 1,314,411 | 56.2 | % | 1,256,785 | 57.2 | % | 2,490,430 | 57.0 | % | 2,432,609 | 57.9 | % | |||||||||||||||
Marketing, selling and administrative expenses | 312,923 | 13.4 | % | 283,855 | 12.9 | % | 650,284 | 14.9 | % | 601,320 | 14.3 | % | |||||||||||||||
Depreciation and amortization expenses | 253,376 | 10.8 | % | 234,937 | 10.7 | % | 493,606 | 11.3 | % | 470,686 | 11.2 | % | |||||||||||||||
Operating Income | 456,895 | 19.5 | % | 419,697 | 19.1 | % | 731,041 | 16.7 | % | 699,219 | 16.6 | % | |||||||||||||||
Other income (expense): | |||||||||||||||||||||||||||
Interest income | 13,098 | 0.6 | % | 5,811 | 0.3 | % | 20,831 | 0.5 | % | 12,063 | 0.3 | % | |||||||||||||||
Interest expense, net of interest capitalized | (81,864 | ) | (3.5 | )% | (76,632 | ) | (3.5 | )% | (149,742 | ) | (3.4 | )% | (156,949 | ) | (3.7 | )% | |||||||||||
Equity investment income | 44,311 | 1.9 | % | 23,359 | 1.1 | % | 73,063 | 1.7 | % | 35,239 | 0.8 | % | |||||||||||||||
Other income (expense) | 33,855 | 1.4 | % | (2,709 | ) | (0.1 | )% | 9,755 | 0.2 | % | (5,320 | ) | (0.1 | )% | |||||||||||||
9,400 | 0.4 | % | (50,171 | ) | (2.3 | )% | (46,093 | ) | (1.1 | )% | (114,967 | ) | (2.7 | )% | |||||||||||||
Net Income | $ | 466,295 | 19.9 | % | $ | 369,526 | 16.8 | % | $ | 684,948 | 15.7 | % | $ | 584,252 | 13.9 | % | |||||||||||
Diluted Earnings per Share | $ | 2.19 | $ | 1.71 | $ | 3.21 | $ | 2.71 |
Quarter Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Net Income | $ | 466,295 | $ | 369,526 | $ | 684,948 | $ | 584,252 | |||||||
Adjusted Net income | 482,221 | 369,526 | 714,979 | 584,252 | |||||||||||
Net Adjustments to Net Income - Increase | $ | 15,926 | $ | — | $ | 30,031 | $ | — | |||||||
Adjustments to Net Income: | |||||||||||||||
Impairment loss related to Skysea Holding(1) | $ | — | $ | — | $ | 23,343 | $ | — | |||||||
Impairment and other costs related to exit of tour operations business(2) | 11,255 | — | 11,255 | — | |||||||||||
Transaction costs related to Silversea Cruises acquisition(3) | 4,671 | — | 4,671 | — | |||||||||||
Impact of change in accounting principle(4) | — | — | (9,238 | ) | — | ||||||||||
Net Adjustments to Net Income - Increase | $ | 15,926 | $ | — | $ | 30,031 | $ | — | |||||||
Basic: | |||||||||||||||
Earnings per Share | $ | 2.20 | $ | 1.72 | $ | 3.23 | $ | 2.72 | |||||||
Adjusted Earnings per Share | $ | 2.28 | $ | 1.72 | $ | 3.37 | $ | 2.72 | |||||||
Diluted: | |||||||||||||||
Earnings per Share | $ | 2.19 | $ | 1.71 | $ | 3.21 | $ | 2.71 | |||||||
Adjusted Earnings per Share | $ | 2.27 | $ | 1.71 | $ | 3.36 | $ | 2.71 | |||||||
Weighted-Average Shares Outstanding: | |||||||||||||||
Basic | 211,673 | 215,085 | 212,139 | 214,978 | |||||||||||
Diluted | 212,509 | 216,062 | 213,079 | 215,944 |
(1) | Refer to Note 5. Other Assets for information on the impairment loss related to Skysea Holding. |
(2) | In 2014, we created a tour operations business that focused on developing, marketing and selling land based tours around the world through an e-commerce platform. During the second quarter of 2018, we decided to cease operations and exit this business. As a result, we incurred exit costs, primarily consisting of fixed asset impairment charges and severance expense. |
(3) | Refer to Note 1. General for information on the Silversea Cruises acquisition. |
(4) | In January 2018, we elected to change our accounting policy for recognizing stock-based compensation expense from the graded attribution method to the straight-line attribution method for time-based stock awards. Refer to Note 2. Summary of Significant Accounting Policies to our consolidated financial statements for further information. |
Quarter Ended June 30, | Six Months Ended June 30, | ||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||
Passengers Carried | 1,461,055 | 1,433,339 | 2,866,006 | 2,858,872 | |||||||
Passenger Cruise Days | 10,213,067 | 9,950,570 | 19,838,849 | 19,910,135 | |||||||
APCD | 9,402,736 | 9,152,899 | 18,318,442 | 18,432,309 | |||||||
Occupancy | 108.6 | % | 108.7 | % | 108.3 | % | 108.0 | % |
Quarter Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2018 | 2018 On a Constant Currency Basis | 2017 | 2018 | 2018 On a Constant Currency Basis | 2017 | ||||||||||||||||||
Passenger ticket revenues | $ | 1,672,570 | $ | 1,653,080 | $ | 1,581,385 | $ | 3,098,214 | $ | 3,045,394 | $ | 2,999,608 | |||||||||||
Onboard and other revenues | 665,035 | 661,938 | 613,889 | 1,267,147 | 1,258,780 | 1,204,226 | |||||||||||||||||
Total revenues | 2,337,605 | 2,315,018 | 2,195,274 | 4,365,361 | 4,304,174 | 4,203,834 | |||||||||||||||||
Less: | |||||||||||||||||||||||
Commissions, transportation and other | 358,305 | 354,488 | 340,331 | 648,914 | 640,082 | 650,579 | |||||||||||||||||
Onboard and other | 142,240 | 141,115 | 132,437 | 241,777 | 240,475 | 238,431 | |||||||||||||||||
Net Revenues | $ | 1,837,060 | $ | 1,819,415 | $ | 1,722,506 | $ | 3,474,670 | $ | 3,423,617 | $ | 3,314,824 | |||||||||||
APCD | 9,402,736 | 9,402,736 | 9,152,899 | 18,318,442 | 18,318,442 | 18,432,309 | |||||||||||||||||
Gross Yields | $ | 248.61 | $ | 246.21 | $ | 239.84 | $ | 238.30 | $ | 234.96 | $ | 228.07 | |||||||||||
Net Yields | $ | 195.38 | $ | 193.50 | $ | 188.19 | $ | 189.68 | $ | 186.89 | $ | 179.84 |
Quarter Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2018 | 2018 On a Constant Currency Basis | 2017 | 2018 | 2018 On a Constant Currency Basis | 2017 | ||||||||||||||||||
Total cruise operating expenses | $ | 1,314,411 | $ | 1,305,451 | $ | 1,256,785 | $ | 2,490,430 | $ | 2,470,629 | $ | 2,432,609 | |||||||||||
Marketing, selling and administrative expenses (1) (2) | 296,997 | 294,106 | 283,855 | 643,596 | 635,066 | 601,320 | |||||||||||||||||
Gross Cruise Costs | 1,611,408 | 1,599,557 | 1,540,640 | 3,134,026 | 3,105,695 | 3,033,929 | |||||||||||||||||
Less: | |||||||||||||||||||||||
Commissions, transportation and other | 358,305 | 354,488 | 340,331 | 648,914 | 640,082 | 650,579 | |||||||||||||||||
Onboard and other | 142,240 | 141,115 | 132,437 | 241,777 | 240,475 | 238,431 | |||||||||||||||||
Net Cruise Costs | 1,110,863 | 1,103,954 | 1,067,872 | 2,243,335 | 2,225,138 | 2,144,919 | |||||||||||||||||
Less: | |||||||||||||||||||||||
Fuel | 172,309 | 172,309 | 170,748 | 332,650 | 332,650 | 348,162 | |||||||||||||||||
Net Cruise Costs Excluding Fuel | $ | 938,554 | $ | 931,645 | $ | 897,124 | $ | 1,910,685 | $ | 1,892,488 | $ | 1,796,757 | |||||||||||
APCD | 9,402,736 | 9,402,736 | 9,152,899 | 18,318,442 | 18,318,442 | 18,432,309 | |||||||||||||||||
Gross Cruise Costs per APCD | $ | 171.38 | $ | 170.12 | $ | 168.32 | $ | 171.09 | $ | 169.54 | $ | 164.60 | |||||||||||
Net Cruise Costs per APCD | $ | 118.14 | $ | 117.41 | $ | 116.67 | $ | 122.46 | $ | 121.47 | $ | 116.37 | |||||||||||
Net Cruise Costs Excluding Fuel per APCD | $ | 99.82 | $ | 99.08 | $ | 98.02 | $ | 104.30 | $ | 103.31 | $ | 97.48 |
(1) | For the six months ended June 30, 2018, the amount does not include the impact of the change in accounting principle of $9.2 million related to the recognition of stock-based compensation expense. Refer to Note 2. Summary of Significant Accounting Policies to our consolidated financial statements for further information. |
As Reported | Constant Currency | |
Net Yields | 3.25% to 4.25% | 2.75% to 3.75% |
Net Cruise Costs per APCD | 2.0% to 2.5% | Approx. 2.0% |
Net Cruise Costs per APCD, Excluding Fuel | Approx. 3.0% | Approx. 2.5% |
Capacity Change | 3.7% | |
Depreciation and Amortization | $1,025 to $1,035 million | |
Interest Expense, net | $288 to $298 million | |
Fuel Consumption (metric tons) | 1,337,000 | |
Fuel Expenses | $693 million | |
Percent Hedged (fwd consumption) | 50% | |
Adjusted Earnings per Share-Diluted | $8.70 to $8.90 |
Remaining Periods 2018 | |
1% Change in Currency | $11 million |
1% Change in Net Yields | $40 million |
1% Change in NCC x Fuel | $19 million |
100 basis pt. Change in LIBOR | $17 million |
10% Change in Fuel Prices | $21 million |
As Reported | Constant Currency | |
Net Yields | Approx. 1.5% | Approx. 2.0% |
Net Cruise Costs per APCD | Flat | Flat |
Net Cruise Costs per APCD, Excluding Fuel | Approx. (1.0%) | Approx. (1.0%) |
Capacity Change | 8.2% | |
Depreciation and Amortization | $260 to $265 million | |
Interest Expense, net | $78 to $82 million | |
Fuel Consumption (metric tons) | 340,200 | |
Fuel Expenses | $184 million | |
Percent Hedged (fwd consumption) | 47% | |
Adjusted Earnings per Share-Diluted | $3.90 to $3.95 |
Third Quarter 2018 | |
1% Change in Currency | $7 million |
1% Change in Net Yields | $22 million |
1% Change in NCC x Fuel | $9 million |
100 basis pt. Change in LIBOR | $7 million |
10% Change in Fuel Prices | $15 million |
Ranking | Q1 | Q2 | Q3 | Q4 | FY 2018 | |||||
1 | AUD | GBP | GBP | AUD | GBP | |||||
2 | CAD | AUD | EUR | GBP | AUD | |||||
3 | GBP | CAD | CNH | CAD | CAD | |||||
4 | CNH | CNH | CAD | EUR | EUR | |||||
5 | EUR | EUR | MXN | CNH | CNH |
Currency Abbreviation | Currency | |
AUD | Australian Dollar | |
CAD | Canadian Dollar | |
CNH | Chinese Yuan | |
EUR | Euro | |
GBP | British Pound | |
MXN | Mexican Peso |
• | a 2.7% increase in capacity, which increased passenger ticket revenues by $43.2 million primarily due to the addition of Symphony of the Seas to our fleet during the second quarter of 2018; |
• | an increase of $28.5 million in ticket prices primarily driven by higher pricing on our Europe and Asia/Pacific sailings and the improvement in our ticket price on a per passenger basis due to the addition of Symphony of the Seas; and |
• | a favorable effect of changes in foreign currency exchange rates related to our revenue transactions denominated in currencies other than the United States dollar of approximately $19.5 million. |
• | a $29.7 million increase in onboard revenue attributable to higher spending on a per passenger basis primarily due to our revenue enhancing initiatives, including beverage package sales and promotions, new strategies and promotions on our specialty restaurants, internet and other telecommunication services, and an increase in port activities mainly due to itinerary changes; |
• | a $16.4 million increase attributable to the 2.7% increase in capacity noted above; and |
• | a favorable effect of changes in foreign currency exchange rates related to our onboard and other revenue transactions denominated in currencies other than the United States dollar of approximately $3.1 million. |
• | the 2.7% increase in capacity noted above, which increased cruise operating expenses by $34.1 million; |
• | a $10.1 million increase in payroll and related expenses primarily driven by changes in our gratuity structure; and |
• | an unfavorable effect of changes in foreign currency exchange rates related to our cruise operating expenses denominated in currencies other than the United States dollar of approximately $9.0 million. |
• | an increase of $64.3 million in ticket prices primarily driven by higher pricing on Europe and Asia/Pacific sailings; and |
• | a favorable effect of changes in foreign currency exchange rates related to our revenue transactions denominated in currencies other than the United States dollar of approximately $52.8 million. |
• | a $54.7 million increase in onboard revenue attributable to higher spending on a per passenger basis primarily due to our revenue enhancing initiatives, including beverage package sales and promotions, new strategies and promotions of our specialty restaurants, internet and other telecommunication services, and an increase in port activities mainly due to itinerary changes; and |
• | a favorable effect of changes in foreign currency exchange rates related to our onboard and other revenue transactions denominated in currencies other than the United States dollar of approximately $8.4 million. |
• | a $30.9 million gain recognized in 2017 resulting from the sale of Legend of the Seas, which did not recur in 2018; |
• | a $29.6 million increase in payroll and related expenses primarily driven by changes in our gratuity structure; and |
• | an unfavorable effect of changes in foreign currency exchange rates related to our cruise operating expenses denominated in currencies other than the United States dollar of approximately $19.8 million. |
• | the 0.6% decrease in capacity noted above, which decreased cruise operating expenses by $15.1 million; and |
• | a $13.4 million decrease in fuel expense, excluding the impact of the decrease in capacity. Our cost of fuel (net of the financial impact of fuel swap agreements) for 2018 decreased 4.2% per metric ton compared to 2017. |
Ship | Expected to Enter Service | Approximate Berths | ||
Royal Caribbean International — | ||||
Oasis-class: | ||||
Unnamed | 2nd Quarter 2021 | 5,500 | ||
Quantum-class: | ||||
Spectrum of the Seas | 2nd Quarter 2019 | 4,250 | ||
Unnamed | 4th Quarter 2020 | 4,250 | ||
Icon-class: | ||||
Unnamed | 2nd Quarter 2022 | 5,650 | ||
Unnamed | 2nd Quarter 2024 | 5,650 | ||
Celebrity Cruises — | ||||
Edge-class: | ||||
Celebrity Edge | 4th Quarter 2018 | 2,900 | ||
Celebrity Apex | 2nd Quarter 2020 | 2,900 | ||
Unnamed | 4th Quarter 2021 | 3,200 | ||
Unnamed | 4th Quarter 2022 | 3,200 | ||
Celebrity Flora | 2nd Quarter 2019 | 100 | ||
TUI Cruises (50% joint venture) (1)— | ||||
Unnamed | 1st Quarter 2019 | 2,850 | ||
Unnamed | 3rd Quarter 2023 | 2,850 | ||
Total Berths | 43,300 |
(1) | The additional capacity is partially offset through the transfer of the original Mein Schiff 1 to an affiliate of TUI AG, our joint venture partner in TUI Cruises, in April 2018. |
Payments due by period | |||||||||||||||||||
Less than | 1-3 | 3-5 | More than | ||||||||||||||||
Total | 1 year | years | years | 5 years | |||||||||||||||
Operating Activities: | |||||||||||||||||||
Operating lease obligations(1) | $ | 229,732 | $ | 27,937 | $ | 41,779 | $ | 19,932 | $ | 140,084 | |||||||||
Interest on long-term debt(2) | 1,504,109 | 302,578 | 498,991 | 333,956 | 368,584 | ||||||||||||||
Other(3) | 976,284 | 188,253 | 364,704 | 193,942 | 229,385 | ||||||||||||||
Investing Activities: | 0 | ||||||||||||||||||
Ship purchase obligations(4) | 9,199,772 | 1,752,333 | 3,179,667 | 3,016,319 | 1,251,453 | ||||||||||||||
Financing Activities: | 0 | ||||||||||||||||||
Long-term debt obligations(5) | 8,474,818 | 1,170,169 | 2,369,772 | 2,210,570 | 2,724,307 | ||||||||||||||
Capital lease obligations(6) | 44,271 | 7,457 | 14,343 | 10,255 | 12,216 | ||||||||||||||
Other(7) | 23,454 | 9,238 | 11,093 | 3,123 | — | ||||||||||||||
Total | $ | 20,452,440 | $ | 3,457,965 | $ | 6,480,349 | $ | 5,788,097 | $ | 4,726,029 |
(1) | We are obligated under noncancelable operating leases primarily for offices, warehouses and motor vehicles. Amounts represent contractual obligations with initial terms in excess of one year. |
(2) | Long-term debt obligations mature at various dates through fiscal year 2030 and bear interest at fixed and variable rates. Interest on variable-rate debt is calculated based on forecasted debt balances, including the impact of interest rate swap agreements using the applicable rate at June 30, 2018. Debt denominated in other currencies is calculated based on the applicable exchange rate at June 30, 2018. |
(3) | Amounts primarily represent future commitments with remaining terms in excess of one year to pay for our usage of certain port facilities, marine consumables, services and maintenance contracts. Amounts do not include the PortMiami lease further discussed below under Off-Balance Sheet Arrangements. |
(4) | Amounts do not include potential obligations which remain subject to cancellation at our sole discretion. |
(5) | Amounts represent debt obligations with initial terms in excess of one year. Debt denominated in other currencies is calculated based on the applicable exchange rate at June 30, 2018. |
(6) | Amounts represent capital lease obligations with initial terms in excess of one year. |
(7) | Amounts represent fees payable to sovereign guarantors in connection with certain of our export credit debt facilities and facility fees on our revolving credit facilities. |
Period | Total number of shares purchased | Average price paid per share | Total number of shares purchased as part of publicly announced plans or programs(1) | Approximate dollar value of shares that may yet be purchased under the plans or programs | |||
April 1, 2018 - April 30, 2018 | — | $— | — | $— | |||
May 1, 2018 - May 31, 2018 | — | $— | — | $1,000,000,000 | |||
June 1, 2018 - June 30, 2018 | 1,285,234 | $106.93 | 1,285,234 | $862,500,000 | |||
Total | 1,285,234 | 1,285,234 |
(1) | On May 9 2018, we announced that our board of directors authorized a 24-month common stock repurchase program for up to $1.0 billion. For further information on our stock repurchase transactions, refer to Note 8. Shareholders' Equity to our consolidated financial statements. |
10.1 | |||
10.2 | |||
10.3 | |||
10.4 | |||
10.5 | |||
10.6 | |||
10.7 | |||
10.8 | |||
10.9 | |||
10.10 | |||
10.11 | |||
10.12 | |||
31.1 | |||
31.2 | |||
32.1 |
* | Filed herewith | |
** | Furnished herewith |
(ii) | the Consolidated Balance Sheets at June 30, 2018 and December 31, 2017; |
ROYAL CARIBBEAN CRUISES LTD. | ||
(Registrant) | ||
/s/ JASON T. LIBERTY | ||
Jason T. Liberty | ||
Executive Vice President, Chief Financial Officer | ||
August 2, 2018 | (Principal Financial Officer and duly authorized signatory) |
Private & Confidential | ||||
Dated 3 July 2018 | ||||
Royal Caribbean Cruises Ltd. (1) (the Borrower) KfW IPEX-Bank GmbH (2) (the Hermes Agent) KfW IPEX-Bank GmbH (3) (the Facility Agent) KfW IPEX-Bank GmbH (4) (as Initial Mandated Lead Arranger) BNP Paribas Fortis S.A./N.V. (5) DNB Bank ASA Skandinaviska Enskilda Banken AB (publ) (the Mandated Lead Arrangers) and certain financial institutions (6) (the Lenders) | ||||
___________________________________________ Amendment No. 5 in connection with the Credit Agreement in respect of “Quantum of the Seas” (Hull S-697) ___________________________________________ |
(1) | ROYAL CARIBBEAN CRUISES LTD. (a corporation organised and existing under the laws of The Republic of Liberia) (the Borrower); |
(2) | KfW IPEX-Bank GmbH as facility agent (the Facility Agent); |
(3) | KfW IPEX-Bank GmbH as Hermes agent (the Hermes Agent); |
(4) | KfW IPEX-Bank GmbH as initial mandated lead arranger (the Initial Mandated Lead Arranger); |
(5) | BNP Paribas Fortis S.A./N.V, DNB Bank ASA, and Skandinaviska Enskilda Banken AB (publ) as mandated lead arrangers (together with the Initial Mandated Lead Arranger, the Mandated Lead Arrangers); and |
(6) | The financial institutions party thereto as lenders from time to time (the Lenders). |
(A) | The Borrower, the Facility Agent, the Hermes Agent and the Lenders are parties to a credit agreement dated 8 June 2011, as amended and restated by that amendment agreement dated 17 February 2012, as further amended by that deed of amendment no. 2 dated 10 May 2012, that Amendment No. 3 dated 17 October 2014 and as further amended and restated by amendment No. 4 dated 2 February 2016 (the Existing Credit Agreement), in respect of the vessel with Hull number S-697 (now “Quantum of the Seas” with IMO Number 9549463) (the Vessel) whereby it was agreed that the Lenders would make available to the Borrower, upon the terms and conditions therein, a US dollar loan facility (the Facility) calculated on the amount equal to the sum of (a) up to eighty per cent (80%) of the Contract Price (as defined in the Existing Credit Agreement) of the Vessel but which Contract Price will not exceed EURO 725,000,000 and (b) up to 100% of the Hermes Fee (as defined therein). |
(B) | The Parties wish to amend the Existing Credit Agreement to the extent set out in this Amendment. |
1 | Interpretation and definitions |
1.1 | Definitions in the Existing Credit Agreement |
(a) | Unless the context otherwise requires or unless otherwise defined in this Amendment, words and expressions defined in the Existing Credit Agreement shall have the same meanings when used in this Amendment. |
(b) | The principles of construction set out in the Existing Credit Agreement shall have effect as if set out in this Amendment. |
1.2 | In this Amendment: |
1.3 | Third party rights |
1.4 | Designation |
2 | Amendment of the Existing Credit Agreement |
3 | Conditions of Effectiveness of Amended Agreement |
3.1 | The Amended Agreement shall become effective in accordance with the terms of this Amendment on the date each of the following conditions has been satisfied to the reasonable satisfaction of the Facility Agent (the Effective Date): |
(a) | the Facility Agent shall have received from the Borrower: |
(i) | a certificate of its Secretary or Assistant Secretary as to the incumbency and signatures of those of its officers authorized to act with respect to this Amendment and as to the truth and completeness of the attached resolutions of its Board of Directors then in full force and effect authorizing the execution, delivery and performance of this Amendment, and upon which certificate the Lenders may conclusively rely until the Facility Agent shall have received a further certificate of the Secretary or Assistant Secretary of the Borrower canceling or amending such prior certificate; and |
(ii) | a Certificate of Good Standing issued by the relevant Liberian authorities in respect of the Borrower. |
(b) | the Facility Agent shall have received all invoiced expenses of the Facility Agent (including the agreed fees and expenses of counsel to the Facility Agent) required to be paid by the Borrower pursuant to clause 6 below or that the Borrower has otherwise agreed in writing to pay to the Facility Agent, in each case on or prior to the Effective Date; |
(c) | the Facility Agent shall have received the amendment to the Hermes Insurance Policy duly issued by Hermes; and |
(d) | the representations and warranties set forth in clause 4 are true as of the Effective Date. |
3.2 | The Facility Agent shall notify the Lenders and the Borrower of the Effective Date and such notice shall be conclusive and binding. |
4 | Representations and Warranties |
5 | Incorporation of Terms |
6 | Costs and Expenses |
7 | Counterparts |
8 | Governing Law |
(A) | The Borrower and Meyer Werft GmbH, Papenburg (the “Builder”) have entered on February 14, 2011 into a Contract for the Construction and Sale of Hull No. S-697 (as amended from time to time, the “Construction Contract”) pursuant to which the Builder has agreed to design , construct, equip, complete, sell and deliver the passenger cruise vessel bearing Builder’s hull number S-697 (the “Purchased Vessel”); |
(B) | The Lenders have agreed to make available to the Borrower, upon the terms and conditions contained herein, a US dollar loan facility calculated on the amount (the “Maximum Loan Amount”) equal to the sum of (x) up to eighty per cent (80%) of the Contract Price (as defined below) of the Purchased Vessel (as defined below), as adjusted from time to time in accordance with the Construction Contract to reflect, among other adjustments, change orders, but which Contract Price shall not exceed for this purpose EUR 725,000,000 (the “Contract Price Proceeds”) and (y) up to 100% of the Hermes Fee (as defined below) (the “Hermes Fee Proceeds”) and being made available in the US Dollar Equivalent of that Maximum Loan Amount; |
(C) | Except as otherwise provided below under the Alternative Disbursement Option (as defined below), the Contract Price Proceeds will be provided to the Borrower two (2) Business Days prior to the delivery of the Purchased Vessel for the purpose of paying a portion of the Contract Price in connection with the Borrower’s purchase of the Purchased Vessel. The Hermes Fee Proceeds will be provided on the First Disbursement Date, with 75% of such Hermes Fee Proceeds to be disbursed directly to the Hermes Agent for Hermes’ account for the payment of the Second Fee (as defined below) and 25% to be disbursed to the Borrower for reimbursement of the First Fee (as defined below); |
(D) | The Parties hereto have previously amended this Agreement pursuant to the Amendment Agreement, the Amendment Deed Number Two, the Amendment |
(E) | Pursuant to Amendment Agreement Number Five dated as of 2018 (the “Amendment Agreement Number Five”), and upon satisfaction of the conditions set forth therein, this Agreement is being amended and restated in the form of this Agreement. |
a) | net cash from operating activities (determined in accordance with GAAP) for such period, as shown in the Borrower’s consolidated statement of cash flow for such period, to |
b) | the sum of: |
a) | Any Interest Period which would otherwise end on a day which is not a Business Day shall end on the next Business Day to occur, except if such Business Day does not fall in the same calendar month, the Interest Period will end on the last Business Day in that calendar month, the interest amount due in respect of the Interest Period in question and in respect of the next following Interest Period being adjusted accordingly; and |
b) | If any Interest Period is altered by the application of a) above, the subsequent Interest Period shall end on the day on which it would have ended if the preceding Interest Period had not been so altered. |
a) | subject to Section 3.3.6, if no such offered quotation appears on Reuters LIBOR01 Page (or any successor page) at the relevant time, the LIBO Rate shall be the rate per annum certified by the Facility Agent to be the average of the rates quoted by the Reference Banks as the rate at which each of the Reference Banks was (or would have been) offered deposits of Dollars by prime banks in the London interbank market in an amount approximately equal to the amount of the Loan and for a period of six months; and |
b) | for the purposes of determining the post-maturity rate of interest under Section 3.3.4, the LIBO Rate shall be determined by reference to deposits on an overnight or call basis or for such other period or periods as the Facility Agent may determine after consultation with the Lenders, which period shall be no longer than one month unless the Borrower otherwise agrees. |
a) | Each Lender will make its portion of the Loan available to the Borrower in accordance with Section 2.3 either (i) two (2) Business Days prior to the delivery of the Purchased Vessel to the Borrower under the Construction Contract pursuant to Section 2.3(a) or (ii) if the Borrower elects the Alternative Disbursement Option in accordance with Section 2.3(b), as set forth in Section 2.3(b). The commitment of each Lender described in this Section 2.2 (herein referred to as its “Commitment”) shall be the commitment of such Lender to make available to the Borrower its portion of the Loan hereunder expressed as the initial amount set forth opposite such Lender’s name on its signature page attached hereto or, in the case of any Lender that becomes a Lender pursuant to an assignment pursuant to Section 11.11.1, the amount set forth as such Lender’s Commitment in the related Lender Assignment Agreement, in each case as such amount may be reduced from time to time pursuant to Section 2.2(b) or reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 11.11.1. Notwithstanding the foregoing, each Lender’s Commitment shall terminate on the earlier of (i) the Commitment Termination Date if the Purchased Vessel is not delivered prior to such date and (ii) the delivery of the Purchased Vessel. |
b) | The Borrower may, by notice to the Facility Agent, at any time (i) prior to the date that is not less than 61 days prior to the First Disbursement Date, without premium or penalty, terminate, or from time to time reduce, the Commitments and (ii) prior to the date on which the Commitments have been terminated but less than 61 days prior to the First Disbursement Date, and subject to Section 4.4, terminate, or from time to time reduce, the Commitments. Any such termination or reduction of the Commitments shall be applied to the respective Commitments of the Lenders, pro rata according to the amounts of their respective Commitments. |
c) | If any Lender shall default in its obligations under Section 2.1, the Facility Agent shall, at the request of the Borrower, use reasonable efforts to assist the Borrower in finding a bank or financial institution acceptable to the Borrower to replace such Lender. |
a) | Unless the Borrower has elected the Alternative Disbursement Option in accordance with Section 2.3(b), the Borrower shall deliver a Loan Request and the documents required to be delivered pursuant to Section 5.1.1(a) to the Facility Agent on or before 11:00 a.m., London time, not less than two (2) Business Days in advance of the date that is two (2) Business Days prior to the anticipated delivery date of the Purchased Vessel. The aggregate amount of the Loan to be advanced shall not exceed the US Dollar Maximum Loan Amount. |
b) | The Borrower may, subject to Section 4.12(b), at any time prior to the Contractual Delivery Date, elect the Alternative Disbursement Option by written notice to the Facility Agent delivered ten (10) Business Days prior to the requested date of the first such advance to be made following such election. If so elected, the Borrower shall deliver a Loan Request and, in the case of the First Disbursement Date, the documents required to be delivered pursuant to Section 5.1.1(a) to the Facility Agent on or before 11:00 a.m. London time, not less than two (2) Business Days in advance of the date on which the Borrower is required to make a pre-delivery installment to the Builder (other than, for the avoidance of doubt, the first such pre-delivery installment due under the Construction Contract) or, in the case of the advance on the Final Disbursement Date, not less than two (2) Business Days in advance of the date that is two (2) Business Days prior to the anticipated delivery date of the Purchased Vessel. Each such advance of a portion of the Loan shall not exceed the US Dollar Equivalent of 80% of the installment payment owing to the Builder on such date; provided, however, that (i) the advance to be made on the First Disbursement Date may be increased by up to 100% of the total amount of the Hermes Fee, (ii) the advance to be made on the Final Disbursement Date may be in an amount up to the excess of the US Dollar Maximum Loan Amount over the aggregate amount of all advances made prior to the Final Disbursement Date, and (iii) the aggregate amount of all such advances shall not exceed the US Dollar Maximum Loan Amount. |
c) | The Facility Agent shall promptly notify each Lender of any Loan Request by forwarding a copy thereof to each Lender, together with its attachments. On the terms and subject to the conditions of this Agreement, the Loan (or portion thereof, as specified by the Borrower) shall be made on the Business Day specified in such Loan Request. On or before 11:00 a.m., New York time, on the Business Day specified in such Loan Request, the Lenders shall, without any set-off or counterclaim, deposit with the Facility Agent same day funds in an amount equal to such Lender’s Percentage of the requested Loan or portion thereof. Such deposit will be made to an account which the Facility Agent shall specify from time to time by notice to the Lenders. To the extent funds are so received from the Lenders, the Facility Agent shall, without any set-off or counterclaim, make such funds available to the Borrower on the Business Day specified in the Loan Request by wire transfer of same day funds to the account or accounts the Borrower shall have specified in its Loan Request. |
d) | The Borrower shall, upon receipt of the Dollar funds into the account referred to in Section 2.3(c) above, (i) complete the purchase of EUR with its counterparties or otherwise as set out in the Loan Request (by authorising and instructing the Facility Agent to remit the necessary Dollar funds to the said counterparties) and shall procure the payment of all EUR proceeds of such transactions to the EUR Pledged Account no later than the Business Day immediately following the Business Day specified in the Loan Request and (ii) to the extent of any such Dollar funds as shall not be used to purchase EUR, (by authorising and instructing the Facility Agent accordingly) shall procure the payment of such Dollar funds to the Dollar Pledged Account on the Business Day specified in the Loan Request. |
e) | If the Borrower elects to finance all or any part of the Hermes Fee with a portion of the advance made on the First Disbursement Date, the Borrower shall indicate such election in its Loan Request with respect to such advance. When this election is made, the amount of the advance in Dollars (the “US Dollar Hermes Advance Amount”) that will fund the Hermes Fee shall be equal to the Dollar amount that corresponds to the EUR amount of the Hermes Fee to be financed with such advance, which amount shall be reasonably determined by the Facility Agent based on the spot rate for EUR-Dollar exchanges on the date such Loan Request is delivered, which spot rate shall be determined by reference to a publicly available market service like Bloomberg that can be independently verified by the Borrower. The Facility Agent shall notify the Borrower and the Lenders of the US Dollar Hermes Advance Amount (including the applicable spot rate referred to above) on the date such Loan Request is delivered, and the Lenders shall deposit such US Dollar Hermes Advance Amount with the Facility Agent in accordance with Section 2.3(c). The Borrower will be deemed to have directed the Facility Agent to pay over directly to Hermes on behalf of the Borrower that portion of the EUR amount of the Second Fee to be financed with the proceeds of the advance on the First Disbursement Date and to retain for the Borrower’s own account (and deposit in the Dollar Pledge Account pending disbursement in accordance with Section 2.3(f)) deposits made by the Lenders in Dollars in an amount equal to the portion of the US Dollar Hermes Advance Amount attributable to the First Fee paid by the Facility Agent to Hermes on behalf of the Borrower. |
f) | Upon the date of delivery of the Purchased Vessel, the Facility Agent shall direct that moneys standing to the credit of the Pledged Accounts shall, in the manner set out in the Loan Request, be disbursed as follows: |
b) | If, on the date of delivery of the Purchased Vessel, the outstanding principal amount of the Loan exceeds the US Dollar Maximum Loan Amount (as a result of a reduction in the Contract Price after the Final Disbursement Date and before the delivery of the Purchased Vessel), the Borrower shall repay the Loan in an amount equal to such excess within two (2) Business Days after the date of delivery of the Purchased Vessel. Any such partial prepayment shall be applied pro rata in satisfaction of the repayment installments of the Loan set out in Exhibit A. |
c) | No such amounts repaid by the Borrower pursuant to this Section 3.1 may be reborrowed under the terms of this Agreement. |
a) | May, from time to time on any Business Day, make a voluntary prepayment, in whole or in part, of the outstanding principal amount of the Loan; provided that: |
i) | all such voluntary prepayments shall require (x) for prepayments on or after the Final Disbursement Date made prior to delivery of the Purchased Vessel in respect of the advance made on such Final Disbursement Date, at least two (2) Business Days’ prior written notice to the Facility Agent, and (y) for all other prepayments, at least 30 calendar days’ prior written notice, if all or any portion of the Loan is a Fixed Rate Loan, and at least five (5) Business Days’ (or, if such prepayment is to be made on the last day of an Interest Period for such Loan, four (4) Business Days’) prior written notice, if the Loan is a Floating Rate Loan, in each case to the Facility Agent; and |
ii) | all such voluntary partial prepayments shall be in an aggregate minimum amount of $10,000,000 and a multiple of $1,000,000 (or in the remaining amount of the Loan) and shall be applied in inverse order of maturity or ratably among all remaining installments, as the Borrower shall designate to the Facility Agent, in satisfaction of the repayment installments of the Loan set out in Exhibit A. |
b) | Shall, immediately upon any acceleration of the repayment of the installments of the Loan pursuant to Section 8.2 or 8.3 or the mandatory prepayment of the Loan pursuant to Section 9.2, repay the Loan. |
a) | By written notice to the Facility Agent delivered prior to the date that is not less than 61 days prior to the First Disbursement Date, the Borrower may elect, without incurring any liability to make any payments pursuant to Section 4.4 or to pay any other indemnity or compensation obligation, to pay interest on the Loan at the Floating Rate. |
b) | By written notice to the Facility Agent delivered less than 61 days prior to the First Disbursement Date but not less than 30 days prior to the First Disbursement Date, the Borrower may elect, subject to Section 4.4, to pay interest on the Loan at the Floating Rate. |
c) | By written notice to the Facility Agent no later than 2:00 p.m. Frankfurt time 30 days prior to the end of an Interest Period, the Borrower may elect, subject to Section 4.4, to pay interest on the Loan for the remainder of the term of the Loan at the Floating Rate, with effect from the end of that Interest Period. |
d) | Any election made under any of Section 3.3.2.a), Section 3.3.2.b) or Section 3.3.2.c) may only be made one time during the term of the Loan. |
a) | each Interest Payment Date; |
b) | each Repayment Date; |
c) | the date of any prepayment, in whole or in part, of principal outstanding on the Loan (but only on the principal so prepaid); and |
d) | on that portion of the Loan the repayment of which is accelerated pursuant to Section 8.2 or Section 8.3, immediately upon such acceleration. |
a) | Dollar deposits in the relevant amount and for the relevant Interest Period are not available to each Reference Bank in its relevant market, or |
b) | by reason of circumstances affecting the Reference Banks’ relevant markets, adequate means do not exist for ascertaining the interest rate applicable hereunder to LIBO Rate loans for the relevant Interest Period, or |
c) | the cost to Option B Lenders that in the aggregate hold more than 50% of the aggregate outstanding principal amount of the Loan then held by Option B Lenders, if any Lender shall have entered into an Option B Interest Make-Up Agreement, of obtaining matching deposits in the relevant interbank market for the relevant Interest Period would be in excess of the LIBO Rate (provided, that no Option B Lender may exercise its rights |
a. | subject any Lender to any taxes, levies, duties, charges, fees, deductions or withholdings of any nature with respect to its portion of the Loan or any part thereof imposed, levied, collected, withheld or assessed by any jurisdiction or any political subdivision or taxing authority thereof (other than taxation on overall net income and, to the extent such taxes are described in Section 4.6, withholding taxes); or |
b. | change the basis of taxation to any Lender (other than a change in taxation on the overall net income of any Lender) of payments of principal or interest or any other payment due or to become due pursuant to this Agreement; or |
c. | impose, modify or deem applicable any reserve or capital adequacy requirements (other than the increased capital costs described in Section 4.5 and the reserve costs |
d. | impose on any Lender any other condition affecting its portion of the Loan or any part thereof, |
i) | if at the time interest is calculated at the Floating Rate, any conversion or repayment or prepayment or acceleration of the principal amount of the Loan on a date other than the scheduled last day of an Interest Period or otherwise scheduled date for repayment or payment (including payments made in accordance with Section 3.1(b); |
ii) | if at the time interest is calculated at the Fixed Rate, any repayment or prepayment or acceleration of the principal amount of the Loan, other than any repayment made on the date scheduled for such repayment; |
iii) | an election by the Borrower of the Floating Rate in accordance with Section 3.3.2.b) or Section 3.3.2.c); |
iv) | a reduction or termination of the Commitments by the Borrower pursuant to Section 2.2.b)(ii); or |
v) | the Loan not being made in accordance with the Loan Request therefor due to the fault of the Borrower or as a result of any of the conditions precedent set forth in Article V not being satisfied, |
a. | if at that time interest is calculated at the Floating Rate, pay directly to the Facility Agent an amount (the “Floating Rate Indemnity Amount”) equal to the amount by which: |
(i) | interest calculated at the Floating Rate which a Lender would have received on its share of the amount of the Loan subject to such Funding Losses Event for the period from the date of receipt of any part of its share in the Loan to the last day of the applicable Interest Period, |
(ii) | the amount which a Lender would be able to obtain by placing an amount equal to the amount received by it on deposit with a leading bank in the appropriate interbank market for a period |
b. | if at that time interest is calculated at the Fixed Rate, pay to the Facility Agent for the account of such Lender the sum of: |
(A) | an amount equal to the amount by which: |
(i) | interest calculated at the Fixed Rate which a Lender would have received on its share of the amount of the Loan subject to such Funding Losses Event for the period from the date of receipt of any part of its share of the Loan to the final scheduled date for the repayment of Loan in full pursuant to Section 3.1, |
(ii) | the amount by which a Lender would be able to obtain by placing an equal amount to the amount received by it on deposit and receiving interest equal to the money market rate then applicable to Dollars on the Reuters page “ICAP1” (the “Reinvestment Rate”), |
(B) | if such Lender has entered into an Option B Interest Make-up Agreement, an amount equal to the Floating Rate Indemnity Amount. |
a. | pay directly to the relevant authority the full amount required to be so withheld or deducted; |
b. | promptly forward to the Facility Agent an official receipt or other documentation satisfactory to the Facility Agent evidencing such payment to such authority; and |
c. | pay to the Facility Agent for the account of the Lenders such additional amount or amounts as is necessary to ensure that the net amount actually received by each Lender will equal the full amount such Lender would have received had no such withholding or deduction been required. |
a. | (%5) Each Option A Lender hereby instructs the Facility Agent to remit all payments of interest made with respect to any portion of the Loan held by such Option A Lender to the Refinancing Bank less (x) the margin for Fixed Rate Loans of 1.10% and (y) the CIRR administrative fee of 0.20% if interest on the Loan made by that Lender is then calculated at the Fixed Rate and less the Floating Rate Margin if interest on that Loan is then calculated at the Floating Rate. |
b. | The Facility Agent shall promptly (but in any event on the same Business Day that the same are received or, as contemplated in clause (a) of this Section, deemed received) remit in same day funds to each Lender its share, if any, of such payments received by the Facility Agent for the account of such Lender without any set-off, deduction or counterclaim. All interest and fees shall be computed on the basis of the actual number of days (including the first day but excluding the last day) occurring during the period for which such interest or fee is payable over a year comprised of 360 days. Whenever any payment to be made shall otherwise be due on a day which is not a Business Day, such payment shall (except as otherwise required by clause (a) of the definition of the term “Interest Period”) be made on the next succeeding Business Day and such extension of time shall be included in computing interest and fees, if any, in connection with such payment. |
a. | Watson, Farley & Williams (New York) LLP, counsel to the Borrower, as to Liberian Law, covering the matters set forth in Exhibit D-1 hereto; |
b. | Norton Rose LLP, counsel to the Facility Agent, covering the matters set forth in Exhibit D-2 hereto; and |
c. | Clifford Chance US LLP, United States tax counsel to the Lenders, covering the matters set forth in Exhibit D-3 hereto, |
(i) | the government of the Federal Republic of Germany, the Federal Audit Court or any authorized representatives specified by these bodies shall be authorized at any time to inspect and make or demand copies of the records, accounts, documents and other deeds of the Lenders; |
(ii) | in the course of its activity as the Facility Agent, the Facility Agent may: |
(a) | provide the government of the Federal Republic of Germany with information concerning the transactions to be handled by it; and |
(b) | disclose information concerning the subsidized transaction in the context of internationally agreed consultation/notification proceedings and statutory specifications, |
(iii) | the Facility Agent and (to the extent the Lenders have entered into an Option A Refinancing Agreement with the Refinancing Bank) the Lenders are entitled to disclose to the Refinancing Bank: |
(a) | circumstances pertaining to the Loan, proper repayment and collateralization; |
(b) | extraordinary events which may jeopardize the proper servicing of the Loan; |
(c) | any information required by the Refinancing Bank with respect to the proper use of any refinancing funds granted to the respective Lender; and |
(d) | the Loan Documents; |
a. | the representations and warranties set forth in Article VI (excluding, however, those set forth in Section 6.10) shall be true and correct in all material respects except for those representations and warranties that are qualified by materiality or Material Adverse Effect, which shall be true and correct, with the same effect as if then made; and |
b. | no Default and no Prepayment Event and no event which (with notice or lapse of time or both) would become a Prepayment Event shall have then occurred and be continuing. |
a. | contravene the Borrower’s Organic Documents; |
b. | contravene any law or governmental regulation of any Applicable Jurisdiction except as would not reasonably be expected to result in a Material Adverse Effect; |
c. | contravene any court decree or order binding on the Borrower or any of its property except as would not reasonably be expected to result in a Material Adverse Effect; |
d. | contravene any contractual restriction binding on the Borrower or any of its property except as would not reasonably be expected to result in a Material Adverse Effect; or |
e. | result in, or require the creation or imposition of, any Lien on any of the Borrower’s properties except as would not reasonably be expected to result in a Material Adverse Effect. |
a. | The Borrower is in compliance with all applicable laws, rules, regulations and orders, except to the extent that the failure to so comply does not and would not reasonably be expected to have a Material Adverse Effect. |
b. | The Borrower has implemented and maintains in effect policies and procedures designed to procure compliance by the Borrower, its Subsidiaries and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions. The Borrower and its Subsidiaries and, to the knowledge of the Borrower, their respective officers, employees, directors and agents, are in compliance with Anti-Corruption Laws and applicable Sanctions, in all material respects and are not knowingly engaged in any activity that would reasonably be expected to result in Borrower being designated as a Sanctioned Person. None of (i) the Borrower, any Subsidiary or to the knowledge of the Borrower or such Subsidiary any of their respective directors, officers or employees, or (ii) to the knowledge of the Borrower, any agent of the Borrower or any Subsidiary that will act in any capacity in connection with or benefit from the credit facility established hereby, is a Sanctioned Person. |
c. | The Borrower is in compliance with all applicable Environmental Laws, except to the extent that the failure to so comply would not have a Material Adverse Effect. |
a. | legally and beneficially owned by the Borrower or one of the Borrower’s wholly owned Subsidiaries, |
b. | registered in the name of the Borrower or one of the Borrower’s wholly owned Subsidiaries under the Bahamian or Maltese flag or such other flag as the parties may mutually agree, |
c. | classed as required by Section 7.1.4(b), |
d. | free of all recorded Liens, other than Liens permitted by Section 7.2.3, |
e. | insured against loss or damage in compliance with Section 7.1.5, and |
f. | exclusively operated by or chartered to the Borrower or one of the Borrower’s wholly owned Subsidiaries except as otherwise permitted pursuant to Section 7.1.4. |
a. | as soon as available and in any event within 60 days after the end of each of the first three Fiscal Quarters of each Fiscal Year of the Borrower, a copy of the Borrower’s report on Form 10-Q (or any successor form) as filed by the Borrower with the SEC for such Fiscal Quarter, containing unaudited consolidated financial statements of the Borrower for such Fiscal Quarter (including a balance sheet and profit and loss statement) prepared in accordance with GAAP, subject to normal year-end audit adjustments; |
b. | as soon as available and in any event within 120 days after the end of each Fiscal Year of the Borrower, a copy of the Borrower’s annual report on Form 10-K (or any successor form) as filed by the Borrower with the SEC for such Fiscal Year, containing audited consolidated financial statements of the Borrower for such Fiscal Year prepared in accordance with GAAP (including a balance sheet and profit and loss statement) and audited by PricewaterhouseCoopers LLP or another firm of independent public accountants of similar standing; |
c. | together with each of the statements delivered pursuant to the foregoing clause (a) or (b), a certificate, executed by the chief financial officer, the treasurer or the corporate controller of the Borrower, showing, as of the last day of the relevant Fiscal Quarter or Fiscal Year compliance with the covenants set forth in Section 7.2.4 (in reasonable detail and with appropriate calculations and computations in all respects reasonably satisfactory to the Facility Agent); |
d. | as soon as possible after the occurrence of a Default or Prepayment Event, a statement of the chief financial officer of the Borrower setting forth details of such Default or Prepayment Event (as the case may be) and the action which the Borrower has taken and proposes to take with respect thereto; |
e. | as soon as the Borrower becomes aware thereof, notice of any Material Litigation except to the extent that such Material Litigation is disclosed by the Borrower in filings with the SEC; |
f. | as soon as the Borrower becomes aware thereof, notice of any event which, in its reasonable opinion, would be expected to materially adversely affect the business, operations or financial condition of the Borrower and its Subsidiaries taken as a whole; |
g. | promptly after the sending or filing thereof, copies of all reports which the Borrower sends to all holders of each security issued by the Borrower, and all registration statements which the Borrower or any of its Subsidiaries files with the SEC or any national securities exchange; and |
h. | such other information respecting the condition or operations, financial or otherwise, of the Borrower or any of its Subsidiaries as any Lender through the Facility Agent may from time to time reasonably request; |
a. | in the case of the Borrower, the maintenance and preservation of its corporate existence (subject to the provisions of Section 7.2.6); |
b. | in the case of the Borrower, maintenance of its qualification as a foreign corporation in the State of Florida; |
c. | the payment, before the same become delinquent, of all taxes, assessments and governmental charges imposed upon it or upon its property, except to the extent being diligently contested in good faith by appropriate proceedings; |
d. | compliance with all applicable Environmental Laws; |
e. | compliance with all anti-money laundering laws and Anti-Corruption Laws applicable to the Borrower, including by not making or causing to be made any offer, gift or payment, consideration or benefit of any kind to anyone, either directly or indirectly, as an inducement or reward for the performance of any of the transactions contemplated by this Agreement to the extent the same would be in contravention of such applicable laws; and |
f. | the Borrower will maintain in effect policies and procedures designed to procure compliance by the Borrower, its Subsidiaries and their respective directors, officers and employees with Anti-Corruption Laws and applicable Sanctions. |
a. | cause the Purchased Vessel to be exclusively operated by or chartered to the Borrower or one of the Borrower’s wholly owned Subsidiaries, provided that the Borrower or such Subsidiary may charter out the Purchased Vessel (i) to entities other than the Borrower and the Borrower’s wholly owned Subsidiaries and (ii) on a time charter with a stated duration not in excess of one year; |
b. | cause the Purchased Vessel to be kept in such condition as will entitle her to classification by a classification society of recognized standing; |
c. | upon delivery of the Purchased Vessel, provide the following to the Facility Agent with respect to the Purchased Vessel: |
d. | within seven days after delivery of the Purchased Vessel, provide the following to the Facility Agent with respect to the Purchased Vessel: |
a. | Indebtedness, secured by Liens of the type described in Section 7.2.3; |
b. | Indebtedness owing to the Borrower or a direct or indirect Subsidiary of the Borrower; |
c. | Indebtedness incurred to finance, refinance or refund the cost (including the cost of construction) of assets acquired after the Effective Date; |
d. | Indebtedness in an aggregate principal amount, together with (but without duplication of) Indebtedness permitted under Section 7.2.2(a) and permitted to be secured under Section 7.2.3(c), at any one time outstanding not exceeding (determined at the time of creation of such Lien or the incurrence by any Existing Principal Subsidiary of such Indebtedness, as applicable) 10.0% of the total assets of the Borrower and its Subsidiaries taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter; |
e. | [RESERVED]; and |
f. | obligations in respect of Hedging Instruments entered into for the purpose of managing interest rate, foreign currency exchange or commodity exposure risk and not for speculative purposes. |
a. | [RESERVED]; |
b. | Liens on assets (including, without limitation, shares of capital stock of corporations and assets owned by any corporation that becomes a Subsidiary of the Borrower after the Effective Date) acquired after the Effective Date (whether by purchase, construction or otherwise) by the Borrower or any of its Subsidiaries (other than (x) an Existing Principal Subsidiary or (y) any other Principal Subsidiary which, at any time, after three months after the acquisition of a Vessel, owns a Vessel free of any mortgage Lien), which Liens were created solely for the purpose of securing Indebtedness representing, or incurred to finance, refinance or refund, the cost (including the cost of construction) of such assets, so long as (i) the acquisition of such assets is not otherwise prohibited by the terms of this Agreement and (ii) each such Lien is created within three months after the acquisition of the relevant assets; |
c. | in addition to other Liens permitted under this Section 7.2.3, Liens securing Indebtedness in an aggregate principal amount, together with (but without duplication of) Indebtedness permitted under Section 7.2.2(d), at any one time outstanding not exceeding (determined at the time of creation of such Lien or the incurrence by any Existing Principal Subsidiary of such indebtedness, as applicable) (i) 10.0% of the total assets of the Borrower and its Subsidiaries (the “Lien Basket Amount”) taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter; provided, however that, if, at any time, the Senior Debt Rating of the Borrower is less than Investment Grade as given by both Moody’s and S&P, the Lien Basket Amount shall be the greater of (x) 5.0% of the total assets of the Borrower and its Subsidiaries taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter and (y) $735,000,000; |
d. | Liens on assets acquired after the Effective Date by the Borrower or any of its Subsidiaries (other than by (x) any Subsidiary that is an Existing Principal Subsidiary or (y) any other Principal Subsidiary which, at any time, owns a Vessel free of any mortgage Lien) so long as (i) the acquisition of such assets is not otherwise prohibited by the terms of this Agreement and (ii) each of such Liens existed on such assets before the time of its acquisition and was not created by the Borrower or any of its Subsidiaries in anticipation thereof; |
e. | Liens on any asset of any corporation that becomes a Subsidiary of the Borrower (other than a corporation that also becomes a Subsidiary of an Existing Principal Subsidiary) after the Effective Date so long as (i) the acquisition or creation of such corporation by the Borrower is not otherwise prohibited by the terms of this Agreement and (ii) such Liens are in existence at the time such corporation becomes a Subsidiary of the Borrower and were not created by the Borrower or any of its Subsidiaries in anticipation thereof; |
f. | Liens securing Government-related Obligations; |
g. | Liens for taxes, assessments or other governmental charges or levies not at the time delinquent or thereafter payable without penalty or being diligently contested in good faith by appropriate proceedings; |
h. | Liens of carriers, warehousemen, mechanics, materialmen and landlords incurred in the ordinary course of business for sums not overdue by more than 60 days or being diligently contested in good faith by appropriate proceedings; |
i. | Liens incurred in the ordinary course of business in connection with workers’ compensation, unemployment insurance or other forms of governmental insurance or benefits; |
j. | Liens for current crew’s wages and salvage; |
k. | Liens arising by operation of law as the result of the furnishing of necessaries for any Vessel so long as the same are discharged in the ordinary course of business or are being diligently contested in good faith by appropriate proceedings; |
l. | Liens on Vessels that: |
m. | normal and customary rights of set-off upon deposits of cash or other Liens originating solely by virtue of any statutory or common law provision relating to bankers’ liens, rights of set-off or similar rights in favor of banks or other depository institutions; |
n. | Liens in respect of rights of set-off, recoupment and holdback in favor of credit card processors securing obligations in connection with credit card processing services incurred in the ordinary course of business; |
o. | Liens on cash or Cash Equivalents or marketable securities securing: |
p. | deposits to secure the performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case in the ordinary course of business and deposits securing liabilities to insurance carriers under insurance or self-insurance arrangements; |
q. | easements, zoning restrictions, rights-of-way and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or interfere with the ordinary conduct of business of the Borrower or any Subsidiary; and |
r. | licenses, sublicenses, leases or subleases granted to other Persons not materially interfering with the conduct of the business of the Borrower or any of its Subsidiaries. |
a. | Net Debt to Capitalization Ratio, as at the end of any Fiscal Quarter, to be greater than 0.625 to 1. |
b. | Fixed Charge Coverage Ratio to be less than 1.25 to 1 as at the last day of any Fiscal Quarter. |
a. | any such Subsidiary may (i) liquidate or dissolve voluntarily into, and may merge with and into, the Borrower or any other Subsidiary, and the assets or stock of any Subsidiary may be purchased or otherwise acquired by the Borrower or any other Subsidiary or (ii) merge with and into another Person in connection with a sale or other disposition permitted by Section 7.2.7; and |
b. | so long as no Event of Default or Prepayment Event has occurred and is continuing or would occur after giving effect thereto, the Borrower or any of its Subsidiaries may merge into any other Person, or any other Person may merge into the Borrower or any such Subsidiary, or the Borrower or any of its Subsidiaries may purchase or otherwise acquire all or substantially all of the assets of any Person, in each case so long as: |
(A) | the surviving corporation shall have assumed in a writing, delivered to the Facility Agent, all of the Borrower’s obligations hereunder and under the other Loan Documents; |
(B) | the surviving corporation shall, promptly upon the request of the Facility Agent or any Lender, supply such documentation and other evidence as is reasonably requested by the Facility Agent or any Lender in order for the Facility Agent or such Lender to carry out and be satisfied it has complied with the results of all necessary “know your customer” or other similar checks under all applicable laws and regulations; and |
(C) | as soon as practicable after receiving notice from the Borrower of such merger, and in any event no later than five Business Days after the delivery of such notice, for a surviving corporation that is organized under the laws of a jurisdiction other than of the United States or a political subdivision thereof or Liberia, any Lender that may not legally lend to, establish credit for the account of and/or do any business whatsoever with such surviving corporation, either directly or through an Affiliate of such Lender (a “Protesting Lender”) shall so notify the Borrower and the Facility Agent in writing. With respect to each Protesting Lender, the Borrower shall, effective on or before the date that such surviving corporation shall have the right to borrow hereunder, notify the Facility Agent and such Protesting Lender that the Commitments of such Protesting Lender shall be terminated; provided that such Protesting Lender shall have received one or more payments from either the Borrower or one or more assignees in an aggregate amount at least equal to the aggregate outstanding principal amount of the Loan owing to such Protesting Lender, together with accrued interest thereon to the date of payment of such principal amount and all other amounts payable to such Protesting Lender under this Agreement. |
a. | generally fail to pay, or admit in writing its inability to pay, its debts as they become due; |
b. | apply for, consent to, or acquiesce in, the appointment of a trustee, receiver, sequestrator or other custodian for it or any of its property, or make a general assignment for the benefit of creditors; |
c. | in the absence of such application, consent or acquiescence, permit or suffer to exist the appointment of a trustee, receiver, sequestrator or other custodian for it or for a substantial part of its property, and such trustee, receiver, sequestrator or other custodian shall not be discharged within 60 days, provided that in the case of such an event in respect of the Borrower, the Borrower hereby expressly authorizes the Facility Agent and each Lender to appear in any court conducting any relevant proceeding during such 60-day period to preserve, protect and defend their respective rights under the Loan Documents; |
d. | permit or suffer to exist the commencement of any bankruptcy, reorganization, debt arrangement or other case or proceeding under any bankruptcy or insolvency law, or any dissolution, winding up or liquidation proceeding, in respect of the Borrower or any of such Subsidiaries, and, if any such case or proceeding is not commenced by the Borrower or such Subsidiary, such case or proceeding shall be consented to or acquiesced in by the Borrower or such Subsidiary or shall result in the entry of an order for relief or shall remain for 60 days undismissed, provided that the Borrower hereby expressly authorizes the Facility Agent and each Lender to appear in any court conducting any such case or proceeding during such 60-day period to preserve, protect and defend their respective rights under the Loan Documents; or |
e. | take any corporate action authorizing, or in furtherance of, any of the foregoing. |
a. | enforcement proceedings in respect of any material assets of the Borrower or such Principal Subsidiary shall have been commenced by any creditor upon such judgment or order and shall not have been stayed or enjoined within five (5) Business Days after the commencement of such enforcement proceedings; or |
b. | there shall be any period of 30 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect. |
a. | modify any requirement hereunder that any particular action be taken by all the Lenders or by the Required Lenders shall be effective unless consented to by each Lender; |
b. | modify this Section 11.1 or change the definition of “Required Lenders” shall be made without the consent of each Lender; |
c. | increase the Commitment of any Lender shall be made without the consent of such Lender; |
d. | reduce any fees described in Article III payable to any Lender shall be made without the consent of such Lender; |
e. | extend the Commitment Termination Date of any Lender shall be made without the consent of such Lender; |
f. | extend the due date for, or reduce the amount of, any scheduled repayment or prepayment of principal of or interest on the Loan (or reduce the principal amount of or rate of interest on the Loan) owed to any Lender shall be made without the consent of such Lender; or |
g. | affect adversely the interests, rights or obligations of the Facility Agent in its capacity as such shall be made without consent of the Facility Agent. |
a. | except to the extent permitted under Section 7.2.5, the Borrower may not assign or transfer its rights or obligations hereunder without the prior written consent of the Facility Agent and each Lender; and |
b. | the rights of sale, assignment and transfer of the Lenders are subject to Section 11.11. |
a. | written notice of such assignment or transfer, together with payment instructions, addresses and related information with respect to such Assignee Lender, shall have been given to the Borrower and the Facility Agent by such Lender and such Assignee Lender; |
b. | such Assignee Lender shall have executed and delivered to the Borrower and the Facility Agent a Lender Assignment Agreement, accepted by the Facility Agent and, if the Loan is a Fixed Rate Loan, any other agreements required by the Facility Agent or the CIRR Representative in connection therewith; and |
c. | the processing fees described below shall have been paid. |
a. | no participation contemplated in this Section 11.11.2 shall relieve such Lender from its obligations hereunder; |
b. | such Lender shall remain solely responsible for the performance of its obligations hereunder; |
c. | the Borrower and the Facility Agent shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement and each of the other Loan Documents; |
d. | no Participant, unless such Participant is an Affiliate of such Lender, shall be entitled to require such Lender to take or refrain from taking any action hereunder or under any other Loan Document, except that such Lender may agree with any Participant that such Lender will not, without such Participant’s consent, take any actions of the type described in clauses (b) through (f) of Section 11.1; |
e. | the Borrower shall not be required to pay any amount under Sections 4.2(c), 4.3, 4.4, 4.5, 4.6 and 4.7 that is greater than the amount which it would have been required to pay had no participating interest been sold; and |
f. | each Lender Party that sells a participation under this Section 11.11.2 shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest on) each of the Participant’s interest in the Lender Party’s Advances, Commitments or other interests hereunder (the “Participant Register”). The entries in the Participant Register shall be conclusive absent manifest error, and such Lender may treat each person whose name is recorded in the Participant Register as the owner of such participation for all purposes hereunder. |
g. | KfW IPEX may not sell participating interests pursuant to this Section 11.11.2 aggregating, when taken together with Loans and/or Commitments sold by KfW IPEX pursuant to Section 11.11.1, more than 50.0% the aggregate principal amount of the Loan and/or the aggregate Commitments without the written consent of the Borrower (which consent shall not be required following the occurrence and during the continuance of an Event of Default or a Prepayment Event). |
(a) | 95% cover of the Loan. |
(b) | If the Borrower does not exercise the Alternative Disbursement Option, the Hermes Fee will not exceed 2.37% of the aggregate principal amount of the Loan as advanced on or prior to the Final Disbursement Date. Before exercising the Alternative Disbursement Option, the Borrower may request that the Hermes Agent obtain an indication of the new Hermes Fee (which it is anticipated will apply if the Borrower exercises the Alternative Disbursement Option) before it delivers notice of its option to exercise the Alternative Disbursement Option, which request shall not be considered to be notice of the Borrower’s intent to exercise the Alternative Disbursement Option. Such new Hermes Fee shall become effective only if the Borrower delivers notice of its option to exercise the Alternative Disbursement Option. If the Hermes Fee is so increased, each Lender agrees that its Commitment shall be increased by an amount equal to its pro rata share of the excess of the new Hermes Fee over the old Hermes Fee. |
(c) | The parties have entered into this Agreement on the basis that the Hermes Insurance Policy shall contain the following terms and should such terms not be included within the Hermes Insurance Policy, then the Borrower may cancel the Commitment(s): |
(i) | 25% of the Hermes Fee as in effect on the date of issuance of the Hermes Insurance Policy (“First Fee”) will be payable to the Hermes Agent or Hermes on demand following the issue of the Hermes Insurance Policy; |
(ii) | 2.37% (or such higher percentage as determined under Section 11.13.1(b) if the Borrower exercises the Alternative Disbursement Option) of the Maximum Loan Amount less the First Fee (“Second Fee”) will be payable to the Hermes Agent or Hermes on the First Disbursement Date; |
(iii) | if the Commitments are cancelled in full by the Borrower or the Lenders on or prior to the First Disbursement Date, Hermes shall be required to reimburse the Hermes Agent the amount of the First Fee less an administration fee (such administration fee to be no greater than 5% of the amount refunded but in any event not exceeding EUR 2,500); |
(iv) | if the Commitments are cancelled in part by the Borrower on or prior to the First Disbursement Date, Hermes shall be required to reimburse the Hermes Agent an amount equal to a corresponding proposition of the First Fee, based on the proportion of the aggregate Commitments prior to such cancellation to the aggregate Commitments after giving effect to such cancellation, less an administration fee (such administration fee to be no greater than 5% of the amount refunded but in any event not exceeding EUR 2,500); and |
(v) | if, after the First Disbursement Date, the Borrower reduces the Commitments and/or prepays all or part of the Loan in accordance with this Agreement, Hermes shall be required to reimburse the Hermes Agent an amount equal to all or a corresponding proportion of the unexpired portion of the Hermes Fee, having regard to the amount of the reduction in Commitments and/or prepayment and the remaining term of the Loan less the sum of (x) a break funding fee equal to 20% of the unexpired portion of the Hermes Fee and (y) an administration fee (such fee to be no greater than 5% of the amount refunded but in any event not exceeding EUR 2,500). |
(a) | Provided that the Hermes Insurance Policy complies with Section 11.13.1, the Borrower shall pay (a) the First Fee to the Hermes Agent or Hermes on demand following the issue of the Hermes Insurance Policy and (b) the Second Fee to the Hermes Agent or Hermes on the First Disbursement Date. In each case, if received by the Hermes Agent, the Hermes Agent shall pay such amount to Hermes. |
(b) | Provided that the Hermes Insurance Policy complies with Section 11.13.1, the Borrower shall pay to the Hermes Agent or Hermes an issue fee of EUR 12,500 for the issue of the Hermes Insurance Policy on demand following issue of the Hermes Insurance Policy. |
(a) | Promptly upon receipt of the Hermes Insurance Policy from Hermes, the Hermes Agent shall (subject to any confidentiality undertakings given to Hermes by the Hermes Agent pursuant to the terms of the Hermes Insurance Policy) send a copy thereof to the Borrower. |
(b) | The Hermes Agent shall perform such acts or provide such information, which are, acting reasonably, within its power so to perform or so to provide, as required by Hermes under the Hermes Insurance Policy as necessary to ensure that the Lenders obtain the support of Hermes pursuant to the Hermes Insurance Policy. |
(c) | The Hermes Agent shall: |
(i) | make written requests to Hermes seeking a reimbursement of the Hermes Fee in the circumstances described in Section 11.13.1(c)(iii), (iv) or (v) promptly after the relevant cancellation or prepayment and (subject to any confidentiality undertakings given to Hermes by the Hermes Agent pursuant to the terms of the Hermes Insurance Policy) provide a copy of the request to the Borrower; |
(ii) | use its reasonable endeavours to maximize the amount of any reimbursement of the Hermes Fee to which the Hermes Agent is entitled; |
(iii) | pay to the Borrower the full amount of any reimbursement of the Hermes Fee that the Hermes Agent receives from Hermes within two (2) Business Days of receipt with same day value; and |
(iv) | relay the good faith concerns of the Borrower to Hermes regarding the amount it is required to pay to Hermes or the amount of any reimbursement to which the Hermes Agent is entitled, it being agreed that the Hermes Agent’s obligation shall be no greater than simply to pass on to Hermes the Borrower’s concerns. |
(d) | Each Lender will co‑operate with the Hermes Agent, the Facility Agent and each other Lender, and take such action and/or refrain from taking such action as may be reasonably necessary, to ensure that the Hermes Insurance Policy and each Interest Make‑Up Agreement (as defined in and entered into in accordance with the Terms and Conditions) continue in full force and effect and shall indemnify and hold harmless each other Lender in the event that the Hermes Insurance Policy or such Interest Make‑Up Agreement (as the case may be) does not continue in full force and effect due to its gross negligence or willful default. |
Private & Confidential | ||||
Dated 3 July 2018 | ||||
Royal Caribbean Cruises Ltd. (1) (the Borrower) KfW IPEX-Bank GmbH (2) (the Hermes Agent) KfW IPEX-Bank GmbH (3) (the Facility Agent) KfW IPEX-Bank GmbH (4) (as Initial Mandated Lead Arranger) BNP Paribas Fortis S.A./N.V. (5) DNB Bank ASA Skandinaviska Enskilda Banken AB (publ) (the Mandated Lead Arrangers) and certain financial institutions (6) (the Lenders) | ||||
___________________________________________ Amendment No. 5 in connection with the Credit Agreement in respect of “Anthem of the Seas” (Hull S-698) ___________________________________________ |
(1) | ROYAL CARIBBEAN CRUISES LTD. (a corporation organised and existing under the laws of The Republic of Liberia) (the Borrower); |
(2) | KfW IPEX-Bank GmbH as facility agent (the Facility Agent); |
(3) | KfW IPEX-Bank GmbH as Hermes agent (the Hermes Agent); |
(4) | KfW IPEX-Bank GmbH as initial mandated lead arranger (the Initial Mandated Lead Arranger); |
(5) | BNP Paribas Fortis S.A./N.V, DNB Bank ASA, and Skandinaviska Enskilda Banken AB (publ) as mandated lead arrangers (together with the Initial Mandated Lead Arranger, the Mandated Lead Arrangers); and |
(6) | The financial institutions party thereto as lenders from time to time (the Lenders). |
(A) | The Borrower, the Facility Agent, the Hermes Agent and the Lenders are parties to a credit agreement dated 8 June 2011, as amended and restated by that amendment agreement dated 17 February 2012, as further amended by that deed of amendment no. 2 dated 10 May 2012, that Amendment No. 3 dated 2 April 2015 and as further amended and restated by amendment No. 4 dated 3 February 2016 (the Existing Credit Agreement), in respect of the vessel with Hull number S-698 (now “Anthem of the Seas” with IMO Number 9656101) (the Vessel) whereby it was agreed that the Lenders would make available to the Borrower, upon the terms and conditions therein, a US dollar loan facility (the Facility) calculated on the amount equal to the sum of (a) up to eighty per cent (80%) of the Contract Price (as defined in the Existing Credit Agreement) of the Vessel but which Contract Price will not exceed EURO 725,000,000 and (b) up to 100% of the Hermes Fee (as defined therein). |
(B) | The Parties wish to amend and restate the Existing Credit Agreement to the extent set out in this Amendment. |
1 | Interpretation and definitions |
1.1 | Definitions in the Existing Credit Agreement |
(a) | Unless the context otherwise requires or unless otherwise defined in this Amendment, words and expressions defined in the Existing Credit Agreement shall have the same meanings when used in this Amendment. |
(b) | The principles of construction set out in the Existing Credit Agreement shall have effect as if set out in this Amendment. |
1.2 | In this Amendment: |
1.3 | Third party rights |
1.4 | Designation |
2 | Amendment of the Existing Credit Agreement |
3 | Conditions of Effectiveness of Amended Agreement |
3.1 | The Amended Agreement shall become effective in accordance with the terms of this Amendment on the date each of the following conditions has been satisfied to the reasonable satisfaction of the Facility Agent (the Effective Date): |
(a) | the Facility Agent shall have received from the Borrower: |
(i) | a certificate of its Secretary or Assistant Secretary as to the incumbency and signatures of those of its officers authorized to act with respect to this Amendment and as to the truth and completeness of the attached resolutions of its Board of Directors then in full force and effect authorizing the execution, delivery and performance of this Amendment, and upon which certificate the Lenders may conclusively rely until the Facility Agent shall have received a further certificate of the Secretary or Assistant Secretary of the Borrower canceling or amending such prior certificate; and |
(ii) | a Certificate of Good Standing issued by the relevant Liberian authorities in respect of the Borrower. |
(b) | the Facility Agent shall have received all invoiced expenses of the Facility Agent (including the agreed fees and expenses of counsel to the Facility Agent) required to be paid by the Borrower pursuant to clause 6 below or that the Borrower has otherwise agreed in writing to pay to the Facility Agent, in each case on or prior to the Effective Date; |
(c) | the Facility Agent shall have received the amendment to the Hermes Insurance Policy duly issued by Hermes; and |
(d) | the representations and warranties set forth in clause 4 are true as of the Effective Date. |
3.2 | The Facility Agent shall notify the Lenders and the Borrower of the Effective Date and such notice shall be conclusive and binding. |
4 | Representations and Warranties |
5 | Incorporation of Terms |
6 | Costs and Expenses |
7 | Counterparts |
8 | Governing Law |
(A) | The Borrower and Meyer Werft GmbH, Papenburg (the “Builder”) have entered on February 14, 2011 into a Contract for the Construction and Sale of Hull No. S-698 (as amended from time to time, the “Construction Contract”) pursuant to which the Builder has agreed to design, construct, equip, complete, sell and deliver the passenger cruise vessel bearing Builder’s hull number S-698 (the “Purchased Vessel”); |
(B) | The Lenders have agreed to make available to the Borrower, upon the terms and conditions contained herein, a US dollar loan facility calculated on the amount (the “Maximum Loan Amount”) equal to the sum of (x) up to eighty per cent (80%) of the Contract Price (as defined below) of the Purchased Vessel (as defined below), as adjusted from time to time in accordance with the Construction Contract to reflect, among other adjustments, change orders, but which Contract Price shall not exceed for this purpose EUR 725,000,000 (the “Contract Price Proceeds”) and (y) up to 100% of the Hermes Fee (as defined below) (the “Hermes Fee Proceeds”) and being made available in the US Dollar Equivalent of that Maximum Loan Amount; |
(C) | Except as otherwise provided below under the Alternative Disbursement Option (as defined below), the Contract Price Proceeds will be provided to the Borrower two (2) Business Days prior to the delivery of the Purchased Vessel for the purpose of paying a portion of the Contract Price in connection with the Borrower’s purchase of the Purchased Vessel. The Hermes Fee Proceeds will be provided on the First Disbursement Date, with 75% of such Hermes Fee Proceeds to be disbursed directly to the Hermes Agent for Hermes’ account for the payment of the Second Fee (as defined below) and 25% to be disbursed to the Borrower for reimbursement of the First Fee (as defined below). |
(D) | The Parties hereto have previously amended this Agreement pursuant to the Amendment Agreement, the Amendment Deed Number Two, the Amendment |
(E) | Pursuant to Amendment Agreement Number Five dated as of 3 July 2018 (the “Amendment Agreement Number Five”), and upon satisfaction of the conditions set forth therein, this Agreement is being amended and restated in the form of this Agreement. |
a) | net cash from operating activities (determined in accordance with GAAP) for such period, as shown in the Borrower’s consolidated statement of cash flow for such period, to |
b) | the sum of: |
a) | Any Interest Period which would otherwise end on a day which is not a Business Day shall end on the next Business Day to occur, except if such Business Day does not fall in the same calendar month, the Interest Period will end on the last Business Day in that calendar month, the interest amount due in respect of the Interest Period in question and in respect of the next following Interest Period being adjusted accordingly; and |
b) | If any Interest Period is altered by the application of a) above, the subsequent Interest Period shall end on the day on which it would have ended if the preceding Interest Period had not been so altered. |
a) | subject to Section 3.3.6, if no such offered quotation appears on Reuters LIBOR01 Page (or any successor page) at the relevant time, the LIBO Rate shall be the rate per annum certified by the Facility Agent to be the average of the rates quoted by the Reference Banks as the rate at which each of the Reference Banks was (or would have been) offered deposits of Dollars by prime banks in the London interbank market in an amount approximately equal to the amount of the Loan and for a period of six months; and |
b) | for the purposes of determining the post-maturity rate of interest under Section 3.3.4, the LIBO Rate shall be determined by reference to deposits on an overnight or call basis or for such other period or periods as the Facility Agent may determine after consultation with the Lenders, which period shall be no longer than one month unless the Borrower otherwise agrees. |
a) | Each Lender will make its portion of the Loan available to the Borrower in accordance with Section 2.3 either (i) two (2) Business Days prior to the delivery of the Purchased Vessel to the Borrower under the Construction Contract pursuant to Section 2.3(a) or (ii) if the Borrower elects the Alternative Disbursement Option in accordance with Section 2.3(b), as set forth in Section 2.3(b). The commitment of each Lender described in this Section 2.2 (herein referred to as its “Commitment”) shall be the commitment of such Lender to make available to the Borrower its portion of the Loan hereunder expressed as the initial amount set forth opposite such Lender’s name on its signature page attached hereto or, in the case of any Lender that becomes a Lender pursuant to an assignment pursuant to Section 11.11.1, the amount set forth as such Lender’s Commitment in the related Lender Assignment Agreement, in each case as such amount may be reduced from time to time pursuant to Section 2.2(b) or reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 11.11.1. Notwithstanding the foregoing, each Lender’s Commitment shall terminate on the earlier of (i) the Commitment Termination Date if the Purchased Vessel is not delivered prior to such date and (ii) the delivery of the Purchased Vessel. |
b) | The Borrower may, by notice to the Facility Agent, at any time (i) prior to the date that is not less than 61 days prior to the First Disbursement Date, without premium or penalty, terminate, or from time to time reduce, the Commitments and (ii) prior to the date on which the Commitments have been terminated but less than 61 days prior to the First Disbursement Date, and subject to Section 4.4, terminate, or from time to time reduce, the Commitments. Any such termination or reduction of the Commitments shall be applied to the respective Commitments of the Lenders, pro rata according to the amounts of their respective Commitments. |
c) | If any Lender shall default in its obligations under Section 2.1, the Facility Agent shall, at the request of the Borrower, use reasonable efforts to assist the Borrower in finding a bank or financial institution acceptable to the Borrower to replace such Lender. |
a) | Unless the Borrower has elected the Alternative Disbursement Option in accordance with Section 2.3(b), the Borrower shall deliver a Loan Request and the documents required to be delivered pursuant to Section 5.1.1(a) to the Facility Agent on or before 11:00 a.m., London time, not less than two (2) Business Days in advance of the date that is two (2) Business Days prior to the anticipated delivery date of the Purchased Vessel. The aggregate amount of the Loan to be advanced shall not exceed the US Dollar Maximum Loan Amount. |
b) | The Borrower may, subject to Section 4.12(b), at any time prior to the Contractual Delivery Date, elect the Alternative Disbursement Option by written notice to the Facility Agent delivered ten (10) Business Days prior to the requested date of the first such advance to be made following such election. If so elected, the Borrower shall deliver a Loan Request and, in the case of the First Disbursement Date, the documents required to be delivered pursuant to Section 5.1.1(a) to the Facility Agent on or before 11:00 a.m. London time, not less than two (2) Business Days in advance of the date on which the Borrower is required to make a pre-delivery installment to the Builder (other than, for the avoidance of doubt, the first such pre-delivery installment due under the Construction Contract) or, in the case of the advance on the Final Disbursement Date, not less than two (2) Business Days in advance of the date that is two (2) Business Days prior to the anticipated delivery date of the Purchased Vessel. Each such advance of a portion of the Loan shall not exceed the US Dollar Equivalent of 80% of the installment payment owing to the Builder on such date; provided, however, that (i) the advance to be made on the First Disbursement Date may be increased by up to 100% of the total amount of the Hermes Fee, (ii) the advance to be made on the Final Disbursement Date may be in an amount up to the excess of the US Dollar Maximum Loan Amount over the aggregate amount of all advances made prior to the Final Disbursement Date, and (iii) the aggregate amount of all such advances shall not exceed the US Dollar Maximum Loan Amount. |
c) | The Facility Agent shall promptly notify each Lender of any Loan Request by forwarding a copy thereof to each Lender, together with its attachments. On the terms and subject to the conditions of this Agreement, the Loan (or portion thereof, as specified by the Borrower) shall be made on the Business Day specified in such Loan Request. On or before 11:00 a.m., New York time, on the Business Day specified in such Loan Request, the Lenders shall, without any set-off or counterclaim, deposit with the Facility Agent same day funds in an amount equal to such Lender’s Percentage of the requested Loan or portion thereof. Such deposit will be made to an account which the Facility Agent shall specify from time to time by notice to the Lenders. To the extent funds are so received from the Lenders, the Facility Agent shall, without any set-off or counterclaim, make such funds available to the Borrower on the Business Day specified in the Loan Request by wire transfer of same day funds to the account or accounts the Borrower shall have specified in its Loan Request. |
d) | The Borrower shall, upon receipt of the Dollar funds into the account referred to in Section 2.3(c) above, (i) complete the purchase of EUR with its counterparties or otherwise as set out in the Loan Request (by authorising and instructing the Facility Agent to remit the necessary Dollar funds to the said counterparties) and shall procure the payment of all EUR proceeds of such transactions to the EUR Pledged Account no later than the Business Day immediately following the Business Day specified in the Loan Request and (ii) to the extent of any such Dollar funds as shall not be used to purchase EUR, (by authorising and instructing the Facility Agent accordingly) shall procure the payment of such Dollar funds to the Dollar Pledged Account on the Business Day specified in the Loan Request. |
e) | If the Borrower elects to finance all or any part of the Hermes Fee with a portion of the advance made on the First Disbursement Date, the Borrower shall indicate such election in its Loan Request with respect to such advance. When this election is made, the amount of the advance in Dollars (the “US Dollar Hermes Advance Amount”) that will fund the Hermes Fee shall be equal to the Dollar amount that corresponds to the EUR amount of the Hermes Fee to be financed with such advance, which amount shall be reasonably determined by the Facility Agent based on the spot rate for EUR-Dollar exchanges on the date such Loan Request is delivered, which spot rate shall be determined by reference to a publicly available market service like Bloomberg that can be independently verified by the Borrower. The Facility Agent shall notify the Borrower and the Lenders of the US Dollar Hermes Advance Amount (including the applicable spot rate referred to above) on the date such Loan Request is delivered, and the Lenders shall deposit such US Dollar Hermes Advance Amount with the Facility Agent in accordance with Section 2.3(c). The Borrower will be deemed to have directed the Facility Agent to pay over directly to Hermes on behalf of the Borrower that portion of the EUR amount of the Second Fee to be financed with the proceeds of the advance on the First Disbursement Date and to retain for the Borrower’s own account (and deposit in the Dollar Pledge Account pending disbursement in accordance with Section 2.3(f)) deposits made by the Lenders in Dollars in an amount equal to the portion of the US Dollar Hermes Advance Amount attributable to the First Fee paid by the Facility Agent to Hermes on behalf of the Borrower. |
f) | Upon the date of delivery of the Purchased Vessel, the Facility Agent shall direct that moneys standing to the credit of the Pledged Accounts shall, in the manner set out in the Loan Request, be disbursed as follows: |
b) | If, on the date of delivery of the Purchased Vessel, the outstanding principal amount of the Loan exceeds the US Dollar Maximum Loan Amount (as a result of a reduction in the Contract Price after the Final Disbursement Date and before the delivery of the Purchased Vessel), the Borrower shall repay the Loan in an amount equal to such excess within two (2) Business Days after the date of delivery of the Purchased Vessel. Any such partial prepayment shall be applied pro rata in satisfaction of the repayment installments of the Loan set out in Exhibit A. |
c) | No such amounts repaid by the Borrower pursuant to this Section 3.1 may be reborrowed under the terms of this Agreement. |
a) | May, from time to time on any Business Day, make a voluntary prepayment, in whole or in part, of the outstanding principal amount of the Loan; provided that: |
i) | all such voluntary prepayments shall require (x) for prepayments on or after the Final Disbursement Date made prior to delivery of the Purchased Vessel in respect of the advance made on such Final Disbursement Date, at least two (2) Business Days’ prior written notice to the Facility Agent, and (y) for all other prepayments, at least 30 calendar days’ prior written notice, if all or any portion of the Loan is a Fixed Rate Loan, and at least five (5) Business Days’ (or, if such prepayment is to be made on the last day of an Interest Period for such Loan, four (4) Business Days’) prior written notice, if the Loan is a Floating Rate Loan, in each case to the Facility Agent; and |
ii) | all such voluntary partial prepayments shall be in an aggregate minimum amount of $10,000,000 and a multiple of $1,000,000 (or in the remaining amount of the Loan) and shall be applied in inverse order of maturity or ratably among all remaining installments, as the Borrower shall designate to the Facility Agent, in satisfaction of the repayment installments of the Loan set out in Exhibit A. |
b) | Shall, immediately upon any acceleration of the repayment of the installments of the Loan pursuant to Section 8.2 or 8.3 or the mandatory prepayment of the Loan pursuant to Section 9.2, repay the Loan. |
a) | By written notice to the Facility Agent delivered prior to the date that is not less than 61 days prior to the First Disbursement Date, the Borrower may elect, without incurring any liability to make any payments pursuant to Section 4.4 or to pay any other indemnity or compensation obligation, to pay interest on the Loan at the Floating Rate. |
b) | By written notice to the Facility Agent delivered less than 61 days prior to the First Disbursement Date but not less than 30 days prior to the First Disbursement Date, the Borrower may elect, subject to Section 4.4, to pay interest on the Loan at the Floating Rate. |
c) | By written notice to the Facility Agent no later than 2:00 p.m. Frankfurt time 30 days prior to the end of an Interest Period, the Borrower may elect, subject to Section 4.4, to pay interest on the Loan for the remainder of the term of the Loan at the Floating Rate, with effect from the end of that Interest Period. |
d) | Any election made under any of Section 3.3.2.a), Section 3.3.2.b) or Section 3.3.2.c) may only be made one time during the term of the Loan. |
a) | each Interest Payment Date; |
b) | each Repayment Date; |
c) | the date of any prepayment, in whole or in part, of principal outstanding on the Loan (but only on the principal so prepaid); and |
d) | on that portion of the Loan the repayment of which is accelerated pursuant to Section 8.2 or Section 8.3, immediately upon such acceleration. |
a) | Dollar deposits in the relevant amount and for the relevant Interest Period are not available to each Reference Bank in its relevant market, or |
b) | by reason of circumstances affecting the Reference Banks’ relevant markets, adequate means do not exist for ascertaining the interest rate applicable hereunder to LIBO Rate loans for the relevant Interest Period, or |
c) | the cost to Option B Lenders that in the aggregate hold more than 50% of the aggregate outstanding principal amount of the Loan then held by Option B Lenders, if any Lender shall have entered into an Option B Interest Make-Up Agreement, of obtaining matching deposits in the relevant interbank market for the relevant Interest Period would be in excess of the LIBO Rate (provided, that no Option B Lender may exercise its rights pursuant to this Section 4.2.c) for amounts up to the difference between such Option B Lender’s cost of obtaining matching deposits on the date such Option B Lender becomes a Lender hereunder less the LIBO Rate on such date), |
a. | subject any Lender to any taxes, levies, duties, charges, fees, deductions or withholdings of any nature with respect to its portion of the Loan or any part thereof imposed, levied, collected, withheld or assessed by any jurisdiction or any political subdivision or taxing authority thereof (other than taxation on overall net income and, to the extent such taxes are described in Section 4.6, withholding taxes); or |
b. | change the basis of taxation to any Lender (other than a change in taxation on the overall net income of any Lender) of payments of principal or interest or any other payment due or to become due pursuant to this Agreement; or |
c. | impose, modify or deem applicable any reserve or capital adequacy requirements (other than the increased capital costs described in Section 4.5 and the reserve costs described in Section 4.7) or other banking or monetary controls or requirements which affect the manner in which a Lender shall allocate its capital resources to its obligations hereunder or require the making of any special deposits against or in respect of any assets or liabilities of, deposits with or for the account of, or loans by, any Lender (provided that such Lender shall, unless prohibited by law, allocate its capital resources to its obligations hereunder in a manner which is consistent with its present treatment of the allocation of its capital resources); or |
d. | impose on any Lender any other condition affecting its portion of the Loan or any part thereof, |
i) | if at the time interest is calculated at the Floating Rate, any conversion or repayment or prepayment or acceleration of the principal amount of the Loan on a date other than the scheduled last day of an Interest Period or otherwise scheduled date for repayment or payment (including payments made in accordance with Section 3.1(b); |
ii) | if at the time interest is calculated at the Fixed Rate, any repayment or prepayment or acceleration of the principal amount of the Loan, other than any repayment made on the date scheduled for such repayment; |
iii) | an election by the Borrower of the Floating Rate in accordance with Section 3.3.2.b) or Section 3.3.2.c); |
iv) | a reduction or termination of the Commitments by the Borrower pursuant to Section 2.2.b)(ii); or |
v) | the Loan not being made in accordance with the Loan Request therefor due to the fault of the Borrower or as a result of any of the conditions precedent set forth in Article V not being satisfied, |
a. | if at that time interest is calculated at the Floating Rate, pay directly to the Facility Agent an amount (the “Floating Rate Indemnity Amount”) equal to the amount by which: |
(i) | interest calculated at the Floating Rate which a Lender would have received on its share of the amount of the Loan subject to such Funding Losses Event for the period from the date of receipt of any part of its share in the Loan to the last day of the applicable Interest Period, |
(ii) | the amount which a Lender would be able to obtain by placing an amount equal to the amount received by it on deposit with a leading bank in the appropriate interbank market for a period starting on the Business Day following receipt and ending on the last day of the applicable Interest Period. |
b. | if at that time interest is calculated at the Fixed Rate, pay to the Facility Agent for the account of such Lender the sum of: |
(A) | an amount equal to the amount by which: |
(i) | interest calculated at the Fixed Rate which a Lender would have received on its share of the amount of the Loan subject to such Funding Losses Event for the period from the date of receipt of any part of its share of the Loan to the final scheduled date for the repayment of Loan in full pursuant to Section 3.1, |
(ii) | the amount by which a Lender would be able to obtain by placing an equal amount to the amount received by it on deposit and receiving interest equal to the money market rate then applicable to Dollars on the Reuters page “ICAP1” (the “Reinvestment Rate”), |
(B) | if such Lender has entered into an Option B Interest Make-up Agreement, an amount equal to the Floating Rate Indemnity Amount. |
a. | pay directly to the relevant authority the full amount required to be so withheld or deducted; |
b. | promptly forward to the Facility Agent an official receipt or other documentation satisfactory to the Facility Agent evidencing such payment to such authority; and |
c. | pay to the Facility Agent for the account of the Lenders such additional amount or amounts as is necessary to ensure that the net amount actually received by each Lender will equal the full amount such Lender would have received had no such withholding or deduction been required. |
a. | (%5) Each Option A Lender hereby instructs the Facility Agent to remit all payments of interest made with respect to any portion of the Loan held by such Option A Lender to the Refinancing Bank less (x) the margin for Fixed Rate Loans of 1.10% and (y) the CIRR administrative fee of 0.20% if interest on the Loan made by that Lender is then calculated at the Fixed Rate and less the Floating Rate Margin if interest on that Loan is then calculated at the Floating Rate. |
b. | The Facility Agent shall promptly (but in any event on the same Business Day that the same are received or, as contemplated in clause (a) of this Section, deemed received) remit in same day funds to each Lender its share, if any, of such payments received by the Facility Agent for the account of such Lender without any set-off, deduction or counterclaim. All interest and fees shall be computed on the basis of the actual number of days (including the first day but excluding the last day) occurring during the period for which such interest or fee is payable over a year comprised of 360 days. Whenever any payment to be made shall otherwise be due on a day which is not a Business Day, such payment shall (except as otherwise required by clause (a) of the definition of the term “Interest Period”) be made on the next succeeding Business Day and such extension of time shall be included in computing interest and fees, if any, in connection with such payment. |
a. | Watson, Farley & Williams (New York) LLP, counsel to the Borrower, as to Liberian Law, covering the matters set forth in Exhibit D-1 hereto; |
b. | Norton Rose LLP, counsel to the Facility Agent, covering the matters set forth in Exhibit D-2 hereto; and |
c. | Clifford Chance US LLP, United States tax counsel to the Lenders, covering the matters set forth in Exhibit D-3 hereto, |
(i) | the government of the Federal Republic of Germany, the Federal Audit Court or any authorized representatives specified by these bodies shall be authorized at any time to inspect and make or demand copies of the records, accounts, documents and other deeds of the Lenders; |
(ii) | in the course of its activity as the Facility Agent, the Facility Agent may: |
(a) | provide the government of the Federal Republic of Germany with information concerning the transactions to be handled by it; and |
(b) | disclose information concerning the subsidized transaction in the context of internationally agreed consultation/notification proceedings and statutory specifications, |
(iii) | the Facility Agent and (to the extent the Lenders have entered into an Option A Refinancing Agreement with the Refinancing Bank) the Lenders are entitled to disclose to the Refinancing Bank: |
(a) | circumstances pertaining to the Loan, proper repayment and collateralization; |
(b) | extraordinary events which may jeopardize the proper servicing of the Loan; |
(c) | any information required by the Refinancing Bank with respect to the proper use of any refinancing funds granted to the respective Lender; and |
(d) | the Loan Documents; |
a. | the representations and warranties set forth in Article VI (excluding, however, those set forth in Section 6.10) shall be true and correct in all material respects except for those representations and warranties that are qualified by materiality or Material Adverse Effect, which shall be true and correct, with the same effect as if then made; and |
b. | no Default and no Prepayment Event and no event which (with notice or lapse of time or both) would become a Prepayment Event shall have then occurred and be continuing. |
a. | contravene the Borrower’s Organic Documents; |
b. | contravene any law or governmental regulation of any Applicable Jurisdiction except as would not reasonably be expected to result in a Material Adverse Effect; |
c. | contravene any court decree or order binding on the Borrower or any of its property except as would not reasonably be expected to result in a Material Adverse Effect; |
d. | contravene any contractual restriction binding on the Borrower or any of its property except as would not reasonably be expected to result in a Material Adverse Effect; or |
e. | result in, or require the creation or imposition of, any Lien on any of the Borrower’s properties except as would not reasonably be expected to result in a Material Adverse Effect. |
a. | The Borrower is in compliance with all applicable laws, rules, regulations and orders, except to the extent that the failure to so comply does not and would not reasonably be expected to have a Material Adverse Effect. |
b. | The Borrower has implemented and maintains in effect policies and procedures designed to procure compliance by the Borrower, its Subsidiaries and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions. The Borrower and its Subsidiaries and, to the knowledge of the Borrower, their respective officers, employees, directors and agents, are in compliance with Anti-Corruption Laws and applicable Sanctions, in all material respects and are not knowingly engaged in any activity that would reasonably be expected to result in Borrower being designated as a Sanctioned Person. None of (i) the Borrower, any Subsidiary or to the knowledge of the Borrower or such Subsidiary any of their respective directors, officers or employees, or (ii) to the knowledge of the Borrower, any agent of the Borrower or any Subsidiary that will act in any capacity in connection with or benefit from the credit facility established hereby, is a Sanctioned Person. |
c. | The Borrower is in compliance with all applicable Environmental Laws, except to the extent that the failure to so comply would not have a Material Adverse Effect. |
a. | legally and beneficially owned by the Borrower or one of the Borrower’s wholly owned Subsidiaries, |
b. | registered in the name of the Borrower or one of the Borrower’s wholly owned Subsidiaries under the Bahamian or Maltese flag or such other flag as the parties may mutually agree, |
c. | classed as required by Section 7.1.4(b), |
d. | free of all recorded Liens, other than Liens permitted by Section 7.2.3, |
e. | insured against loss or damage in compliance with Section 7.1.5, and |
f. | exclusively operated by or chartered to the Borrower or one of the Borrower’s wholly owned Subsidiaries except as otherwise permitted pursuant to Section 7.1.4. |
a. | as soon as available and in any event within 60 days after the end of each of the first three Fiscal Quarters of each Fiscal Year of the Borrower, a copy of the Borrower’s report on Form 10-Q (or any successor form) as filed by the Borrower with the SEC for such Fiscal Quarter, containing unaudited consolidated financial statements of the Borrower for such Fiscal Quarter (including a balance sheet and profit and loss statement) prepared in accordance with GAAP, subject to normal year-end audit adjustments; |
b. | as soon as available and in any event within 120 days after the end of each Fiscal Year of the Borrower, a copy of the Borrower’s annual report on Form 10-K (or any successor form) as filed by the Borrower with the SEC for such Fiscal Year, containing audited consolidated financial statements of the Borrower for such Fiscal Year prepared in accordance with GAAP (including a balance sheet and profit and loss statement) and audited by PricewaterhouseCoopers LLP or another firm of independent public accountants of similar standing; |
c. | together with each of the statements delivered pursuant to the foregoing clause (a) or (b), a certificate, executed by the chief financial officer, the treasurer or the corporate controller of the Borrower, showing, as of the last day of the relevant Fiscal Quarter or Fiscal Year compliance with the covenants set forth in Section 7.2.4 (in reasonable detail and with appropriate calculations and computations in all respects reasonably satisfactory to the Facility Agent); |
d. | as soon as possible after the occurrence of a Default or Prepayment Event, a statement of the chief financial officer of the Borrower setting forth details of such Default or Prepayment Event (as the case may be) and the action which the Borrower has taken and proposes to take with respect thereto; |
e. | as soon as the Borrower becomes aware thereof, notice of any Material Litigation except to the extent that such Material Litigation is disclosed by the Borrower in filings with the SEC; |
f. | as soon as the Borrower becomes aware thereof, notice of any event which, in its reasonable opinion, would be expected to materially adversely affect the business, operations or financial condition of the Borrower and its Subsidiaries taken as a whole; |
g. | promptly after the sending or filing thereof, copies of all reports which the Borrower sends to all holders of each security issued by the Borrower, and all registration statements which the Borrower or any of its Subsidiaries files with the SEC or any national securities exchange; and |
h. | such other information respecting the condition or operations, financial or otherwise, of the Borrower or any of its Subsidiaries as any Lender through the Facility Agent may from time to time reasonably request; |
a. | in the case of the Borrower, the maintenance and preservation of its corporate existence (subject to the provisions of Section 7.2.6); |
b. | in the case of the Borrower, maintenance of its qualification as a foreign corporation in the State of Florida; |
c. | the payment, before the same become delinquent, of all taxes, assessments and governmental charges imposed upon it or upon its property, except to the extent being diligently contested in good faith by appropriate proceedings; |
d. | compliance with all applicable Environmental Laws; |
e. | compliance with all anti-money laundering laws and Anti-Corruption Laws applicable to the Borrower, including by not making or causing to be made any offer, gift or payment, consideration or benefit of any kind to anyone, either directly or indirectly, as an inducement or reward for the performance of any of the transactions contemplated by this Agreement to the extent the same would be in contravention of such applicable laws; and |
f. | the Borrower will maintain in effect policies and procedures designed to procure compliance by the Borrower, its Subsidiaries and their respective directors, officers and employees with Anti-Corruption Laws and applicable Sanctions. |
a. | cause the Purchased Vessel to be exclusively operated by or chartered to the Borrower or one of the Borrower’s wholly owned Subsidiaries, provided that the Borrower or such Subsidiary may charter out the Purchased Vessel (i) to entities other than the Borrower and the Borrower’s wholly owned Subsidiaries and (ii) on a time charter with a stated duration not in excess of one year; |
b. | cause the Purchased Vessel to be kept in such condition as will entitle her to classification by a classification society of recognized standing; |
c. | upon delivery of the Purchased Vessel, provide the following to the Facility Agent with respect to the Purchased Vessel: |
d. | within seven days after delivery of the Purchased Vessel, provide the following to the Facility Agent with respect to the Purchased Vessel: |
a. | Indebtedness, secured by Liens of the type described in Section 7.2.3; |
b. | Indebtedness owing to the Borrower or a direct or indirect Subsidiary of the Borrower; |
c. | Indebtedness incurred to finance, refinance or refund the cost (including the cost of construction) of assets acquired after the Effective Date; |
d. | Indebtedness in an aggregate principal amount, together with (but without duplication of) Indebtedness permitted under Section 7.2.2(a) and permitted to be secured under Section 7.2.3(c), at any one time outstanding not exceeding (determined at the time of creation of such Lien or the incurrence by any Existing Principal Subsidiary of such Indebtedness, as applicable) 10.0% of the total assets of the Borrower and its Subsidiaries taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter; |
e. | [RESERVED]; and |
f. | obligations in respect of Hedging Instruments entered into for the purpose of managing interest rate, foreign currency exchange or commodity exposure risk and not for speculative purposes. |
a. | [RESERVED]; |
b. | Liens on assets (including, without limitation, shares of capital stock of corporations and assets owned by any corporation that becomes a Subsidiary of the Borrower after the Effective Date) acquired after the Effective Date (whether by purchase, construction or otherwise) by the Borrower or any of its Subsidiaries (other than (x) an Existing Principal Subsidiary or (y) any other Principal Subsidiary which, at any time, after three months after the acquisition of a Vessel, owns a Vessel free of any mortgage Lien), which Liens were created solely for the purpose of securing Indebtedness representing, or incurred to finance, refinance or refund, the cost (including the cost of construction) of such assets, so long as (i) the acquisition of such assets is not otherwise prohibited by the terms of this Agreement and (ii) each such Lien is created within three months after the acquisition of the relevant assets; |
c. | in addition to other Liens permitted under this Section 7.2.3, Liens securing Indebtedness in an aggregate principal amount, together with (but without duplication of) Indebtedness permitted under Section 7.2.2(d), at any one time outstanding not exceeding (determined at the time of creation of such Lien or the incurrence by any Existing Principal Subsidiary of such indebtedness, as applicable) (i) 10.0% of the total assets of the Borrower and its Subsidiaries (the “Lien Basket Amount”) taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter; provided, however that, if, at any time, the Senior Debt Rating of the Borrower is less than Investment Grade as given by both Moody’s and S&P, the Lien Basket Amount shall be the greater of (x) 5.0% of the total assets of the Borrower and its Subsidiaries taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter and (y) $735,000,000; |
d. | Liens on assets acquired after the Effective Date by the Borrower or any of its Subsidiaries (other than by (x) any Subsidiary that is an Existing Principal Subsidiary or (y) any other Principal Subsidiary which, at any time, owns a Vessel free of any mortgage Lien) so long as (i) the acquisition of such assets is not otherwise prohibited by the terms of this Agreement and (ii) each of such Liens existed on such assets before the time of its acquisition and was not created by the Borrower or any of its Subsidiaries in anticipation thereof; |
e. | Liens on any asset of any corporation that becomes a Subsidiary of the Borrower (other than a corporation that also becomes a Subsidiary of an Existing Principal Subsidiary) after the Effective Date so long as (i) the acquisition or creation of such corporation by the Borrower is not otherwise prohibited by the terms of this Agreement and (ii) such Liens are in existence at the time such corporation becomes a Subsidiary of the Borrower and were not created by the Borrower or any of its Subsidiaries in anticipation thereof; |
f. | Liens securing Government-related Obligations; |
g. | Liens for taxes, assessments or other governmental charges or levies not at the time delinquent or thereafter payable without penalty or being diligently contested in good faith by appropriate proceedings; |
h. | Liens of carriers, warehousemen, mechanics, materialmen and landlords incurred in the ordinary course of business for sums not overdue by more than 60 days or being diligently contested in good faith by appropriate proceedings; |
i. | Liens incurred in the ordinary course of business in connection with workers’ compensation, unemployment insurance or other forms of governmental insurance or benefits; |
j. | Liens for current crew’s wages and salvage; |
k. | Liens arising by operation of law as the result of the furnishing of necessaries for any Vessel so long as the same are discharged in the ordinary course of business or are being diligently contested in good faith by appropriate proceedings; |
l. | Liens on Vessels that: |
m. | normal and customary rights of set-off upon deposits of cash or other Liens originating solely by virtue of any statutory or common law provision relating to bankers’ liens, rights of set-off or similar rights in favor of banks or other depository institutions; |
n. | Liens in respect of rights of set-off, recoupment and holdback in favor of credit card processors securing obligations in connection with credit card processing services incurred in the ordinary course of business; |
o. | Liens on cash or Cash Equivalents or marketable securities securing: |
p. | deposits to secure the performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case in the ordinary course of business and deposits securing liabilities to insurance carriers under insurance or self-insurance arrangements; |
q. | easements, zoning restrictions, rights-of-way and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or interfere with the ordinary conduct of business of the Borrower or any Subsidiary; and |
r. | licenses, sublicenses, leases or subleases granted to other Persons not materially interfering with the conduct of the business of the Borrower or any of its Subsidiaries. |
a. | Net Debt to Capitalization Ratio, as at the end of any Fiscal Quarter, to be greater than 0.625 to 1. |
b. | Fixed Charge Coverage Ratio to be less than 1.25 to 1 as at the last day of any Fiscal Quarter. |
a. | any such Subsidiary may (i) liquidate or dissolve voluntarily into, and may merge with and into, the Borrower or any other Subsidiary, and the assets or stock of any Subsidiary may be purchased or otherwise acquired by the Borrower or any other Subsidiary or (ii) merge with and into another Person in connection with a sale or other disposition permitted by Section 7.2.7; and |
b. | so long as no Event of Default or Prepayment Event has occurred and is continuing or would occur after giving effect thereto, the Borrower or any of its Subsidiaries may merge into any other Person, or any other Person may merge into the Borrower or any such Subsidiary, or the Borrower or any of its Subsidiaries may purchase or otherwise acquire all or substantially all of the assets of any Person, in each case so long as: |
(A) | the surviving corporation shall have assumed in a writing, delivered to the Facility Agent, all of the Borrower’s obligations hereunder and under the other Loan Documents; |
(B) | the surviving corporation shall, promptly upon the request of the Facility Agent or any Lender, supply such documentation and other evidence as is reasonably requested by the Facility Agent or any Lender in order for the Facility Agent or such Lender to carry out and be satisfied it has complied with the results of all necessary “know your customer” or other similar checks under all applicable laws and regulations; and |
(C) | as soon as practicable after receiving notice from the Borrower of such merger, and in any event no later than five Business Days after the delivery of such notice, for a surviving corporation that is organized under the laws of a jurisdiction other than of the United States or a political subdivision thereof or Liberia, any Lender that may not legally lend to, establish credit for the account of and/or do any business whatsoever with such surviving corporation, either directly or through an Affiliate of such Lender (a “Protesting Lender”) shall so notify the Borrower and the Facility Agent in writing. With respect to each Protesting Lender, the Borrower shall, effective on or before the date that such surviving corporation shall have the right to borrow hereunder, notify the Facility Agent and such Protesting Lender that the Commitments of such Protesting Lender shall be terminated; provided that such Protesting Lender shall have received one or more payments from either the Borrower or one or more assignees in an aggregate amount at least equal to the aggregate outstanding principal amount of the Loan owing to such Protesting Lender, together with accrued interest thereon to the date of payment of such principal amount and all other amounts payable to such Protesting Lender under this Agreement. |
a. | generally fail to pay, or admit in writing its inability to pay, its debts as they become due; |
b. | apply for, consent to, or acquiesce in, the appointment of a trustee, receiver, sequestrator or other custodian for it or any of its property, or make a general assignment for the benefit of creditors; |
c. | in the absence of such application, consent or acquiescence, permit or suffer to exist the appointment of a trustee, receiver, sequestrator or other custodian for it or for a substantial part of its property, and such trustee, receiver, sequestrator or other custodian shall not be discharged within 60 days, provided that in the case of such an event in respect of the Borrower, the Borrower hereby expressly authorizes the Facility Agent and each Lender to appear in any court conducting any relevant proceeding during such 60-day period to preserve, protect and defend their respective rights under the Loan Documents; |
d. | permit or suffer to exist the commencement of any bankruptcy, reorganization, debt arrangement or other case or proceeding under any bankruptcy or insolvency law, or any dissolution, winding up or liquidation proceeding, in respect of the Borrower or any of such Subsidiaries, and, if any such case or proceeding is not commenced by the Borrower or such Subsidiary, such case or proceeding shall be consented to or acquiesced in by the Borrower or such Subsidiary or shall result in the entry of an order for relief or shall remain for 60 days undismissed, provided that the Borrower hereby expressly authorizes the Facility Agent and each Lender to appear in any court conducting any such case or proceeding during such 60-day period to preserve, protect and defend their respective rights under the Loan Documents; or |
e. | take any corporate action authorizing, or in furtherance of, any of the foregoing. |
a. | enforcement proceedings in respect of any material assets of the Borrower or such Principal Subsidiary shall have been commenced by any creditor upon such judgment or order and shall not have been stayed or enjoined within five (5) Business Days after the commencement of such enforcement proceedings; or |
b. | there shall be any period of 30 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect. |
a. | modify any requirement hereunder that any particular action be taken by all the Lenders or by the Required Lenders shall be effective unless consented to by each Lender; |
b. | modify this Section 11.1 or change the definition of “Required Lenders” shall be made without the consent of each Lender; |
c. | increase the Commitment of any Lender shall be made without the consent of such Lender; |
d. | reduce any fees described in Article III payable to any Lender shall be made without the consent of such Lender; |
e. | extend the Commitment Termination Date of any Lender shall be made without the consent of such Lender; |
f. | extend the due date for, or reduce the amount of, any scheduled repayment or prepayment of principal of or interest on the Loan (or reduce the principal amount of or rate of interest on the Loan) owed to any Lender shall be made without the consent of such Lender; or |
g. | affect adversely the interests, rights or obligations of the Facility Agent in its capacity as such shall be made without consent of the Facility Agent. |
a. | except to the extent permitted under Section 7.2.5, the Borrower may not assign or transfer its rights or obligations hereunder without the prior written consent of the Facility Agent and each Lender; and |
b. | the rights of sale, assignment and transfer of the Lenders are subject to Section 11.11. |
a. | written notice of such assignment or transfer, together with payment instructions, addresses and related information with respect to such Assignee Lender, shall have been given to the Borrower and the Facility Agent by such Lender and such Assignee Lender; |
b. | such Assignee Lender shall have executed and delivered to the Borrower and the Facility Agent a Lender Assignment Agreement, accepted by the Facility Agent and, if the Loan is a Fixed Rate Loan, any other agreements required by the Facility Agent or the CIRR Representative in connection therewith; and |
c. | the processing fees described below shall have been paid. |
a. | no participation contemplated in this Section 11.11.2 shall relieve such Lender from its obligations hereunder; |
b. | such Lender shall remain solely responsible for the performance of its obligations hereunder; |
c. | the Borrower and the Facility Agent shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement and each of the other Loan Documents; |
d. | no Participant, unless such Participant is an Affiliate of such Lender, shall be entitled to require such Lender to take or refrain from taking any action hereunder or under any other Loan Document, except that such Lender may agree with any Participant that such Lender will not, without such Participant’s consent, take any actions of the type described in clauses (b) through (f) of Section 11.1; |
e. | the Borrower shall not be required to pay any amount under Sections 4.2(c), 4.3, 4.4, 4.5, 4.6 and 4.7 that is greater than the amount which it would have been required to pay had no participating interest been sold; and |
f. | each Lender Party that sells a participation under this Section 11.11.2 shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest on) each of the Participant’s interest in the Lender Party’s Advances, Commitments or other interests hereunder (the “Participant Register”). The entries in the Participant Register shall be conclusive absent manifest error, and such Lender may treat each person whose name is recorded in the Participant Register as the owner of such participation for all purposes hereunder. |
g. | KfW IPEX may not sell participating interests pursuant to this Section 11.11.2 aggregating, when taken together with Loans and/or Commitments sold by KfW IPEX pursuant to Section 11.11.1, more than 50.0% the aggregate principal amount of the Loan and/or the aggregate Commitments without the written consent of the Borrower (which consent shall not be required following the occurrence and during the continuance of an Event of Default or a Prepayment Event). |
(a) | 95% cover of the Loan. |
(b) | If the Borrower does not exercise the Alternative Disbursement Option, the Hermes Fee will not exceed 2.37% of the aggregate principal amount of the Loan as advanced on or prior to the Final Disbursement Date. Before exercising the Alternative Disbursement Option, the Borrower may request that the Hermes Agent obtain an indication of the new Hermes Fee (which it is anticipated will apply if the Borrower exercises the Alternative Disbursement Option) before it delivers notice of its option to exercise the Alternative Disbursement Option, which request shall not be considered to be notice of the Borrower’s intent to exercise the Alternative Disbursement Option. Such new Hermes Fee shall become effective only if the Borrower delivers notice of its option to exercise the Alternative Disbursement Option. If the Hermes Fee is so increased, each Lender agrees that its Commitment shall be increased by an amount equal to its pro rata share of the excess of the new Hermes Fee over the old Hermes Fee. |
(c) | The parties have entered into this Agreement on the basis that the Hermes Insurance Policy shall contain the following terms and should such terms not be included within the Hermes Insurance Policy, then the Borrower may cancel the Commitment(s): |
(i) | 25% of the Hermes Fee as in effect on the date of issuance of the Hermes Insurance Policy (“First Fee”) will be payable to the Hermes Agent or Hermes on demand following the issue of the Hermes Insurance Policy; |
(ii) | 2.37% (or such higher percentage as determined under Section 11.13.1(b) if the Borrower exercises the Alternative Disbursement Option) of the Maximum Loan Amount less the First Fee (“Second Fee”) will be payable to the Hermes Agent or Hermes on the First Disbursement Date; |
(iii) | if the Commitments are cancelled in full by the Borrower or the Lenders on or prior to the First Disbursement Date, Hermes shall be required to reimburse the Hermes Agent the amount of the First Fee less an administration fee (such administration fee to be no greater than 5% of the amount refunded but in any event not exceeding EUR 2,500); |
(iv) | if the Commitments are cancelled in part by the Borrower on or prior to the First Disbursement Date, Hermes shall be required to reimburse the Hermes Agent an amount equal to a corresponding proposition of the First Fee, based on the proportion of the aggregate Commitments prior to such cancellation to the aggregate Commitments after giving effect to such cancellation, less an administration fee (such administration fee to be no greater than 5% of the amount refunded but in any event not exceeding EUR 2,500); and |
(v) | if, after the First Disbursement Date, the Borrower reduces the Commitments and/or prepays all or part of the Loan in accordance with this Agreement, Hermes shall be required to reimburse the Hermes Agent an amount equal to all or a corresponding proportion of the unexpired portion of the Hermes Fee, having regard to the amount of the reduction in Commitments and/or prepayment and the remaining term of the Loan less the sum of (x) a break funding fee equal to 20% of the unexpired portion of the Hermes Fee and (y) an administration fee (such fee to be no greater than 5% of the amount refunded but in any event not exceeding EUR 2,500). |
(a) | Provided that the Hermes Insurance Policy complies with Section 11.13.1, the Borrower shall pay (a) the First Fee to the Hermes Agent or Hermes on demand following the issue of the Hermes Insurance Policy and (b) the Second Fee to the Hermes Agent or Hermes on the First Disbursement Date. In each case, if received by the Hermes Agent, the Hermes Agent shall pay such amount to Hermes. |
(b) | Provided that the Hermes Insurance Policy complies with Section 11.13.1, the Borrower shall pay to the Hermes Agent or Hermes an issue fee of EUR 12,500 for the issue of the Hermes Insurance Policy on demand following issue of the Hermes Insurance Policy. |
(a) | Promptly upon receipt of the Hermes Insurance Policy from Hermes, the Hermes Agent shall (subject to any confidentiality undertakings given to Hermes by the Hermes Agent pursuant to the terms of the Hermes Insurance Policy) send a copy thereof to the Borrower. |
(b) | The Hermes Agent shall perform such acts or provide such information, which are, acting reasonably, within its power so to perform or so to provide, as required by Hermes under the Hermes Insurance Policy as necessary to ensure that the Lenders obtain the support of Hermes pursuant to the Hermes Insurance Policy. |
(c) | The Hermes Agent shall: |
(i) | make written requests to Hermes seeking a reimbursement of the Hermes Fee in the circumstances described in Section 11.13.1(c)(iii), (iv) or (v) promptly after the relevant cancellation or prepayment and (subject to any confidentiality undertakings given to Hermes by the Hermes Agent pursuant to the terms of the Hermes Insurance Policy) provide a copy of the request to the Borrower; |
(ii) | use its reasonable endeavours to maximize the amount of any reimbursement of the Hermes Fee to which the Hermes Agent is entitled; |
(iii) | pay to the Borrower the full amount of any reimbursement of the Hermes Fee that the Hermes Agent receives from Hermes within two (2) Business Days of receipt with same day value; and |
(iv) | relay the good faith concerns of the Borrower to Hermes regarding the amount it is required to pay to Hermes or the amount of any reimbursement to which the Hermes Agent is entitled, it being agreed that the Hermes Agent’s obligation shall be no greater than simply to pass on to Hermes the Borrower’s concerns. |
(d) | Each Lender will co‑operate with the Hermes Agent, the Facility Agent and each other Lender, and take such action and/or refrain from taking such action as may be reasonably necessary, to ensure that the Hermes Insurance Policy and each Interest Make‑Up Agreement (as defined in and entered into in accordance with the Terms and Conditions) continue in full force and effect and shall indemnify and hold harmless each other Lender in the event that the Hermes Insurance Policy or such Interest Make‑Up Agreement (as the case may be) does not continue in full force and effect due to its gross negligence or willful default. |
Exhibit 10.6 | ||||
Dated 3 July 2018 | ||||
Royal Caribbean Cruises Ltd. (1) (the Borrower) KfW IPEX-Bank GmbH (2) (the Hermes Agent) KfW IPEX-Bank GmbH (3) (the Facility Agent) KfW IPEX-Bank GmbH (4) (as Initial Mandated Lead Arranger) Banco Santander S.A. (5) BNP Paribas Fortis S.A./N.V. Commerzbank AG, New York Branch DNB Bank ASA, Grand Cayman Branch HSBC Bank plc Norddeutsche Landesbank Girozentrale Société Générale MUFG Bank, Ltd. (formerly known as The Bank of Tokyo Mitsubishi UFJ, Ltd.) (the Mandated Lead Arrangers) and certain financial institutions (6) (the Lenders) | ||||
Amendment No. 2 in connection with the Credit Agreement in respect of “Ovation of the Seas” (Hull S-699) |
(1) | Royal Caribbean Cruises Ltd. (a corporation organised and existing under the laws of The Republic of Liberia) (the Borrower); |
(2) | KfW IPEX-Bank GmbH as facility agent (the Facility Agent); |
(3) | KfW IPEX-Bank GmbH as Hermes agent (the Hermes Agent); |
(4) | KfW IPEX-Bank GmbH as initial mandated lead arranger (the Initial Mandated Lead Arranger); |
(5) | Banco Santander S.A., BNP Paribas Fortis S.A./N.V, Commerzbank AG, New York Branch, DNB Bank ASA, Grand Cayman Branch, HSBC Bank plc, Norddeutsche Landesbank Girozentrale, Société Générale and MUFG Bank, Ltd. (formerly known as The Bank of Tokyo Mitsubishi UFJ, Ltd.) as mandated lead arrangers (together with the Initial Mandated Lead Arranger, the Mandated Lead Arrangers); and |
(6) | The financial institutions party thereto as lenders from time to time (the Lenders). |
(A) | The Borrower, the Facility Agent, the Hermes Agent and the Lenders are parties to a credit agreement dated 27 November 2013 as amended and restated on 31 March 2016 (the Existing Credit Agreement), in respect of the vessel “Ovation of the Seas” with Hull number S-699 (the Vessel) whereby it was agreed that the Lenders would make available to the Borrower, upon the terms and conditions therein, a US dollar loan facility (the Facility) calculated on the amount equal to the sum of (a) up to eighty per cent (80%) of the Contract Price (as defined in the Existing Credit Agreement) of the Vessel but which Contract Price will not exceed EUR 777,000,000 and (b) up to 100% of the Hermes Fee (as defined therein). |
(B) | The Parties wish to amend and restate the Existing Credit Agreement to the extent set out in this Amendment. |
1 | Interpretation and definitions |
1.1 | Definitions in the Existing Credit Agreement |
(a) | Unless the context otherwise requires or unless otherwise defined in this Amendment, words and expressions defined in the Existing Credit Agreement shall have the same meanings when used in this Amendment. |
(b) | The principles of construction set out in the Existing Credit Agreement shall have effect as if set out in this Amendment. |
1.2 | Definitions |
1.3 | Third party rights |
1.4 | Designation |
2 | Amendment of the Existing Credit Agreement |
3 | Conditions of Effectiveness of Amended Agreement |
3.1 | The Amended Agreement shall become effective in accordance with the terms of this Amendment on the date each of the following conditions has been satisfied to the reasonable satisfaction of the Facility Agent (the Effective Date): |
(a) | the Facility Agent shall have received from the Borrower: |
(i) | a certificate of its Secretary or Assistant Secretary as to the incumbency and signatures of those of its officers authorised to act with respect to this Amendment and as to the truth and completeness of the attached resolutions of its Board of Directors then in full force and effect authorising the execution, delivery and performance of this Amendment, and upon which certificate the Lenders may conclusively rely until the Facility Agent shall have received a further certificate of the Secretary or Assistant Secretary of the Borrower canceling or amending such prior certificate; and |
(ii) | a Certificate of Good Standing issued by the relevant Liberian authorities in respect of the Borrower; |
(b) | the Facility Agent shall have received all invoiced expenses of the Facility Agent (including the agreed fees and expenses of counsel to the Facility Agent) required to be paid by the Borrower pursuant to clause 6 below or that the Borrower has otherwise agreed in writing to pay to the Facility Agent, in each case on or prior to the Effective Date; |
(c) | the Facility Agent shall have received the amendment to the Hermes Insurance Policy duly issued by Hermes; and |
(d) | the representations and warranties set forth in clause 4 are true as of the Effective Date. |
3.2 | The Facility Agent shall notify the Lenders and the Borrower of the Effective Date and such notice shall be conclusive and binding. |
4 | Representations and Warranties |
5 | Incorporation of Terms |
6 | Costs and Expenses |
7 | Counterparts |
8 | Governing Law |
(A) | The Borrower and Meyer Werft GmbH, Papenburg (the “Builder”) have entered on May 30, 2013 into a Contract for the Construction and Sale of Hull No. S-699 (as amended from time to time, the “Construction Contract”) pursuant to which the Builder has agreed to design, construct, equip, complete, sell and deliver the passenger cruise vessel bearing Builder’s hull number S-699 (the “Purchased Vessel”); |
(B) | The Lenders have agreed to make available to the Borrower, upon the terms and conditions contained herein, a US dollar loan facility calculated on the amount (the “Maximum Loan Amount”) equal to the sum of (x) up to eighty per cent (80%) of the Contract Price (as defined below) of the Purchased Vessel (as defined below), as adjusted from time to time in accordance with the Construction Contract to reflect, among other adjustments, change orders, but which Contract Price shall not exceed for this purpose EUR 777,000,000 (the “Contract Price Proceeds”) and (y) up to 100% of the Hermes Fee (as defined below) (the “Hermes Fee Proceeds”) and being made available in the US Dollar Equivalent of that Maximum Loan Amount; |
(C) | The Contract Price Proceeds will be provided to the Borrower two (2) Business Days prior to the delivery of the Purchased Vessel for the purpose of paying a portion of the Contract Price in connection with the Borrower’s purchase of the Purchased Vessel. The Hermes Fee Proceeds will be provided on the Disbursement Date and paid as set forth in Section 2.3(c) and (d); |
(D) | The Parties hereto have previously amended and restated this Agreement pursuant to Amendment Number One (as defined below); and |
(E) | Pursuant to Amendment Number Two dated as of 3 July 2018 (the “Amendment Number Two”), and upon satisfaction of the conditions set forth therein, this Agreement is being amended and restated in the form of this Agreement. |
a) | net cash from operating activities (determined in accordance with GAAP) for such period, as shown in the Borrower’s consolidated statement of cash flow for such period, to |
b) | the sum of: |
a) | any Interest Period which would otherwise end on a day which is not a Business Day shall end on the next Business Day to occur, except if such Business Day does not fall in the same calendar month, the Interest Period will end on the last Business Day in that calendar month, the interest amount due in respect of the Interest Period in question and in respect of the next following Interest Period being adjusted accordingly; and |
b) | if any Interest Period is altered by the application of a) above, the subsequent Interest Period shall end on the day on which it would have ended if the preceding Interest Period had not been so altered. |
a) | subject to Section 3.3.6, if no such offered quotation appears on Reuters LIBOR01 Page (or any successor page) at the relevant time, the LIBO Rate shall be the rate per annum certified by the Facility Agent to be the average of the rates quoted by the Reference Banks as the rate at which each of the Reference Banks was (or would have been) offered deposits of Dollars by prime banks in the London interbank market in an amount approximately equal to the amount of the Loan and for a period of six months; and |
b) | for the purposes of determining the post-maturity rate of interest under Section 3.3.4, the LIBO Rate shall be determined by reference to deposits on an overnight or call basis or for such other period or periods as the Facility Agent may determine after consultation with the Lenders, which period shall be no longer than one month unless the Borrower otherwise agrees. |
(a) | for the EUR amount payable in respect of the final (delivery) instalment of the Contract Price (excluding the portion thereof comprising the Buyer's Allowance), the total of such EUR amount converted to a corresponding Dollar amount as determined using the weighted average rate of exchange that the Borrower has agreed, either in the spot or forward currency markets, to pay its counterparties for the purchase of the relevant amount of EUR with Dollars for the payment of that final installment of the Contract Price and including in such weighted average the spot rates for any EUR amounts due that have not been hedged by the Borrower; |
(b) | for all EUR amounts payable in respect of the Buyer's Allowance, the total of such EUR amounts converted to a corresponding Dollar amount as determined using the USD-to-EUR rate used by the Borrower to convert the relevant USD amount of the amount of the Buyer's Allowance into EUR for the purpose of the Builder invoicing the same to the Borrower in EUR in accordance with the Construction Contract; and |
(c) | for the calculation and payment of the Hermes Fee in Dollars, the amount thereof in EUR converted to a corresponding Dollar amount as determined by Hermes on the basis of the latest rate for the purchase of EUR with Dollars to be published by the German Federal Ministry of Finance prior to the time that Hermes issues its invoice for the Hermes Fee. |
a) | Each Lender will make its portion of the Loan available to the Borrower in accordance with Section 2.3 two (2) Business Days prior to the delivery of the Purchased Vessel to the Borrower under the Construction Contract. The commitment of each Lender described in this Section 2.2 (herein referred to as its “Commitment”) shall be the commitment of such Lender to make available to the Borrower its portion of the Loan hereunder expressed as the initial amount set forth opposite such Lender’s name on its signature page attached hereto or, in the case of any Lender that becomes a Lender pursuant to an assignment pursuant to Section 11.11.1, the amount set forth as such Lender’s Commitment in the related Lender Assignment Agreement, in each case as such amount may be reduced from time to time pursuant to Section 2.2(b) or reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 11.11.1. Notwithstanding the foregoing, each Lender’s Commitment shall terminate on the earlier of (i) the Commitment Termination Date if the Purchased Vessel is not delivered prior to such date and (ii) the delivery of the Purchased Vessel. |
b) | The Borrower may, by notice to the Facility Agent, at any time (i) prior to the date that is not less than 62 days prior to the expected Disbursement Date, without premium or penalty, terminate, or from time to time reduce, the Commitments and (ii) prior to the date on which the Commitments have been terminated but less than 62 days prior to the expected Disbursement Date, and subject to Section 4.4, terminate, or from time to time reduce, the Commitments. Any such termination or reduction of the Commitments shall be applied to the respective Commitments of the Lenders, pro rata according to the amounts of their respective Commitments. Where the Commitments are cancelled in full or in part the Borrower shall pay on the date of such cancellation all amounts, including any fees and commissions which have accrued but remain unpaid at such date, which are due and owing to the Facility Agent and the Lenders at such date to the extent that such amounts, other than principal of the Loan, are the subject of invoices from the Facility Agent to the Borrower received by the Borrower not less than two (2) Business Days prior to the date of such cancellation. Otherwise, such amounts shall be payable by the Borrower following the date of such cancellation upon the second (2nd) Business Day following receipt of the relevant invoices. |
c) | If any Lender shall default in its obligations under Section 2.1, the Facility Agent shall, at the request of the Borrower, use reasonable efforts to assist the Borrower in finding a bank or financial institution acceptable to the Borrower to replace such Lender. |
a) | The Borrower shall deliver a Loan Request and the documents required to be delivered pursuant to Section 5.1.1(a) to the Facility Agent on or before 11:00 a.m., London time, not less than two (2) Business Days in advance of the date that is two (2) Business Days prior to the anticipated Delivery Date. The aggregate amount of the Loan to be advanced shall not exceed the US Dollar Maximum Loan Amount. |
b) | The Facility Agent shall promptly notify each Lender of any Loan Request by forwarding a copy thereof to each Lender, together with its attachments. On the terms and subject to the conditions of this Agreement, the Loan shall be made on the Business Day specified in such Loan Request. On or before 2:00 p.m., London time, on the Business Day specified in such Loan Request, the Lenders shall, without any set-off or counterclaim, deposit with the Facility Agent same day Dollar funds in an amount equal to such Lender’s Percentage of the requested Loan. Such deposit will be made to an account which the Facility Agent shall specify from time to time by notice to the Lenders. To the extent funds are so received from the Lenders, the Facility Agent shall, without any set-off or counterclaim, make such funds available to the Borrower on the Business Day specified in the Loan Request by wire transfer of same day funds to the account or accounts the Borrower shall have specified in its Loan Request. |
c) | The Borrower shall, upon receipt of the Dollar funds into the account referred to in Section 2.3(b) above, (i) complete the purchase of EUR with its counterparties or otherwise as set out in the Loan Request (by authorising and instructing the Facility Agent to remit the necessary Dollar funds to the said counterparties) and shall procure the payment of all EUR proceeds of such transactions to the EUR Pledged Account no later than the Business Day immediately following the Business Day specified in the Loan Request and (ii) to the extent of any such Dollar funds as shall not be used to purchase EUR, shall procure (by authorising and instructing the Facility Agent accordingly) the payment of such Dollar funds to the Dollar Pledged Account on the Disbursement Date. |
d) | Upon the date of delivery to the Borrower of the Purchased Vessel, the Facility Agent shall direct that moneys standing to the credit of the Pledged Accounts shall, in the manner set out in the Loan Request and in accordance with the requirements and provisions of the Pledge Agreement, be disbursed as follows: |
i) | in EUR, to the account of the Builder, as designated by the Builder and identified by the Borrower in the Loan Request, to the extent necessary to meet the final instalment of the Contract Price (including any portion thereof attributable to the Buyer's Allowance); and |
ii) | in Dollars, (y) to Hermes in payment of the Second Fee; and (z) to the account of the Borrower, as designated by the Borrower and identified by the Borrower in the Loan Request, in reimbursement of the First Fee and in respect of any additional amounts standing to the Dollar Pledged Account as of the date of such disbursement, |
a) | Subject to Section 3.1 b), the Borrower shall repay the Loan in 24 equal semi-annual installments, with the first instalment to fall due on the date falling six (6) months after the Delivery Date and the final instalment to fall due on the date of Final Maturity. |
b) | If, on the date of delivery of the Purchased Vessel, the outstanding principal amount of the Loan exceeds the US Dollar Maximum Loan Amount (as a result of a reduction in the Contract Price after the Disbursement Date and before the delivery of the Purchased Vessel), the Borrower shall repay the Loan in an amount equal to such excess within two (2) Business Days after the date of delivery of the Purchased Vessel. Any such partial prepayment shall be applied pro rata in satisfaction of the remaining repayment installments of the Loan. |
c) | No such amounts repaid by the Borrower pursuant to this Section 3.1 may be re-borrowed under the terms of this Agreement. |
a) | may, from time to time on any Business Day, make a voluntary prepayment, in whole or in part, of the outstanding principal amount of the Loan; provided that: |
i) | all such voluntary prepayments shall require (x) for prepayments on or after the Disbursement Date made prior to delivery of the Purchased Vessel in respect of the advance made on the Disbursement Date, at least two (2) Business Days’ prior written notice to the Facility Agent, and (y) for all other prepayments, at least 30 calendar days’ prior written notice, if all or any portion of the Loan is a Fixed Rate Loan, and at least five (5) Business Days’ (or, if such prepayment is to be made on the last day of an Interest Period for such Loan, four (4) Business Days’) prior written notice, if the Loan is a Floating Rate Loan, in each case to the Facility Agent; and |
ii) | all such voluntary partial prepayments shall be in an aggregate minimum amount of $10,000,000 and a multiple of $1,000,000 (or in the remaining amount of the Loan) and shall be applied in inverse order of maturity or ratably among all remaining installments, as the Borrower shall designate to the Facility Agent, in satisfaction of the remaining repayment installments of the Loan; and |
b) | shall, immediately upon any acceleration of the repayment of the installments of the Loan pursuant to Section 8.2 or 8.3 or the mandatory prepayment of the Loan pursuant to Section 9.2, repay the Loan. |
a) | By written notice to the Facility Agent delivered prior to the date that is not less than 62 days prior to the expected Disbursement Date, the Borrower may elect, without incurring any liability to make any payments pursuant to Section 4.4 or to pay any other indemnity or compensation obligation, to pay interest on the Loan at the Floating Rate. |
b) | By written notice to the Facility Agent delivered less than 62 days prior to the expected Disbursement Date, the Borrower may elect, subject to Section 4.4, to pay interest on the Loan at the Floating Rate. |
c) | By written notice to the Facility Agent no later than 2:00 p.m. Frankfurt time 32 days prior to the end of an Interest Period, the Borrower may elect, subject to Section 4.4, to pay interest on the Loan for the remainder of the term of the Loan at the Floating Rate, with effect from the end of that Interest Period. |
d) | Any election made under any of Section 3.3.2.a), Section 3.3.2.b) or Section 3.3.2.c) may only be made one time during the term of the Loan and shall be irrevocable. |
a) | each Interest Payment Date; |
b) | each Repayment Date; |
c) | the date of any prepayment, in whole or in part, of principal outstanding on the Loan (but only on the principal so prepaid); and |
d) | on that portion of the Loan the repayment of which is accelerated pursuant to Section 8.2 or Section 8.3, immediately upon such acceleration. |
a) | Dollar deposits in the relevant amount and for the relevant Interest Period are not available to each Reference Bank in its relevant market, or |
b) | by reason of circumstances affecting the Reference Banks’ relevant markets, adequate means do not exist for ascertaining the interest rate applicable hereunder to LIBO Rate loans for the relevant Interest Period, or |
c) | the cost to Option B Lenders that in the aggregate hold more than 50% of the aggregate outstanding principal amount of the Loan then held by Option B Lenders, if any Lender shall have entered into an Option B Interest Make-Up Agreement, of obtaining matching deposits in the relevant interbank market for the relevant Interest Period would be in excess of the LIBO Rate (provided that no Option B Lender may exercise its rights under this Section 4.2(c)) for amounts up to the difference between such Option B Lender’s cost of obtaining matching deposits on the date such Option B Lender becomes a Lender hereunder less the LIBO Rate on such date), |
a. | subject any Lender to any taxes, levies, duties, charges, fees, deductions or withholdings of any nature with respect to its portion of the Loan or any part thereof imposed, levied, collected, withheld or assessed by any jurisdiction or any political subdivision or taxing authority thereof (other than taxation on overall net income and, to the extent such taxes are described in Section 4.6, withholding taxes); or |
b. | change the basis of taxation to any Lender (other than a change in taxation on the overall net income of any Lender) of payments of principal or interest or any other payment due or to become due pursuant to this Agreement; or |
c. | impose, modify or deem applicable any reserve or capital adequacy requirements (other than the increased capital costs described in Section 4.5 and the reserve costs described in Section 4.7) or other banking or monetary controls or requirements which affect the manner in which a Lender shall allocate its capital resources to its obligations hereunder or require the making of any special deposits against or in respect of any assets or liabilities of, deposits with or for the account of, or loans by, any Lender (provided that such Lender shall, unless prohibited by law, allocate its capital resources to its obligations hereunder in a manner which is consistent with its present treatment of the allocation of its capital resources); or |
d. | impose on any Lender any other condition affecting its portion of the Loan or any part thereof, |
i) | if at the time interest is calculated at the Floating Rate on such Lender’s portion of the Loan, any conversion or repayment or prepayment or acceleration of the principal amount of such Lender’s portion of the Loan on a date other than the scheduled last day of an Interest Period or otherwise scheduled date for repayment or payment (including payments made in accordance with Section 3.1(b)); |
ii) | if at the time interest is calculated at the Fixed Rate on such Lender’s portion of the Loan, any repayment or prepayment or acceleration of the principal amount of such Lender’s |
iii) | an election by the Borrower of the Floating Rate in accordance with Section 3.3.2.b) or Section 3.3.2.c); |
iv) | a reduction or termination of the Commitments by the Borrower pursuant to Section 2.2.b)(ii); or |
v) | the Loan not being made in accordance with the Loan Request therefor due to the fault of the Borrower or as a result of any of the conditions precedent set forth in Article V not being satisfied, |
a. | if at that time interest is calculated at the Floating Rate on such Lender’s portion of the Loan, pay directly to the Facility Agent for the account of such Lender an amount (the “Floating Rate Indemnity Amount”) equal to the amount by which: |
(i) | interest calculated at the Floating Rate which such Lender would have received on its share of the amount of the Loan subject to such Funding Losses Event for the period from the date of receipt of any part of its share in the Loan to the last day of the applicable Interest Period, |
(ii) | the amount which such Lender would be able to obtain by placing an amount equal to the amount received by it on deposit with a leading bank in the appropriate interbank market for a period starting on the Business Day following receipt and ending on the last day of the applicable Interest Period; or |
b. | if at that time interest is calculated at the Fixed Rate on such Lender’s portion of the Loan, pay to the Facility Agent the sum of: |
(A) | an amount equal to the amount by which: |
(i) | interest calculated at the Fixed Rate which such Lender would have received on its share of the amount of the Loan subject to such Funding Losses Event for the period from the date of receipt of any part of its share of the Loan to the final scheduled date for the repayment of Loan in full pursuant to Section 3.1, |
(ii) | the amount by which such Lender would be able to obtain by placing an equal amount to the amount received by it on deposit and receiving interest equal to the money market rate then applicable to Dollars on the Reuters page “ICAP1” (the “Reinvestment Rate”), |
(B) | an amount equal to the Floating Rate Indemnity Amount (and assuming for the purpose of this calculation that the interest on the Loan is calculated at the Floating Rate and not the Fixed Rate). |
a. | pay directly to the relevant authority the full amount required to be so withheld or deducted; |
b. | promptly forward to the Facility Agent an official receipt or other documentation satisfactory to the Facility Agent evidencing such payment to such authority; and |
c. | pay to the Facility Agent for the account of the Lenders such additional amount or amounts as is necessary to ensure that the net amount actually received by each Lender will equal the full amount such Lender would have received had no such withholding or deduction been required. |
a. | (%5) Each Option A Lender hereby instructs the Facility Agent to remit all payments of interest made with respect to any portion of the Loan held by such Option A Lender to the Refinancing Bank (A) less (x) the Fixed Rate Margin and (y) the CIRR administrative fee of 0.39% but plus (z) an agreed refinancing margin and agreed bank margin, if interest on the portion of the Loan made by that Lender is then calculated at the Fixed Rate, or (B) less (x) the Floating Rate Margin but plus (y) an agreed refinancing margin and bank margin, if interest on that portion of the Loan is then calculated at the Floating Rate. |
b. | The Facility Agent shall promptly (but in any event on the same Business Day that the same are received or, as contemplated in clause (a) of this Section, deemed received) remit in same day funds to each Lender its share, if any, of such payments received by the Facility Agent for the account of such Lender without any set-off, deduction or counterclaim. All interest and fees shall be computed on the basis of the actual number of days (including the first day but excluding the last day) occurring during the period for which such interest or fee is payable over a year comprised of 360 days. Whenever any payment to be made shall otherwise be due on a day which is not a Business Day, such payment shall (except as otherwise required by clause (a) of the definition of the term “Interest Period”) be made on the next succeeding Business Day and such extension of time shall be included in computing interest and fees, if any, in connection with such payment. |
(a) | the Recovering Lender shall, within three (3) Business Days, notify details of the receipt or recovery to the Facility Agent; |
(b) | the Facility Agent shall determine whether the receipt or recovery is in excess of the amount the Recovering Lender would have been paid had the receipt or recovery been received or made by the Facility Agent and distributed in accordance with the said Section 4.8, without taking account of any taxes which would be imposed on the Facility Agent in relation to the receipt, recovery or distribution; and |
(c) | the Recovering Lender shall, within three (3) Business Days of demand by the Facility Agent, pay to the Facility Agent an amount (the "Sharing Payment") equal to such receipt or recovery less any amount which the Facility Agent determines may be retained by the Recovering Lender as its share of any payment to be made, in accordance with any applicable provisions of this Agreement. |
a. | each Sharing Lender shall, upon request of the Facility Agent, pay to the Facility Agent for the account of that Recovering Lender an amount equal to the appropriate part of its share of the Sharing Payment (together with an amount as is necessary to reimburse that Recovering Lender for its proportion of any interest on the Sharing |
b. | as between the Borrower and each relevant Sharing Lender, an amount equal to the relevant Redistributed Amount will be treated as not having been paid by the Borrower. |
a. | This Section 4.10 shall not apply to the extent that the Recovering Lender would not, after making any payment pursuant to this Section 4.10, have a valid and enforceable claim against the Borrower. |
b. | A Recovering Lender is not obliged to share with any other Lender any amount which the Recovering Lender has received or recovered as a result of taking legal or arbitration proceedings, if: |
(i) | it notified the other Lender of the legal or arbitration proceedings; and |
(ii) | the other Lender had an opportunity to participate in those legal or arbitration proceedings but did not do so as soon as reasonably practicable having received notice and did not take separate legal or arbitration proceedings. |
a. | Watson Farley & Williams LLP, counsel to the Borrower, as to Liberian Law, covering the matters set forth in Exhibit B-1 hereto; |
b. | Norton Rose Fulbright LLP, counsel to the Facility Agent and the Lenders, covering the matters set forth in ExhibitB-2 hereto; and |
c. | Norton Rose Fulbright LLP, counsel to the Facility Agent and the Lenders as to German law, an opinion addressed to the Facility Agent and the Lenders covering the matters set forth in Exhibit B-3 hereto. |
d. | Clifford Chance US LLP, United States tax counsel to the Facility Agent for the benefit of Lenders, covering the matters set forth in Exhibit B-4 hereto, |
a. | the representations and warranties set forth in Article VI (excluding, however, those set forth in Section 6.10) shall be true and correct in all material respects except for those representations and warranties that are qualified by materiality or Material Adverse Effect, which shall be true and correct, with the same effect as if then made; and |
b. | no Default and no Prepayment Event and no event which (with notice or lapse of time or both) would become a Prepayment Event shall have then occurred and be continuing. |
a. | certified as true (by the Builder) copies of the reimbursement request and supporting documents received by the Builder from the Borrower pursuant to Article XVII.1(b) of the Construction Contract in relation to the incurred Buyer’s Allowance; |
b. | a copy of the final invoice from the Builder showing the amount of the Contract Price (including the Buyer’s Allowance) and the portion thereof payable to the Builder on the Delivery Date under the Construction Contract; and |
c. | copies of the wire transfers for all payments by the Borrower to the Builder under the Construction Contract in respect of the Contract Price. |
a. | contravene the Borrower’s Organic Documents; |
b. | contravene any law or governmental regulation of any Applicable Jurisdiction except as would not reasonably be expected to result in a Material Adverse Effect; |
c. | contravene any court decree or order binding on the Borrower or any of its property except as would not reasonably be expected to result in a Material Adverse Effect; |
d. | contravene any contractual restriction binding on the Borrower or any of its property except as would not reasonably be expected to result in a Material Adverse Effect; or |
e. | result in, or require the creation or imposition of, any Lien on any of the Borrower’s properties except as would not reasonably be expected to result in a Material Adverse Effect. |
a. | The Borrower is in compliance with all applicable laws, rules, regulations and orders, except to the extent that the failure to so comply does not and would not reasonably be expected to have a Material Adverse Effect. |
b. | The Borrower has implemented and maintains in effect policies and procedures designed to procure compliance by the Borrower, its Subsidiaries and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions. The Borrower and its Subsidiaries and, to the knowledge of the Borrower, their respective officers, employees, directors and agents, are in compliance with Anti-Corruption Laws and applicable Sanctions, in all material respects and are not knowingly engaged in any activity that would reasonably be expected to result in Borrower being designated as a Sanctioned Person. None of (i) the Borrower, any Subsidiary or to the knowledge of the Borrower or such Subsidiary any of their respective directors, officers or employees, or (ii) to the knowledge of the Borrower, any agent of the Borrower or any Subsidiary that will act in any capacity in connection with or benefit from the credit facility established hereby, is a Sanctioned Person. |
c. | The Borrower is in compliance with all applicable Environmental Laws, except to the extent that the failure to so comply would not have a Material Adverse Effect. |
a. | legally and beneficially owned by the Borrower or one of the Borrower’s wholly owned Subsidiaries, |
b. | registered in the name of the Borrower or one of the Borrower’s wholly owned Subsidiaries under the Bahamian or Maltese flag or such other flag as the parties may mutually agree, |
c. | classed as required by Section 7.1.4(b), |
d. | free of all recorded Liens, other than Liens permitted by Section 7.2.3, |
e. | insured against loss or damage in compliance with Section 7.1.5, and |
f. | exclusively operated by or chartered to the Borrower or one of the Borrower’s wholly owned Subsidiaries. |
a. | as soon as available and in any event within 60 days after the end of each of the first three Fiscal Quarters of each Fiscal Year of the Borrower, a copy of the Borrower’s report on Form 10-Q (or any successor form) as filed by the Borrower with the SEC for such Fiscal Quarter, containing unaudited consolidated financial statements of the Borrower for such Fiscal Quarter (including a balance sheet and profit and loss statement) prepared in accordance with GAAP, subject to normal year-end audit adjustments; |
b. | as soon as available and in any event within 120 days after the end of each Fiscal Year of the Borrower, a copy of the Borrower’s annual report on Form 10-K (or any successor form) as filed by the Borrower with the SEC for such Fiscal Year, containing audited consolidated financial statements of the Borrower for such Fiscal Year prepared in accordance with GAAP (including a balance sheet and profit and loss statement) and audited by PricewaterhouseCoopers LLP or another firm of independent public accountants of similar standing; |
c. | together with each of the statements delivered pursuant to the foregoing clause (a) or (b), a certificate, executed by the chief financial officer, the treasurer or the corporate controller of the Borrower, showing, as of the last day of the relevant Fiscal Quarter or Fiscal Year compliance with the covenants set forth in Section 7.2.4 (in reasonable detail and with appropriate calculations and computations in all respects reasonably satisfactory to the Facility Agent); |
d. | as soon as possible after the occurrence of a Default or Prepayment Event, a statement of the chief financial officer of the Borrower setting forth details of such Default or Prepayment Event (as the case may be) and the action which the Borrower has taken and proposes to take with respect thereto; |
e. | as soon as the Borrower becomes aware thereof, notice of any Material Litigation except to the extent that such Material Litigation is disclosed by the Borrower in filings with the SEC; |
f. | promptly after the sending or filing thereof, copies of all reports which the Borrower sends to all holders of each security issued by the Borrower, and all registration statements which the Borrower or any of its Subsidiaries files with the SEC or any national securities exchange; and |
g. | such other information respecting the condition or operations, financial or otherwise, of the Borrower or any of its Subsidiaries as any Lender through the Facility Agent may from time to time reasonably request; |
a. | in the case of the Borrower, the maintenance and preservation of its corporate existence (subject to the provisions of Section 7.2.6); |
b. | in the case of the Borrower, maintenance of its qualification as a foreign corporation in the State of Florida; |
c. | the payment, before the same become delinquent, of all taxes, assessments and governmental charges imposed upon it or upon its property, except to the extent being diligently contested in good faith by appropriate proceedings; |
d. | compliance with all applicable Environmental Laws; |
e. | compliance with all anti-money laundering laws and Anti-Corruption Laws applicable to the Borrower, including by not making or causing to be made any offer, gift or payment, consideration or benefit of any kind to anyone, either directly or indirectly, as an inducement or reward for the performance of any of the transactions contemplated by this Agreement to the extent the same would be in contravention of such applicable laws; and |
f. | the Borrower will maintain in effect policies and procedures designed to procure compliance by the Borrower, its Subsidiaries and their respective directors, officers and employees with Anti-Corruption Laws and applicable Sanctions. |
a. | from the Delivery Date, cause the Purchased Vessel to be exclusively operated by or chartered to the Borrower or one of the Borrower’s wholly owned Subsidiaries, provided that the Borrower or such Subsidiary may charter out the Purchased Vessel (i) to entities other than the Borrower and the Borrower’s wholly owned Subsidiaries and (ii) on a time charter with a stated duration not in excess of one year; |
b. | from the Delivery Date, cause the Purchased Vessel to be kept in such condition as will entitle her to classification by a classification society of recognized standing; |
c. | from the Delivery Date, provide the following to the Facility Agent with respect to the Purchased Vessel: |
d. | within seven days after the Delivery Date, provide the following to the Facility Agent with respect to the Purchased Vessel: |
a. | Indebtedness secured by Liens of the type described in Section 7.2.3; |
b. | Indebtedness owing to the Borrower or a direct or indirect Subsidiary of the Borrower; |
c. | Indebtedness incurred to finance, refinance or refund the cost (including the cost of construction) of assets acquired after the Effective Date; |
d. | Indebtedness in an aggregate principal amount, together with (but without duplication of) Indebtedness permitted to be secured under Section 7.2.3(d), at any one time outstanding not exceeding (determined at the time of creation of such Lien or the |
e. | [RESERVED]; and |
f. | obligations in respect of Hedging Instruments entered into for the purpose of managing interest rate, foreign currency exchange or commodity exposure risk and not for speculative purposes. |
a. | [RESERVED]; |
b. | Liens on assets (including, without limitation, shares of capital stock of corporations and assets owned by any corporation that becomes a Subsidiary of the Borrower after the Effective Date) acquired after the Effective Date (whether by purchase, construction or otherwise) by the Borrower or any of its Subsidiaries (other than (x) an Existing Principal Subsidiary or (y) any other Principal Subsidiary which, at any time, after three months after the acquisition of a Vessel, owns a Vessel free of any mortgage Lien), which Liens were created solely for the purpose of securing Indebtedness representing, or incurred to finance, refinance or refund, the cost (including the cost of construction) of such assets, so long as (i) the acquisition of such assets is not otherwise prohibited by the terms of this Agreement and (ii) each such Lien is created within three months after the acquisition of the relevant assets; |
c. | the Construction Mortgage but only to the extent that the same is discharged on the Delivery Date; |
d. | in addition to other Liens permitted under this Section 7.2.3, Liens securing Indebtedness in an aggregate principal amount, together with (but without duplication of) Indebtedness permitted under Section 7.2.2(d), at any one time outstanding not exceeding (determined at the time of creation of such Lien or the incurrence by any Existing Principal Subsidiary of such indebtedness, as applicable) (i) 10.0% of the total assets of the Borrower and its Subsidiaries (the “Lien Basket Amount”) taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter; provided, however that, if, at any time, the Senior Debt Rating of the Borrower is less than Investment Grade as given by both Moody’s and S&P, the Lien Basket Amount shall be the greater of (x) 5.0% of the total assets of the Borrower and its Subsidiaries taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter and (y) $735,000,000; |
e. | Liens on assets acquired after the Effective Date by the Borrower or any of its Subsidiaries (other than by (x) any Subsidiary that is an Existing Principal Subsidiary or (y) any other Principal Subsidiary which, at any time, owns a Vessel free of any mortgage Lien) so long as (i) the acquisition of such assets is not otherwise prohibited by the terms of this Agreement and (ii) each of such Liens existed on such assets before the time of its acquisition and was not created by the Borrower or any of its Subsidiaries in anticipation thereof; |
f. | Liens on any asset of any corporation that becomes a Subsidiary of the Borrower (other than a corporation that also becomes a Subsidiary of an Existing Principal Subsidiary) after the Effective Date so long as (i) the acquisition or creation of such corporation by the Borrower is not otherwise prohibited by the terms of this Agreement and (ii) such Liens are in existence at the time such corporation becomes a Subsidiary of the Borrower and were not created by the Borrower or any of its Subsidiaries in anticipation thereof; |
g. | Liens securing Government-related Obligations; |
h. | Liens for taxes, assessments or other governmental charges or levies not at the time delinquent or thereafter payable without penalty or being diligently contested in good faith by appropriate proceedings; |
i. | Liens of carriers, warehousemen, mechanics, material-men and landlords incurred in the ordinary course of business for sums not overdue by more than 60 days or being diligently contested in good faith by appropriate proceedings; |
j. | Liens incurred in the ordinary course of business in connection with workers’ compensation, unemployment insurance or other forms of governmental insurance or benefits; |
k. | Liens for current crew’s wages and salvage; |
l. | Liens arising by operation of law as the result of the furnishing of necessaries for any Vessel so long as the same are discharged in the ordinary course of business or are being diligently contested in good faith by appropriate proceedings; |
m. | Liens on Vessels that: |
n. | normal and customary rights of set-off upon deposits of cash or other Liens originating solely by virtue of any statutory or common law provision relating to bankers’ liens, rights of set-off or similar rights in favor of banks or other depository institutions; |
o. | Liens in respect of rights of set-off, recoupment and holdback in favor of credit card processors securing obligations in connection with credit card processing services incurred in the ordinary course of business; |
p. | Liens on cash or Cash Equivalents or marketable securities securing: |
q. | deposits to secure the performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case in the ordinary course of business and deposits securing liabilities to insurance carriers under insurance or self-insurance arrangements; |
r. | easements, zoning restrictions, rights-of-way and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or interfere with the ordinary conduct of business of the Borrower or any Subsidiary; and |
s. | licenses, sublicenses, leases or subleases granted to other Persons not materially interfering with the conduct of the business of the Borrower or any of its Subsidiaries. |
a. | Net Debt to Capitalization Ratio, as at the end of any Fiscal Quarter, to be greater than 0.625 to 1. |
b. | Fixed Charge Coverage Ratio to be less than 1.25 to 1 as at the last day of any Fiscal Quarter. |
a. | any such Subsidiary may (i) liquidate or dissolve voluntarily into, and may merge with and into, the Borrower or any other Subsidiary, and the assets or stock of any Subsidiary may be purchased or otherwise acquired by the Borrower or any other Subsidiary or (ii) merge with and into another Person in connection with a sale or other disposition permitted by Section 7.2.7; and |
b. | so long as no Event of Default or Prepayment Event has occurred and is continuing or would occur after giving effect thereto, the Borrower or any of its Subsidiaries may merge into any other Person, or any other Person may merge into the Borrower or any such Subsidiary, or the Borrower or any of its Subsidiaries may purchase or otherwise acquire all or substantially all of the assets of any Person, in each case so long as: |
(A) | the surviving corporation shall have assumed in a writing, delivered to the Facility Agent, all of the Borrower’s obligations hereunder and under the other Loan Documents; |
(B) | the surviving corporation shall, promptly upon the request of the Facility Agent or any Lender, supply such documentation and other evidence as is reasonably requested by the Facility Agent or any Lender in order for the Facility Agent or such Lender to carry out and be satisfied it has complied with the results of all necessary “know your customer” or other similar checks under all applicable laws and regulations; and |
(C) | as soon as practicable after receiving notice from the Borrower of such merger, and in any event no later than five Business Days after the delivery of such notice, for a surviving corporation that is organized under the laws of a jurisdiction other than of the United States or a political subdivision thereof or Liberia, any Lender that may not legally lend to, establish credit for the account of and/or do any business whatsoever with such surviving corporation, either directly or through an Affiliate of such Lender (a “Protesting Lender”) shall so notify the Borrower and the Facility Agent in writing. With respect to each Protesting Lender, the Borrower shall, effective on or before the date that such surviving corporation shall have the right to borrow hereunder, notify the Facility Agent and such Protesting Lender that the Commitments of such Protesting Lender shall be terminated; provided that such Protesting Lender shall have received one or more payments from either the Borrower or one or more assignees in an aggregate amount at least equal to the aggregate outstanding principal amount of the Loan owing to such Protesting Lender, together with accrued interest thereon to the date of payment of such principal amount and all other amounts payable to such Protesting Lender under this Agreement. |
a. | generally fail to pay, or admit in writing its inability to pay, its debts as they become due; |
b. | apply for, consent to, or acquiesce in, the appointment of a trustee, receiver, sequestrator or other custodian for it or any of its property, or make a general assignment for the benefit of creditors; |
c. | in the absence of such application, consent or acquiescence, permit or suffer to exist the appointment of a trustee, receiver, sequestrator or other custodian for it or for a substantial part of its property, and such trustee, receiver, sequestrator or other custodian shall not be discharged within 60 days, provided that in the case of such an event in respect of the Borrower, the Borrower hereby expressly authorizes the Facility Agent and each Lender to appear in any court conducting any relevant proceeding during such 60-day period to preserve, protect and defend their respective rights under the Loan Documents; |
d. | permit or suffer to exist the commencement of any bankruptcy, reorganization, debt arrangement or other case or proceeding under any bankruptcy or insolvency law, or any dissolution, winding up or liquidation proceeding, in respect of the Borrower or any of such Subsidiaries, and, if any such case or proceeding is not commenced by the Borrower or such Subsidiary, such case or proceeding shall be consented to or acquiesced in by the Borrower or such Subsidiary or shall result in the entry of an order for relief or shall remain for 60 days undismissed, provided that the Borrower hereby expressly authorizes the Facility Agent and each Lender to appear in any court conducting any such case or proceeding during such 60-day period to preserve, protect and defend their respective rights under the Loan Documents; or |
e. | take any corporate action authorizing, or in furtherance of, any of the foregoing. |
a. | enforcement proceedings in respect of any material assets of the Borrower or such Principal Subsidiary shall have been commenced by any creditor upon such judgment or order and shall not have been stayed or enjoined within five (5) Business Days after the commencement of such enforcement proceedings; or |
b. | there shall be any period of 30 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect. |
a. | modify any requirement hereunder that any particular action be taken by all the Lenders or by the Required Lenders shall be effective unless consented to by each Lender; |
b. | modify this Section 11.1 or change the definition of “Required Lenders” shall be made without the consent of each Lender; |
c. | increase the Commitment of any Lender shall be made without the consent of such Lender; |
d. | reduce any fees described in Article III payable to any Lender shall be made without the consent of such Lender; |
e. | extend the Commitment Termination Date of any Lender shall be made without the consent of such Lender; |
f. | extend the due date for, or reduce the amount of, any scheduled repayment or prepayment of principal of or interest on the Loan (or reduce the principal amount of or rate of interest on the Loan) owed to any Lender shall be made without the consent of such Lender; or |
g. | affect adversely the interests, rights or obligations of the Facility Agent in its capacity as such shall be made without consent of the Facility Agent. |
a. | except to the extent permitted under Section 7.2.6, the Borrower may not assign or transfer its rights or obligations hereunder without the prior written consent of the Facility Agent and each Lender; and |
b. | the rights of sale, assignment and transfer of the Lenders are subject to Section 11.11. |
a. | written notice of such assignment or transfer, together with payment instructions, addresses and related information with respect to such Assignee Lender, shall have been given to the Borrower and the Facility Agent by such Lender and such Assignee Lender; |
b. | such Assignee Lender shall have executed and delivered to the Borrower and the Facility Agent a Lender Assignment Agreement, accepted by the Facility Agent and, if the applicable portion of the Loan is a Fixed Rate Loan, any other agreements required by the Facility Agent or the CIRR Representative in connection therewith; and |
c. | the processing fees described below shall have been paid. |
a. | no participation contemplated in this Section 11.11.2 shall relieve such Lender from its obligations hereunder; |
b. | such Lender shall remain solely responsible for the performance of its obligations hereunder; |
c. | the Borrower and the Facility Agent shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement and each of the other Loan Documents; |
d. | no Participant, unless such Participant is an Affiliate of such Lender, shall be entitled to require such Lender to take or refrain from taking any action hereunder or under any other Loan Document, except that such Lender may agree with any Participant that such Lender will not, without such Participant’s consent, take any actions of the type described in clauses (b) through (f) of Section 11.1; |
e. | the Borrower shall not be required to pay any amount under Sections 4.2(c), 4.3, 4.4, 4.5, 4.6 and 4.7 that is greater than the amount which it would have been required to pay had no participating interest been sold; and |
f. | each Lender that sells a participation under this Section 11.11.2 shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts of (and stated interest on) each of the Participant’s interest in that Lender’s portion of the Loan, Commitments or other interests hereunder (the “Participant Register”). The entries in the Participant Register shall be conclusive absent manifest error, and such Lender may treat each person whose name is recorded in the Participant Register as the owner of such participation for all purposes hereunder. |
g. | KfW IPEX may not sell participating interests pursuant to this Section 11.11.2 that, when taken together with Loans and/or Commitments sold by KfW IPEX pursuant to Section 11.11.1, result in KfW IPEX’s share of the aggregate principal amount of the Loan and/or the aggregate Commitments being less than 50% of the total Loan or total Commitments, without the written consent of the Borrower (which consent shall not be required following the occurrence and during the continuance of an Event of Default or a Prepayment Event). |
(a) | The Hermes Insurance Policy will cover 95% of the Loan. |
(b) | The Hermes Fee will equal 2.37% of the aggregate principal amount of the Loan as at the Delivery Date. |
(c) | The parties have entered into this Agreement on the basis that the Hermes Insurance Policy shall contain the following terms and should such terms not be included within the Hermes Insurance Policy, then the Borrower may cancel the Commitment(s): |
(i) | 25% of the Hermes Fee as in effect on the date of issuance of the Hermes Insurance Policy (“First Fee”) will be payable to the Hermes Agent or Hermes in Dollars within two (2) Business Days of receipt by the Borrower of demand from the Hermes Agent following the later to occur of (i) the issue of the Hermes Insurance Policy and (ii) the Effective Date; |
(ii) | the balance of the Hermes Fee (being the amount thereof under paragraph (b) above less the First Fee) (“Second Fee”) will be payable in Dollars to the Hermes Agent or Hermes on the Delivery Date ; |
(iii) | if the Commitments are cancelled in full by the Borrower or the Lenders on or prior to the Delivery Date (including, for the avoidance of doubt, subsequent to disbursement of the Loan and prepayment thereof by the Borrower under Section 3.7), Hermes shall be required to reimburse the Hermes Agent the amount of the First Fee less an administration fee (such administration fee to be no greater than 5% of the amount refunded but in any event not exceeding EUR 2,500); |
(iv) | if the Commitments are cancelled in part by the Borrower on or prior to the Delivery Date (including, for the avoidance of doubt, subsequent to disbursement of the Loan and prepayment thereof by the Borrower under Section 3.7), Hermes shall be required to reimburse the Hermes Agent an amount equal to a corresponding proportion of the First Fee, based on the proportion of the aggregate Commitments prior to such cancellation to the aggregate Commitments after giving effect to such cancellation, less an administration fee (such administration fee to be no greater than 5% of the amount refunded but in any event not exceeding EUR 2,500); and |
(v) | if, after the Delivery Date, the Borrower prepays all or part of the Loan in accordance with this Agreement, Hermes shall be required to reimburse the Hermes Agent an amount equal to a corresponding proportion of the unexpired portion of the Hermes Fee, having regard to the amount of the prepayment and the remaining term of the Loan less the sum of (x) a break funding fee equal to 20% of the unexpired portion of the Hermes Fee and (y) an administration fee (such fee to be no greater than 5% of the amount refunded but in any event not exceeding EUR 2,500). |
(a) | Provided that the Hermes Insurance Policy complies with Section 11.13.1, the Borrower shall pay (a) the First Fee to the Hermes Agent or Hermes in accordance with section 11.13.1(c)(i) and (b) the Second Fee to the Hermes Agent or Hermes on the Delivery Date. In each case, if received by the Hermes Agent, the Hermes Agent shall pay such amount to Hermes. |
(b) | Provided that the Hermes Insurance Policy complies with Section 11.13.1, the Borrower shall pay to the Hermes Agent or Hermes an issue fee of EUR 12,500 for the issue of the Hermes Insurance Policy at the same time that the First Fee is payable. |
(a) | Promptly upon receipt of the Hermes Insurance Policy from Hermes, the Hermes Agent shall (subject to any confidentiality undertakings given to Hermes by the Hermes Agent pursuant to the terms of the Hermes Insurance Policy) send a copy thereof to the Borrower. |
(b) | The Hermes Agent shall perform such acts or provide such information which are, acting reasonably, within its power so to perform or so to provide, as required by Hermes under the Hermes Insurance Policy and as are necessary to ensure that the Lenders obtain the support of Hermes pursuant to the Hermes Insurance Policy. |
(c) | The Hermes Agent shall (in the circumstances described in Section 11.13.1(c)(iii), (iv) or (v)): |
(i) | make written requests to Hermes seeking a reimbursement of the Hermes Fee promptly after the relevant cancellation or prepayment and (subject to any confidentiality undertakings given to Hermes by the Hermes Agent pursuant to the terms of the Hermes Insurance Policy) provide a copy of the request to the Borrower; |
(ii) | use its reasonable endeavours to maximize the amount of any reimbursement of the Hermes Fee to which the Hermes Agent is entitled; |
(iii) | pay to the Borrower the full amount of any reimbursement of the Hermes Fee that the Hermes Agent receives from Hermes within two (2) Business Days of receipt with same day value; and |
(iv) | relay the good faith concerns of the Borrower to Hermes regarding the amount it is required to pay to Hermes or the amount of any reimbursement to which the Hermes Agent is entitled, it being agreed that the Hermes Agent’s obligation shall be no greater than simply to pass on to Hermes the Borrower’s concerns. |
(d) | Each Lender will co‑operate with the Hermes Agent, the Facility Agent and each other Lender, and take such action and/or refrain from taking such action as may be reasonably necessary, to ensure that the Hermes Insurance Policy and each Interest Make‑Up Agreement (as defined in and entered into in accordance with the Terms and Conditions) continue in full force and effect and shall indemnify and hold harmless each other Lender in the event that the Hermes Insurance Policy or such Interest Make‑Up Agreement (as the case may be) does not continue in full force and effect due to its gross negligence or willful default. |
(i) | the government of the Federal Republic of Germany, the Federal Audit Court or any authorised representatives specified by these bodies shall be authorised at any time to inspect and make or demand copies of the records, accounts, documents and other deeds of any or all of the Lenders relating to this Agreement; |
(ii) | in the course of its activity as the Facility Agent, the Facility Agent may: |
(a) | provide the government of the Federal Republic of Germany with information concerning the transactions to be handled by it under this Agreement; and |
(b) | disclose information concerning the subsidized transaction contemplated by this Agreement in the context of internationally agreed consultation/notification proceedings and statutory specifications, including information received from the Lenders relating to this Agreement; and |
(iii) | the Facility Agent and (to the extent the Lenders have entered into an Option A Refinancing Agreement with the Refinancing Bank) the Lenders are entitled to disclose to the Refinancing Bank: |
(a) | circumstances pertaining to the Loan, proper repayment and collateralization; |
(b) | extraordinary events which may jeopardize the proper servicing of the Loan; |
(c) | any information required by the Refinancing Bank with respect to the proper use of any refinancing funds granted to the respective Lender in respect of the Loan; and |
(d) | the Loan Documents; |
Exhibit 10.7 | ||||
Dated 7 September 2016 | ||||
Royal Caribbean Cruises Ltd. (1) (the Borrower) KfW IPEX-Bank GmbH (2) (the Hermes Agent) KfW IPEX-Bank GmbH (3) (the Facility Agent) KfW IPEX-Bank GmbH (4) (as Initial Mandated Lead Arranger) Bayerische Landesbank Munich (5) BNP Paribas Fortis S.A./N.V. Commerzbank AG, New York Branch DZ Bank AG Skandinaviska Enskilda Banken AB (publ) (the Mandated Lead Arrangers) and certain financial institutions (6) (the Lenders) | ||||
Amendment No. 1 in connection with the Credit Agreement in respect of Hull S-700 |
(1) | Royal Caribbean Cruises Ltd. (a corporation organised and existing under the laws of The Republic of Liberia) (the Borrower); |
(2) | KfW IPEX-Bank GmbH as facility agent (the Facility Agent); |
(3) | KfW IPEX-Bank GmbH as Hermes agent (the Hermes Agent); |
(4) | KfW IPEX-Bank GmbH as initial mandated lead arranger (the Initial Mandated Lead Arranger); |
(5) | Bayerische Landesbank Munich, BNP Paribas Fortis S.A./N.V, Commerzbank AG, New York Branch, DZ Bank AG, and Skandinaviska Enskilda Banken AB (publ) as mandated lead arrangers (together with the Initial Mandated Lead Arranger, the Mandated Lead Arrangers); and |
(6) | The financial institutions party thereto as lenders from time to time (the Lenders). |
(A) | The Borrower, the Facility Agent, the Hermes Agent and the Lenders are parties to a credit agreement dated November 13, 2015 (the Existing Credit Agreement), in respect of the vessel with Hull number S-700 (the Vessel) whereby it was agreed that the Lenders would make available to the Borrower, upon the terms and conditions therein, a US dollar loan facility (the Facility) calculated on the amount equal to the sum of (a) up to eighty per cent (80%) of the Contract Price (as defined in the Existing Credit Agreement) of the Vessel but which Contract Price will not exceed EUR 931,000,000 and (b) up to 100% of the Hermes Fee (as defined therein). |
(B) | The Parties wish to amend the Existing Credit Agreement to the extent set out in this Amendment. |
1 | Interpretation and definitions |
1.1 | Definitions in the Existing Credit Agreement |
(a) | Unless the context otherwise requires or unless otherwise defined in this Amendment, words and expressions defined in the Existing Credit Agreement shall have the same meanings when used in this Amendment. |
(b) | The principles of construction set out in the Existing Credit Agreement shall have effect as if set out in this Amendment. |
1.2 | In this Amendment: |
1.3 | Third party rights |
1.4 | Designation |
2 | Amendment of the Existing Credit Agreement |
3 | Conditions of Effectiveness of Amended Agreement |
(a) | The Facility Agent shall have received all invoiced expenses of the Facility Agent (including the agreed fees and expenses of counsel to the Facility Agent) required to be paid by the Borrower pursuant to Section 6 below or that the Borrower has otherwise agreed in writing to pay to the Facility Agent, in each case on or prior to the Effective Date. |
(b) | The representations and warranties set forth in Section 4 are true as of the Effective Date. |
4 | Representations and Warranties |
5 | Incorporation of Terms |
6 | Costs and Expenses |
7 | Counterparts |
8 | Governing Law |
(a) | for the EUR amount payable in respect of the final (delivery) instalment of the Contract Price (excluding the portion thereof comprising the Buyer's Allowance), the total of such EUR amount converted to a corresponding Dollar amount as determined using the weighted average rate of exchange that the Borrower has agreed, either in the spot or forward currency markets, to pay its counterparties for the purchase of the relevant amount of EUR with Dollars for the payment of that final installment of the Contract Price and including in such weighted average the spot rates for any EUR amounts due that have not been hedged by the Borrower; |
(b) | for all EUR amounts payable in respect of the Buyer's Allowance, the total of such EUR amounts converted to a corresponding Dollar amount as determined using the USD-to-EUR rate used by the Borrower to convert the relevant USD amount of the amount of the Buyer's Allowance into EUR for the purpose of the Builder invoicing the same to the Borrower in EUR in accordance with the Construction Contract; and |
(c) | for the calculation and payment of the Hermes Fee in Dollars, the amount thereof in EUR converted to a corresponding Dollar amount as determined by Hermes on the basis of the latest rate for the purchase of EUR with Dollars to be published by the German Federal Ministry of Finance prior to the time that Hermes issues its invoice for the Hermes Fee. |
Exhibit 10.8 | ||||
Dated 3 July 2018 | ||||
Royal Caribbean Cruises Ltd. (1) (the Borrower) KfW IPEX-Bank GmbH (2) (the Hermes Agent) KfW IPEX-Bank GmbH (3) (the Facility Agent) KfW IPEX-Bank GmbH (4) (as Initial Mandated Lead Arranger) Bayerische Landesbank Munich (5) BNP Paribas Fortis S.A./N.V. Commerzbank AG, New York Branch DZ Bank AG, New York Branch Skandinaviska Enskilda Banken AB (publ) (the Mandated Lead Arrangers) and certain financial institutions (6) (the Lenders) | ||||
Amendment No. 2 in connection with the Credit Agreement in respect of Hull S-700 |
(1) | Royal Caribbean Cruises Ltd. (a corporation organised and existing under the laws of The Republic of Liberia) (the Borrower); |
(2) | KfW IPEX-Bank GmbH as facility agent (the Facility Agent); |
(3) | KfW IPEX-Bank GmbH as Hermes agent (the Hermes Agent); |
(4) | KfW IPEX-Bank GmbH as initial mandated lead arranger (the Initial Mandated Lead Arranger); |
(5) | Bayerische Landesbank Munich, BNP Paribas Fortis S.A./N.V, Commerzbank AG, New York Branch, DZ Bank AG, New York Branch, and Skandinaviska Enskilda Banken AB (publ) as mandated lead arrangers (together with the Initial Mandated Lead Arranger, the Mandated Lead Arrangers); and |
(6) | The financial institutions party thereto as lenders from time to time (the Lenders). |
(A) | The Borrower, the Facility Agent, the Hermes Agent and the Lenders are parties to a credit agreement dated 13 November 2015 as amended on 7 September 2016 (the Existing Credit Agreement), in respect of the vessel with Hull number S-700 (the Vessel) whereby it was agreed that the Lenders would make available to the Borrower, upon the terms and conditions therein, a US dollar loan facility (the Facility) calculated on the amount equal to the sum of (a) up to eighty per cent (80%) of the Contract Price (as defined in the Existing Credit Agreement) of the Vessel but which Contract Price will not exceed EUR 931,000,000 and (b) up to 100% of the Hermes Fee (as defined therein). |
(B) | The Parties wish to amend and restate the Existing Credit Agreement to the extent set out in this Amendment. |
1 | Interpretation and definitions |
1.1 | Definitions in the Existing Credit Agreement |
(a) | Unless the context otherwise requires or unless otherwise defined in this Amendment, words and expressions defined in the Existing Credit Agreement shall have the same meanings when used in this Amendment. |
(b) | The principles of construction set out in the Existing Credit Agreement shall have effect as if set out in this Amendment. |
1.2 | Definitions |
1.3 | Third party rights |
1.4 | Designation |
2 | Amendment of the Existing Credit Agreement |
3 | Conditions of Effectiveness of Amended Agreement |
3.1 | The Amended Agreement shall become effective in accordance with the terms of this Amendment on the date each of the following conditions has been satisfied to the reasonable satisfaction of the Facility Agent (the Effective Date): |
(a) | the Facility Agent shall have received from the Borrower: |
(i) | a certificate of its Secretary or Assistant Secretary as to the incumbency and signatures of those of its officers authorised to act with respect to this Amendment and as to the truth and completeness of the attached resolutions of its Board of Directors then in full force and effect authorising the execution, delivery and performance of this Amendment, and upon which certificate the Lenders may conclusively rely until the Facility Agent shall have received a further certificate of the Secretary or Assistant Secretary of the Borrower canceling or amending such prior certificate; and |
(ii) | a Certificate of Good Standing issued by the relevant Liberian authorities in respect of the Borrower; |
(b) | the Facility Agent shall have received all invoiced expenses of the Facility Agent (including the agreed fees and expenses of counsel to the Facility Agent) required to be paid by the Borrower pursuant to clause 6 below or that the Borrower has otherwise agreed in writing to pay to the Facility Agent, in each case on or prior to the Effective Date; |
(c) | the Facility Agent shall have received the amendment to the Hermes Insurance Policy duly issued by Hermes; and |
(d) | the representations and warranties set forth in clause 4 are true as of the Effective Date. |
3.2 | The Facility Agent shall notify the Lenders and the Borrower of the Effective Date and such notice shall be conclusive and binding. |
4 | Representations and Warranties |
5 | Incorporation of Terms |
6 | Costs and Expenses |
7 | Counterparts |
8 | Governing Law |
(A) | The Borrower and Meyer Werft GmbH & Co. KG (the "Builder") have on June 12, 2015 entered into a Contract for the Construction and Sale of Hull No. S-700 (as amended from time to time, the "Construction Contract") pursuant to which the Builder has agreed to design, construct, equip, complete, sell and deliver the passenger cruise vessel bearing Builder's hull number S-700 (the "Purchased Vessel"); |
(B) | The Lenders have agreed to make available to the Borrower, upon the terms and conditions contained herein, a US dollar loan facility calculated on the amount (the "Maximum Loan Amount") equal to (x) eighty per cent (80%) of the Contract Price (as defined below) of the Purchased Vessel (as defined below), as adjusted from time to time in accordance with the Construction Contract to reflect, among other adjustments, change orders, but which Contract Price shall not exceed for this purpose EUR 931,000,000 (the "Contract Price Proceeds"), plus (y) 100% of the Hermes Fee (as defined below) (the "Hermes Fee Proceeds") and being made available in the US Dollar Equivalent of that Maximum Loan Amount; |
(C) | The Contract Price Proceeds will be provided to the Borrower two (2) Business Days prior to the delivery of the Purchased Vessel for the purpose of paying a portion of the Contract Price in connection with the Borrower's purchase of the Purchased Vessel. The Hermes Fee Proceeds will be provided on the Disbursement Date and paid as set forth in Section 2.5(c) and (d); |
(D) | The Parties hereto have previously amended this Agreement pursuant to the an amendment agreement dated 7 September 2016 (the “Amendment Number One”); and |
(E) | Pursuant to Amendment Agreement Number Two dated as of 3 July 2018 (the “Amendment Number Two”), and upon satisfaction of the conditions set forth therein, this Agreement is being amended and restated in the form of this Agreement. |
(a) | net cash from operating activities (determined in accordance with GAAP) for such period, as shown in the Borrower's consolidated statement of cash flow for such period, to |
(b) | the sum of: |
(a) | any Interest Period which would otherwise end on a day which is not a Business Day shall end on the next Business Day to occur, except if such Business Day does not fall in the same calendar month, the Interest Period will end on the last Business Day in that calendar month, the interest amount due in respect of the Interest Period in question and in respect of the next following Interest Period being adjusted accordingly; and |
(b) | if any Interest Period is altered by the application of a) above, the subsequent Interest Period shall end on the day on which it would have ended if the preceding Interest Period had not been so altered. |
(a) | subject to Section 3.3.6, if no such rate appears on pages LIBOR01 or LIBOR02 of the Thomson Reuters screen (or any such replacement page) at the relevant time, the LIBO Rate shall be the rate per annum certified by the Facility Agent to be the average of the rates quoted by the Reference Banks as the rate at which each of the Reference Banks was (or would have been) offered deposits of Dollars by prime banks in the London interbank market in an amount approximately equal to the amount of the Loan and for a period of six months (or for such other period as shall be agreed by the Borrower and the Facility Agent); |
(b) | for the purposes of determining the post-maturity rate of interest under Section 3.3.4, the LIBO Rate shall be determined by reference to deposits on an overnight or call basis or for such other period or periods as the Facility Agent may determine after consultation with the Lenders, which period shall be no longer than one month unless the Borrower otherwise agrees; and |
(c) | if the LIBO Rate determined in accordance with the foregoing provisions of this definition is less than zero, such rate shall be deemed to be zero for purposes of this Agreement. |
(a) | all cash on hand of the Borrower and its Subsidiaries; plus |
(b) | all Cash Equivalents. |
(a) | borrowed money (whether by loan or issuance and sale of debt securities), including drawings under this Agreement and any revolving credit facilities, and |
(b) | the issuance and sale of equity securities. |
(a) | for the EUR amount payable in respect of the final (delivery) instalment of the Contract Price (excluding the portion thereof comprising the Buyer's |
(b) | for all EUR amounts payable in respect of the Buyer's Allowance, the total of such EUR amounts converted to a corresponding Dollar amount as determined using the USD-to-EUR rate used by the Borrower to convert the relevant USD amount of the amount of the Buyer's Allowance into EUR for the purpose of the Builder invoicing the same to the Borrower in EUR in accordance with the Construction Contract; and |
(c) | for the calculation and payment of the Hermes Fee in Dollars, the amount thereof in EUR converted to a corresponding Dollar amount as determined by Hermes on the basis of the latest rate for the purchase of EUR with Dollars to be published by the German Federal Ministry of Finance prior to the time that Hermes issues its invoice for the Hermes Fee. |
(a) | Each Lender's Commitment shall terminate on the earlier of (i) the Commitment Termination Date if the Purchased Vessel is not delivered to the Borrower prior to such date and (ii) the delivery to the Borrower of the Purchased Vessel. |
(b) | If any Lender shall default in its obligations under Section 2.1, the Facility Agent shall, at the request of the Borrower, use reasonable efforts to assist the Borrower in finding a bank or financial institution acceptable to the Borrower to replace such Lender. |
(a) | If the Reduction Notice is delivered by the Borrower at least 63 days prior to the actual Disbursement Date, the Borrower shall not incur any liability to make any payments pursuant to Section 4.4 or to incur any other indemnity or compensation obligation. If the Reduction Notice is delivered by the Borrower less than 63 days prior to the actual Disbursement Date, the Borrower shall either (i) pay such compensation to the relevant Lender as required by, and in accordance with, Section 4.4 to the extent such Lender incurs a loss as set out in Section 4.4 or (ii) extend the Disbursement Date to a date that falls at least 63 days after the Reduction Notice was first delivered by the Borrower. In the event that the Borrower elects the option under the foregoing clause (ii), the Borrower shall deliver a Loan Request to the Facility Agent in accordance with Section 2.5(a), and the proposed Disbursement Date set out in such Loan Request shall be a date that falls at least 63 days after the Reduction Notice was first delivered by the Borrower. |
(a) | The Facility Agent shall promptly notify each Lender of any Loan Request by forwarding a copy thereof to each Lender, together with its attachments. On the terms and subject to the conditions of this Agreement, the Loan shall be made on the Business Day specified in such Loan Request. On or before 2:00 p.m., London time, on the Business Day specified in such Loan Request, each Lender shall, |
(b) |
(c) | The Borrower shall, upon receipt of the Dollar funds into the account referred to in Section 2.5(b) above, (i) complete the purchase of EUR with its counterparties or otherwise as set out in the Loan Request (by authorising and instructing the Facility Agent to remit the necessary Dollar funds to the said counterparties) and shall procure the payment of all EUR proceeds of such transactions to the EUR Pledged Account no later than the Business Day immediately following the Business Day specified in the Loan Request and (ii) to the extent of any such Dollar funds as shall not be used to purchase EUR, shall procure (by authorising and instructing the Facility Agent accordingly) the payment of such Dollar funds to the Dollar Pledged Account on the Disbursement Date. |
(d) | Upon the date of delivery to the Borrower of the Purchased Vessel, the Facility Agent shall direct that moneys standing to the credit of the Pledged Accounts shall, in the manner set out in the Loan Request and in accordance with the requirements and provisions of the Pledge Agreement, be disbursed as follows: |
i. | in EUR, to the account of the Builder, as designated by the Builder and identified by the Borrower in the Loan Request, to the extent necessary to meet the final instalment of the Contract Price (including any portion thereof attributable to the Buyer's Allowance); and |
ii. | in Dollars, (y) to Hermes in payment of the Second Fee; and (z) to the account of the Borrower, as designated by the Borrower and identified by the Borrower in the Loan Request, in reimbursement of the First Fee and in respect of any additional amounts standing to the Dollar Pledged Account as of the date of such disbursement, |
(a) | If, on the date of delivery to the Borrower of the Purchased Vessel, the outstanding principal amount of the Loan exceeds the US Dollar Maximum Loan Amount (as a result of a reduction in the Contract Price after the Disbursement Date and before the delivery of the Purchased Vessel), the Borrower shall repay the Loan in an amount equal to such excess within two (2) Business Days after the date of delivery to the Borrower of the Purchased Vessel. Any such partial prepayment shall be applied pro rata in satisfaction of the remaining scheduled repayment instalments of the Loan. |
(b) | No amount repaid by the Borrower pursuant to this Section 3.1 may be re-borrowed under the terms of this Agreement. |
i. | may, from time to time on any Business Day, make a voluntary prepayment, in whole or in part, of the outstanding principal amount of the Loan; provided that: |
a. | all such voluntary prepayments shall require (x) for prepayments on or after the Disbursement Date made prior to delivery to the Borrower of the Purchased Vessel in respect of the advance made on the Disbursement Date, at least two (2) Business Days' prior written notice to the Facility Agent, and (y) for all other prepayments, at least 30 calendar days' prior written notice, if all or any portion of the Loan is a Fixed Rate Loan, and at least five (5) Business Days' (or, if such prepayment is to be made on the last day of an Interest Period for such Loan, four (4) Business Days') prior written notice, if the Loan is a Floating Rate Loan, in each case to the Facility Agent; and |
b. | all such voluntary partial prepayments shall be in an aggregate minimum amount of $10,000,000 and a multiple of $1,000,000 (or in the remaining amount of the Loan) and shall be applied in inverse order of maturity or ratably among all remaining instalments, as the Borrower shall designate to the Facility Agent, in satisfaction of the remaining repayment instalments of the Loan; and |
ii. | shall, immediately upon any acceleration of the repayment of the instalments of the Loan pursuant to Section 8.2 or 8.3 or the mandatory prepayment of the Loan pursuant to Section 9.2, repay the Loan. |
(a) | If, by reason of a Change in Law, it becomes unlawful under any applicable law (i) for a Lender to be subject to a commitment to make available to the Borrower such Lender's portion of the Loan hereunder as provided in Section 2.2, (ii) for a Lender to make or hold its portion of the Loan in its Lending Office, (iii) for a Lender to receive a payment under this Agreement or any other Loan Document or (iv) for a Lender to comply with any other material provision of, or to perform its obligations as contemplated by, this Agreement or any other Loan Document, the Lender affected by such Change in Law may give written notice (the "Illegality Notice") to the Borrower and the Facility Agent of such Change in Law, including reasonable details of the relevant Change of Law. Any Illegality Notice must be given by a Lender no later than 120 days after such Lender first obtains actual knowledge or written notice of the relevant Change in Law. |
(b) | If an affected Lender delivers an Illegality Notice prior to the Disbursement Date, then, subject to Section 11.17, (1) whilst the arrangements contemplated by the following clause (2) have not yet been completed and the Commitment of such Lender has not been formally cancelled, such Lender shall not be obliged to fund its Commitment and (2) the Borrower shall be entitled at any time within 50 days after receipt of such Illegality Notice to replace such Lender with one or more financial institutions (I) reasonably acceptable to the Facility Agent, (II) meeting the criteria set out in Section 2.2 of the Terms and Conditions, (III) acceptable to Hermes and (IV) in the case of a replacement of an Option A Lender, reasonably acceptable to KfW; provided that any such assignment shall be either (x) in the case of a single assignment, an assignment of all of the rights and obligations of the assigning Lender under this Agreement or (y) in the case of more than one assignment, an assignment of a portion of such rights and obligations made concurrently with another such assignment or other such assignments that collectively cover all of the rights and obligations of the assigning Lender under this Agreement. If, at the end of such 50-day period, the Borrower has not so replaced such affected Lender as aforesaid and no alternative arrangements have been implemented pursuant to Section 11.17, the Commitment held by such Lender shall be cancelled. |
(c) | If an affected Lender delivers an Illegality Notice on or following the Disbursement Date, then the Borrower shall have the right, but not the obligation, exercisable at any time within 50 days after receipt of such Illegality Notice (the "Option Period"), either (1) to prepay the portion of the Loan held by such Lender in full on or before the expiry of the Option Period, together with all unpaid interest and fees thereon accrued to but excluding the date of such prepayment, or (2) to replace such Lender on or before the expiry of the Option Period with one or more financial institutions (I) reasonably acceptable to the Facility Agent, (II) meeting the criteria set out in Section 2.2 of the Terms and Conditions, (III) acceptable to Hermes and (IV) in the case of a replacement of an Option A Lender, reasonably acceptable to KfW; provided that (x) in the case of a single assignment, any such assignment shall be either an assignment of all of the rights and obligations of the assigning Lender under this Agreement or, in the case of more than one assignment, an assignment of a portion of such rights and obligations made concurrently with another such assignment or other such assignments that collectively cover all of the rights and obligations of the assigning Lender under this Agreement and (y) no Lender shall be obligated to make any such assignment as a result of an election by the Borrower pursuant to this Section 3.2(d) unless and until such Lender shall have received one or more payments from one or more Assignee Lenders and/or the Borrower in an aggregate amount at least equal to the portion of the Loan held by such Lender, together with all unpaid interest and fees thereon accrued to but excluding the date of such assignment (and all other amounts then owing to such Lender under this Agreement). |
(d) | Each prepayment of the Loan made pursuant to this Section 3 shall be without premium or penalty, except as may be required by Section 4.4. No amounts prepaid by the Borrower may be re-borrowed under the terms of this Agreement except as provided in Section 3.7 and the last paragraph of Section 9.1 (which follows Section 9.1.11). |
(a) | If the Borrower has not elected the Floating Rate prior to the Disbursement Date as permitted by Section 3.3.2(a), the Borrower may elect, by written notice to the Facility Agent no later than 2:00 p.m. Frankfurt time 32 days prior to the end of an Interest Period and subject to Section 4.4, to pay interest on the Loan for the remainder of the term of the Loan at the Floating Rate, with effect from the end of that Interest Period. |
(b) | Any election made under any of Section 3.3.2(a) or Section 3.3.2(b) may only be made one time during the term of the Loan and shall be irrevocable. |
(a) | each Repayment Date; |
(b) | the date of any prepayment, in whole or in part, of principal outstanding on the Loan (but only on the principal so prepaid); |
(c) | on that portion of the Loan the repayment of which is accelerated pursuant to Section 8.2 or Section 8.3, immediately upon such acceleration; and |
(d) | in the case of any interest on any principal, interest or other amount owing under this Agreement or any other Loan Document that is overdue, from time to time on demand of the Facility Agent until such overdue amount is paid in full. |
(a) | Dollar deposits in the relevant amount and for the relevant Interest Period are not available to each Reference Bank in its relevant market, or |
(b) | by reason of circumstances affecting the Reference Banks' relevant markets, adequate means do not exist for ascertaining the interest rate applicable hereunder to LIBO Rate loans for the relevant Interest Period, or |
(c) | the cost to Option B Lenders that in the aggregate hold more than 50% of the aggregate outstanding principal amount of the Loan then held by Option B Lenders, if any Lender shall have entered into an Option B Interest Make-Up Agreement, of obtaining matching deposits in the relevant interbank market for the relevant Interest Period would be in excess of the LIBO Rate (provided that no Option B Lender may exercise its rights under this Section 4.2(c) for amounts up to the difference between such |
(a) | subject any Lender to any taxes, levies, duties, charges, fees, deductions or withholdings of any nature with respect to its portion of the Loan or any part thereof imposed, levied, collected, withheld or assessed by any jurisdiction or any political subdivision or taxing authority thereof (other than (i) taxes as to which such Lender is indemnified under Section 4.6 and (ii) taxes excluded from the indemnity set forth in Section 4.6); or |
(b) | change the basis of taxation to any Lender (other than a change in taxation on the overall net income of any Lender) of payments of principal or interest or any other payment due or to become due pursuant to this Agreement; or |
(c) | impose, modify or deem applicable any reserve or capital adequacy requirements (other than the increased capital costs described in Section 4.5 and the reserve costs described in Section 4.7) or other banking or monetary controls or requirements which affect the manner in which a Lender shall allocate its capital resources to its obligations hereunder or require the making of any special deposits against or in respect of any assets or liabilities of, deposits with or for the account of, or loans by, any Lender (provided that such Lender shall, unless prohibited by law, allocate its capital resources to its obligations hereunder in a manner which is consistent with its present treatment of the allocation of its capital resources); or |
(d) | impose on any Lender any other condition affecting its portion of the Loan or any part thereof, |
(a) | if at the time interest is calculated at the Floating Rate on such Lender's portion of the Loan, any conversion or repayment or prepayment or acceleration of the principal amount of such Lender's portion of the Loan on a date other than the scheduled last day of an Interest Period or otherwise scheduled date for repayment or payment (in each case, including payments made in accordance with Section 3.1(b), but excluding any prepayment made following an election by the Borrower to effect a prepayment pursuant to Section 3.2(d), or any repayment pursuant to Section 9.1.12, by reason of a Non-Borrower Related Change in Law); |
(b) | if at the time interest is calculated at the Fixed Rate on such Lender's portion of the Loan, any repayment or prepayment or acceleration of the principal amount of such Lender's portion of the Loan, other than any repayment made on the date scheduled for such repayment (in each case, excluding any prepayment made following an election by the Borrower to effect a prepayment pursuant to Section 3.2(d), or any repayment pursuant to Section 9.1.12, by reason of a Non-Borrower Related Change in Law); |
(c) | without prejudice to the rights of the Borrower to elect an option under Section 3.3.2(a), an election by the Borrower of the Floating Rate in accordance with Section 3.3.2(a) (where the Disbursement Date is a date that falls less than 63 days after the Floating Rate Election Notice was delivered by the Borrower) or Section 3.3.2(b); |
(d) | a reduction or termination of the Commitments by the Borrower pursuant to Section 2.3(b)(i); |
(e) | the Loan not being made in accordance with the Loan Request therefor due to the fault of the Borrower or as a result of any of the conditions precedent set forth in Article V not being satisfied; or |
(f) | any prepayment of the Loan by the Borrower pursuant to Section 3.7; |
a. | if at that time interest is calculated at the Floating Rate on such Lender's portion of the Loan, pay directly to the Facility Agent for the account of such Lender an amount (the "Floating Rate Indemnity Amount") equal to the amount, if any, by which: |
(i) | interest calculated at the Floating Rate which such Lender would have received on its share of the amount of the Loan subject to such Funding Losses Event for the period from the date of receipt of any part of its share in the Loan to the last day of the applicable Interest Period, |
(ii) | the amount which such Lender would be able to obtain by placing an amount equal to the amount received by it on deposit with a leading bank in the appropriate interbank market for a period starting on the Business Day following receipt and ending on the last day of the applicable Interest Period; or |
b. | if at that time interest is calculated at the Fixed Rate on such Lender's portion of the Loan, pay to the Facility Agent the sum of: |
(A) | an amount equal to the amount, if any, by which: |
(i) | interest calculated at the rate per annum equal to (a) the CIRR which such Lender would have received on its share of the amount of the Loan subject to such Funding Losses Event minus (b) the administrative margin of 0.20%, for the period from the date of receipt of any part of its share of the Loan to the final scheduled date for the repayment of Loan in full pursuant to Section 3.1, |
(ii) | the amount by which such Lender would be able to obtain by placing for such remaining period an equal amount to the amount received by it on deposit and receiving interest equal to the money market rate then applicable to Dollars on the Reuters page "ICAP1" (the "Reinvestment Rate"), |
(B) | an amount equal to the Floating Rate Indemnity Amount (and assuming for the purpose of this calculation that the interest on the Loan is calculated at the Floating Rate and not the Fixed Rate). |
(a) | pay directly to the relevant authority the full amount required to be so withheld or deducted; |
(b) | promptly forward to the Facility Agent an official receipt or other documentation satisfactory to the Facility Agent evidencing such payment to such authority; and |
(c) | pay to the Facility Agent for the account of the Lenders such additional amount or amounts as is necessary to ensure that the net amount actually received by each Lender will equal the full amount such Lender would have received had no such withholding or deduction been required. |
(a) | the principal amount of the Loan outstanding on such day; and |
(b) | the remainder of (x) a fraction the numerator of which is the rate (expressed as a decimal) at which interest accrues on the Loan for such Interest Period as provided in this Agreement (less, if applicable, the Floating Rate Margin) and the denominator of which is one minus any increase after the Effective Date in the effective rate (expressed as a decimal) at which such reserve requirements are imposed on such Lender minus (y) such numerator; and |
(c) | 1/360. |
(a) |
i. | Each Option A Lender hereby instructs the Facility Agent to remit all payments of interest made with respect to any portion of the Loan held by such Option A Lender to KfW (A) less (x) the Fixed Rate Margin and (y) the CIRR administrative fee of 0.20% but plus (z) an agreed KfW margin, if interest on the portion of the Loan made by that Lender is then calculated at the Fixed Rate, or (B) less (x) the Floating Rate Margin but plus (y) an agreed KfW margin, if interest on that portion of the Loan is then calculated at the Floating Rate. |
ii. | Each Option B Lender hereby instructs the Facility Agent, with respect to any portion of the Loan held by such Option B Lender, to pay directly to such Option B Lender interest thereon at the Fixed Rate or the Floating Rate (whichever is applicable), on the basis that, if interest on such portion of the Loan is then calculated at the Fixed Rate, such Option B Lender will, where amounts are payable to the KfW by that Option B Lender under the CIRR Agreement, account directly to the KfW on behalf of the Federal Republic of Germany for any such amounts payable by that Lender under the CIRR Agreement to which such Lender is a party. |
(b) | The Facility Agent shall promptly (but in any event on the same Business Day that the same are received or, as contemplated in clause (a) of this Section, deemed received) remit in same day funds to each Lender its share, if any, of such payments received by the Facility Agent for the account of such Lender without any set-off, deduction or counterclaim. All interest and fees shall be computed on the basis of the actual number of days (including the first day but excluding the last day) occurring during the period for which such interest or fee is payable over a year comprised of 360 days. Whenever any payment to be made shall otherwise be due on a day which is not a Business Day, such payment shall (except as otherwise required by clause (a) of the definition of the term "Interest Period") be made on the next succeeding Business Day and such extension of time shall be included in computing interest and fees, if any, in connection with such payment. |
(a) | the Recovering Lender shall, within three (3) Business Days, notify details of the receipt or recovery to the Facility Agent; |
(b) | the Facility Agent shall determine whether the receipt or recovery is in excess of the amount the Recovering Lender would have been paid had the receipt or recovery been received or made by the Facility Agent and distributed in accordance with the said Section 4.8, without taking account of any taxes which would be imposed on the Facility Agent in relation to the receipt, recovery or distribution; and |
(c) | the Recovering Lender shall, within three (3) Business Days of demand by the Facility Agent, pay to the Facility Agent an amount (the "Sharing Payment") equal to such receipt or recovery less any amount which the Facility Agent determines may be |
(a) | each Sharing Lender shall, upon request of the Facility Agent, pay to the Facility Agent for the account of that Recovering Lender an amount equal to the appropriate part of its share of the Sharing Payment (together with an amount as is necessary to reimburse that Recovering Lender for its proportion of any interest on the Sharing Payment which that Recovering Lender is required to pay) (the "Redistributed Amount"); and |
(b) | solely as between the Borrower and each relevant Sharing Lender, an amount equal to the relevant Redistributed Amount will be treated as not having been paid by the Borrower. |
(a) | This Section 4.10 shall not apply to the extent that the Recovering Lender would not, after making any payment pursuant to this Section 4.10, have a valid and enforceable claim against the Borrower. |
(b) | A Recovering Lender is not obliged to share with any other Lender any amount which the Recovering Lender has received or recovered as a result of taking legal or arbitration proceedings, if: |
i. | it notified the other Lender of the legal or arbitration proceedings; and |
ii. | the other Lender had an opportunity to participate in those legal or arbitration proceedings but did not do so as soon as reasonably practicable |
(e) | If the Borrower becomes a US Tax Obligor or the Facility 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 the Borrower is a US Tax Obligor and the relevant Lender is KfW IPEX, the date of this Agreement; |
(ii) | where the Borrower is a US Tax Obligor on a date an assignment or transfer is made pursuant to Section 11.11.1 and the relevant Lender is an Assignee Lender that becomes a Lender in accordance with Section 11.11.1, the date on which such Assignee Lender becomes a Lender; |
(iii) | where the Borrower is not a US Tax Obligor, the date of a request from the Facility Agent, |
(A) | a withholding certificate on Form W-8 (or any successor form), Form W-9 (or any successor form) or any other relevant form; or |
(B) | any withholding statement or other document, authorisation or waiver as the Facility Agent may require to certify or establish the status of such Lender under FATCA or that other law or regulation. |
(f) | The Facility Agent shall provide any withholding certificate, withholding statement, document, authorisation or waiver it receives from a Lender pursuant to paragraph (e) above to the Borrower. |
(g) | If any withholding certificate, withholding statement, document, authorisation or waiver provided to the Facility Agent by a Lender pursuant to paragraph (e) 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 Facility Agent unless it is unlawful for the Lender to do so (in which case the Lender shall promptly notify the Facility Agent). The Facility Agent shall provide any such updated withholding certificate, withholding statement, document, authorisation or waiver to the Borrower. |
(h) | The Facility Agent may rely on any withholding certificate, withholding statement, document, authorisation or waiver it receives from a Lender pursuant to paragraph (e) or (g) above without further verification. The Facility Agent shall not be liable for any action taken by it under or in connection with paragraph (e), (f) or (g) above. |
(a) | a certificate of its Secretary or Assistant Secretary as to the incumbency and signatures of those of its officers authorised to act with respect to this Agreement and each other Loan Document and as to the truth and completeness of the attached: |
i. | resolutions of its Board of Directors then in full force and effect authorising the execution, delivery and performance of this Agreement and each other Loan Document, and |
ii. | Organic Documents of the Borrower, |
(b) | a Certificate of Good Standing issued by the relevant Liberian authorities in respect of the Borrower. |
(a) | Watson, Farley & Williams LLP, counsel to the Borrower, as to Liberian Law, covering the matters set forth in Exhibit B-1 hereto; |
(b) | Norton Rose Fulbright LLP, counsel to the Facility Agent and the Lenders, covering the matters set forth in Exhibit B-2 hereto; |
(c) | Norton Rose Fulbright LLP, counsel to the Facility Agent and the Lenders as to German law, an opinion addressed to the Facility Agent and the Lenders covering the matters set forth in Exhibit B-3 hereto; |
(d) | Clifford Chance US LLP, United States tax counsel to the Facility Agent for the benefit of Lenders, covering the matters set forth in Exhibit B-4 hereto; and |
(e) | if requested by a Lender at least 90 days prior to the expected Disbursement Date in order to comply with Article 194 of the Regulation (EU) No 575/2013 (CRR), a single legal opinion (for the benefit of all the Lenders notwithstanding that not all the Lenders have requested the same) on matters of German law related to the validity and enforceability of the Hermes Insurance Policy, |
(a) | The Facility Agent or the Hermes Agent shall have received the Hermes Insurance Policy duly issued; and |
(b) | Hermes shall not have, prior to the advance of the Loan, delivered to the Facility Agent or the Hermes Agent any notice that the Federal Republic of Germany has determined that the Loan is excluded from cover under the Hermes Insurance Policy. |
(a) | the representations and warranties set forth in Article VI (excluding, however, those set forth in Section 6.10) shall be true and correct in all material respects except for those representations and warranties that are qualified by materiality or Material Adverse Effect, which shall be true and correct, with the same effect as if then made; and |
(b) | no Default and no Prepayment Event and no event which (with notice or lapse of time or both) would become a Prepayment Event shall have then occurred and be continuing. |
(a) | certified as true (by the Builder) copies of the reimbursement request and supporting documents received by the Builder from the Borrower pursuant to Article XVII.1(b) of the Construction Contract in relation to the incurred Buyer's Allowance; |
(b) | a copy of the final invoice from the Builder showing the amount of the Contract Price (including the Buyer's Allowance) and the portion thereof payable to the Builder on the Delivery Date under the Construction Contract; and |
(c) | appropriate evidence of all payments made by the Borrower to the Builder on or prior to the Disbursement Date under the Construction Contract in respect of the Contract Price (including, without limitation, the twenty per cent (20%) equity payment thereunder). |
(a) | contravene the Borrower's Organic Documents; |
(b) | contravene any law or governmental regulation of any Applicable Jurisdiction except as would not reasonably be expected to result in a Material Adverse Effect; |
(c) | contravene any court decree or order binding on the Borrower or any of its property except as would not reasonably be expected to result in a Material Adverse Effect; |
(d) | contravene any contractual restriction binding on the Borrower or any of its property except as would not reasonably be expected to result in a Material Adverse Effect; or |
(e) | result in, or require the creation or imposition of, any Lien on any of the Borrower's properties except: (i) as would not reasonably be expected to result in a Material Adverse Effect or (ii) or Liens created under the Loan Documents. |
(a) | legally and beneficially owned by the Borrower or one of the Borrower's wholly owned Subsidiaries, |
(b) | registered in the name of the Borrower or one of the Borrower's wholly owned Subsidiaries under the Bahamian or Maltese flag or such other flag as the parties may mutually agree, |
(c) | classed as required by Section 7.1.4(b), |
(d) | free of all recorded Liens, other than Liens permitted by Section 7.2.3, |
(e) | insured against loss or damage in compliance with Section 7.1.5, and |
(f) | exclusively operated by or chartered to the Borrower or one of the Borrower's wholly owned Subsidiaries. |
(a) | as soon as available and in any event within 60 days after the end of each of the first three Fiscal Quarters of each Fiscal Year of the Borrower, a copy of the Borrower's report on Form 10-Q (or any successor form) as filed by the Borrower with the SEC for such Fiscal Quarter, containing unaudited consolidated financial statements of the Borrower for such Fiscal Quarter (including a balance sheet and profit and loss statement) prepared in accordance with GAAP, subject to normal year-end audit adjustments; |
(b) | as soon as available and in any event within 120 days after the end of each Fiscal Year of the Borrower, a copy of the Borrower's annual report on Form 10-K (or any successor form) as filed by the Borrower with the SEC for such Fiscal Year, containing audited consolidated financial statements of the Borrower for such Fiscal Year prepared in accordance with GAAP (including a balance sheet and profit and loss statement) and audited by PricewaterhouseCoopers LLP or another firm of independent public accountants of similar standing; |
(c) | together with each of the statements delivered pursuant to the foregoing clause (a) or (b), a certificate, executed by the chief financial officer, the treasurer or the corporate controller of the Borrower, showing, as of the last day of the relevant Fiscal Quarter or Fiscal Year compliance with the covenants set forth in Section 7.2.4 (in reasonable detail and with appropriate calculations and computations in all respects reasonably satisfactory to the Facility Agent); |
(d) | as soon as possible after the occurrence of a Default or Prepayment Event, a statement of the chief financial officer of the Borrower setting forth details of such Default or Prepayment Event (as the case may be) and the action which the Borrower has taken and proposes to take with respect thereto; |
(e) | as soon as the Borrower becomes aware thereof, notice of any Material Litigation except to the extent that such Material Litigation is disclosed by the Borrower in filings with the SEC; |
(f) | promptly after the sending or filing thereof, copies of all reports which the Borrower sends to all holders of each security issued by the Borrower, and all registration statements which the Borrower or any of its Subsidiaries files with the SEC or any national securities exchange; and |
(g) | such other information respecting the condition or operations, financial or otherwise, of the Borrower or any of its Subsidiaries as any Lender through the Facility Agent may from time to time reasonably request; |
(a) | in the case of the Borrower, the maintenance and preservation of its corporate existence (subject to the provisions of Section 7.2.6); |
(b) | in the case of the Borrower, maintenance of its qualification as a foreign corporation in the State of Florida; |
(c) | the payment, before the same become delinquent, of all taxes, assessments and governmental charges imposed upon it or upon its property, except to the extent being diligently contested in good faith by appropriate proceedings; |
(d) | compliance with all applicable Environmental Laws; |
(e) | compliance with all anti-money laundering laws and Anti-Corruption Laws applicable to the Borrower, including by not making or causing to be made any offer, gift or payment, consideration or benefit of any kind to anyone, either directly or indirectly, as an inducement or reward for the performance of any of the transactions contemplated by this Agreement to the extent the same would be in contravention of such applicable laws; and |
(f) | the Borrower will maintain in effect policies and procedures designed to procure compliance by the Borrower, its Subsidiaries and their respective directors, officers and employees with Anti-Corruption Laws and applicable Sanctions. |
(a) | from the Delivery Date, cause the Purchased Vessel to be exclusively operated by or chartered to the Borrower or one of the Borrower's wholly owned Subsidiaries, provided that the Borrower or such Subsidiary may charter out the Purchased Vessel (i) to entities other than the Borrower and the Borrower's wholly owned Subsidiaries and (ii) on a time charter with a stated duration not in excess of one year; |
(b) | from the Delivery Date, cause the Purchased Vessel to be kept in such condition as will entitle her to classification by a classification society of recognised standing; |
(c) | on the Delivery Date, provide the following to the Facility Agent with respect to the Purchased Vessel: |
(d) | within seven days after the Delivery Date, provide the following to the Facility Agent with respect to the Purchased Vessel: |
(a) | Indebtedness secured by Liens of the type described in Section 7.2.3; |
(b) | Indebtedness owing to the Borrower or a direct or indirect Subsidiary of the Borrower; |
(c) | Indebtedness incurred to finance, refinance or refund the cost (including the cost of construction) of assets acquired after the Effective Date; |
(d) | Indebtedness in an aggregate principal amount, together with (but without duplication of) Indebtedness permitted to be secured under Section 7.2.3(c), at any one time outstanding not exceeding (determined at the time of creation of such Lien or the incurrence by any Existing Principal Subsidiary of such Indebtedness, as applicable) 10.0% of the total assets of the Borrower and its Subsidiaries taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter; and |
(e) | obligations in respect of Hedging Instruments entered into for the purpose of managing interest rate, foreign currency exchange or commodity exposure risk and not for speculative purposes. |
(a) | Liens on assets (including, without limitation, shares of capital stock of corporations and assets owned by any corporation that becomes a Subsidiary of the Borrower after the Effective Date) acquired after the Effective Date (whether by purchase, construction or otherwise) by the Borrower or any of its Subsidiaries (other than (x) an Existing Principal Subsidiary or (y) any other Principal Subsidiary which, at any time, after three months after the acquisition of a Vessel, owns a Vessel free of any mortgage Lien), which Liens were created solely for the purpose of securing Indebtedness representing, or incurred to finance, refinance or refund, the cost (including the cost of construction) of such assets, so long as (i) the acquisition of such assets is not otherwise prohibited by the terms of this Agreement and (ii) each such Lien is created within three months after the acquisition of the relevant assets; |
(b) | the Construction Mortgage but only to the extent that the same is discharged on the Delivery Date; |
(c) | in addition to other Liens permitted under this Section 7.2.3, Liens securing Indebtedness in an aggregate principal amount, together with (but without duplication of) Indebtedness permitted under Section 7.2.2(d), at any one time outstanding not exceeding (determined at the time of creation of such Lien or the incurrence by any Existing Principal Subsidiary of such indebtedness, as applicable) (i) 10.0% of the total assets of the Borrower and its Subsidiaries (the “Lien Basket Amount”) taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter; provided, however that, if, at any time, the Senior Debt Rating of the Borrower is less than Investment Grade as given by both Moody’s and S&P, the Lien Basket Amount shall be the greater of (x) 5.0% of the total assets of the Borrower and its Subsidiaries taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter and (y) $735,000,000; |
(d) | Liens on assets acquired after the Effective Date by the Borrower or any of its Subsidiaries (other than by (x) any Subsidiary that is an Existing Principal Subsidiary or (y) any other Principal Subsidiary which, at any time, owns a Vessel free of any mortgage Lien) so long as (i) the acquisition of such assets is not otherwise prohibited by the terms of this Agreement and (ii) each of such Liens existed on such assets before the time of its acquisition and was not created by the Borrower or any of its Subsidiaries in anticipation thereof; |
(e) | Liens on any asset of any corporation that becomes a Subsidiary of the Borrower (other than a corporation that also becomes a Subsidiary of an Existing Principal Subsidiary) after the Effective Date so long as (i) the acquisition or creation of such corporation by the Borrower is not otherwise prohibited by the terms of this Agreement and (ii) such Liens are in existence at the time such corporation becomes a Subsidiary of the Borrower and were not created by the Borrower or any of its Subsidiaries in anticipation thereof; |
(f) | Liens securing Government-related Obligations; |
(g) | Liens for taxes, assessments or other governmental charges or levies not at the time delinquent or thereafter payable without penalty or being diligently contested in good faith by appropriate proceedings; |
(h) | Liens of carriers, warehousemen, mechanics, materialmen and landlords incurred in the ordinary course of business for sums not overdue by more than 60 days or being diligently contested in good faith by appropriate proceedings; |
(i) | Liens incurred in the ordinary course of business in connection with workers' compensation, unemployment insurance or other forms of governmental insurance or benefits; |
(j) | Liens for current crew's wages and salvage; |
(k) | Liens arising by operation of law as the result of the furnishing of necessaries for any Vessel so long as the same are discharged in the ordinary course of business or are being diligently contested in good faith by appropriate proceedings; |
(l) | Liens on Vessels that: |
(m) | normal and customary rights of set-off upon deposits of cash or other Liens originating solely by virtue of any statutory or common law provision relating to bankers' liens, rights of set-off or similar rights in favour of banks or other depository institutions; |
(n) | Liens in respect of rights of set-off, recoupment and holdback in favour of credit card processors securing obligations in connection with credit card processing services incurred in the ordinary course of business; |
(o) | Liens on cash or Cash Equivalents or marketable securities securing: |
(p) | deposits to secure the performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case in the ordinary course of business and deposits securing liabilities to insurance carriers under insurance or self-insurance arrangements; |
(q) | easements, zoning restrictions, rights-of-way and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or interfere with the ordinary conduct of business of the Borrower or any Subsidiary; and |
(r) | licenses, sublicenses, leases or subleases granted to other Persons not materially interfering with the conduct of the business of the Borrower or any of its Subsidiaries. |
(a) | Net Debt to Capitalisation Ratio, as at the end of any Fiscal Quarter, to be greater than 0.625 to 1. |
(b) | Fixed Charge Coverage Ratio to be less than 1.25 to 1 as at the last day of any Fiscal Quarter. |
(a) | any such Subsidiary may (i) liquidate or dissolve voluntarily into, and may merge with and into, the Borrower or any other Subsidiary, and the assets or stock of any Subsidiary may be purchased or otherwise acquired by the Borrower or any other Subsidiary or (ii) merge with and into another Person in connection with a sale or other disposition permitted by Section 7.2.7; and |
(b) | so long as no Event of Default or Prepayment Event has occurred and is continuing or would occur after giving effect thereto, the Borrower or any of its Subsidiaries may merge into any other Person, or any other Person may merge into the Borrower or any such Subsidiary, or the Borrower or any of its Subsidiaries may purchase or otherwise acquire all or substantially all of the assets of any Person, in each case so long as: |
(A) | the surviving corporation shall have assumed in a writing, delivered to the Facility Agent, all of the Borrower's obligations hereunder and under the other Loan Documents; |
(B) | the surviving corporation shall, promptly upon the request of the Facility Agent or any Lender, supply such documentation and other evidence as is reasonably requested by the Facility Agent or any Lender in order for the Facility Agent or such Lender to carry out and be satisfied it has complied with the results of all necessary “know your customer” or other similar checks under all applicable laws and regulations; and |
(C) | as soon as practicable after receiving notice from the Borrower of such merger, and in any event no later than five Business Days after the delivery of such notice, for a surviving corporation that is organized under the laws of a jurisdiction other than of the United States or a political subdivision thereof or Liberia, any Lender that may not legally lend to, establish credit for the account of and/or do any business whatsoever with such surviving corporation, either directly or through an Affiliate of such Lender (a “Protesting Lender”) shall so notify the Borrower and the Facility Agent in writing. With respect to each Protesting Lender, the Borrower shall, effective on or before the date that such surviving corporation shall have the right to borrow hereunder, notify the Facility Agent and such Protesting Lender that the Commitments of such Protesting Lender shall be terminated; provided that such Protesting Lender shall have received one or more payments from either the Borrower or one or more assignees in an aggregate amount at least equal to the aggregate outstanding principal amount of the Loan owing to such Protesting Lender, together with accrued interest thereon to the date of payment of such principal amount and all other amounts payable to such Protesting Lender under this Agreement. |
(a) | generally fail to pay, or admit in writing its inability to pay, its debts as they become due; |
(b) | apply for, consent to, or acquiesce in, the appointment of a trustee, receiver, sequestrator or other custodian for it or any of its property, or make a general assignment for the benefit of creditors; |
(c) | in the absence of such application, consent or acquiescence, permit or suffer to exist the appointment of a trustee, receiver, sequestrator or other custodian for it or for a substantial part of its property, and such trustee, receiver, sequestrator or other custodian shall not be discharged within 60 days, provided that in the case of such an event in respect of the Borrower, the Borrower hereby expressly authorises the Facility Agent and each Lender to appear in any court conducting any relevant proceeding during such 60-day period to preserve, protect and defend their respective rights under the Loan Documents; |
(d) | permit or suffer to exist the commencement of any bankruptcy, reorganisation, debt arrangement or other case or proceeding under any bankruptcy or insolvency law, or any dissolution, winding up or liquidation proceeding, in respect of the Borrower or any of such Subsidiaries, and, if any such case or proceeding is not commenced by the Borrower or such Subsidiary, such case or proceeding shall be consented to or acquiesced in by the Borrower or such Subsidiary or shall result in the entry of an order for relief or shall remain for 60 days undismissed, provided that the Borrower hereby expressly authorises the Facility Agent and each Lender to appear in any court conducting any such case or proceeding during such 60-day period to preserve, protect and defend their respective rights under the Loan Documents; or |
(e) | take any corporate action authorising, or in furtherance of, any of the foregoing. |
(a) | enforcement proceedings in respect of any material assets of the Borrower or such Principal Subsidiary shall have been commenced by any creditor upon such judgment or order and shall not have been stayed or enjoined within five (5) Business Days after the commencement of such enforcement proceedings; or |
(b) | there shall be any period of 30 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect. |
(a) | this Article X shall inure to its benefit as to any actions taken or omitted to be taken by it while it was the Facility Agent under this Agreement; and |
(b) | Section 11.3 and Section 11.4 shall continue to inure to its benefit. |
(a) | modify any requirement hereunder that any particular action be taken by all the Lenders or by the Required Lenders shall be effective unless consented to by each Lender; |
(b) | modify this Section 11.1 or change the definition of "Required Lenders" shall be made without the consent of each Lender; |
(c) | increase the Commitment of any Lender shall be made without the consent of such Lender; |
(d) | reduce any fees described in Article III payable to any Lender shall be made without the consent of such Lender; |
(e) | extend the Commitment Termination Date of any Lender shall be made without the consent of such Lender; |
(f) | extend the due date for, or reduce the amount of, any scheduled repayment or prepayment of principal of or interest on the Loan (or reduce the principal amount of or rate of interest on the Loan) owed to any Lender shall be made without the consent of such Lender; or |
(g) | affect adversely the interests, rights or obligations of the Facility Agent in its capacity as such shall be made without consent of the Facility Agent. |
(a) | All notices and other communications provided to any party hereto under this Agreement or any other Loan Document shall be in writing, by facsimile or by electronic mail and addressed, delivered or transmitted to such party at its address, facsimile number or electronic mail address set forth below its signature hereto or set forth in the Lender Assignment Agreement or at such other address, or facsimile number as may be designated by such party in a notice to the other parties. Any notice, if mailed and properly addressed with postage prepaid or if properly addressed and sent by pre-paid courier service, shall be deemed given when received; any notice, if transmitted by facsimile, shall be deemed given when transmitted provided it is received in legible form; any notice, if transmitted by electronic mail, shall be deemed given upon acknowledgment of receipt by the recipient. |
(b) | So long as KfW IPEX is the Facility Agent, the Borrower may provide to the Facility Agent all information, documents and other materials that it furnishes to the Facility Agent hereunder or any other Loan Document (and any guaranties, security agreements and other agreements relating thereto), including, without limitation, all notices, requests, financial statements, financial and other reports, certificates and other materials, but excluding any such communication that (i) relates to a request for a new, or a conversion of an existing advance or other extension of credit (including any election of an interest rate or interest period relating thereto), (ii) relates to the payment of any principal or other amount due hereunder or any other Loan Document prior to the scheduled date therefor, (iii) provides notice of any Default or Event of Default or (iv) is required to be delivered to satisfy any condition precedent to the effectiveness of the Agreement and/or any advance or other extension of credit hereunder (all such non-excluded communications being referred to herein collectively as "Communications"), by transmitting the Communications in an electronic/soft medium in a format acceptable to the Facility Agent at claudia.wenzel@kfw.de (or such other email address notified by the Facility Agent to the Borrower); provided that any Communication requested pursuant to Section 7.1.1(h) shall be in a format acceptable to the Borrower and the Facility Agent. |
(c) | The Borrower agrees that the Facility Agent may make such items included in the Communications as the Borrower may specifically agree available to the Lenders by posting such notices, at the option of the Borrower, on Intralinks or any similar such platform (the "Platform") acceptable to the Borrower. Although the primary web portal is secured with a dual firewall and a User ID/Password Authorisation System and the Platform is secured through a single user per deal authorisation method whereby each user may access the Platform only on a deal-by-deal basis, the Borrower acknowledges that (i) the distribution of material through an electronic medium is not necessarily secure and that there are confidentiality and other risks associated with such distribution, (ii) the Platform is provided "as is" and "as available" and (iii) neither the Facility Agent nor any of its Affiliates warrants the accuracy, adequacy or completeness of the Communications or the Platform and each expressly disclaims liability for errors or omissions in the Communications or the Platform. No warranty of any kind, express, implied or statutory, including, without limitation, any warranty of merchantability, fitness for a particular purpose, non-infringement of third party rights or freedom from viruses or other code defects, is made by the Facility Agent or any of its Affiliates in connection with the Platform. |
(d) | The Facility Agent agrees that the receipt of Communications by the Facility Agent at its e-mail address set forth above shall constitute effective delivery of such Communications to the Facility Agent for purposes hereunder and any other Loan Document (and any guaranties, security agreements and other agreements relating thereto). |
(a) | except to the extent permitted under Section 7.2.6, the Borrower may not assign or transfer its rights or obligations hereunder without the prior written consent of the Facility Agent and each Lender; and |
(b) | the rights of sale, assignment and transfer of the Lenders are subject to Section 11.11. |
(a) | written notice of such assignment or transfer, together with payment instructions, addresses and related information with respect to such Assignee Lender, shall have been given to the Borrower and the Facility Agent by such Lender and such Assignee Lender; |
(b) | such Assignee Lender shall have executed and delivered to the Borrower and the Facility Agent a Lender Assignment Agreement, accepted by the Facility Agent and, if the applicable portion of the Loan is a Fixed Rate Loan, any other agreements required by the Facility Agent or the KfW in connection therewith; and |
(c) | the processing fees described below shall have been paid. |
(a) | no participation contemplated in this Section 11.11.2 shall relieve such Lender from its obligations hereunder; |
(b) | such Lender shall remain solely responsible for the performance of its obligations hereunder; |
(c) | the Borrower and the Facility Agent shall continue to deal solely and directly with such Lender in connection with such Lender's rights and obligations under this Agreement and each of the other Loan Documents; |
(d) | no Participant, unless such Participant is an Affiliate of such Lender, shall be entitled to require such Lender to take or refrain from taking any action hereunder or under any other Loan Document, except that such Lender may agree with any Participant that such Lender will not, without such Participant's consent, take any actions of the type described in clauses (b) through (f) of Section 11.1; |
(e) | the Borrower shall not be required to pay any amount under Sections 4.2(c), 4.3, 4.4, 4.5, 4.6 and 4.7 that is greater than the amount which it would have been required to pay had no participating interest been sold; and |
(f) | each Lender that sells a participation under this Section 11.11.2 shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts of (and stated interest on) each of the Participant's interest in that Lender's portion of the Loan, Commitments or other interests hereunder (the "Participant Register"). The entries in the Participant Register shall be conclusive absent manifest error, and such Lender may treat each person whose name is recorded in the Participant Register as the owner of such participation for all purposes hereunder. |
(g) | KfW IPEX may not sell participating interests pursuant to this Section 11.11.2 that, when taken together with Loans and/or Commitments sold by KfW IPEX pursuant to Section 11.11.1, result in KfW IPEX's share of the aggregate principal amount of the Loan and/or the aggregate Commitments being less than 50% of the total Loan or total Commitments, without the written consent of the Borrower (which consent shall not be required following the occurrence and during the continuance of an Event of Default or a Prepayment Event). |
(a) | The Hermes Insurance Policy will cover 95% of the Loan. |
(b) | The Hermes Fee will equal 2.37% of the aggregate principal amount of the Loan as at the Delivery Date. |
(c) | The parties have entered into this Agreement on the basis that the Hermes Insurance Policy shall contain the following terms and should such terms not be included within the Hermes Insurance Policy, then the Borrower may cancel the Commitment(s): |
(i) | 25% of the Hermes Fee as in effect on the date of issuance of the Hermes Insurance Policy ("First Fee") will be payable to the Hermes Agent or Hermes in Dollars within two (2) Business Days of receipt by the Borrower of demand from the Hermes Agent following the later to occur of (i) the issue of the Hermes Insurance Policy and (ii) the Effective Date; |
(ii) | the balance of the Hermes Fee (being the amount thereof under paragraph (b) above less the First Fee) ("Second Fee") will be payable in Dollars to the Hermes Agent or Hermes on the Delivery Date ; |
(iii) | if the Commitments are cancelled in full by the Borrower or the Lenders on or prior to the Delivery Date (including, for the avoidance of doubt, subsequent to disbursement of the Loan and prepayment thereof by the Borrower under Section 3.7), Hermes shall be required to reimburse the Hermes Agent the amount of the First Fee less an administration fee (such administration fee to be no greater than 5% of the amount refunded but in any event not exceeding EUR 2,500); |
(iv) | if the Commitments are cancelled in part by the Borrower on or prior to the Delivery Date (including, for the avoidance of doubt, subsequent to disbursement of the Loan and prepayment thereof by the Borrower under Section 3.7), Hermes shall be required to reimburse the Hermes Agent an amount equal to a corresponding proportion of the First Fee, based on the proportion of the aggregate Commitments prior to such cancellation to the aggregate Commitments after giving effect to such cancellation, less an administration fee (such administration fee to be no greater than 5% of the amount refunded but in any event not exceeding EUR 2,500); and |
(v) | if, after the Delivery Date, the Borrower prepays all or part of the Loan in accordance with this Agreement, Hermes shall be required to reimburse the Hermes Agent an amount equal to a corresponding proportion of the unexpired portion of the Hermes Fee, having regard to the amount of the prepayment and the remaining term of the Loan less the sum of (x) a break funding fee equal to 20% of the unexpired portion of the Hermes Fee and (y) an administration fee (such fee to be no greater than 5% of the amount refunded but in any event not exceeding EUR 2,500). |
(a) | Provided that the Hermes Insurance Policy complies with Section 11.13.1, the Borrower shall pay (a) the First Fee to the Hermes Agent in accordance with section 11.13.1(c)(i) and (b) the Second Fee to the Hermes Agent on the Delivery Date. In each case, if received by the Hermes Agent, the Hermes Agent shall pay such amount to Hermes. |
(b) | Provided that the Hermes Insurance Policy complies with Section 11.13.1, the Borrower shall pay to the Hermes Agent an issue fee of EUR 12,500 for the issue of the Hermes Insurance Policy at the same time that the First Fee is payable. |
(a) | Promptly upon receipt of the Hermes Insurance Policy from Hermes, the Hermes Agent shall (subject to any confidentiality undertakings given to Hermes by the Hermes Agent pursuant to the terms of the Hermes Insurance Policy) send a copy thereof to the Borrower. |
(b) | The Hermes Agent shall perform such acts or provide such information which are, acting reasonably, within its power so to perform or so to provide, as required by Hermes under the Hermes Insurance Policy and as are necessary to ensure that the Lenders obtain the support of Hermes pursuant to the Hermes Insurance Policy. |
(c) | The Hermes Agent shall (in the circumstances described in Section 11.13.1(c)(iii), (iv) or (v)): |
(i) | make written requests to Hermes seeking a reimbursement of the Hermes Fee promptly after the relevant cancellation or prepayment and (subject to any confidentiality undertakings given to Hermes by the Hermes Agent pursuant to the terms of the Hermes Insurance Policy) provide a copy of the request to the Borrower; |
(ii) | use its reasonable endeavours to maximise the amount of any reimbursement of the Hermes Fee to which the Hermes Agent is entitled; |
(iii) | pay to the Borrower the full amount of any reimbursement of the Hermes Fee that the Hermes Agent receives from Hermes within two (2) Business Days of receipt with same day value; and |
(iv) | relay the good faith concerns of the Borrower to Hermes regarding the amount it is required to pay to Hermes or the amount of any reimbursement to which the Hermes Agent is entitled, it being agreed that the Hermes Agent's obligation shall be no greater than simply to pass on to Hermes the Borrower's concerns. |
(d) | Each Lender will co‑operate with the Hermes Agent, the Facility Agent and each other Lender, and take such action and/or refrain from taking such action as may be reasonably necessary, to ensure that the Hermes Insurance Policy and each CIRR Agreement continue in full force and effect and shall indemnify and hold harmless each other Lender in the event that the Hermes Insurance Policy or such CIRR Agreement (as the case may be) does not continue in full force and effect due to its gross negligence or wilful default. |
(a) | the government of the Federal Republic of Germany, the Federal Audit Court or any authorised representatives specified by these bodies shall be authorised at any time to inspect and make or demand copies of the records, accounts, documents and other deeds of any or all of the Lenders relating to this Agreement; |
(b) | in the course of its activity as the Facility Agent, the Facility Agent may: |
(i) | provide the government of the Federal Republic of Germany with information concerning the transactions to be handled by it under this Agreement; and |
(ii) | disclose information concerning the subsidised transaction contemplated by this Agreement in the context of internationally agreed consultation/notification proceedings and statutory specifications, including information received from the Lenders relating to this Agreement; and |
(c) | the Facility Agent and (to the extent the Lenders have entered into an Option A Refinancing Agreement with KfW) the Lenders are entitled to disclose to KfW: |
(i) | circumstances pertaining to the Loan, proper repayment and collateralisation; |
(ii) | extraordinary events which may jeopardise the proper servicing of the Loan; |
(iii) | any information required by KfW with respect to the proper use of any refinancing funds granted to the respective Lender in respect of the Loan; and |
(iv) | the Loan Documents; |
(a) | If the provisions of Section 3.2(c), 3.2(d) or 9.1.11 apply (and having regard to clause (b) below), the Facility Agent, the Borrower and the Lenders (or, in the case of Section 3.2(c) or 3.2(d), any affected Lender) shall discuss in good faith (but without obligation) for a period (the "Mitigation Period") of not less than 30 days (and which in the case of Section 3.2(d) shall commence on the first day of the 50-day period referred to in that Section and, in the case of Section 9.1.11, shall run concurrently with the 30 day period referred to in that Section) after (x) the date on which the Illegality Notice is given or (y) the date of Section 9.1.11 becomes applicable, as the case may be: |
(i) | in the case of Section 3.2(c) or 3.2(d), what steps may be open to the relevant Lender to mitigate or remove such circumstances (including, without limitation, the possibility of assigning the Lender’s Commitment to an Affiliate or another Lending Office); and |
(ii) | in the case of Section 9.1.11, the circumstances in which Section 9.1.11 has become applicable and whether there are any steps or actions which can be taken to remove the effect of Section 9.1.11 and/or reinstate the Hermes Insurance Policy. |
(b) | To the extent required by or considered necessary by any Party, the Lenders (and, in the case of Section 3.2(c) or 3.2(d), any affected Lender) shall use commercially reasonable efforts to include Hermes in all foregoing discussions. |
(c) | If an Illegality Notice shall be given by any Lender during the period falling 20 days prior to the anticipated Delivery Date, the affected Lender will use all reasonable efforts to accelerate the mitigation steps of the type described or to be discussed pursuant to this Section to try and enable the Commitment of such Lender to still be available for drawing by the Borrower two (2) Business Days prior to the Delivery Date in the manner contemplated by this Agreement. |
Exhibit 10.9 | ||||
Dated 7 September 2016 | ||||
Royal Caribbean Cruises Ltd. (1) (the Borrower) KfW IPEX-Bank GmbH (2) (the Hermes Agent) KfW IPEX-Bank GmbH (3) (the Facility Agent) KfW IPEX-Bank GmbH (4) (as Initial Mandated Lead Arranger) Bayerische Landesbank Munich (5) BNP Paribas Fortis S.A./N.V. Commerzbank AG, New York Branch DZ Bank AG Skandinaviska Enskilda Banken AB (publ) (the Mandated Lead Arrangers) and certain financial institutions (6) (the Lenders) | ||||
Amendment No. 1 in connection with the Credit Agreement in respect of Hull S-713 |
(1) | Royal Caribbean Cruises Ltd. (a corporation organised and existing under the laws of The Republic of Liberia) (the Borrower); |
(2) | KfW IPEX-Bank GmbH as facility agent (the Facility Agent); |
(3) | KfW IPEX-Bank GmbH as Hermes agent (the Hermes Agent); |
(4) | KfW IPEX-Bank GmbH as initial mandated lead arranger (the Initial Mandated Lead Arranger); |
(5) | Bayerische Landesbank Munich, BNP Paribas Fortis S.A./N.V, Commerzbank AG, New York Branch, DZ Bank AG, and Skandinaviska Enskilda Banken AB (publ) as mandated lead arrangers (together with the Initial Mandated Lead Arranger, the Mandated Lead Arrangers); and |
(6) | The financial institutions party thereto as lenders from time to time (the Lenders). |
(A) | The Borrower, the Facility Agent, the Hermes Agent and the Lenders are parties to a credit agreement dated November 13, 2015 (the Existing Credit Agreement), in respect of the vessel with Hull number S-713 (the Vessel) whereby it was agreed that the Lenders would make available to the Borrower, upon the terms and conditions therein, a US dollar loan facility (the Facility) calculated on the amount equal to the sum of (a) up to eighty per cent (80%) of the Contract Price (as defined in the Existing Credit Agreement) of the Vessel but which Contract Price will not exceed EUR 948,850,000 and (b) up to 100% of the Hermes Fee (as defined therein). |
(B) | The Parties wish to amend the Existing Credit Agreement to the extent set out in this Amendment. |
1 | Interpretation and definitions |
1.1 | Definitions in the Existing Credit Agreement |
(a) | Unless the context otherwise requires or unless otherwise defined in this Amendment, words and expressions defined in the Existing Credit Agreement shall have the same meanings when used in this Amendment. |
(b) | The principles of construction set out in the Existing Credit Agreement shall have effect as if set out in this Amendment. |
1.2 | In this Amendment: |
1.3 | Third party rights |
1.4 | Designation |
2 | Amendment of the Existing Credit Agreement |
3 | Conditions of Effectiveness of Amended Agreement |
(a) | The Facility Agent shall have received all invoiced expenses of the Facility Agent (including the agreed fees and expenses of counsel to the Facility Agent) required to be paid by the Borrower pursuant to Section 6 below or that the Borrower has otherwise agreed in writing to pay to the Facility Agent, in each case on or prior to the Effective Date. |
(b) | The representations and warranties set forth in Section 4 are true as of the Effective Date. |
4 | Representations and Warranties |
5 | Incorporation of Terms |
6 | Costs and Expenses |
7 | Counterparts |
8 | Governing Law |
(a) | for the EUR amount payable in respect of the final (delivery) instalment of the Contract Price (excluding the portion thereof comprising the Buyer's Allowance), the total of such EUR amount converted to a corresponding Dollar amount as determined using the weighted average rate of exchange that the Borrower has agreed, either in the spot or forward currency markets, to pay its counterparties for the purchase of the relevant amount of EUR with Dollars for the payment of that final installment of the Contract Price and including in such weighted average the spot rates for any EUR amounts due that have not been hedged by the Borrower; |
(b) | for all EUR amounts payable in respect of the Buyer's Allowance, the total of such EUR amounts converted to a corresponding Dollar amount as determined using the USD-to-EUR rate used by the Borrower to convert the relevant USD amount of the amount of the Buyer's Allowance into EUR for the purpose of the Builder invoicing the same to the Borrower in EUR in accordance with the Construction Contract; and |
(c) | for the calculation and payment of the Hermes Fee in Dollars, the amount thereof in EUR converted to a corresponding Dollar amount as determined by Hermes on the basis of the latest rate for the purchase of EUR with Dollars to be published by the German Federal Ministry of Finance prior to the time that Hermes issues its invoice for the Hermes Fee. |
Exhibit 10.10 | ||||
Dated 3 July 2018 | ||||
Royal Caribbean Cruises Ltd. (1) (the Borrower) KfW IPEX-Bank GmbH (2) (the Hermes Agent) KfW IPEX-Bank GmbH (3) (the Facility Agent) KfW IPEX-Bank GmbH (4) (as Initial Mandated Lead Arranger) Bayerische Landesbank Munich (5) BNP Paribas Fortis S.A./N.V. Commerzbank AG, New York Branch DZ Bank AG, New York Branch Skandinaviska Enskilda Banken AB (publ) (the Mandated Lead Arrangers) and certain financial institutions (6) (the Lenders) | ||||
Amendment No. 2 in connection with the Credit Agreement in respect of Hull S-713 |
(1) | Royal Caribbean Cruises Ltd. (a corporation organised and existing under the laws of The Republic of Liberia) (the Borrower); |
(2) | KfW IPEX-Bank GmbH as facility agent (the Facility Agent); |
(3) | KfW IPEX-Bank GmbH as Hermes agent (the Hermes Agent); |
(4) | KfW IPEX-Bank GmbH as initial mandated lead arranger (the Initial Mandated Lead Arranger); |
(5) | Bayerische Landesbank Munich, BNP Paribas Fortis S.A./N.V, Commerzbank AG, New York Branch, DZ Bank AG, New York Branch, and Skandinaviska Enskilda Banken AB (publ) as mandated lead arrangers (together with the Initial Mandated Lead Arranger, the Mandated Lead Arrangers); and |
(6) | The financial institutions party thereto as lenders from time to time (the Lenders). |
(A) | The Borrower, the Facility Agent, the Hermes Agent and the Lenders are parties to a credit agreement dated 13 November 2015 as amended on 7 September 2016 (the Existing Credit Agreement), in respect of the vessel with Hull number S-713 (the Vessel) whereby it was agreed that the Lenders would make available to the Borrower, upon the terms and conditions therein, a US dollar loan facility (the Facility) calculated on the amount equal to the sum of (a) up to eighty per cent (80%) of the Contract Price (as defined in the Existing Credit Agreement) of the Vessel but which Contract Price will not exceed EUR 948,850,000 and (b) up to 100% of the Hermes Fee (as defined therein). |
(B) | The Parties wish to amend and restate the Existing Credit Agreement to the extent set out in this Amendment. |
1 | Interpretation and definitions |
1.1 | Definitions in the Existing Credit Agreement |
(a) | Unless the context otherwise requires or unless otherwise defined in this Amendment, words and expressions defined in the Existing Credit Agreement shall have the same meanings when used in this Amendment. |
(b) | The principles of construction set out in the Existing Credit Agreement shall have effect as if set out in this Amendment. |
1.2 | Definitions |
1.3 | Third party rights |
1.4 | Designation |
2 | Amendment of the Existing Credit Agreement |
3 | Conditions of Effectiveness of Amended Agreement |
3.1 | The Amended Agreement shall become effective in accordance with the terms of this Amendment on the date each of the following conditions has been satisfied to the reasonable satisfaction of the Facility Agent (the Effective Date): |
(a) | the Facility Agent shall have received from the Borrower: |
(i) | a certificate of its Secretary or Assistant Secretary as to the incumbency and signatures of those of its officers authorised to act with respect to this Amendment and as to the truth and completeness of the attached resolutions of its Board of Directors then in full force and effect authorising the execution, delivery and performance of this Amendment, and upon which certificate the Lenders may conclusively rely until the Facility Agent shall have received a further certificate of the Secretary or Assistant Secretary of the Borrower canceling or amending such prior certificate; and |
(ii) | a Certificate of Good Standing issued by the relevant Liberian authorities in respect of the Borrower; |
(b) | the Facility Agent shall have received all invoiced expenses of the Facility Agent (including the agreed fees and expenses of counsel to the Facility Agent) required to be paid by the Borrower pursuant to clause 6 below or that the Borrower has otherwise agreed in writing to pay to the Facility Agent, in each case on or prior to the Effective Date; |
(c) | the Facility Agent shall have received the amendment to the Hermes Insurance Policy duly issued by Hermes; and |
(d) | the representations and warranties set forth in clause 4 are true as of the Effective Date. |
3.2 | The Facility Agent shall notify the Lenders and the Borrower of the Effective Date and such notice shall be conclusive and binding. |
4 | Representations and Warranties |
5 | Incorporation of Terms |
7 | Counterparts |
8 | Governing Law |
(A) | The Borrower and Meyer Werft GmbH & Co. KG (the "Builder") have on June 12, 2015 entered into a Contract for the Construction and Sale of Hull No. S-713 (as amended from time to time, the "Construction Contract") pursuant to which the Builder has agreed to design, construct, equip, complete, sell and deliver the passenger cruise vessel bearing Builder's hull number S-713 (the "Purchased Vessel"); |
(B) | The Lenders have agreed to make available to the Borrower, upon the terms and conditions contained herein, a US dollar loan facility calculated on the amount (the "Maximum Loan Amount") equal to (x) eighty per cent (80%) of the Contract Price (as defined below) of the Purchased Vessel (as defined below), as adjusted from time to time in accordance with the Construction Contract to reflect, among other adjustments, change orders, but which Contract Price shall not exceed for this purpose EUR 948,850,000 (the "Contract Price Proceeds"), plus (y) 100% of the Hermes Fee (as defined below) (the "Hermes Fee Proceeds") and being made available in the US Dollar Equivalent of that Maximum Loan Amount; |
(C) | The Contract Price Proceeds will be provided to the Borrower two (2) Business Days prior to the delivery of the Purchased Vessel for the purpose of paying a portion of the Contract Price in connection with the Borrower's purchase of the Purchased Vessel. The Hermes Fee Proceeds will be provided on the Disbursement Date and paid as set forth in Section 2.5(c) and (d); |
(D) | The Parties hereto have previously amended this Agreement pursuant to the an amendment agreement dated 7 September 2016 (the “Amendment Number One”); and |
(E) | Pursuant to Amendment Agreement Number Two dated as of 3 July 2018 (the “Amendment Number Two”), and upon satisfaction of the conditions set |
(a) | net cash from operating activities (determined in accordance with GAAP) for such period, as shown in the Borrower's consolidated statement of cash flow for such period, to |
(b) | the sum of: |
(a) | any Interest Period which would otherwise end on a day which is not a Business Day shall end on the next Business Day to occur, except if such Business Day does not fall in the same calendar month, the Interest Period will end on the last Business |
(b) |
(c) | if any Interest Period is altered by the application of a) above, the subsequent Interest Period shall end on the day on which it would have ended if the preceding Interest Period had not been so altered. |
(a) | subject to Section 3.3.6, if no such rate appears on pages LIBOR01 or LIBOR02 of the Thomson Reuters screen (or any such replacement page) at the relevant time, the LIBO Rate shall be the rate per annum certified by the Facility Agent to be the average |
(b) |
(c) | for the purposes of determining the post-maturity rate of interest under Section 3.3.4, the LIBO Rate shall be determined by reference to deposits on an overnight or call basis or for such other period or periods as the Facility Agent may determine after consultation with the Lenders, which period shall be no longer than one month unless the Borrower otherwise agrees; and |
(d) | if the LIBO Rate determined in accordance with the foregoing provisions of this definition is less than zero, such rate shall be deemed to be zero for purposes of this Agreement. |
(a) | all cash on hand of the Borrower and its Subsidiaries; plus |
(b) | all Cash Equivalents. |
(a) | borrowed money (whether by loan or issuance and sale of debt securities), including drawings under this Agreement and any revolving credit facilities, and |
(b) | the issuance and sale of equity securities. |
(a) | for the EUR amount payable in respect of the final (delivery) instalment of the Contract Price (excluding the portion thereof comprising the Buyer's Allowance), the total of such EUR amount converted to a corresponding Dollar amount as determined using the weighted average rate of exchange that the Borrower has agreed, either in the spot or forward currency markets, to pay its counterparties for the purchase of the relevant amount of EUR with Dollars for the payment of that final installment of the Contract Price and including in such weighted average the spot rates for any EUR amounts due that have not been hedged by the Borrower; |
(b) | for all EUR amounts payable in respect of the Buyer's Allowance, the total of such EUR amounts converted to a corresponding Dollar amount as determined using the USD-to-EUR rate used by the Borrower to convert the relevant USD amount of the amount of the Buyer's Allowance into EUR for the purpose of the Builder invoicing the same to the Borrower in EUR in accordance with the Construction Contract; and |
(c) | for the calculation and payment of the Hermes Fee in Dollars, the amount thereof in EUR converted to a corresponding Dollar amount as determined by Hermes on the basis of the latest rate for the purchase of EUR with Dollars to be published by the German Federal Ministry of Finance prior to the time that Hermes issues its invoice for the Hermes Fee. |
(b) | Each Lender's Commitment shall terminate on the earlier of (i) the Commitment Termination Date if the Purchased Vessel is not delivered to the Borrower prior to such date and (ii) the delivery to the Borrower of the Purchased Vessel. |
(c) | If any Lender shall default in its obligations under Section 2.1, the Facility Agent shall, at the request of the Borrower, use reasonable efforts to assist the Borrower in finding a bank or financial institution acceptable to the Borrower to replace such Lender. |
(a) | If the Reduction Notice is delivered by the Borrower at least 63 days prior to the actual Disbursement Date, the Borrower shall not incur any liability to make any payments pursuant to Section 4.4 or to incur any other indemnity or compensation obligation. If the Reduction Notice is delivered by the Borrower less than 63 days prior to the actual Disbursement Date, the Borrower shall either (i) pay such compensation to the relevant Lender as required by, and in accordance with, Section 4.4 to the extent such Lender incurs a loss as set out in Section 4.4 or (ii) extend the Disbursement Date to a date that falls at least 63 days after the Reduction Notice was first delivered by the Borrower. In the event that the Borrower elects the option under the foregoing clause (ii), the Borrower shall deliver a Loan Request to the Facility Agent in accordance with Section 2.5(a), and the proposed Disbursement Date set out in such Loan Request shall be a date that falls at least 63 days after the Reduction Notice was first delivered by the Borrower. |
(a) | The Facility Agent shall promptly notify each Lender of any Loan Request by forwarding a copy thereof to each Lender, together with its attachments. On the terms and subject to the conditions of this Agreement, the Loan shall be made on the Business Day specified in such Loan Request. On or before 2:00 p.m., London time, on the Business Day specified in such Loan Request, each Lender shall, without any set-off or counterclaim, deposit with the Facility Agent same day Dollar funds in an amount equal to such Lender's Percentage of the requested Loan. Such deposit will be made to an account which the Facility Agent shall specify from time to time by notice to the Lenders. To the extent funds are so received from the Lenders, the Facility Agent shall, without any set-off or counterclaim, make such funds available to the Borrower on the Business Day specified in the Loan Request by wire transfer of same day funds to the account or accounts the Borrower shall have specified in its Loan Request. |
(b) | The Borrower shall, upon receipt of the Dollar funds into the account referred to in Section 2.5(b) above, (i) complete the purchase of EUR with its counterparties or otherwise as set out in the Loan Request (by authorising and instructing the Facility Agent to remit the necessary Dollar funds to the said counterparties) and shall procure the payment of all EUR proceeds of such transactions to the EUR Pledged Account no later than the Business Day immediately following the Business Day specified in the Loan Request and (ii) to the extent of any such Dollar funds as shall not be used to purchase EUR, shall procure (by authorising and instructing the Facility Agent accordingly) the payment of such Dollar funds to the Dollar Pledged Account on the Disbursement Date. |
(c) | Upon the date of delivery to the Borrower of the Purchased Vessel, the Facility Agent shall direct that moneys standing to the credit of the Pledged Accounts shall, in the manner set out in the Loan Request and in accordance with the requirements and provisions of the Pledge Agreement, be disbursed as follows: |
i. | in EUR, to the account of the Builder, as designated by the Builder and identified by the Borrower in the Loan Request, to the extent necessary to meet the final instalment of the Contract Price (including any portion thereof attributable to the Buyer's Allowance); and |
ii. | in Dollars, (y) to Hermes in payment of the Second Fee; and (z) to the account of the Borrower, as designated by the Borrower and identified by |
(a) | Subject to Section 3.1(b), the Borrower shall repay the Loan in 24 equal semi-annual instalments, with the first instalment to fall due on the date falling six (6) months after the Disbursement Date and the final instalment to fall due on the date of Final Maturity. |
(b) | If, on the date of delivery to the Borrower of the Purchased Vessel, the outstanding principal amount of the Loan exceeds the US Dollar Maximum Loan Amount (as a result of a reduction in the Contract Price after the Disbursement Date and before the delivery of the Purchased Vessel), the Borrower shall repay the Loan in an amount equal to such excess within two (2) Business Days after the date of delivery to the Borrower of the Purchased Vessel. Any such partial prepayment shall be applied pro rata in satisfaction of the remaining scheduled repayment instalments of the Loan. |
(c) | No amount repaid by the Borrower pursuant to this Section 3.1 may be re-borrowed under the terms of this Agreement. |
i. | may, from time to time on any Business Day, make a voluntary prepayment, in whole or in part, of the outstanding principal amount of the Loan; provided that: |
a. | all such voluntary prepayments shall require (x) for prepayments on or after the Disbursement Date made prior to delivery to the Borrower of the Purchased Vessel in respect of the advance made on the Disbursement Date, at least two (2) Business Days' prior written notice to the Facility Agent, and (y) for all other prepayments, at least 30 calendar days' prior written notice, if all or any portion of the Loan is a Fixed Rate Loan, and at least five (5) Business Days' (or, if such prepayment is to be made on the last day of an Interest Period for such Loan, four (4) Business Days') prior written notice, if the Loan is a Floating Rate Loan, in each case to the Facility Agent; and |
b. | all such voluntary partial prepayments shall be in an aggregate minimum amount of $10,000,000 and a multiple of $1,000,000 (or in the remaining amount of the Loan) and shall be applied in inverse order of maturity or ratably among all remaining instalments, as the Borrower shall designate to the Facility Agent, in satisfaction of the remaining repayment instalments of the Loan; and |
ii. | shall, immediately upon any acceleration of the repayment of the instalments of the Loan pursuant to Section 8.2 or 8.3 or the mandatory prepayment of the Loan pursuant to Section 9.2, repay the Loan. |
(a) | If, by reason of a Change in Law, it becomes unlawful under any applicable law (i) for a Lender to be subject to a commitment to make available to the Borrower such Lender's portion of the Loan hereunder as provided in Section 2.2, (ii) for a Lender to make or hold its portion of the Loan in its Lending Office, (iii) for a Lender to receive a payment under this Agreement or any other Loan Document or (iv) for a Lender to comply with any other material provision of, or to perform its obligations as contemplated by, this Agreement or any other Loan Document, the Lender affected by such Change in Law may give written notice (the "Illegality Notice") to the Borrower and the Facility Agent of such Change in Law, including reasonable details of the relevant Change of Law. Any Illegality Notice must be given by a Lender no later than 120 days after such Lender first obtains actual knowledge or written notice of the relevant Change in Law. |
(b) | If an affected Lender delivers an Illegality Notice prior to the Disbursement Date, then, subject to Section 11.17, (1) whilst the arrangements contemplated by the following |
(c) | If an affected Lender delivers an Illegality Notice on or following the Disbursement Date, then the Borrower shall have the right, but not the obligation, exercisable at any time within 50 days after receipt of such Illegality Notice (the "Option Period"), either (1) to prepay the portion of the Loan held by such Lender in full on or before the expiry of the Option Period, together with all unpaid interest and fees thereon accrued to but excluding the date of such prepayment, or (2) to replace such Lender on or before the expiry of the Option Period with one or more financial institutions (I) reasonably acceptable to the Facility Agent, (II) meeting the criteria set out in Section 2.2 of the Terms and Conditions, (III) acceptable to Hermes and (IV) in the case of a replacement of an Option A Lender, reasonably acceptable to KfW; provided that (x) in the case of a single assignment, any such assignment shall be either an assignment of all of the rights and obligations of the assigning Lender under this Agreement or, in the case of more than one assignment, an assignment of a portion of such rights and obligations made concurrently with another such assignment or other such assignments that collectively cover all of the rights and obligations of the assigning Lender under this Agreement and (y) no Lender shall be obligated to make any such assignment as a result of an election by the Borrower pursuant to this Section 3.2(d) unless and until such Lender shall have received one or more payments from one or more Assignee Lenders and/or the Borrower in an aggregate amount at least equal to the portion of the Loan held by such Lender, together with all unpaid interest and fees thereon accrued to but excluding the date of such assignment (and all other amounts then owing to such Lender under this Agreement). |
(d) | Each prepayment of the Loan made pursuant to this Section 3 shall be without premium or penalty, except as may be required by Section 4.4. No amounts prepaid by the Borrower may be re-borrowed under the terms of this Agreement except as provided in Section 3.7 and the last paragraph of Section 9.1 (which follows Section 9.1.11). |
(a) | If the Borrower has not elected the Floating Rate prior to the Disbursement Date as permitted by Section 3.3.2(a), the Borrower may elect, by written notice to the Facility Agent no later than 2:00 p.m. Frankfurt time 32 days prior to the end of an Interest Period and subject to Section 4.4, to pay interest on the Loan for the remainder of the term of the Loan at the Floating Rate, with effect from the end of that Interest Period. |
(b) | Any election made under any of Section 3.3.2(a) or Section 3.3.2(b) may only be made one time during the term of the Loan and shall be irrevocable. |
(a) | each Repayment Date; |
(b) | the date of any prepayment, in whole or in part, of principal outstanding on the Loan (but only on the principal so prepaid); |
(c) | on that portion of the Loan the repayment of which is accelerated pursuant to Section 8.2 or Section 8.3, immediately upon such acceleration; and |
(d) | in the case of any interest on any principal, interest or other amount owing under this Agreement or any other Loan Document that is overdue, from time to time on demand of the Facility Agent until such overdue amount is paid in full. |
(a) | Dollar deposits in the relevant amount and for the relevant Interest Period are not available to each Reference Bank in its relevant market, or |
(b) | by reason of circumstances affecting the Reference Banks' relevant markets, adequate means do not exist for ascertaining the interest rate applicable hereunder to LIBO Rate loans for the relevant Interest Period, or |
(c) | the cost to Option B Lenders that in the aggregate hold more than 50% of the aggregate outstanding principal amount of the Loan then held by Option B Lenders, if any Lender shall have entered into an Option B Interest Make-Up Agreement, of obtaining matching deposits in the relevant interbank market for the relevant Interest Period would be in excess of the LIBO Rate (provided that no Option B Lender may exercise its rights under this Section 4.2(c) for amounts up to the difference between such Option B Lender's cost of obtaining matching deposits on the date such Option B Lender becomes a Lender hereunder less the LIBO Rate on such date), |
(a) | subject any Lender to any taxes, levies, duties, charges, fees, deductions or withholdings of any nature with respect to its portion of the Loan or any part thereof imposed, levied, collected, withheld or assessed by any jurisdiction or any political subdivision or taxing authority thereof (other than (i) taxes as to which such Lender is indemnified under Section 4.6 and (ii) taxes excluded from the indemnity set forth in Section 4.6); or |
(b) | change the basis of taxation to any Lender (other than a change in taxation on the overall net income of any Lender) of payments of principal or interest or any other payment due or to become due pursuant to this Agreement; or |
(c) | impose, modify or deem applicable any reserve or capital adequacy requirements (other than the increased capital costs described in Section 4.5 and the reserve costs described in Section 4.7) or other banking or monetary controls or requirements which affect the manner in which a Lender shall allocate its capital resources to its obligations hereunder or require the making of any special deposits against or in respect of any assets or liabilities of, deposits with or for the account of, or loans by, any Lender (provided that such Lender shall, unless prohibited by law, allocate its capital resources to its obligations hereunder in a manner which is consistent with its present treatment of the allocation of its capital resources); or |
(d) | impose on any Lender any other condition affecting its portion of the Loan or any part thereof, |
(a) | if at the time interest is calculated at the Floating Rate on such Lender's portion of the Loan, any conversion or repayment or prepayment or acceleration of the principal amount of such Lender's portion of the Loan on a date other than the scheduled last day of an Interest Period or otherwise scheduled date for repayment or payment (in each case, including payments made in accordance with Section 3.1(b), but excluding any prepayment made following an election by the Borrower to effect a prepayment pursuant to Section 3.2(d), or any repayment pursuant to Section 9.1.12, by reason of a Non-Borrower Related Change in Law); |
(b) | if at the time interest is calculated at the Fixed Rate on such Lender's portion of the Loan, any repayment or prepayment or acceleration of the principal amount of such Lender's portion of the Loan, other than any repayment made on the date scheduled for such repayment (in each case, excluding any prepayment made following an election by the Borrower to effect a prepayment pursuant to Section 3.2(d), or any repayment pursuant to Section 9.1.12, by reason of a Non-Borrower Related Change in Law); |
(c) | without prejudice to the rights of the Borrower to elect an option under Section 3.3.2(a), an election by the Borrower of the Floating Rate in accordance with Section 3.3.2(a) (where the Disbursement Date is a date that falls less than 63 days after the Floating Rate Election Notice was delivered by the Borrower) or Section 3.3.2(b); |
(d) | a reduction or termination of the Commitments by the Borrower pursuant to Section 2.3(b)(i); |
(e) | the Loan not being made in accordance with the Loan Request therefor due to the fault of the Borrower or as a result of any of the conditions precedent set forth in Article V not being satisfied; or |
(f) | any prepayment of the Loan by the Borrower pursuant to Section 3.7; |
a. | if at that time interest is calculated at the Floating Rate on such Lender's portion of the Loan, pay directly to the Facility Agent for the account of such Lender an amount (the "Floating Rate Indemnity Amount") equal to the amount, if any, by which: |
(i) | interest calculated at the Floating Rate which such Lender would have received on its share of the amount of the Loan subject to such Funding Losses Event for the period from the date of receipt of any part of its share in the Loan to the last day of the applicable Interest Period, |
(ii) | the amount which such Lender would be able to obtain by placing an amount equal to the amount received by it on deposit with a leading bank in the appropriate interbank market for a period starting on the Business Day following receipt and ending on the last day of the applicable Interest Period; or |
b. | if at that time interest is calculated at the Fixed Rate on such Lender's portion of the Loan, pay to the Facility Agent the sum of: |
(A) | an amount equal to the amount, if any, by which: |
(i) | interest calculated at the rate per annum equal to (a) the CIRR which such Lender would have received on its share of the amount of the Loan subject to such Funding Losses Event minus (b) the administrative margin of 0.20%, for the period from the date of receipt of any part of its share of the Loan to the final scheduled date for the repayment of Loan in full pursuant to Section 3.1, |
(ii) | the amount by which such Lender would be able to obtain by placing for such remaining period an equal amount to the amount received by it on deposit and receiving interest equal to the money market rate then applicable to Dollars on the Reuters page "ICAP1" (the "Reinvestment Rate"), |
(B) | an amount equal to the Floating Rate Indemnity Amount (and assuming for the purpose of this calculation that the interest on the Loan is calculated at the Floating Rate and not the Fixed Rate). |
(a) | pay directly to the relevant authority the full amount required to be so withheld or deducted; |
(b) | promptly forward to the Facility Agent an official receipt or other documentation satisfactory to the Facility Agent evidencing such payment to such authority; and |
(c) | pay to the Facility Agent for the account of the Lenders such additional amount or amounts as is necessary to ensure that the net amount actually received by each Lender will equal the full amount such Lender would have received had no such withholding or deduction been required. |
(a) | the principal amount of the Loan outstanding on such day; and |
(b) | the remainder of (x) a fraction the numerator of which is the rate (expressed as a decimal) at which interest accrues on the Loan for such Interest Period as provided in this Agreement (less, if applicable, the Floating Rate Margin) and the denominator of which is one minus any increase after the Effective Date in the effective rate (expressed as a decimal) at which such reserve requirements are imposed on such Lender minus (y) such numerator; and |
(c) | 1/360. |
(a) |
i. | Each Option A Lender hereby instructs the Facility Agent to remit all payments of interest made with respect to any portion of the Loan held by such Option A Lender to KfW (A) less (x) the Fixed Rate Margin and (y) the CIRR administrative fee of 0.20% but plus (z) an agreed KfW margin, if interest on the portion of the Loan made by that Lender is then calculated at the Fixed Rate, or (B) less (x) the Floating Rate Margin but plus (y) an agreed KfW margin, if interest on that portion of the Loan is then calculated at the Floating Rate. |
ii. | Each Option B Lender hereby instructs the Facility Agent, with respect to any portion of the Loan held by such Option B Lender, to pay directly to such Option B Lender interest thereon at the Fixed Rate or the Floating Rate (whichever is applicable), on the basis that, if interest on such portion of the Loan is then calculated at the Fixed Rate, such Option B Lender will, where amounts are payable to the KfW by that Option B Lender under the CIRR Agreement, account directly to the KfW on behalf of the Federal Republic of Germany for any such amounts payable by that Lender under the CIRR Agreement to which such Lender is a party. |
(b) | The Facility Agent shall promptly (but in any event on the same Business Day that the same are received or, as contemplated in clause (a) of this Section, deemed received) remit in same day funds to each Lender its share, if any, of such payments received by the Facility Agent for the account of such Lender without any set-off, deduction or counterclaim. All interest and fees shall be computed on the basis of the actual number of days (including the first day but excluding the last day) occurring during the period for which such interest or fee is payable over a year comprised of 360 days. Whenever any payment to be made shall otherwise be due on a day which is not a Business Day, such payment shall (except as otherwise required by clause (a) of the definition of the term "Interest Period") be made on the next succeeding Business Day and such extension of time shall be included in computing interest and fees, if any, in connection with such payment. |
(a) | the Recovering Lender shall, within three (3) Business Days, notify details of the receipt or recovery to the Facility Agent; |
(b) | the Facility Agent shall determine whether the receipt or recovery is in excess of the amount the Recovering Lender would have been paid had the receipt or recovery been received or made by the Facility Agent and distributed in accordance with the said Section 4.8, without taking account of any taxes which would be imposed on the Facility Agent in relation to the receipt, recovery or distribution; and |
(c) | the Recovering Lender shall, within three (3) Business Days of demand by the Facility Agent, pay to the Facility Agent an amount (the "Sharing Payment") equal to such |
(a) | each Sharing Lender shall, upon request of the Facility Agent, pay to the Facility Agent for the account of that Recovering Lender an amount equal to the appropriate part of its share of the Sharing Payment (together with an amount as is necessary to reimburse that Recovering Lender for its proportion of any interest on the Sharing Payment which that Recovering Lender is required to pay) (the "Redistributed Amount"); and |
(b) | solely as between the Borrower and each relevant Sharing Lender, an amount equal to the relevant Redistributed Amount will be treated as not having been paid by the Borrower. |
(a) | This Section 4.10 shall not apply to the extent that the Recovering Lender would not, after making any payment pursuant to this Section 4.10, have a valid and enforceable claim against the Borrower. |
(b) | A Recovering Lender is not obliged to share with any other Lender any amount which the Recovering Lender has received or recovered as a result of taking legal or arbitration proceedings, if: |
i. | it notified the other Lender of the legal or arbitration proceedings; and |
ii. | the other Lender had an opportunity to participate in those legal or arbitration proceedings but did not do so as soon as reasonably practicable |
(e) | If the Borrower becomes a US Tax Obligor or the Facility 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 the Borrower is a US Tax Obligor and the relevant Lender is KfW IPEX, the date of this Agreement; |
(ii) | where the Borrower is a US Tax Obligor on a date an assignment or transfer is made pursuant to Section 11.11.1 and the relevant Lender is an Assignee Lender that becomes a Lender in accordance with Section 11.11.1, the date on which such Assignee Lender becomes a Lender; |
(iii) | where the Borrower is not a US Tax Obligor, the date of a request from the Facility Agent, |
(A) | a withholding certificate on Form W-8 (or any successor form), Form W-9 (or any successor form) or any other relevant form; or |
(B) | any withholding statement or other document, authorisation or waiver as the Facility Agent may require to certify or establish the status of such Lender under FATCA or that other law or regulation. |
(f) | The Facility Agent shall provide any withholding certificate, withholding statement, document, authorisation or waiver it receives from a Lender pursuant to paragraph (e) above to the Borrower. |
(g) | If any withholding certificate, withholding statement, document, authorisation or waiver provided to the Facility Agent by a Lender pursuant to paragraph (e) 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 Facility Agent unless it is unlawful for the Lender to do so (in which case the Lender shall promptly notify the Facility Agent). The Facility Agent shall provide any such updated withholding certificate, withholding statement, document, authorisation or waiver to the Borrower. |
(h) | The Facility Agent may rely on any withholding certificate, withholding statement, document, authorisation or waiver it receives from a Lender pursuant to paragraph (e) or (g) above without further verification. The Facility Agent shall not be liable for any action taken by it under or in connection with paragraph (e), (f) or (g) above. |
(a) | a certificate of its Secretary or Assistant Secretary as to the incumbency and signatures of those of its officers authorised to act with respect to this Agreement and each other Loan Document and as to the truth and completeness of the attached: |
i. | resolutions of its Board of Directors then in full force and effect authorising the execution, delivery and performance of this Agreement and each other Loan Document, and |
ii. | Organic Documents of the Borrower, |
(b) | a Certificate of Good Standing issued by the relevant Liberian authorities in respect of the Borrower. |
(a) | Watson, Farley & Williams LLP, counsel to the Borrower, as to Liberian Law, covering the matters set forth in Exhibit B-1 hereto; |
(b) | Norton Rose Fulbright LLP, counsel to the Facility Agent and the Lenders, covering the matters set forth in Exhibit B-2 hereto; |
(c) | Norton Rose Fulbright LLP, counsel to the Facility Agent and the Lenders as to German law, an opinion addressed to the Facility Agent and the Lenders covering the matters set forth in Exhibit B-3 hereto; |
(d) | Clifford Chance US LLP, United States tax counsel to the Facility Agent for the benefit of Lenders, covering the matters set forth in Exhibit B-4 hereto; and |
(e) | if requested by a Lender at least 90 days prior to the expected Disbursement Date in order to comply with Article 194 of the Regulation (EU) No 575/2013 (CRR), a single legal opinion (for the benefit of all the Lenders notwithstanding that not all the Lenders have requested the same) on matters of German law related to the validity and enforceability of the Hermes Insurance Policy, |
(a) | The Facility Agent or the Hermes Agent shall have received the Hermes Insurance Policy duly issued; and |
(b) | Hermes shall not have, prior to the advance of the Loan, delivered to the Facility Agent or the Hermes Agent any notice that the Federal Republic of Germany has determined that the Loan is excluded from cover under the Hermes Insurance Policy. |
(a) | the representations and warranties set forth in Article VI (excluding, however, those set forth in Section 6.10) shall be true and correct in all material respects except for those representations and warranties that are qualified by materiality or Material Adverse Effect, which shall be true and correct, with the same effect as if then made; and |
(b) | no Default and no Prepayment Event and no event which (with notice or lapse of time or both) would become a Prepayment Event shall have then occurred and be continuing. |
(a) | certified as true (by the Builder) copies of the reimbursement request and supporting documents received by the Builder from the Borrower pursuant to Article XVII.1(b) of the Construction Contract in relation to the incurred Buyer's Allowance; |
(b) | a copy of the final invoice from the Builder showing the amount of the Contract Price (including the Buyer's Allowance) and the portion thereof payable to the Builder on the Delivery Date under the Construction Contract; and |
(c) | appropriate evidence of all payments made by the Borrower to the Builder on or prior to the Disbursement Date under the Construction Contract in respect of the Contract Price (including, without limitation, the twenty per cent (20%) equity payment thereunder). |
(a) | contravene the Borrower's Organic Documents; |
(b) | contravene any law or governmental regulation of any Applicable Jurisdiction except as would not reasonably be expected to result in a Material Adverse Effect; |
(c) | contravene any court decree or order binding on the Borrower or any of its property except as would not reasonably be expected to result in a Material Adverse Effect; |
(d) | contravene any contractual restriction binding on the Borrower or any of its property except as would not reasonably be expected to result in a Material Adverse Effect; or |
(e) | result in, or require the creation or imposition of, any Lien on any of the Borrower's properties except: (i) as would not reasonably be expected to result in a Material Adverse Effect or (ii) or Liens created under the Loan Documents. |
(a) | legally and beneficially owned by the Borrower or one of the Borrower's wholly owned Subsidiaries, |
(b) | registered in the name of the Borrower or one of the Borrower's wholly owned Subsidiaries under the Bahamian or Maltese flag or such other flag as the parties may mutually agree, |
(c) | classed as required by Section 7.1.4(b), |
(d) | free of all recorded Liens, other than Liens permitted by Section 7.2.3, |
(e) | insured against loss or damage in compliance with Section 7.1.5, and |
(f) | exclusively operated by or chartered to the Borrower or one of the Borrower's wholly owned Subsidiaries. |
(a) | as soon as available and in any event within 60 days after the end of each of the first three Fiscal Quarters of each Fiscal Year of the Borrower, a copy of the Borrower's |
(b) | as soon as available and in any event within 120 days after the end of each Fiscal Year of the Borrower, a copy of the Borrower's annual report on Form 10-K (or any successor form) as filed by the Borrower with the SEC for such Fiscal Year, containing audited consolidated financial statements of the Borrower for such Fiscal Year prepared in accordance with GAAP (including a balance sheet and profit and loss statement) and audited by PricewaterhouseCoopers LLP or another firm of independent public accountants of similar standing; |
(c) | together with each of the statements delivered pursuant to the foregoing clause (a) or (b), a certificate, executed by the chief financial officer, the treasurer or the corporate controller of the Borrower, showing, as of the last day of the relevant Fiscal Quarter or Fiscal Year compliance with the covenants set forth in Section 7.2.4 (in reasonable detail and with appropriate calculations and computations in all respects reasonably satisfactory to the Facility Agent); |
(d) | as soon as possible after the occurrence of a Default or Prepayment Event, a statement of the chief financial officer of the Borrower setting forth details of such Default or Prepayment Event (as the case may be) and the action which the Borrower has taken and proposes to take with respect thereto; |
(e) | as soon as the Borrower becomes aware thereof, notice of any Material Litigation except to the extent that such Material Litigation is disclosed by the Borrower in filings with the SEC; |
(f) | promptly after the sending or filing thereof, copies of all reports which the Borrower sends to all holders of each security issued by the Borrower, and all registration statements which the Borrower or any of its Subsidiaries files with the SEC or any national securities exchange; and |
(g) | such other information respecting the condition or operations, financial or otherwise, of the Borrower or any of its Subsidiaries as any Lender through the Facility Agent may from time to time reasonably request; |
(a) | in the case of the Borrower, the maintenance and preservation of its corporate existence (subject to the provisions of Section 7.2.6); |
(b) | in the case of the Borrower, maintenance of its qualification as a foreign corporation in the State of Florida; |
(c) | the payment, before the same become delinquent, of all taxes, assessments and governmental charges imposed upon it or upon its property, except to the extent being diligently contested in good faith by appropriate proceedings; |
(d) | compliance with all applicable Environmental Laws; |
(e) | compliance with all anti-money laundering laws and Anti-Corruption Laws applicable to the Borrower, including by not making or causing to be made any offer, gift or payment, consideration or benefit of any kind to anyone, either directly or indirectly, as an inducement or reward for the performance of any of the transactions contemplated by this Agreement to the extent the same would be in contravention of such applicable laws; and |
(f) | the Borrower will maintain in effect policies and procedures designed to procure compliance by the Borrower, its Subsidiaries and their respective directors, officers and employees with Anti-Corruption Laws and applicable Sanctions. |
(a) | from the Delivery Date, cause the Purchased Vessel to be exclusively operated by or chartered to the Borrower or one of the Borrower's wholly owned Subsidiaries, provided that the Borrower or such Subsidiary may charter out the Purchased Vessel (i) to entities other than the Borrower and the Borrower's wholly owned Subsidiaries and (ii) on a time charter with a stated duration not in excess of one year; |
(b) | from the Delivery Date, cause the Purchased Vessel to be kept in such condition as will entitle her to classification by a classification society of recognised standing; |
(c) | on the Delivery Date, provide the following to the Facility Agent with respect to the Purchased Vessel: |
(d) | within seven days after the Delivery Date, provide the following to the Facility Agent with respect to the Purchased Vessel: |
(a) | Indebtedness secured by Liens of the type described in Section 7.2.3; |
(b) | Indebtedness owing to the Borrower or a direct or indirect Subsidiary of the Borrower; |
(c) | Indebtedness incurred to finance, refinance or refund the cost (including the cost of construction) of assets acquired after the Effective Date; |
(d) | Indebtedness in an aggregate principal amount, together with (but without duplication of) Indebtedness permitted to be secured under Section 7.2.3(c), at any one time outstanding not exceeding (determined at the time of creation of such Lien or the incurrence by any Existing Principal Subsidiary of such Indebtedness, as applicable) 10.0% of the total assets of the Borrower and its Subsidiaries taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter; and |
(e) | obligations in respect of Hedging Instruments entered into for the purpose of managing interest rate, foreign currency exchange or commodity exposure risk and not for speculative purposes. |
(a) | Liens on assets (including, without limitation, shares of capital stock of corporations and assets owned by any corporation that becomes a Subsidiary of the Borrower after the Effective Date) acquired after the Effective Date (whether by purchase, construction or otherwise) by the Borrower or any of its Subsidiaries (other than (x) an Existing Principal Subsidiary or (y) any other Principal Subsidiary which, at any time, after three months after the acquisition of a Vessel, owns a Vessel free of any mortgage Lien), which Liens were created solely for the purpose of securing Indebtedness representing, or incurred to finance, refinance or refund, the cost (including the cost of construction) of such assets, so long as (i) the acquisition of such |
(b) | the Construction Mortgage but only to the extent that the same is discharged on the Delivery Date; |
(c) | in addition to other Liens permitted under this Section 7.2.3, Liens securing Indebtedness in an aggregate principal amount, together with (but without duplication of) Indebtedness permitted under Section 7.2.2(d), at any one time outstanding not exceeding (determined at the time of creation of such Lien or the incurrence by any Existing Principal Subsidiary of such indebtedness, as applicable) (i) 10.0% of the total assets of the Borrower and its Subsidiaries (the “Lien Basket Amount”) taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter; provided, however that, if, at any time, the Senior Debt Rating of the Borrower is less than Investment Grade as given by both Moody’s and S&P, the Lien Basket Amount shall be the greater of (x) 5.0% of the total assets of the Borrower and its Subsidiaries taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter and (y) $735,000,000; |
(d) | Liens on assets acquired after the Effective Date by the Borrower or any of its Subsidiaries (other than by (x) any Subsidiary that is an Existing Principal Subsidiary or (y) any other Principal Subsidiary which, at any time, owns a Vessel free of any mortgage Lien) so long as (i) the acquisition of such assets is not otherwise prohibited by the terms of this Agreement and (ii) each of such Liens existed on such assets before the time of its acquisition and was not created by the Borrower or any of its Subsidiaries in anticipation thereof; |
(e) | Liens on any asset of any corporation that becomes a Subsidiary of the Borrower (other than a corporation that also becomes a Subsidiary of an Existing Principal Subsidiary) after the Effective Date so long as (i) the acquisition or creation of such corporation by the Borrower is not otherwise prohibited by the terms of this Agreement and (ii) such Liens are in existence at the time such corporation becomes a Subsidiary of the Borrower and were not created by the Borrower or any of its Subsidiaries in anticipation thereof; |
(f) | Liens securing Government-related Obligations; |
(g) | Liens for taxes, assessments or other governmental charges or levies not at the time delinquent or thereafter payable without penalty or being diligently contested in good faith by appropriate proceedings; |
(h) | Liens of carriers, warehousemen, mechanics, materialmen and landlords incurred in the ordinary course of business for sums not overdue by more than 60 days or being diligently contested in good faith by appropriate proceedings; |
(i) | Liens incurred in the ordinary course of business in connection with workers' compensation, unemployment insurance or other forms of governmental insurance or benefits; |
(j) | Liens for current crew's wages and salvage; |
(k) | Liens arising by operation of law as the result of the furnishing of necessaries for any Vessel so long as the same are discharged in the ordinary course of business or are being diligently contested in good faith by appropriate proceedings; |
(l) | Liens on Vessels that: |
(m) | normal and customary rights of set-off upon deposits of cash or other Liens originating solely by virtue of any statutory or common law provision relating to bankers' liens, rights of set-off or similar rights in favour of banks or other depository institutions; |
(n) | Liens in respect of rights of set-off, recoupment and holdback in favour of credit card processors securing obligations in connection with credit card processing services incurred in the ordinary course of business; |
(o) | Liens on cash or Cash Equivalents or marketable securities securing: |
(p) | deposits to secure the performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case in the ordinary course of business and deposits securing liabilities to insurance carriers under insurance or self-insurance arrangements; |
(q) | easements, zoning restrictions, rights-of-way and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or interfere with the ordinary conduct of business of the Borrower or any Subsidiary; and |
(r) | licenses, sublicenses, leases or subleases granted to other Persons not materially interfering with the conduct of the business of the Borrower or any of its Subsidiaries. |
(a) | Net Debt to Capitalisation Ratio, as at the end of any Fiscal Quarter, to be greater than 0.625 to 1. |
(b) | Fixed Charge Coverage Ratio to be less than 1.25 to 1 as at the last day of any Fiscal Quarter. |
(a) | any such Subsidiary may (i) liquidate or dissolve voluntarily into, and may merge with and into, the Borrower or any other Subsidiary, and the assets or stock of any Subsidiary may be purchased or otherwise acquired by the Borrower or any other Subsidiary or (ii) merge with and into another Person in connection with a sale or other disposition permitted by Section 7.2.7; and |
(b) | so long as no Event of Default or Prepayment Event has occurred and is continuing or would occur after giving effect thereto, the Borrower or any of its Subsidiaries may merge into any other Person, or any other Person may merge into the Borrower or any such Subsidiary, or the Borrower or any of its Subsidiaries may purchase or otherwise acquire all or substantially all of the assets of any Person, in each case so long as: |
(A) | the surviving corporation shall have assumed in a writing, delivered to the Facility Agent, all of the Borrower's obligations hereunder and under the other Loan Documents; |
(B) | the surviving corporation shall, promptly upon the request of the Facility Agent or any Lender, supply such documentation and other evidence as is reasonably requested by the Facility Agent or any Lender in order for the Facility Agent or such Lender to carry out and be satisfied it has complied with the results of all necessary “know your customer” or other similar checks under all applicable laws and regulations; and |
(C) | as soon as practicable after receiving notice from the Borrower of such merger, and in any event no later than five Business Days after the delivery of such notice, for a surviving corporation that is organized under the laws of a jurisdiction other than of the United States or a political subdivision thereof or Liberia, any Lender that may not legally lend to, establish credit for the account of and/or do any business whatsoever with such surviving corporation, either directly or through an Affiliate of such Lender (a “Protesting Lender”) shall so notify the Borrower and the Facility Agent in writing. With respect to each Protesting Lender, the Borrower shall, effective on or before the date that such surviving corporation shall have the right to borrow hereunder, notify the Facility Agent and such Protesting Lender that the Commitments of such Protesting Lender shall be terminated; provided that such Protesting Lender shall have received one or more payments from either the Borrower or one or more assignees in an aggregate amount at least equal to the aggregate outstanding principal amount of the Loan owing to such Protesting Lender, together with accrued interest thereon to the date of payment of such principal amount and all other amounts payable to such Protesting Lender under this Agreement. |
(a) | generally fail to pay, or admit in writing its inability to pay, its debts as they become due; |
(b) | apply for, consent to, or acquiesce in, the appointment of a trustee, receiver, sequestrator or other custodian for it or any of its property, or make a general assignment for the benefit of creditors; |
(c) | in the absence of such application, consent or acquiescence, permit or suffer to exist the appointment of a trustee, receiver, sequestrator or other custodian for it or for a substantial part of its property, and such trustee, receiver, sequestrator or other custodian shall not be discharged within 60 days, provided that in the case of such an event in respect of the Borrower, the Borrower hereby expressly authorises the Facility Agent and each Lender to appear in any court conducting any relevant proceeding during such 60-day period to preserve, protect and defend their respective rights under the Loan Documents; |
(d) | permit or suffer to exist the commencement of any bankruptcy, reorganisation, debt arrangement or other case or proceeding under any bankruptcy or insolvency law, or any dissolution, winding up or liquidation proceeding, in respect of the Borrower or any of such Subsidiaries, and, if any such case or proceeding is not commenced by the Borrower or such Subsidiary, such case or proceeding shall be consented to or acquiesced in by the Borrower or such Subsidiary or shall result in the entry of an order for relief or shall remain for 60 days undismissed, provided that the Borrower hereby expressly authorises the Facility Agent and each Lender to appear in any court conducting any such case or proceeding during such 60-day period to preserve, protect and defend their respective rights under the Loan Documents; or |
(e) | take any corporate action authorising, or in furtherance of, any of the foregoing. |
(a) | enforcement proceedings in respect of any material assets of the Borrower or such Principal Subsidiary shall have been commenced by any creditor upon such judgment or order and shall not have been stayed or enjoined within five (5) Business Days after the commencement of such enforcement proceedings; or |
(b) | there shall be any period of 30 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect. |
(a) | this Article X shall inure to its benefit as to any actions taken or omitted to be taken by it while it was the Facility Agent under this Agreement; and |
(b) | Section 11.3 and Section 11.4 shall continue to inure to its benefit. |
(a) | modify any requirement hereunder that any particular action be taken by all the Lenders or by the Required Lenders shall be effective unless consented to by each Lender; |
(b) | modify this Section 11.1 or change the definition of "Required Lenders" shall be made without the consent of each Lender; |
(c) | increase the Commitment of any Lender shall be made without the consent of such Lender; |
(d) | reduce any fees described in Article III payable to any Lender shall be made without the consent of such Lender; |
(e) | extend the Commitment Termination Date of any Lender shall be made without the consent of such Lender; |
(f) | extend the due date for, or reduce the amount of, any scheduled repayment or prepayment of principal of or interest on the Loan (or reduce the principal amount of or rate of interest on the Loan) owed to any Lender shall be made without the consent of such Lender; or |
(g) | affect adversely the interests, rights or obligations of the Facility Agent in its capacity as such shall be made without consent of the Facility Agent. |
(a) | All notices and other communications provided to any party hereto under this Agreement or any other Loan Document shall be in writing, by facsimile or by electronic mail and addressed, delivered or transmitted to such party at its address, facsimile number or electronic mail address set forth below its signature hereto or set forth in the Lender Assignment Agreement or at such other address, or facsimile number as may be designated by such party in a notice to the other parties. Any notice, if mailed and properly addressed with postage prepaid or if properly addressed and sent by pre-paid courier service, shall be deemed given when received; any notice, if transmitted by facsimile, shall be deemed given when transmitted provided it is received in legible form; any notice, if transmitted by electronic mail, shall be deemed given upon acknowledgment of receipt by the recipient. |
(b) | So long as KfW IPEX is the Facility Agent, the Borrower may provide to the Facility Agent all information, documents and other materials that it furnishes to the Facility Agent hereunder or any other Loan Document (and any guaranties, security agreements and other agreements relating thereto), including, without limitation, all notices, requests, financial statements, financial and other reports, certificates and other materials, but excluding any such communication that (i) relates to a request for a new, or a conversion of an existing advance or other extension of credit (including any election of an interest rate or interest period relating thereto), (ii) relates to the payment of any principal or other amount due hereunder or any other Loan Document prior to the scheduled date therefor, (iii) provides notice of any Default or Event of Default or (iv) is required to be delivered to satisfy any condition precedent to the effectiveness of the Agreement and/or any advance or other extension of credit hereunder (all such non-excluded communications being referred to herein collectively as "Communications"), by transmitting the Communications in an electronic/soft medium in a format acceptable to the Facility Agent at claudia.wenzel@kfw.de (or such other email address notified by the Facility Agent to the Borrower); provided that |
(c) | The Borrower agrees that the Facility Agent may make such items included in the Communications as the Borrower may specifically agree available to the Lenders by posting such notices, at the option of the Borrower, on Intralinks or any similar such platform (the "Platform") acceptable to the Borrower. Although the primary web portal is secured with a dual firewall and a User ID/Password Authorisation System and the Platform is secured through a single user per deal authorisation method whereby each user may access the Platform only on a deal-by-deal basis, the Borrower acknowledges that (i) the distribution of material through an electronic medium is not necessarily secure and that there are confidentiality and other risks associated with such distribution, (ii) the Platform is provided "as is" and "as available" and (iii) neither the Facility Agent nor any of its Affiliates warrants the accuracy, adequacy or completeness of the Communications or the Platform and each expressly disclaims liability for errors or omissions in the Communications or the Platform. No warranty of any kind, express, implied or statutory, including, without limitation, any warranty of merchantability, fitness for a particular purpose, non-infringement of third party rights or freedom from viruses or other code defects, is made by the Facility Agent or any of its Affiliates in connection with the Platform. |
(d) | The Facility Agent agrees that the receipt of Communications by the Facility Agent at its e-mail address set forth above shall constitute effective delivery of such Communications to the Facility Agent for purposes hereunder and any other Loan Document (and any guaranties, security agreements and other agreements relating thereto). |
(a) | except to the extent permitted under Section 7.2.6, the Borrower may not assign or transfer its rights or obligations hereunder without the prior written consent of the Facility Agent and each Lender; and |
(b) | the rights of sale, assignment and transfer of the Lenders are subject to Section 11.11. |
(a) | written notice of such assignment or transfer, together with payment instructions, addresses and related information with respect to such Assignee Lender, shall have been given to the Borrower and the Facility Agent by such Lender and such Assignee Lender; |
(b) | such Assignee Lender shall have executed and delivered to the Borrower and the Facility Agent a Lender Assignment Agreement, accepted by the Facility Agent and, if the applicable portion of the Loan is a Fixed Rate Loan, any other agreements required by the Facility Agent or the KfW in connection therewith; and |
(c) | the processing fees described below shall have been paid. |
(a) | no participation contemplated in this Section 11.11.2 shall relieve such Lender from its obligations hereunder; |
(b) | such Lender shall remain solely responsible for the performance of its obligations hereunder; |
(c) | the Borrower and the Facility Agent shall continue to deal solely and directly with such Lender in connection with such Lender's rights and obligations under this Agreement and each of the other Loan Documents; |
(d) | no Participant, unless such Participant is an Affiliate of such Lender, shall be entitled to require such Lender to take or refrain from taking any action hereunder or under any other Loan Document, except that such Lender may agree with any Participant that such Lender will not, without such Participant's consent, take any actions of the type described in clauses (b) through (f) of Section 11.1; |
(e) | the Borrower shall not be required to pay any amount under Sections 4.2(c), 4.3, 4.4, 4.5, 4.6 and 4.7 that is greater than the amount which it would have been required to pay had no participating interest been sold; and |
(f) | each Lender that sells a participation under this Section 11.11.2 shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register on which it |
(g) | KfW IPEX may not sell participating interests pursuant to this Section 11.11.2 that, when taken together with Loans and/or Commitments sold by KfW IPEX pursuant to Section 11.11.1, result in KfW IPEX's share of the aggregate principal amount of the Loan and/or the aggregate Commitments being less than 50% of the total Loan or total Commitments, without the written consent of the Borrower (which consent shall not be required following the occurrence and during the continuance of an Event of Default or a Prepayment Event). |
(a) | The Hermes Insurance Policy will cover 95% of the Loan. |
(b) | The Hermes Fee will equal 2.37% of the aggregate principal amount of the Loan as at the Delivery Date. |
(c) | The parties have entered into this Agreement on the basis that the Hermes Insurance Policy shall contain the following terms and should such terms not be included within the Hermes Insurance Policy, then the Borrower may cancel the Commitment(s): |
(i) | 25% of the Hermes Fee as in effect on the date of issuance of the Hermes Insurance Policy ("First Fee") will be payable to the Hermes Agent or Hermes in Dollars within two (2) Business Days of receipt by the Borrower of demand from the Hermes Agent following the later to occur of (i) the issue of the Hermes Insurance Policy and (ii) the Effective Date; |
(ii) | the balance of the Hermes Fee (being the amount thereof under paragraph (b) above less the First Fee) ("Second Fee") will be payable in Dollars to the Hermes Agent or Hermes on the Delivery Date ; |
(iii) | if the Commitments are cancelled in full by the Borrower or the Lenders on or prior to the Delivery Date (including, for the avoidance of doubt, subsequent to disbursement of the Loan and prepayment thereof by the Borrower under Section 3.7), Hermes shall be required to reimburse the Hermes Agent the amount of the First Fee less an administration fee (such administration fee to be no greater than 5% of the amount refunded but in any event not exceeding EUR 2,500); |
(iv) | if the Commitments are cancelled in part by the Borrower on or prior to the Delivery Date (including, for the avoidance of doubt, subsequent to disbursement of the Loan and prepayment thereof by the Borrower under Section 3.7), Hermes shall be required to reimburse the Hermes Agent an amount equal to a corresponding proportion of the First Fee, based on the proportion of the aggregate Commitments prior to such cancellation to the aggregate Commitments after giving effect to such cancellation, less an administration fee (such administration fee to be no greater than 5% of the amount refunded but in any event not exceeding EUR 2,500); and |
(v) | if, after the Delivery Date, the Borrower prepays all or part of the Loan in accordance with this Agreement, Hermes shall be required to reimburse the Hermes Agent an amount equal to a corresponding proportion of the unexpired portion of the Hermes Fee, having regard to the amount of the prepayment and the remaining term of the Loan less the sum of (x) a break funding fee equal to 20% of the unexpired portion of the Hermes Fee and (y) an administration fee (such fee to be no greater than 5% of the amount refunded but in any event not exceeding EUR 2,500). |
(a) | Provided that the Hermes Insurance Policy complies with Section 11.13.1, the Borrower shall pay (a) the First Fee to the Hermes Agent in accordance with section 11.13.1(c)(i) and (b) the Second Fee to the Hermes Agent on the Delivery Date. In each case, if received by the Hermes Agent, the Hermes Agent shall pay such amount to Hermes. |
(b) | Provided that the Hermes Insurance Policy complies with Section 11.13.1, the Borrower shall pay to the Hermes Agent an issue fee of EUR 12,500 for the issue of the Hermes Insurance Policy at the same time that the First Fee is payable. |
(a) | Promptly upon receipt of the Hermes Insurance Policy from Hermes, the Hermes Agent shall (subject to any confidentiality undertakings given to Hermes by the Hermes Agent pursuant to the terms of the Hermes Insurance Policy) send a copy thereof to the Borrower. |
(b) | The Hermes Agent shall perform such acts or provide such information which are, acting reasonably, within its power so to perform or so to provide, as required by Hermes under the Hermes Insurance Policy and as are necessary to ensure that the Lenders obtain the support of Hermes pursuant to the Hermes Insurance Policy. |
(c) | The Hermes Agent shall (in the circumstances described in Section 11.13.1(c)(iii), (iv) or (v)): |
(i) | make written requests to Hermes seeking a reimbursement of the Hermes Fee promptly after the relevant cancellation or prepayment and (subject to any confidentiality undertakings given to Hermes by the Hermes Agent pursuant to the terms of the Hermes Insurance Policy) provide a copy of the request to the Borrower; |
(ii) | use its reasonable endeavours to maximise the amount of any reimbursement of the Hermes Fee to which the Hermes Agent is entitled; |
(iii) | pay to the Borrower the full amount of any reimbursement of the Hermes Fee that the Hermes Agent receives from Hermes within two (2) Business Days of receipt with same day value; and |
(iv) | relay the good faith concerns of the Borrower to Hermes regarding the amount it is required to pay to Hermes or the amount of any reimbursement to which the Hermes Agent is entitled, it being agreed |
(d) | Each Lender will co‑operate with the Hermes Agent, the Facility Agent and each other Lender, and take such action and/or refrain from taking such action as may be reasonably necessary, to ensure that the Hermes Insurance Policy and each CIRR Agreement continue in full force and effect and shall indemnify and hold harmless each other Lender in the event that the Hermes Insurance Policy or such CIRR Agreement (as the case may be) does not continue in full force and effect due to its gross negligence or wilful default. |
(a) | the government of the Federal Republic of Germany, the Federal Audit Court or any authorised representatives specified by these bodies shall be authorised at any time to inspect and make or demand copies of the records, accounts, documents and other deeds of any or all of the Lenders relating to this Agreement; |
(b) | in the course of its activity as the Facility Agent, the Facility Agent may: |
(i) | provide the government of the Federal Republic of Germany with information concerning the transactions to be handled by it under this Agreement; and |
(ii) | disclose information concerning the subsidised transaction contemplated by this Agreement in the context of internationally agreed consultation/notification proceedings and statutory specifications, including information received from the Lenders relating to this Agreement; and |
(c) | the Facility Agent and (to the extent the Lenders have entered into an Option A Refinancing Agreement with KfW) the Lenders are entitled to disclose to KfW: |
(i) | circumstances pertaining to the Loan, proper repayment and collateralisation; |
(ii) | extraordinary events which may jeopardise the proper servicing of the Loan; |
(iii) | any information required by KfW with respect to the proper use of any refinancing funds granted to the respective Lender in respect of the Loan; and |
(iv) | the Loan Documents; |
(a) | If the provisions of Section 3.2(c), 3.2(d) or 9.1.11 apply (and having regard to clause (b) below), the Facility Agent, the Borrower and the Lenders (or, in the case of Section 3.2(c) or 3.2(d), any affected Lender) shall discuss in good faith (but without obligation) for a period (the "Mitigation Period") of not less than 30 days (and which in the case of Section 3.2(d) shall commence on the first day of the 50-day period referred to in that Section and, in the case of Section 9.1.11, shall run concurrently with the 30 day period referred to in that Section) after (x) the date on which the Illegality Notice is given or (y) the date of Section 9.1.11 becomes applicable, as the case may be: |
(i) | in the case of Section 3.2(c) or 3.2(d), what steps may be open to the relevant Lender to mitigate or remove such circumstances (including, without limitation, the possibility of assigning the Lender’s Commitment to an Affiliate or another Lending Office); and |
(ii) | in the case of Section 9.1.11, the circumstances in which Section 9.1.11 has become applicable and whether there are any steps or actions which |
(b) | To the extent required by or considered necessary by any Party, the Lenders (and, in the case of Section 3.2(c) or 3.2(d), any affected Lender) shall use commercially reasonable efforts to include Hermes in all foregoing discussions. |
(c) | If an Illegality Notice shall be given by any Lender during the period falling 20 days prior to the anticipated Delivery Date, the affected Lender will use all reasonable efforts to accelerate the mitigation steps of the type described or to be discussed pursuant to this Section to try and enable the Commitment of such Lender to still be available for drawing by the Borrower two (2) Business Days prior to the Delivery Date in the manner contemplated by this Agreement. |
Dated July 3, 49T2018 | ||||
49TROYAL CARIBBEAN CRUISES LTD. (1) (as Borrower) 49TKFW IPEX-BANK GMBH (2) (as Hermes Agent) 49TKFW IPEX-BANK GMBH (3) (as Facility Agent and Documentation Agent) 49TBNP PARIBAS FORTIS SA/NV (4) (as Finnvera Agent) 49TKFW IPEX-BANK GMBH (5) (as Initial Mandated Lead Arranger) 49TBNP PARIBAS FORTIS SA/NV (6) HSBC BANK PLC COMMERZBANK AG, NEW YORK BRANCH BANCO SANTANDER S.A. (as Other Mandated Lead Arrangers) 49TBANCO BILBAO VIZCAYA ARGENTARIA, S.A, (7) NIEDERLASSUNG DEUTSCHLAND BAYERISCHE LANDESBANK, NEW YORK BRANCH DZ BANK AG, NEW YORK BRANCH JPMORGAN CHASE BANK, N.A., LONDON BRANCH SUMITOMO MITSUI BANKING CORPORATION EUROPE LIMITED (as Lead Arrangers) 49Tand 49TCERTAIN FINANCIAL INSTITUTIONS (8) (as Lenders) | ||||
49TAmendment No. 1 in connection with the Credit Agreement in respect of ICON 1 Hull No. 1400 |
(1) | Royal Caribbean Cruises Ltd. (a corporation organised and existing under the laws of The Republic of Liberia) (the Borrower); |
(2) | KfW IPEX-Bank GmbH as facility agent and documentation agent (the Facility Agent); |
(3) | KfW IPEX-Bank GmbH as Hermes agent (the Hermes Agent); |
(4) | BNP Paribas Fortis SA/NV as Finnvera Agent (the Finnvera Agent) |
(5) | KfW IPEX-Bank GmbH as initial mandated lead arranger (the Initial Mandated Lead Arranger); |
(6) | BNP Paribas Fortis SA/NV, HSBC Bank plc, Commerzbank AG, New York Branch and Banco Santander S.A. as other mandated lead arrangers (the Other Mandated Lead Arrangers and, together with the Initial Mandated Lead Arranger, the Mandated Lead Arrangers); |
(7) | Banco Bilbao Vizcaya Argentaria, S.A., Niederlassung Deutschland, Bayersiche Landesbank, New York Branch, DZ Bank AG, New York Branch, JPMorgan Chase Bank, N.A., London Branch and Sumitomo Mitsui Banking Corporation Europe Limited as lead arrangers; and |
(8) | The financial institutions party listed in Schedule 1 hereto as lenders (the Lenders). |
(A) | The Borrower, the Facility Agent, the Hermes Agent, the Finnvera Agent, the Mandated Lead Arrangers and the Lenders are parties to a credit agreement dated 11 October 2017 (the Existing Credit Agreement), in respect of the vessel with hull number 1400 (the Vessel) whereby it was agreed that the Lenders would make available to the Borrower, upon the terms and conditions therein, a US dollar loan facility (the Facility) calculated on the amount equal to the sum of (a) up to eighty per cent (80%) of the Contract Price (as defined in the Existing Credit Agreement) of the Vessel but which Contract Price will not exceed EUR 1,650,000,000, (b) up to 100% of the Finnvera Premium (as defined in the Existing Credit Agreement) and, if applicable, the Finnvera Balancing Premium (as defined in the Existing Credit Agreement) and (c) the US Dollar Equivalent (as defined in the Existing Credit Agreement) of 100% of the Hermes Fee (as defined in the Existing Credit Agreement). |
(B) | The Parties wish to amend and restate the Existing Credit Agreement to the extent set out in this Amendment. |
1 | Interpretation and definitions |
1.1 | Definitions in the Existing Credit Agreement |
(a) | Unless the context otherwise requires or unless otherwise defined in this Amendment, words and expressions defined in the Existing Credit Agreement shall have the same meanings when used in this Amendment. |
(b) | The principles of construction set out in the Existing Credit Agreement shall have effect as if set out in this Amendment. |
1.2 | Definitions |
1.3 | Third party rights |
1.4 | Designation |
2 | Amendment of the Existing Credit Agreement |
3 | Conditions of Effectiveness of Amended Agreement |
3.1 | The Amended Agreement shall become effective in accordance with the terms of this Amendment on the date on which each of the following conditions has been satisfied to the reasonable satisfaction of the Facility Agent (the Effective Date): |
(a) | the Facility Agent shall have received from the Borrower: |
(i) | a certificate of its Secretary or Assistant Secretary as to the incumbency and signatures of those of its officers authorised to act with respect to this Amendment and as to the truth and completeness of the attached resolutions of its Board of Directors then in full force and effect authorising the execution, delivery and performance of this Amendment, and upon which certificate the Lenders may conclusively rely until the Facility Agent shall have received a further certificate of the Secretary or Assistant Secretary of the Borrower canceling or amending such prior certificate; and |
(ii) | a Certificate of Good Standing issued by the relevant Liberian authorities in respect of the Borrower; |
(b) | the Facility Agent shall have received all invoiced expenses of the Facility Agent (including the agreed fees and expenses of counsel to the Facility Agent) required to be paid by the Borrower pursuant to clause 6 below or that the Borrower has otherwise agreed in writing to pay to the Facility Agent, in each case on or prior to the Effective Date; |
(c) | the Facility Agent shall have received: |
(i) | the amendment to the Hermes Insurance Policy duly issued by Hermes; and |
(ii) | the amendment to the Finnvera Guarantee duly issued by Finnvera; and |
(d) | the representations and warranties set forth in clause 4 are true as of the Effective Date. |
3.2 | The Facility Agent shall notify the Lenders and the Borrower of the Effective Date and such notice shall be conclusive and binding. |
4 | Representations and Warranties |
5 | Incorporation of Terms |
6 | Costs and Expenses |
7 | Counterparts |
8 | Governing Law |
1. | KfW IPEX-Bank GmbH |
2. | BNP Paribas Fortis SA/NV |
3. | HSBC Bank USA, National Association |
4. | Commerzbank AG, New York Branch |
5. | Banco Santander, S.A. |
6. | Banco Bilbao Vizcaya Argentaria, S.A., Niederlassung Deutschland |
7. | Bayerische Landesbank, New York Branch |
8. | DZ Bank AG, New York Branch |
9. | JPMorgan Chase Bank, N.A., London Branch |
10. | Sumitomo Mitsui Banking Corporation Europe Limited |
(1) | Royal Caribbean Cruises Ltd., a Liberian corporation (the "Borrower"); |
(2) | KfW IPEX-Bank GmbH, in its capacity as facility agent and documentation agent (in such capacities, the "Facility Agent"); |
(3) | KfW IPEX-Bank GmbH as Hermes agent (in that capacity the "Hermes Agent"); |
(4) | BNP Paribas Fortis SA/NV as Finnvera agent (in that capacity the "Finnvera Agent"); |
(5) | KfW IPEX-Bank GmbH as initial mandated lead arranger (in that capacity the "Initial Mandated Lead Arranger"); |
(6) | BNP Paribas Fortis SA/NV, HSBC Bank plc, Commerzbank AG, New York Branch and Banco Santander, S.A. as the other mandated lead arrangers (the "Other Mandated Lead Arrangers" and together with the Initial Mandated Lead Arranger the "Mandated Lead Arrangers"); |
(7) | Banco Bilbao Vizcaya Argentaria, S.A., Niederlassung Deutschland, Bayerische Landesbank, New York Branch, DZ Bank AG, New York Branch, JPMorgan Chase Bank, N.A., London Branch and Sumitomo Mitsui Banking Corporation Europe Limited as lead arrangers; and |
(8) | KfW IPEX-Bank GmbH ("KfW IPEX"), BNP Paribas Fortis SA/NV, HSBC Bank plc, Commerzbank AG, New York Branch, Banco Santander, S.A., Banco Bilbao Vizcaya Argentaria, S.A., Niederlassung Deutschland, Bayerische Landesbank, New York Branch, DZ Bank AG, New York Branch, JPMorgan Chase Bank, N.A., London Branch and Sumitomo Mitsui Banking Corporation Europe Limited as original FEC lenders (in that capacity the "Original FEC Lenders"), KfW IPEX, BNP Paribas Fortis SA/NV, HSBC Bank USA, National Association, Commerzbank AG, New York Branch, Banco Santander, S.A., Banco Bilbao Vizcaya Argentaria, S.A., Niederlassung Deutschland, Bayerische Landesbank, New York Branch, DZ Bank AG, New York Branch, JPMorgan Chase Bank, N.A., London Branch and Sumitomo Mitsui Banking Corporation Europe Limited as original Hermes lenders (in that capacity the "Original Hermes Lenders") and KfW IPEX, BNP Paribas Fortis SA/NV, HSBC Bank USA, National Association, Commerzbank AG, New York Branch, Banco Santander, S.A., Banco Bilbao Vizcaya Argentaria, S.A., Niederlassung Deutschland, Bayerische Landesbank, New York Branch, DZ Bank AG, New York Branch, JPMorgan Chase Bank, N.A., London Branch and Sumitomo Mitsui Banking Corporation Europe Limited as original Finnvera balancing lenders (in that capacity the "Original Finnvera Balancing Lenders" together with the Original FEC Lenders, the Original Hermes Lenders and each other Person that shall become a |
(A) | The Borrower and Meyer Turku Oy, Finland (the "Builder") have on 12 April 2017 entered into a Contract for the Construction and Sale of ICON 1 Hull No. 1400 (as amended from time to time, the "Construction Contract") pursuant to which the Builder has agreed to design, construct, equip, complete, sell and deliver the passenger cruise vessel bearing Builder's ICON 1 hull number 1400 (the "Purchased Vessel"); and |
(B) | The Lenders have agreed to make available to the Borrower, upon the terms and conditions contained herein, a US dollar loan facility calculated on the amount (the "US Dollar Maximum Loan Amount") equal to: |
(C) | Pursuant to an Amendment Agreement dated as of _3 July______________, 2018 (the “Amendment Agreement’), and upon satisfaction of the conditions set forth therein, the Credit Agreement is being amended and restated in the form of this Agreement. |
(a) | for each of the Original FEC Lenders, the amount set opposite its name in Exhibit A-1 under the heading "FEC Tranche A Commitments" and the amount of any other Commitment in relation to the FEC Tranche A Commitment Amount transferred to it under this Agreement; and |
(b) | for any other Lender, the amount of any Commitment in relation to the FEC Tranche A Commitment Amount transferred to it under a Transfer Certificate or under Section 11.11.1 of this Agreement, |
(a) | for each of the Original FEC Lenders, the amount set opposite its name in Exhibit A-1 under the heading "FEC Tranche B Commitments" and the amount of any other Commitment in relation to the FEC Tranche B Commitment Amount transferred to it under this Agreement; and |
(b) | for any other Lender, the amount of any Commitment in relation to the FEC Tranche B Commitment Amount transferred to it under a Transfer Certificate or under Section 11.11.1 of this Agreement, |
(a) | net cash from operating activities (determined in accordance with GAAP) for such period, as shown in the Borrower's consolidated statement of cash flow for such period, to |
(b) | the sum of: |
(a) | for each of the Original Hermes Lenders, the amount set opposite its name in Exhibit A-1 under the heading "Hermes Commitments" and the amount of any other Commitment in relation to the Hermes Commitment Amount transferred to it under this Agreement; and |
(b) | for any other Lender, the amount of any Commitment in relation to the Hermes Commitment Amount transferred to it under Section 11.11.1 of this Agreement, |
(a) | any Interest Period which would otherwise end on a day which is not a Business Day shall end on the next Business Day to occur, except if such Business Day does not fall in the same calendar month, the Interest Period will end on the last Business Day in that calendar month, the interest amount due in respect of the Interest Period in question and in respect of the next following Interest Period being adjusted accordingly; and |
(b) | if any Interest Period is altered by the application of a) above, the subsequent Interest Period shall end on the day on which it would have ended if the preceding Interest Period had not been so altered. |
(a) | the applicable Screen Rate for the longest period (for which that Screen Rate is available) which is less than the relevant Interest Period; and |
(b) | the applicable Screen Rate for the shortest period (for which that Screen Rate is available) which exceeds the relevant Interest Period. |
(a) | the Screen Rate; or |
(b) | (if no Screen Rate is available for the relevant Interest Period) the Interpolated Screen Rate; or |
(c) | (if (i) no Screen Rate is available for the Floating Rate Loan or (ii) no Screen Rate is available for the relevant Interest Period and it is not possible to calculate the Interpolated Screen Rate), subject to Section 3.3.6, the Reference Bank Rate, |
(d) | for the purposes of determining the post-maturity rate of interest under Section 3.3.4, the LIBO Rate shall be determined by reference to deposits on an overnight or call basis or for such other period or periods as the Facility Agent may determine after consultation with the Lenders, which period shall be no longer than one month unless the Borrower otherwise agrees; and |
(e) | if the LIBO Rate determined in accordance with the foregoing provisions of this definition is less than zero, such rate shall be deemed to be zero for purposes of this Agreement. |
(a) | all cash on hand of the Borrower and its Subsidiaries; plus |
(b) | all Cash Equivalents. |
(a) | borrowed money (whether by loan or issuance and sale of debt securities), including drawings under this Agreement and any revolving credit facilities, and |
(b) | the issuance and sale of equity securities. |
(a) | for all EUR amounts payable in respect of the Contract Price (excluding the portion thereof comprising the NYC Allowance), the total of such EUR amounts converted to a corresponding Dollar amount as determined using the weighted average rate of exchange that the Borrower has agreed, either in the spot or forward currency markets, to pay its counterparties for the purchase of the relevant amounts of EUR with Dollars for the payment of the instalments of the Contract Price (including the final instalment payable on the Actual Delivery Date) and including in such weighted average the spot rates for any EUR amounts due that have not been hedged by the Borrower (the "Weighted Average Rate"); |
(b) | for all EUR amounts payable in respect of the NYC Allowance, the total of such EUR amounts converted to a corresponding Dollar amount as determined using the USD-to-EUR rate used by the Borrower to convert the relevant USD amount of the amount of the NYC Allowance into EUR for the purpose of the Builder invoicing the same to the Borrower in EUR in accordance with the Construction Contract; and |
(c) | for the calculation and payment of the Hermes Fee in Dollars, the amount thereof in EUR converted to a corresponding Dollar amount as determined by Hermes on the basis of the latest rate for the purchase of EUR with Dollars to be published by the German Federal Ministry of Finance prior to the time that Hermes issues its invoice for the Hermes Fee. |
(a) | any reduction, or cancellation of the FEC Tranche A Commitment shall adjust, reduce or cancel (as applicable) each FEC Lender's respective FEC Tranche A Commitment pro rata according to the amount of its respective FEC Tranche A Commitment immediately prior to such adjustment, reduction or cancellation; |
(b) | any reduction or cancellation of the FEC Tranche B Commitment shall adjust, reduce, increase or cancel (as applicable) each FEC Lender's respective FEC Tranche B Commitment pro rata according to the amount of its respective FEC Tranche B Commitment immediately prior to such adjustment, reduction or cancellation; |
(c) | any reduction or cancellation of the Hermes Commitment shall reduce or cancel (as applicable) each Hermes Lender's Hermes Commitment pro rata according to the amount of its respective Hermes Commitment immediately prior to such reduction or cancellation; and |
(d) | any increase, reduction or cancellation of Finnvera Balancing Commitment shall adjust, reduce or cancel (as applicable) each Finnvera Balancing Lender's Finnvera Balancing Commitment pro rata according to the amount of its respective Finnvera Balancing Commitment immediately prior to such adjustment, reduction or cancellation. |
(a) | The Borrower may at any time prior to the date of a Loan Request terminate, or from time to time partially reduce, the Commitments upon written notice to the Facility Agent setting forth the total amount of the reduction in Commitments (the "Reduction Notice"); provided that any such reduction shall be applied (i) pro rata among the FEC Commitment Amount, the Hermes Commitment Amount and the Finnvera Balancing Commitment Amount determined immediately prior to giving effect to such reduction and provided that any such reduction shall not result in the Hermes Commitment at any time being less than 5% of the amount of the total Commitments, (ii) as between the FEC Tranche A Commitment Amount and the FEC Tranche B Commitment Amount, as directed by the Borrower in the Reduction Notice and (iii) as among each FEC Lender holding an FEC Tranche A Commitment, pro rata according to the amount of its respective FEC Tranche A Commitment immediately prior to giving effect to such reduction, (iv) as among each FEC Lender holding an FEC Tranche B Commitment, pro rata according to the amount of its respective FEC Tranche B Commitment immediately prior to giving effect to such reduction, (v) as among each Hermes Lender holding a Hermes Commitment, pro rata according to the amount of its respective Hermes Commitment immediately prior to giving effect to such reduction and (vi) as among each Finnvera Balancing Lender holding a Finnvera Balancing Commitment, pro rata according to the amount of its respective Finnvera Balancing Commitment immediately prior to giving effect to such reduction. The requested reduction shall be effective two Business Days after the date of delivery of the Reduction Notice to the Facility Agent. |
(b) | Except as provided in Sections 2.2(c) and 2.2(d) below, each voluntary reduction in Commitments pursuant to this Section 2.2 shall be without premium or penalty. |
(c) | If, during the period commencing on the Effective Date and ending on the Disbursement Date, the Borrower howsoever reduces the FEC Tranche A Commitment Amount to less than the US Dollar equivalent of EUR1,018,794,290, the Borrower shall pay such Break Costs as required by, and in accordance with, Section 4.4. |
(d) | Where the Commitments are terminated or reduced pursuant to this Section 2.2, the Borrower shall pay to the Facility Agent and the Lenders any fees and commissions that have accrued to but excluding the date of termination or partial reduction (but, in the case of a partial reduction of Commitments, only in respect of the amount of the partial reduction). Any such payment shall be made on the second (2nd) Business Day following receipt by the Borrower of an invoice setting forth the accrued fees and commissions so payable. |
(a) | Promptly following its receipt of the Hermes Insurance Policy, the Facility Agent shall notify the Borrower in writing (with a copy to the Builder) of the documentary requirements specified by Hermes in the letter from Hermes and the letter from Hermes to the Hermes Agent detailing the Hermes Documentary Requirements (as defined below) in order for the Hermes Insurance Policy to become effective in relation to any specified German Construction Contract Component from time to time (the "Hermes Documentary Requirements"). |
(b) | The Hermes Documentary Requirements as notified by the Facility Agent to the Borrower pursuant to Section 2.3(a) shall constitute the definitive list of documents which are to be delivered to the Facility Agent pursuant to Section 5.1.6(d) |
(a) | The Finnvera Balancing Commitment Amount may be increased from zero to an amount up to but not exceeding the aggregate of the Maximum Balancing Amount and the Finnvera Balancing Premium subject to and in accordance with this Section 2.4 only. In order to determine the Maximum Balancing Amount, from time to time, the Facility Agent shall request the Builder (up to 4 weeks before each German Content Review Date) to (a) confirm to the Facility Agent and the Borrower in writing the amount of the Actual German Content Component which is known or confirmed at that time and that part of such Actual German Content Component (if any) for which the Hermes Documentary Requirements can be satisfied and (b) provide copies of all the Hermes Documentary Requirements which are then available for any or all of the confirmed Actual German Content Component. On each German Content Review Date the Maximum Balancing Amount shall reduce by the Eligible German Content Amount which is confirmed at that time provided that the Facility Agent has received from the Builder (in satisfactory form) the relevant Hermes Documentary Requirements for such Eligible German Content Amount. Following each German Content Review Date the Facility Agent shall calculate and confirm to the Borrower in writing the Maximum Balancing Amount then available in accordance with this Agreement which amount cannot be increased following each such confirmation. |
(b) | At any time up to the Final German Content Notice Date, the Borrower may, by written notice to the Facility Agent (the "Final German Content Notice"), elect without premium or penalty to re-allocate a portion of the Hermes Commitment Amount to the Finnvera Balancing Commitment Amount in the event the German Construction Contract Component at such time is expected to be less than EUR200,000,000 and/or there are any elements of the German Construction Contract Component for which the Hermes Documentary Requirements have not been satisfied (and are unlikely to be satisfied by the Final German Content Notice Date (or such later date in advance of the Contractual Delivery Date as the Borrower may agree with the Builder and the Facility Agent)). Any such written notice shall be accompanied by a letter from the Builder regarding the then Actual German Content Component and the then current status of the Hermes Documentary Requirements. The amount that may be re-allocated pursuant to this Section 2.4(b) shall not exceed (a) 80% of the difference between EUR200,000,000 and the Eligible German Content Amount or (b) the Maximum Balancing Amount then available plus the Finnvera Balancing Premium provided that in each case, the Hermes Commitment Amount shall at all times be equal to or greater than 5% of the aggregate Commitments of the Lenders under this Agreement. |
(c) | It is agreed that any partial deficiency in the fulfilment of the Hermes Documentary Requirements relating to a part of the German Construction Contract Component shall not affect the validity of the Hermes Insurance Policy in relation to the remaining German Construction Contract Component and shall not affect the Borrower's right to draw such portion of the Hermes Commitment Amount upon the terms of this Agreement in relation to all those elements of the German Construction Contract Component for which the Hermes Documentary Requirements have been met. |
(d) | In the circumstances set forth in this Section 2.4 only, the Finnvera Balancing Commitment Amount (including any amount specified in Section 2.4(b)) shall be available to the Borrower under the terms of this Agreement. |
(e) | Section 2.1.6 shall apply to any adjustment of the Hermes Commitment Amount and/or the Finnvera Balancing Commitment Amount under this Section 2.4. |
(f) | In the event the Facility Agent has not received the Final German Content Notice by the Final German Content Notice Date or, if as of such Final German Content Notice Date, the Facility Agent has received written notice from the Borrower (accompanied by a letter from the Builder) indicating that the German Construction Contract Component is equal to or greater than EUR200,000,000 and that all Hermes Documentary Requirements can be met in relation to the German Construction Component, then the Finnvera Balancing Commitment will be automatically cancelled without premium or penalty and will not be available for drawing. |
i. | the aggregate amount of FEC Tranche A Loan shall not exceed the FEC Tranche A Commitment Amount as of the Loan Request Date; |
ii. | the aggregate amount of FEC Tranche B Loan shall not exceed the FEC Tranche B Commitment Amount as of the Loan Request Date; |
iii. | the aggregate amount of Hermes Loan shall not exceed the Hermes Commitment Amount as of the Loan Request Date and shall not be less than 5% of the aggregate amount of the Loan; |
iv. | the aggregate amount of Finnvera Balancing Loan shall not exceed the Finnvera Balancing Commitment Amount as of the Loan Request Date; and |
v. | the aggregate amount of the Loan shall not exceed the US Dollar Maximum Loan Amount. |
(a) | The Facility Agent shall, no later than 11:00 a.m., London time, eight (8) Business Days prior to the Disbursement Date, notify each Lender of any Loan Request by forwarding a copy thereof to each Lender, together with its attachments. On the terms and subject to the conditions of this Agreement, the Loan shall be made on the date specified in such Loan Request provided that it is a Business Day. On or before 2:00 p.m., London time, on the Business Day specified in such Loan Request, each Lender shall, without any set-off or counterclaim, deposit with the Facility Agent same day Dollar funds in an amount equal to such Lender's Percentage of each of the FEC Loan, Hermes Loan and, if applicable, Finnvera Balancing Loan requested by such Loan Request. Such deposit will be made to an account which the Facility Agent shall specify from time to time by notice to the Lenders. To the extent funds are so received from the Lenders, the Facility Agent shall, without any set-off or counterclaim, make such funds available to the Borrower on the Business Day specified in the Loan Request by wire transfer of same day funds to the account or accounts the Borrower shall have specified in its Loan Request. |
(b) | The Borrower shall be entitled, upon receipt of the Dollar funds into the account referred to in Section 2.5(b) above, (i) to complete the purchase of EUR with its counterparties or otherwise as set out in the Loan Request (by authorising and instructing the Facility Agent to remit the necessary Dollar funds to the said counterparties) and shall procure the payment of all EUR proceeds of such transactions to the EUR Pledged Account no later than the Business Day immediately following the Business Day specified in the Loan Request and (ii) to the extent of any such Dollar funds as shall not be used to purchase EUR, shall procure (by authorising and instructing the Facility Agent accordingly) the payment of such Dollar funds to the Dollar Pledged Account on the Disbursement Date. |
(c) | The Facility Agent shall direct that moneys standing to the credit of the Pledged Accounts shall, in the manner set out in the Loan Request and in accordance with the requirements and provisions of the Pledge Agreement, be disbursed as follows on the dates specified below: |
(i) | on the Actual Delivery Date, in EUR, to the account of the Builder, as designated by the Builder and identified by the Borrower in the Loan Request, to the extent necessary to meet the final instalment of the Contract Price (including any portion thereof attributable to the NYC Allowance) provided that the Hermes Loan shall only finance up to the lesser of EUR160,000,000 and 80% of the German Construction Contract Component, with the FEC Tranche A Loan, FEC Tranche B Loan and, if applicable, Finnvera Balancing Loan financing the balance of the final instalment. |
(ii) | on the Disbursement Date, in Dollars to Finnvera in payment of (a) the Finnvera Premium; and (b) if applicable, the Finnvera Balancing Premium provided that the relevant portion of the FEC Tranche A Loan and/or the FEC Tranche B Loan shall only finance the Finnvera Premium and, if applicable, the relevant portion of the Finnvera Balancing Loan shall only finance the Finnvera Balancing Premium; and |
(iii) | on the Actual Delivery Date, in Dollars (based on the spot rate of exchange specified in the invoice issued by Hermes prior to the Actual Delivery Date) (a) to Hermes in payment of the Second Fee; and (b) to the account of the Borrower, as designated by the Borrower and identified by the Borrower in the Loan Request, in reimbursement of the First Fee and in respect of any additional amounts standing to the Dollar Pledged Account as of the date of such disbursement provided that the relevant portion of the Hermes Loan shall only finance payment of such First Fee and Second Fee. |
(a) | If, on the Actual Delivery Date, the outstanding principal amount of the Loan exceeds the US Dollar Maximum Loan Amount (as a result of a reduction in the Contract Price after the Disbursement Date and before the delivery of the Purchased Vessel), the Borrower shall prepay the Loan in an amount equal to such excess within two (2) Business Days after the Actual Delivery Date. Any such partial prepayment shall be applied on a pro rata basis across each of the FEC Loan, the Hermes Loan and, if applicable, the Finnvera Balancing Loan provided that the Borrower may direct how such pro rata prepayment shall be applied between the FEC Tranche A Loan and the FEC Tranche B Loan and provided that such pro rata application across the Loan shall not result in the Hermes Loan being less than 5% of the amount of the Loan. |
(b) | No amount repaid or prepaid by the Borrower pursuant to this Section 3.1 may be re-borrowed under the terms of this Agreement. |
(a) | may, from time to time on any Business Day, make a voluntary prepayment, in whole or in part, of the outstanding principal amount of the Loan; provided that: |
(i) | all such voluntary prepayments shall require (x) for prepayments on or after the Disbursement Date made prior to the Actual Delivery Date in respect of the advance made on the Disbursement Date, at least two (2) Business Days' prior written notice to the Facility Agent, and (y) for all other prepayments, at least thirty (30) calendar days' prior written notice (or such shorter period as the Majority Lenders may agree), if all or any portion of the prepayment is to be applied in prepayment of the Fixed Rate Loan, or otherwise at least five (5) Business Days' (or, if such prepayment is to be made on the last day of an Interest Period for the Loan, four (4) Business Days') prior written notice, in each case to the Facility Agent; and |
(ii) | all such voluntary partial prepayments shall be in an aggregate minimum amount of $10,000,000 and a multiple of $1,000,000 (or in the remaining amount of the Loan) and shall be applied in forward order of maturity, inverse order of maturity or rateably at the Borrower's option against the remaining instalments; provided, however, that any such partial prepayment shall be applied on a pro rata basis across each of the FEC Loan, the Hermes Loan and, if applicable, the Finnvera Balancing Loan and provided further that the Borrower may direct how such pro rata prepayment shall be applied between the FEC Tranche A Loan and the FEC Tranche B Loan; and |
(iii) | any voluntary prepayment shall not result in the Hermes Loan being less than 5% of the amount of the Loan at any time. |
(a) | If an affected Lender delivers an Illegality Notice prior to the Disbursement Date, then, subject to Section 11.20, (1) while the arrangements contemplated by the following clause (2) have not yet been completed and the Affected Commitment of such Lender has not been formally cancelled, such Lender shall not be obliged to fund its Affected Commitment and (2) the Borrower shall be entitled at any time within 50 days after receipt of such Illegality Notice to replace such Lender with another Lender hereunder or one or more other financial institutions (I) reasonably acceptable to the Facility Agent and (II) acceptable to each of Finnvera (in respect of the FEC Loan and, if applicable the Finnvera Balancing Loan) and/or Hermes (in respect of the Hermes Loan) (as applicable); provided that any such assignment or transfer shall be either (x) in the case of a single assignment or transfer, an assignment or transfer of all of the rights and obligations of the assigning or transferring Lender under this Agreement with respect to the Affected Commitment or (y) in the case of more than one assignment or transfer, an assignment or transfer of a portion of such rights and obligations made concurrently with another such assignment or transfer or other such assignments or transfers that collectively cover all of the rights and obligations of the assigning or transferring Lender under this Agreement with respect to the Affected Commitment. If, at the end of such 50-day period, the Borrower has not so replaced such affected Lender as aforesaid and no alternative arrangements have been implemented pursuant to Section 11.20, the Affected Commitment held by such Lender shall be cancelled. |
(b) | Subject to Proviso (a) in Section 9.2, if an affected Lender delivers an Illegality Notice on or following the Disbursement Date, then the Borrower shall have the right, but not the obligation, exercisable at any time within 50 days after receipt of such Illegality Notice (the "Option Period"), either (1) to prepay the portion of the Affected Loan held by such Lender in full on or before the expiry of the Option Period, together with all unpaid interest and fees thereon accrued to but excluding the date of such prepayment, or (2) to replace such Lender on or before the expiry of the Option Period with another Lender hereunder or one or more other financial institutions (I) reasonably acceptable to the Facility Agent and (II) acceptable to Finnvera (in respect of the FEC Loan and, if applicable, the Finnvera Balancing Loan) and/or Hermes (in respect of the Hermes Loan) (as applicable); provided that (x) in the case of a single assignment or transfer, any such assignment or transfer shall be either an assignment or transfer of all of the rights and obligations of the assigning or transferring Lender under this Agreement with respect to the Affected Loan or, in the case of more than one assignment or transfer, an assignment or transfer of a portion of such rights and obligations made concurrently with another such assignment or transfer or other such assignments or transfers that collectively cover all of the rights and obligations of the assigning or transferring Lender under this Agreement with respect to the Affected Loan and (y) no Lender shall be obliged to make any such assignment or transfer as a result of an election by the Borrower pursuant to this Section 3.2.2(c) unless and until such Lender shall have received one or more payments from one or more Assignee Lenders, Transferee Lenders and/or the Borrower in an aggregate amount at least equal to the portion of the Affected Loan held by such Lender, together with all unpaid interest and fees thereon accrued to but excluding the date of such assignment or transfer (and all other amounts then owing to such Lender under this Agreement with respect to the Affected Loan). |
(a) | The Loan shall accrue interest from the Disbursement Date to the date of repayment or prepayment of the Loan in full to the Lenders as follows: |
(i) | on the FEC Tranche A Loan at the Fixed Rate; |
(ii) | on the FEC Tranche B Loan, Hermes Loan and the Finnvera Balancing Loan, at the applicable Floating Rate, |
(b) | In relation to interest accruing on the FEC Loan it is agreed that interest shall accrue at the rates specified in Section 3.3.1(a) above and that a portion of the interest which has accrued at a rate equal to 0.05% per annum shall be paid to the Facility Agent for the account of each of the FEC Margin Lenders and the remainder of such interest shall be paid to the Facility Agent for the account of FEC. |
(a) | The parties to this Agreement acknowledge and agree that, at any time when the FEC Tranche A Loan is payable at the Fixed Rate, FEC will have the right to effect an FEC Conversion with respect to the FEC Tranche A Loan (if it has been advanced) or the FEC Commitment relating to the FEC Tranche A Loan (if the FEC Tranche A Loan has not been advanced) if: |
(i) | the funds made available under the Loan have been used for a purpose other than pursuant to Section 2.5(d); |
(ii) | the Borrower has provided incorrect information in relation to an essential issue or failed to disclose matters that have an essential impact on the terms and conditions set out in schedule 3 of the FEC Supplemental Assignment Agreement or the approval of the FEC Financing; |
(iii) | a Transferring Lender or the Facility Agent has provided incorrect information in an essential matter in connection with the Application or failed to disclose matters that have an essential impact on the approval of the FEC Financing; or |
(iv) | a Transferring Lender or the Facility Agent is, in connection with the export transaction pursuant to the Construction Contract or the Loan, found by a court of competent jurisdiction to have been engaged prior to the Disbursement Date in any act that constitutes corrupt activity within the meaning described in clause 12 of the FEC Supplemental Assignment Agreement, or if otherwise the same is proven without controversy. |
(b) | In the event that FEC is entitled under the terms of clause 13.1.1 of the FEC Supplemental Assignment Agreement to effect an FEC Conversion, it shall notify the Borrower through the Facility Agent and advise of the date on which the Fixed Rate will terminate and the FEC Tranche A Floating Rate will apply (the "FEC Conversion Notice") and the Borrower and FEC shall agree the FEC Tranche A Floating Rate Margin which is to apply for purposes of determining the FEC Tranche A Floating Rate in accordance with the procedure set out in a separate side letter between the Borrower and FEC. Any margin agreed shall constitute the FEC Tranche A Floating Rate Margin to apply to the FEC Tranche A Loan effective on and from the date specified in the Conversion Notice. |
(c) | If the Borrower and FEC are unable to agree upon the alternative margin to apply for purposes of determining the FEC Tranche A Floating Rate as provided in Section 3.3.3(b), FEC shall set the FEC Tranche A Floating Rate Margin and FEC shall furnish a certificate to the Borrower and the Facility Agent (the "FEC Conversion Floating Rate Certificate") setting forth such rate (including margin) as soon as reasonably practicable, which FEC Tranche A Floating Rate |
(d) | If an FEC Conversion occurs due to occurrence of the events or circumstances specified in Section 3.3.3(a)(ii), the Borrower shall indemnify FEC in its capacity as Fixed Rate Provider for (x) any Break Costs incurred because of the change of the interest rate and regardless of whether any FEC Commitment is cancelled or any portion of the FEC Tranche A Loan is prepaid in connection with such change of interest and (y) the Interest Subsidy Amount Repayable. |
(e) | If an FEC Conversion occurs due to the occurrence of the events or circumstances specified in Section 3.3.3(a)(i), (iii) or (iv), then, unless such events or circumstances are directly attributable to a breach by the Borrower of its obligations under the Loan Documents, the Facility Agent or Transferring Lender or Transferring Lenders who provided such incorrect information or engaged in such corrupt activity shall (A) indemnify FEC in its capacity as Fixed Rate Provider for (x) any Break Costs incurred because of the change of the interest rate and regardless of whether any FEC Commitment is cancelled or any portion of the FEC Tranche A Loan is prepaid in connection with such change of interest and, except when Section 3.3.3(a)(iv) is applicable, (y) the Interest Subsidy Amount Repayable and (B) indemnify the Borrower no later than three (3) Business Days following the end of each Interest Period for any increase in the amount of interest which the Borrower has paid to the Facility Agent for such Interest Period in respect of the FEC Tranche A Loan as a result of the conversion from the Fixed Rate to the FEC Tranche A Floating Rate. |
(f) | If an FEC Conversion occurs due to the occurrence of the events or circumstances specified in Section 3.3.3(a)(i), (iii) or (iv) which are directly attributable to a breach by the Borrower of its obligations under the Loan Documents, the Borrower shall indemnify FEC in its capacity as Fixed Rate Provider for (x) any Break Costs incurred because of the change of the interest rate and regardless of whether any FEC Commitment is cancelled or any portion of the FEC Tranche A Loan is prepaid in connection with such change of interest and (y) the Interest Subsidy Amount Repayable. |
(g) | In the case of the indemnity under paragraph (d) or (f), the Facility Agent shall provide the Borrower with a certificate prepared by FEC to show, in sufficient detail, the method and basis of the computation of such Break Costs and Interest Subsidy Amount Repayable. In any case referred to in this Section 3.3.3(g), the Facility Agent shall collect from the Borrower the payments payable by the Borrower hereunder and pay such collected payments to FEC without delay upon receipt of such payments from the Borrower. |
(a) | each Repayment Date; |
(b) | the date of any prepayment, in whole or in part, of principal outstanding on the Loan (but only on the principal so prepaid); |
(c) | on that portion of the Loan the repayment of which is accelerated pursuant to Section 8.2 or Section 8.3, immediately upon such acceleration; and |
(d) | in the case of any interest on any principal, interest or other amount owing under this Agreement or any other Loan Document that is overdue, from time to time on demand of the Facility Agent until such overdue amount is paid in full. |
(a) | the Screen Rate shall cease to be available as a publicly available benchmark rate; or |
(b) | Dollar deposits in the relevant amount and for the relevant Interest Period are not available to each Reference Bank in its relevant market; or |
(c) | by reason of circumstances affecting the Reference Banks' relevant markets, adequate means do not exist for ascertaining the interest rate applicable hereunder to LIBO Rate loans for the relevant Interest Period, |
(a) | subject any Lender to any taxes, levies, duties, charges, fees, deductions or withholdings of any nature with respect to its portion of the Loan or any part thereof imposed, levied, collected, withheld or assessed by any jurisdiction or any political subdivision or taxing authority thereof (other than (i) taxes as to which such Lender is indemnified under Section 4.6 and (ii) taxes excluded from the indemnity set forth in Section 4.6); or |
(b) | change the basis of taxation to any Lender (other than a change in taxation on the overall net income of any Lender) of payments of principal or interest or any other payment due or to become due pursuant to this Agreement; or |
(c) | impose, modify or deem applicable any reserve or capital adequacy requirements (other than the increased capital costs described in Section 4.5) |
(d) | impose on any Lender any other condition affecting its portion of the Loan or any part thereof, |
(a) | if at the time interest is calculated at the Floating Rate or, if applicable, the FEC Tranche A Floating Rate on such Lender's portion of the Loan, any conversion or repayment or prepayment or acceleration of the principal amount of such Lender's portion of the Loan on a date other than the scheduled last day of an Interest Period or otherwise scheduled date for repayment or payment (in each case, including any payments as a result of an FEC Reassignment made in accordance with Section 9.1.10(A) where the Borrower is liable to pay Break Costs under Section 9.1.10(A)(b)), but excluding any prepayment made following an election by the Borrower to effect a prepayment pursuant to Section 3.2.2(c), or any repayment pursuant to Section 9.1.11, by reason of a Non-Borrower Related Change in Law); |
(b) | if at the time interest is calculated at the Fixed Rate on such Lender's portion of the Loan, any repayment or prepayment or acceleration of the principal amount of such Lender's portion of the Loan, other than any repayment made on the date scheduled for such repayment (in each case, including any payments whatsoever as a result of an FEC Conversion or an FEC Reassignment where the Borrower is liable to pay Break Costs under Section 3.3.3(d) or Section 3.3.3(f) in the case of an FEC Conversion and Section 9.1.10(A)(b) in the case of an FEC Reassignment) excluding any repayment pursuant to Section 9.1.11, by reason of a Non-Borrower Related Change in Law); |
(c) | a voluntary reduction of the FEC Tranche A Commitment below EUR1,018,794,290; |
(d) | the Loan not being advanced in accordance with the Loan Request therefor due to the fault of the Borrower or as a result of any of the conditions precedent set forth in Article V not being satisfied; |
(e) | any prepayment of the Loan by the Borrower pursuant to Section 4.12 or Section 9.2; or |
(f) | the FEC Tranche A Loan not being advanced on or before the Commitment Termination Date, |
a. | if at that time interest is calculated at the Floating Rate or, if applicable, the FEC Tranche A Floating Rate on such Lender's portion of the Loan, pay directly to the Facility Agent for the account of such Lender an amount (the "Floating Rate Indemnity Amount") equal to the amount, if any, by which: |
(i) | interest calculated at the Floating Rate or, if applicable, the FEC Tranche A Floating Rate which such Lender would have received on its share of the amount of the Loan subject to such Funding Losses Event for the period from the date of receipt of any part of its share in the Loan to the last day of the applicable Interest Period, |
(ii) | the amount which such Lender would be able to obtain by placing an amount equal to the amount received by it on deposit with a leading bank in the appropriate interbank market for a period starting on the Business Day following receipt and ending on the last day of the applicable Interest Period; or |
b. | if at that time the Fixed Rate is applied to the FEC Tranche A Commitment or the FEC Tranche A Loan (as applicable), pay to the Facility Agent acting on the instructions of FEC, in its capacity as the Fixed Rate Provider) for the account of FEC, in its capacity as the Fixed Rate Provider, the amount (if any) in Dollars determined by FEC, as Fixed Rate Provider, by which: |
(i) | the sum of the present value, discounted at the Reinvestment Rate, of each principal payment and interest payment which the FEC Lender would have received on its share of any amount of the FEC Tranche A Commitment that is cancelled or any outstanding amount of the FEC Tranche A Loan that is prepaid for the period from the date of cancellation or from the date of receipt of the prepayment of the principal amount of the FEC Tranche A Loan by the FEC Lender, until the date of Final Maturity (assuming for these purposes that interest would have accrued during the relevant period on a loan ("Deemed Loan") made on the date of cancellation or receipt of the principal amount prepaid in an amount equal to the FEC |
(ii) | the cancelled amount of the FEC Tranche A Commitment or the principal amount of the FEC Tranche A Loan prepaid plus accrued interest paid thereon since the previous interest payment date. |
(a) | pay directly to the relevant authority the full amount required to be so withheld or deducted; |
(b) | promptly forward to the Facility Agent an official receipt or other documentation satisfactory to the Facility Agent evidencing such payment to such authority; and |
(c) | pay to the Facility Agent for the account of the Lenders such additional amount or amounts as is necessary to ensure that the net amount actually received by each Lender will equal the full amount such Lender would have received had no such withholding or deduction been required. |
(a) | Unless otherwise expressly provided in this Agreement or any other Loan Document, all payments by the Borrower in respect of amounts of principal, interest and fees or any other applicable amounts owing to the Lenders hereunder shall be made by the Borrower to the Facility Agent for the account of the Lenders entitled to receive such payments and rateably in accordance with the respective amounts then due and payable to the Lenders. All such payments required to be made to the Facility Agent shall be made by the Borrower, without set-off, deduction or counterclaim, not later than 11:00 a.m., New York time, on the date due, in same day or immediately available funds through the New York Clearing House Interbank Payments System (or such other funds as may be customary for the settlement of international banking transactions in Dollars), to such account as the Facility Agent shall specify from time to time by notice to the Borrower. Funds received after that time shall be deemed to have been received by the Lenders on the next succeeding Business Day. |
(b) | The Facility Agent shall promptly (but in any event on the same Business Day that the same are received or, as contemplated in clause (a) of this Section, deemed received) remit in same day funds to each Lender its share, if any, of such payments received by the Facility Agent for the account of such Lender without any set-off, deduction or counterclaim. All interest and fees shall be computed on |
(a) | the Recovering Lender shall, within three (3) Business Days, notify details of the receipt or recovery to the Facility Agent; |
(b) | the Facility Agent shall determine whether the receipt or recovery is in excess of the amount the Recovering Lender would have been paid had the receipt or recovery been received or made by the Facility Agent and distributed in accordance with the said Section 4.8, without taking account of any taxes which would be imposed on the Facility Agent in relation to the receipt, recovery or distribution; and |
(c) | the Recovering Lender shall, within three (3) Business Days of demand by the Facility Agent, pay to the Facility Agent an amount (the "Sharing Payment") equal to such receipt or recovery less any amount which the Facility Agent determines may be retained by the Recovering Lender as its share of any payment to be made, in accordance with any applicable provisions of this Agreement. |
(a) | each Sharing Lender shall, upon request of the Facility Agent, pay to the Facility Agent for the account of that Recovering Lender an amount equal to the appropriate part of its share of the Sharing Payment (together with an amount as is necessary to reimburse that Recovering Lender for its proportion of any interest on the Sharing Payment which that Recovering Lender is required to pay) (the "Redistributed Amount"); and |
(b) | solely as between the Borrower and each relevant Sharing Lender, an amount equal to the relevant Redistributed Amount will be treated as not having been paid by the Borrower. |
(a) | This Section 4.10 shall not apply to the extent that the Recovering Lender would not, after making any payment pursuant to this Section 4.10, have a valid and enforceable claim against the Borrower. |
(b) | A Recovering Lender is not obliged to share with any other Lender any amount which the Recovering Lender has received or recovered as a result of taking legal or arbitration proceedings, if: |
i. | it notified the other Lender of the legal or arbitration proceedings; and |
ii. | the other Lender had an opportunity to participate in those legal or arbitration proceedings but did not do so as soon as reasonably practicable having received notice and did not take separate legal or arbitration proceedings. |
(e) | If the Borrower becomes a US Tax Obligor or the Facility 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 the Borrower is a US Tax Obligor, the date of this Agreement; |
(ii) | where the Borrower is a US Tax Obligor on a date an assignment or transfer is made pursuant to Section 11.11.1 and the relevant Lender is an Assignee Lender or a Transferee Lender that becomes a Lender in accordance with Section 11.11.1, the date on which such Assignee Lender or Transferee Lender becomes a Lender; |
(iii) | the date of a request from the Facility Agent, |
(A) | a withholding certificate on Form W-8 (or any successor form), Form W-9 (or any successor form) or any other relevant form; or |
(B) | any withholding statement or other document, authorisation or waiver as the Facility Agent may require to certify or establish the status of such Lender under FATCA or that other law or regulation. |
(f) | The Facility Agent shall provide any withholding certificate, withholding statement, document, authorisation or waiver it receives from a Lender pursuant to paragraph (e) above to the Borrower. |
(g) | If any withholding certificate, withholding statement, document, authorisation or waiver provided to the Facility Agent by a Lender pursuant to paragraph (e) 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 Facility Agent unless it is unlawful for the Lender to do so (in which case the Lender shall promptly notify the Facility Agent). The Facility Agent shall provide any such updated withholding certificate, withholding statement, document, authorisation or waiver to the Borrower. |
(h) | The Facility Agent may rely on any withholding certificate, withholding statement, document, authorisation or waiver it receives from a Lender pursuant to paragraph (e) or (g) above without further verification. The Facility Agent shall not be liable for any action taken by it under or in connection with paragraph (e), (f) or (g) above. |
(a) | a certificate of its Secretary or Assistant Secretary as to the incumbency and signatures of those of its officers authorised to act with respect to this Agreement and each other Loan Document and as to the truth and completeness of the attached: |
i. | resolutions of its Board of Directors then in full force and effect authorising the execution, delivery and performance of this Agreement and each other Loan Document, and |
ii. | Organic Documents of the Borrower, |
(b) | a Certificate of Good Standing issued by the relevant Liberian authorities in respect of the Borrower. |
(a) | Watson Farley & Williams LLP, counsel to the Borrower, as to Liberian law, covering the matters set forth in Exhibit B-1 hereto; |
(b) | Stephenson Harwood LLP, counsel to the Facility Agent, as to English law, covering the matters set forth in Exhibit B-2 hereto; |
(c) | Norton Rose Fulbright (Germany) LLP, counsel to the Facility Agent and the Lenders as to German law; |
(d) | Clifford Chance US LLP, United States tax counsel to the Facility Agent for the benefit of the Lenders, covering the matters set forth in Exhibit B-3 hereto; |
(e) | DLA Piper Finland Oy, counsel to the Facility Agent for the benefit of the Lenders, as to Finnish law, covering the matters set forth in Exhibit B-4 hereto including, among others, the validity and enforceability of the Second Finnvera Guarantee; |
(f) | counsel to the Facility Agent and the Lenders as to the law governing the Pledge Agreement, covering the validity and enforceability of the Pledge Agreement; and |
(g) | if requested by a Lender at least 90 days prior to the expected Disbursement Date in order to comply with Article 194 of the Regulation (EU) No 575/2013 (CRR), a single legal opinion (for the benefit of all the Lenders notwithstanding that not all the Lenders have requested the same) on matters of German law related to the validity and enforceability of the Hermes Insurance Policy, |
(a) | The Finnvera Guarantee shall have been duly executed and delivered to the Facility Agent and shall be in full force and effect subject only to payment of the Finnvera Premium to Finnvera out of the proceeds of the FEC Loan and, as at the Disbursement Date, there are no written instructions from Finnvera in effect under clause 6.1 of the Finnvera General Terms requiring the FEC Lenders to cease disbursement of the FEC Loan. |
(b) | If applicable, the Second Finnvera Guarantee shall have been duly executed and delivered to the Facility Agent and shall be in full force and effect subject only to payment of the Finnvera Balancing Premium to Finnvera out of the proceeds of the FEC Balancing Loan and, as at the Disbursement Date, there are no written instructions from Finnvera in effect under clause 6.1 of the Finnvera General Terms requiring the Finnvera Balancing Lenders to cease disbursement of the Finnvera Balancing Loan. |
(c) | The Facility Agent shall have received the Hermes Insurance Policy duly issued and shall be in full force and effect subject only to payment of the Hermes Fee out of the proceeds of the Hermes Loan. |
(d) | Hermes shall not have, prior to the advance of the Loan, delivered to the Facility Agent or the Hermes Agent any notice that the Federal Republic of Germany has determined that the Loan is excluded from cover under the Hermes Insurance Policy. |
(a) | the representations and warranties set forth in Article VI (excluding, however, those set forth in Section 6.10) shall be true and correct in all material respects except for those representations and warranties that are qualified by materiality or Material Adverse Effect, which shall be true and correct, with the same effect as if then made; and |
(b) | no Default and no Prepayment Event and no event which (with notice or lapse of time or both) would become a Prepayment Event shall have then occurred and be continuing. |
(a) | certified as true (by the Builder) copies of the "Buyer's Invoice" received by the Builder from the Borrower pursuant to sub-paragraph (b) of paragraph 2 of Appendix B of the Construction Contract in relation to the incurred NYC Allowance; |
(b) | a copy of the final invoice from the Builder showing the amount of the Contract Price (including the NYC Allowance) and the portion thereof payable to the Builder on the Actual Delivery Date under the Construction Contract; |
(c) | copies of the wire transfers for all payments by the Borrower to the Builder under the Construction Contract in respect of the Contract Price prior to the Borrower's service of the Loan Request; |
(d) | the Hermes Documentary Requirements as notified by the Facility Agent to the Borrower pursuant to Section 2.3(a); and |
(e) | a certified true copy of the Construction Contract together with each addendum thereto which is in effect on the date of the Loan Request. |
(a) | The Facility Agent shall have received a copy of each foreign exchange counterparty confirmation entered into by the Borrower in respect of the payment of the instalments of the Contract Price (other than that relating to the NYC Allowance) at least ten (10) Business Days prior to the proposed Disbursement Date. |
(b) | Following consultation with the Facility Agent the Borrower shall supply to the Facility Agent at least three (3) Business Days prior to the date of the Loan Request its calculation of the US Dollar Maximum Loan Amount under paragraph (a) of the definition of the term "US Dollar Equivalent". |
(a) | A copy of the duly executed FEC Transfer Documents. |
(b) | The FEC Transfer Documents being in full force and effect and where applicable, from and after the Disbursement Date. |
(a) | contravene the Borrower's Organic Documents; |
(b) | contravene any law or governmental regulation of any Applicable Jurisdiction except as would not reasonably be expected to result in a Material Adverse Effect; |
(c) | contravene any court decree or order binding on the Borrower or any of its property except as would not reasonably be expected to result in a Material Adverse Effect; |
(d) | contravene any contractual restriction binding on the Borrower or any of its property except as would not reasonably be expected to result in a Material Adverse Effect; or |
(e) | result in, or require the creation or imposition of, any Lien on any of the Borrower's properties except: (i) as would not reasonably be expected to result in a Material Adverse Effect or (ii) or Liens created under the Loan Documents. |
(a) | legally and beneficially owned by the Borrower or one of the Borrower's wholly owned Subsidiaries, |
(b) | registered in the name of the Borrower or one of the Borrower's wholly owned Subsidiaries under the Bahamian or Maltese flag or such other flag as the parties may mutually agree, |
(c) | classed as required by Section 7.1.4(b), |
(d) | free of all recorded Liens, other than Liens permitted by Section 7.2.3, |
(e) | insured against loss or damage in compliance with Section 7.1.5, and |
(f) | exclusively operated by or chartered to the Borrower or one of the Borrower's wholly owned Subsidiaries. |
(a) | as soon as available and in any event within 60 days after the end of each of the first three Fiscal Quarters of each Fiscal Year of the Borrower, a copy of the Borrower's report on Form 10-Q (or any successor form) as filed by the Borrower with the SEC for such Fiscal Quarter, containing unaudited consolidated financial statements of the Borrower for such Fiscal Quarter (including a balance sheet and profit and loss statement) prepared in accordance with GAAP, subject to normal year-end audit adjustments; |
(b) | as soon as available and in any event within 120 days after the end of each Fiscal Year of the Borrower, a copy of the Borrower's annual report on Form 10-K (or any successor form) as filed by the Borrower with the SEC for such Fiscal Year, containing audited consolidated financial statements of the Borrower for such Fiscal Year prepared in accordance with GAAP (including a balance sheet and profit and loss statement) and audited by PricewaterhouseCoopers LLP or another firm of independent public accountants of similar standing; |
(c) | together with each of the statements delivered pursuant to the foregoing clause (a) or (b), a certificate, executed by the chief financial officer, the treasurer or the corporate controller of the Borrower, showing, as of the last day of the relevant Fiscal Quarter or Fiscal Year compliance with the covenants set forth in Section 7.2.4 (in reasonable detail and with appropriate calculations and computations in all respects reasonably satisfactory to the Facility Agent); |
(d) | as soon as possible after the occurrence of a Default or Prepayment Event, a statement of the chief financial officer of the Borrower setting forth details of such Default or Prepayment Event (as the case may be) and the action which the Borrower has taken and proposes to take with respect thereto; |
(e) | as soon as the Borrower becomes aware thereof, notice of any Material Litigation except to the extent that such Material Litigation is disclosed by the Borrower in filings with the SEC; |
(f) | promptly after the sending or filing thereof, copies of all reports which the Borrower sends to all holders of each security issued by the Borrower, and all registration statements which the Borrower or any of its Subsidiaries files with the SEC or any national securities exchange; |
(g) | such other information respecting the condition or operations, financial or otherwise, of the Borrower or any of its Subsidiaries as any Lender through the Facility Agent may from time to time reasonably request; and |
(h) | information that identifies the Borrower and any Affiliate of the Borrower party to a Loan Document, which may include the name and address of the Borrower and that Affiliate, the organisational documents of the Borrower and any such Affiliate and such other information that will allow the Facility Agent or a Lender and/or its Affiliates to comply with its obligations under the USA Patriot Act. |
(a) | in the case of the Borrower, the maintenance and preservation of its corporate existence (subject to the provisions of Section 7.2.6); |
(b) | in the case of the Borrower, maintenance of its qualification as a foreign corporation in the State of Florida; |
(c) | the payment, before the same become delinquent, of all taxes, assessments and governmental charges imposed upon it or upon its property, except to the extent being diligently contested in good faith by appropriate proceedings; |
(d) | compliance with all applicable Environmental Laws; |
(e) | compliance with all anti-money laundering laws and Anti-Corruption Laws applicable to the Borrower, including by not making or causing to be made any offer, gift or payment, consideration or benefit of any kind to anyone, either directly or indirectly, as an inducement or reward for the performance of any of the transactions contemplated by this Agreement to the extent the same would be in contravention of such applicable laws; and |
(f) | the Borrower will maintain in effect policies and procedures designed to procure compliance by the Borrower, its Subsidiaries and their respective directors, officers and employees with Anti-Corruption Laws and applicable Sanctions. |
(a) | from the Actual Delivery Date, cause the Purchased Vessel to be exclusively operated by or chartered to the Borrower or one of the Borrower's wholly owned Subsidiaries, provided that the Borrower or such Subsidiary may charter out the Purchased Vessel (i) to entities other than the Borrower and the Borrower's wholly owned Subsidiaries and (ii) on a time charter with a stated duration not in excess of one year; |
(b) | from the Actual Delivery Date, cause the Purchased Vessel to be kept in such condition as will entitle her to classification by a classification society of recognised standing; |
(c) | on the Actual Delivery Date, provide the following to the Facility Agent with respect to the Purchased Vessel: |
(d) | within seven days after the Actual Delivery Date, provide the following to the Facility Agent with respect to the Purchased Vessel: |
(a) | The Borrower shall, on the reasonable request of the Facility Agent, provide such information or documents as required under the Credit Support Documents as necessary in each case to enable the Lenders to obtain the full support of FEC and Finnvera as provided for in the Credit Support Documents. In particular but without limitation the Borrower shall provide to the Finnish Ministry such information as required for monitoring and supervision purposes and is relevant to the FEC Financing and the Borrower, the Facility Agent and each of the Original Lenders shall allow representatives of the Finnish Ministry to visit their offices for this purpose. |
(b) | The Borrower shall, on the reasonable request of the Hermes Agent or the Facility Agent, provide such other information as required under the Hermes Insurance Policy and/or the Hermes Conditions as necessary in each case to enable the Hermes Agent, the Facility Agent or the Hermes Lenders to obtain the full support of Hermes and/or the government of the Federal Republic of Germany (as the case may be) pursuant to the Hermes Insurance Policy and/or the Hermes Conditions (as the case may be). The Borrower shall pay to the Hermes Agent, the Facility Agent or the Hermes Lenders the amount of all reasonable costs and expenses reasonably incurred by the Hermes Agent, the Facility Agent or the Hermes Lenders in connection with complying with a request by Hermes or the government of the Federal Republic of Germany for any additional information necessary or desirable in connection with the Hermes Insurance Policy or the Hermes Conditions; provided that the Borrower is consulted before the Hermes Agent, the Facility Agent or Hermes Lenders incurs any such cost or expense. |
(a) | Indebtedness secured by Liens of the type described in Section 7.2.3; |
(b) | Indebtedness owing to the Borrower or a direct or indirect Subsidiary of the Borrower; |
(c) | Indebtedness incurred to finance, refinance or refund the cost (including the cost of construction) of assets acquired after the Effective Date; |
(d) | Indebtedness in an aggregate principal amount, together with (but without duplication of) Indebtedness permitted to be secured under Section 7.2.3(c), at any one time outstanding not exceeding (determined at the time of creation of such Lien or the incurrence by any Existing Principal Subsidiary of such Indebtedness, as applicable) 10.0% of the total assets of the Borrower and its Subsidiaries taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter; and |
(e) | obligations in respect of Hedging Instruments entered into for the purpose of managing interest rate, foreign currency exchange or commodity exposure risk and not for speculative purposes. |
(a) | Liens on assets (including, without limitation, shares of capital stock of corporations and assets owned by any corporation that becomes a Subsidiary of the Borrower after the Effective Date) acquired after the Effective Date (whether by purchase, construction or otherwise) by the Borrower or any of its Subsidiaries (other than (x) an Existing Principal Subsidiary or (y) any other Principal Subsidiary which, at any time, after three months after the acquisition of a Vessel, owns a Vessel free of any mortgage Lien), which Liens were created solely for the purpose of securing Indebtedness representing, or incurred to finance, refinance or refund, the cost (including the cost of construction) of such assets, so long as (i) the acquisition of such assets is not otherwise prohibited by the terms of this Agreement and (ii) each such Lien is created within three months after the acquisition of the relevant assets; |
(b) | the Construction Mortgage but only to the extent that the same is discharged on the Actual Delivery Date; |
(c) | in addition to other Liens permitted under this Section 7.2.3, Liens securing Indebtedness in an aggregate principal amount, together with (but without duplication of) Indebtedness permitted under Section 7.2.2(d), at any one time outstanding not exceeding (determined at the time of creation of such Lien or the incurrence by any Existing Principal Subsidiary of such indebtedness, as applicable) (i) 10.0% of the total assets of the Borrower and its Subsidiaries (the “Lien Basket Amount”) taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter; provided, however that, if, at any time, the Senior Debt Rating of the Borrower is less than Investment Grade as given by both Moody’s and S&P, the Lien Basket Amount shall be the greater of (x) 5.0% of the total assets of the Borrower and its Subsidiaries taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter and (y) $735,000,000; |
(d) | Liens on assets acquired after the Effective Date by the Borrower or any of its Subsidiaries (other than by (x) any Subsidiary that is an Existing Principal Subsidiary or (y) any other Principal Subsidiary which, at any time, owns a Vessel free of any mortgage Lien) so long as (i) the acquisition of such assets is not otherwise prohibited by the terms of this Agreement and (ii) each of such Liens existed on such assets before the time of its acquisition and was not created by the Borrower or any of its Subsidiaries in anticipation thereof; |
(e) | Liens on any asset of any corporation that becomes a Subsidiary of the Borrower (other than a corporation that also becomes a Subsidiary of an Existing Principal Subsidiary) after the Effective Date so long as (i) the acquisition or creation of such corporation by the Borrower is not otherwise prohibited by the terms of this Agreement and (ii) such Liens are in existence at the time such corporation becomes a Subsidiary of the Borrower and were not created by the Borrower or any of its Subsidiaries in anticipation thereof; |
(f) | Liens securing Government-related Obligations; |
(g) | Liens for taxes, assessments or other governmental charges or levies not at the time delinquent or thereafter payable without penalty or being diligently contested in good faith by appropriate proceedings; |
(h) | Liens of carriers, warehousemen, mechanics, materialmen and landlords incurred in the ordinary course of business for sums not overdue by more than 60 days or being diligently contested in good faith by appropriate proceedings; |
(i) | Liens incurred in the ordinary course of business in connection with workers' compensation, unemployment insurance or other forms of governmental insurance or benefits; |
(j) | Liens for current crew's wages and salvage; |
(k) | Liens arising by operation of law as the result of the furnishing of necessaries for any Vessel so long as the same are discharged in the ordinary course of business or are being diligently contested in good faith by appropriate proceedings; |
(l) | Liens on Vessels that: |
(m) | normal and customary rights of set-off upon deposits of cash or other Liens originating solely by virtue of any statutory or common law provision relating to bankers' liens, rights of set-off or similar rights in favour of banks or other depository institutions; |
(n) | Liens in respect of rights of set-off, recoupment and holdback in favour of credit card processors securing obligations in connection with credit card processing services incurred in the ordinary course of business; |
(o) | Liens on cash or Cash Equivalents or marketable securities securing: |
(p) | deposits to secure the performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case in the ordinary course of business and deposits securing liabilities to insurance carriers under insurance or self-insurance arrangements; |
(q) | easements, zoning restrictions, rights-of-way and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or interfere with the ordinary conduct of business of the Borrower or any Subsidiary; and |
(r) | licenses, sublicenses, leases or subleases granted to other Persons not materially interfering with the conduct of the business of the Borrower or any of its Subsidiaries. |
(a) | Net Debt to Capitalisation Ratio, as at the end of any Fiscal Quarter, to be greater than 0.625 to 1. |
(b) | Fixed Charge Coverage Ratio to be less than 1.25 to 1 as at the last day of any Fiscal Quarter. |
(a) | any such Subsidiary may (i) liquidate or dissolve voluntarily into, and may merge with and into, the Borrower or any other Subsidiary, and the assets or stock of any Subsidiary may be purchased or otherwise acquired by the Borrower or any other Subsidiary or (ii) merge with and into another Person in connection with a sale or other disposition permitted by Section 7.2.7; and |
(b) | so long as no Event of Default or Prepayment Event has occurred and is continuing or would occur after giving effect thereto, the Borrower or any of its Subsidiaries may merge into any other Person, or any other Person may merge into the Borrower or any such Subsidiary, or the Borrower or any of its Subsidiaries may purchase or otherwise acquire all or substantially all of the assets of any Person, in each case so long as: |
(A) | the surviving corporation shall have assumed in writing, delivered to the Facility Agent, all of the Borrower's obligations hereunder and under the other Loan Documents; |
(B) | the surviving corporation shall, promptly upon the request of the Facility Agent or any Lender, supply such documentation and other evidence as is reasonably requested by the Facility Agent or any Lender in order for the Facility Agent or such Lender to carry out and be satisfied it has complied with the results of all necessary “know your customer” or other similar checks under all applicable laws and regulations; and |
(C) | as soon as practicable after receiving notice from the Borrower of such merger, and in any event no later than five Business Days after the delivery of such notice, for a surviving corporation that is organized under the laws of a jurisdiction other than of the United States or a political subdivision thereof or Liberia, any Lender that may not legally lend to, establish credit for the account of and/or do any business whatsoever with such surviving corporation, either directly or through an Affiliate of such Lender (a “Protesting Lender”) shall so notify the Borrower and the Facility Agent in writing. With respect to each Protesting Lender, the Borrower shall, effective on or before the date that such surviving corporation shall have the right to borrow hereunder, notify the Facility Agent and such Protesting Lender that the Commitments of such Protesting Lender shall be terminated; provided that such Protesting Lender shall have received one or more payments from either the Borrower or one or more assignees in an aggregate amount at least equal to the aggregate outstanding principal amount of the Loan owing to such Protesting Lender, together with accrued interest thereon to the date of payment of such principal amount and all other amounts payable to such Protesting Lender under this Agreement. |
(a) | generally fail to pay, or admit in writing its inability to pay, its debts as they become due; |
(b) | apply for, consent to, or acquiesce in, the appointment of a trustee, receiver, sequestrator or other custodian for it or any of its property, or make a general assignment for the benefit of creditors; |
(c) | in the absence of such application, consent or acquiescence, permit or suffer to exist the appointment of a trustee, receiver, sequestrator or other custodian for it or for a substantial part of its property, and such trustee, receiver, sequestrator or other custodian shall not be discharged within 60 days, provided that in the case of such an event in respect of the Borrower, the Borrower hereby expressly authorises the Facility Agent and each Lender to appear in any court conducting any relevant proceeding during such 60-day period to preserve, protect and defend their respective rights under the Loan Documents; |
(d) | permit or suffer to exist the commencement of any bankruptcy, reorganisation, debt arrangement or other case or proceeding under any bankruptcy or insolvency law, or any dissolution, winding up or liquidation proceeding, in respect of the Borrower or any of such Subsidiaries, and, if any such case or proceeding is not commenced by the Borrower or such Subsidiary, such case or proceeding shall be consented to or acquiesced in by the Borrower or such Subsidiary or shall result in the entry of an order for relief or shall remain for 60 days undismissed, provided that the Borrower hereby expressly authorises the Facility Agent and each Lender to appear in any court conducting any such case or proceeding during such 60-day period to preserve, protect and defend their respective rights under the Loan Documents; or |
(e) | take any corporate action authorising, or in furtherance of, any of the foregoing. |
(a) | cancel all or any part of the (i) FEC Tranche A Commitment and/or the FEC Tranche B Commitment in the case of FEC and/or (ii) the Finnvera Balancing Commitment and/or the Hermes Commitment (as the case may be) in the case of the Majority Lenders (other than FEC); and/or |
(b) | declare that all or part of any amounts outstanding under the Loan Documents in respect of the Loan or any part thereof are: |
(ii) | payable on demand by the Facility Agent acting on the instructions of FEC in relation to the FEC Loan and the Majority Lenders (other than FEC) in relation to the Hermes Loan, and/or, if applicable, the Finnvera Balancing Loan. |
(a) | enforcement proceedings in respect of any material assets of the Borrower or such Principal Subsidiary shall have been commenced by any creditor upon such judgment or order and shall not have been stayed or enjoined within five (5) Business Days after the commencement of such enforcement proceedings; or |
(b) | there shall be any period of 30 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect. |
(a) | If an FEC Reassignment is at any time effected by FEC other than as a result of any gross negligence or wilful misconduct of the Facility Agent, the Guarantee Holder or any of the Transferring Lenders, (any such FEC Reassignment hereinafter referred to as the "FEC Prepayment Event"), the mandatory prepayments and cancellation provisions contained in Section 9.2 shall apply and the Borrower shall be liable to pay any Break Costs determined in accordance with Section 4.4.1. |
(b) | In the event of an FEC Reassignment as a result of any gross negligence or wilful misconduct of the Facility Agent, the Guarantee Holder or any of the Transferring Lenders, no such mandatory prepayment shall be required and the parties to this Agreement acknowledge and agree that: |
(d) | References to the provisions of the FEC Supplemental Assignment Agreement referred to in this Section 9.1.10(A) shall be to such provisions in the form of the FEC Supplemental Assignment Agreement as originally executed provided no amendments or supplements thereto shall be agreed without the Borrower's prior written consent in which case such references shall be to such provisions of the FEC Supplemental Assignment Agreement as amended or supplemented. |
(e) | The parties to this Agreement acknowledge and agree that if the Transferring Lenders exercise their right to request a re-assignment and/or re-transfer of the FEC Loan pursuant to clause 13.2 of the FEC Supplemental Assignment Agreement, the Borrower shall not be liable to pay any costs and expenses, including but not limited to Break Costs, that are incurred by any party as a result of such re-assignment and/or re-transfer. |
(f) | If Section 9.1.10(A)(c)(ii) applies, the Facility Agent and the Borrower shall enter in good faith negotiations (for a period of not more than thirty (30) days commencing from the date of the FEC Reassignment) with a view to agreeing a substitute basis for determining the rate of interest taking into account the creditworthiness and borrowing credentials of the Borrower and the cost to the Transferring Lenders of funding their respective participations in the FEC Loan. |
(g) | From the date of the FEC Reassignment and unless and until an alternative rate is agreed in accordance with paragraph (f) above, the rate of interest on the relevant part of the FEC Loan for the relevant Interest Period shall be the percentage rate per annum which is the weighted average of the rates notified in good faith to the Facility Agent by each Transferring Lender as soon as practicable and in any event within seven (7) Business Days of the date of the FEC Reassignment (or, if earlier, on the date falling three (3) Business Days before the date on which interest is due to be paid in respect of that Interest Period), to be that which expresses as a percentage rate per annum and in the relevant Transferring Lender's good faith the cost to the relevant Transferring Lender of funding its participation in that FEC Loan from whatever source it may reasonably select. |
(h) | Any alternative basis agreed pursuant to paragraph (f) above shall, with the prior consent of all the Transferring Lenders and the Borrower, be binding on those parties. |
(i) | a reason attributable to the gross negligence or wilful misconduct of FEC, the Facility Agent, the Guarantee Holder or any of the Lenders; or |
(a) | if such Prepayment Event arises under Section 9.1.11, the remedy available under this Section 9.2 shall be limited to that provided in clause (i) above and only with respect to the portion of the Loan held by the affected Lender that gave the relevant Illegality Notice (the "Affected Lender") unless the Affected Lender is a Hermes Lender and any such prepayment of that Hermes Lender's portion of the Loan would result in the Hermes Loan being less than 5% of the Loan outstanding at any time in which event the Borrower shall prepay that portion of the Loan required in order to ensure the Hermes Loan is not less than 5% of the aggregate Loans together with interest and all other Obligations as provided by clause (i) above; |
(b) | if the Prepayment Event arises under Section 9.1.10(A) or (B), the Borrower shall (i) prepay the FEC Loan together with interest and all other Obligations or the FEC Commitment shall be cancelled (as the case may be) in respect of any termination of the Finnvera Guarantee or any FEC Reassignment resulting therefrom and/or (ii) in the case of Section 9.1.10(B) only and if applicable, prepay the Finnvera Balancing Loan together with interest and all other Obligations or the Finnvera Balancing Commitment shall be cancelled (as the case may be) in respect of any termination of the Second Finnvera Guarantee; and |
(c) | if the Prepayment Event arises under Section 9.1.10(C) and no alternative arrangements have been agreed during the Mitigation Period under and in accordance with Section 11.20, the Borrower shall prepay the Loan together with interest and all other Obligations or the total Commitments shall be cancelled (as the case may be) as provided above in clause (i) above. |
(a) | this Article X shall inure to its benefit as to any actions taken or omitted to be taken by it while it was the Facility Agent under this Agreement; and |
(b) | Section 11.3 and Section 11.4 shall continue to inure to its benefit. |
(A) | The provisions of this Agreement and of each other Loan Document may from time to time be amended, modified or waived, if such amendment, modification or waiver is in writing and consented to by the Borrower and the Majority Lenders (acting with the consent of Finnvera and Hermes in respect of any material amendment, modification or waiver); provided that no such amendment, modification or waiver which would: |
(a) | modify any requirement hereunder that any particular action be taken by all the Lenders, Hermes or Finnvera shall be effective unless consented to by each Lender; |
(b) | modify this Section 11.1 or change the definition of "Majority Lenders" shall be made without the consent of each Lender; |
(c) | increase the Commitment of any Lender shall be made without the consent of such Lender; |
(d) | reduce any fees described in Article III payable to any Lender shall be made without the consent of such Lender; |
(e) | extend the Commitment Termination Date of any Lender shall be made without the consent of such Lender; |
(f) | extend the due date for, or reduce the amount of, any scheduled repayment or prepayment of principal of or interest on the Loan (or reduce the principal amount of or rate of interest on the Loan) owed to any Lender shall be made without the consent of such Lender; or |
(g) | affect adversely the interests, rights or obligations of the Facility Agent in its capacity as such shall be made without consent of the Facility Agent. |
(B) | The Facility Agent shall be entitled to request instructions, or clarification of any instruction, from the Majority Lenders in relation to the Loan (or, if the relevant Loan Document stipulates the matter is a decision for any other Lender, Hermes, Finnvera or group of Lenders from that Lender, Hermes, Finnvera or group of Lenders) as to whether, and in what manner, it should exercise or refrain from exercising any right, power, authority or discretion and the Facility Agent may refrain from acting unless and until it receives any such instructions or clarification that it has requested. |
(C) | The Facility Agent is fully protected if it acts on the instructions of the Majority Lenders in relation to the Loan in the exercise of any right, authority, power or discretion or any matter not expressly provided for in the Loan Documents or the Credit Support Documents. Any such instructions given by the Majority Lenders will be binding on the relevant Lenders or all the Lenders (as the case may be). In the absence of instructions, the Facility Agent may act as it considers to be in the best interests of all the Lenders. |
(D) | No failure or delay on the part of the Facility Agent or any Lender in exercising any power or right under this Agreement or any other Loan Document shall operate as a waiver thereof, nor shall any single or partial exercise of any such power or right preclude any other or further exercise thereof or the exercise of any other power or right. No notice to or demand on the Borrower in any case shall entitle it to any notice or demand in similar or other circumstances. No waiver or approval by the Facility Agent or any Lender under this Agreement or any other Loan Document shall, except as may be otherwise stated in such waiver or approval, be applicable to subsequent transactions. No waiver or approval hereunder shall require any similar or dissimilar waiver or approval thereafter to be granted hereunder. The Lenders hereby agree, at any time and from time to time that the Nordea Agreement or the Bank of Nova Scotia Agreement is amended or refinanced to negotiate in good faith to amend this Agreement (but expressly without obligation to agree on any amendment and only on a basis which is strictly a without prejudice to the rights and benefits of the Finance Parties currently existing under this Agreement) to conform any representations, warranties, covenants or events of default in this Agreement to the amendments made to any substantially comparable provisions in the Nordea Agreement or the Bank of Nova Scotia Agreement or any refinancing thereof. |
(a) | All notices and other communications provided to any party hereto under this Agreement or any other Loan Document shall be in writing or by electronic mail and addressed, delivered or transmitted to such party at its address, facsimile number or electronic mail address set forth below its signature hereto or set forth in a Lender Assignment Agreement or Transfer Certificate (as the case may be) or at such other address as may be designated by such party in a notice to the other parties. Any notice, if mailed and properly addressed with postage prepaid or if properly addressed and sent by pre-paid courier service, shall be deemed given when received; any notice, if transmitted by electronic mail, shall be deemed given upon acknowledgment of receipt by the recipient. |
(b) | So long as KfW IPEX is the Facility Agent, the Borrower may provide to the Facility Agent all information, documents and other materials that it furnishes to the Facility Agent hereunder or any other Loan Document (and any guaranties, security agreements and other agreements relating thereto), including, without limitation, all notices, requests, financial statements, financial and other reports, certificates and other materials, but excluding any such communication that (i) relates to a request for a new, or a conversion of an existing advance or other extension of credit (including any election of an interest rate or interest period relating thereto), (ii) relates to the payment of any principal or other amount due hereunder or any other Loan Document prior to the scheduled date therefor, (iii) provides notice of any Default or Event of Default or (iv) is required to be delivered to satisfy any condition precedent to the effectiveness of the Agreement and/or any advance or other extension of credit hereunder (all such non-excluded communications being referred to herein collectively as "Communications"), by transmitting the Communications in an electronic/pdf medium in a format acceptable to the Facility Agent at andre.mutter@kfw.de (or such other email address notified by the Facility Agent to the Borrower). |
(c) | The Borrower agrees that the Facility Agent may make such items included in the Communications as the Borrower may specifically agree available to the Lenders by posting such notices, at the option of the Borrower, on Intralinks or any similar such platform (the "Platform") acceptable to the Borrower. Although the primary web portal is secured with a dual firewall and a User ID/Password Authorisation System and the Platform is secured through a single user per deal authorisation method whereby each user may access the Platform only on a deal-by-deal basis, the Borrower acknowledges that (i) the distribution of material through an electronic medium is not necessarily secure and that there are confidentiality and other risks associated with such distribution, (ii) the Platform is provided "as is" and "as available" and (iii) neither the Facility Agent nor any of its Affiliates warrants the accuracy, adequacy or completeness of the Communications or the Platform and each expressly disclaims liability for errors or omissions in the Communications or the Platform. No warranty of any kind, express, implied or statutory, including, without limitation, any warranty of merchantability, fitness for a particular purpose, non-infringement of third party rights or freedom from viruses or other code defects, is made by the Facility Agent or any of its Affiliates in connection with the Platform. |
(d) | The Facility Agent agrees that the receipt of Communications by the Facility Agent at its e-mail address set forth above shall constitute effective delivery of such Communications to the Facility Agent for purposes hereunder and any other Loan Document (and any guaranties, security agreements and other agreements relating thereto). |
(a) | A person who is not a party to this Agreement 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 except that each of Finnvera and Hermes may enforce and enjoy any rights specifically conferred upon Finnvera or Hermes pursuant to this Agreement. |
(b) | Notwithstanding any term of any Loan Document, the consent of any person who is not a party to a Loan Document (other than Finnvera, FEC (until such time as it becomes a party thereto pursuant to the FEC Transfer Certificates) or Hermes) is not required to rescind or vary this Agreement at any time. |
(a) | except to the extent permitted under Section 7.2.6, the Borrower may not assign or transfer its rights or obligations hereunder without the prior written consent of the Facility Agent and each Lender; and |
(b) | the rights of sale, assignment and transfer of the Lenders are subject to Section 11.11. |
(a) | written notice of such assignment or transfer, together with payment instructions, addresses and related information with respect to such Assignee Lender or Transferee Lender, shall have been given to the Borrower and the Facility Agent by such Lender and such Assignee Lender or Transferee Lender; |
(b) | such Assignee Lender or Transferee Lender shall have executed and delivered to the Borrower and the Facility Agent a Lender Assignment Agreement or a Transfer Certificate as set out in (B) below, accepted by the Facility Agent; |
(c) | the Facility Agent on behalf of FEC shall have received the Additional FEC Transfer Documents where required; and |
(d) | the processing fees described below shall have been paid. |
(a) | A novation is effected if: |
(i) | the Existing Lender and FEC or Transferee Lender (as the case may be) deliver to the Facility Agent a duly completed FEC Transfer Certificate or Transfer Certificate (as the case may be); and |
(ii) | the Facility Agent executes it. |
(b) | The Facility Agent shall only be obliged to execute an FEC Transfer Certificate or Transfer Certificate delivered to it by (i) the Existing Lender and FEC or (ii) the Existing Lender and the Transferee Lender upon its completion of all "know your customer" checks that it is required to carry out in relation to the transfer to FEC or such Transferee Lender and upon receipt of the Additional FEC Transfer Documents where required. |
(c) | Each party to this Agreement (other than the Existing Lender and FEC or Transferee Lender (as the case may be)) irrevocably authorises the Facility Agent to execute any duly completed FEC Transfer Certificate or Transfer Certificate, as applicable on its behalf. |
(d) | On the Effective Date (as defined in the relevant Transfer Certificate): |
(i) | FEC or the Transferring Lender (as applicable) will assume the rights and obligations of the Existing Lender in connection with (i) the FEC Loan in the relevant FEC Transfer Certificate or (ii) any portion of the Loan in the relevant Transfer Certificate by way of novation in substitution for the Existing Lender; and |
(ii) | the Existing Lender will be released from those obligations and cease to have those rights. |
(a) | Unless expressly agreed to the contrary and save in the case of a transfer by the Original Lenders to FEC on the Effective Date, an Existing Lender makes no representation or warranty and assumes no responsibility to a New Lender for: |
(i) | the legality, validity, effectiveness, adequacy or enforceability of the Loan Documents or the Credit Support Documents; |
(ii) | the financial condition of the Borrower; |
(iii) | the performance and observance by the Borrower of its obligations under the Loan Documents; or |
(iv) | the accuracy of any statements (whether written or oral) made in or in connection with any Loan Document or the Credit Support Documents, |
(b) | Each New Lender confirms to the Existing Lender and the other Finance Parties that it: |
(i) | has made (and shall continue to make) its own independent investigation and assessment of the financial condition and affairs of the Borrower and its related entities in connection with its participation in this Agreement and has not relied exclusively on any information provided to it by the Existing Lender or any other Finance Party in connection with any Loan Document or Credit Support Document; and |
(ii) | will continue to make its own independent appraisal of the creditworthiness of the Borrower and its related entities whilst any amount is or may be outstanding under the Loan Documents or any Commitment is in force. |
(c) | Nothing in any Loan Document obliges an Existing Lender to: |
(i) | accept a re-transfer or re-assignment from a New Lender of any of the rights and obligations assigned or transferred under this Section 11.11.1 except in the case of an FEC Reassignment; or |
(ii) | support any losses directly or indirectly incurred by the New Lender by reason of the non-performance by the Borrower of its obligations under the Loan Documents or otherwise, save where Lenders are obliged to reimburse FEC for any Break Costs. |
(a) | no participation contemplated in this Section 11.11.2 shall relieve such Lender from its obligations hereunder; |
(b) | such Lender shall remain solely responsible for the performance of its obligations hereunder; |
(c) | the Borrower and the Facility Agent shall continue to deal solely and directly with such Lender in connection with such Lender's rights and obligations under this Agreement and each of the other Loan Documents; |
(d) | no Participant, unless such Participant is an Affiliate of such Lender, shall be entitled to require such Lender to take or refrain from taking any action hereunder or under any other Loan Document, except that such Lender may agree with any Participant that such Lender will not, without such Participant's consent, take any actions of the type described in clauses (b) through (f) of Section 11.1(A); |
(e) | the Borrower shall not be required to pay any amount under Section 4.3, 4.4, 4.5 and 4.6 that is greater than the amount which it would have been required to pay had no participating interest been sold; and |
(f) | each Lender that sells a participation under this Section 11.11.2 that constitutes a sale of its share in the Loan or an interest therein for U.S. federal income tax purposes shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts of (and stated interest on) each of the Participant's interest in that Lender's portion of the Loan, Commitments or other interests hereunder (the "Participant Register"). The entries in the Participant Register shall be conclusive absent manifest error, and such Lender may treat each person whose name is recorded in the Participant Register as the owner of such participation for all purposes hereunder. |
(a) | The Hermes Insurance Policy will cover 95% of the Hermes Loan. |
(b) | The Hermes Fee will equal 2.79% of the aggregate principal amount of the Hermes Loan as at the Actual Delivery Date. |
(c) | The parties have entered into this Agreement on the basis that the Hermes Insurance Policy shall contain the following terms and should such terms not be included within the Hermes Insurance Policy, then the Borrower may cancel the Commitment(s): |
(i) | 25% of the Hermes Fee as in effect on the date of issuance of the Hermes Insurance Policy ("First Fee") will be payable to the Hermes Agent or Hermes in Dollars within two (2) Business Days of receipt by the Borrower of demand from the Hermes Agent following the later to occur of (i) the issue of the Hermes Insurance Policy and (ii) the Effective Date; |
(ii) | the balance of the Hermes Fee (being the amount thereof under paragraph (b) above less the First Fee) ("Second Fee") will be payable in Dollars to the Hermes Agent or Hermes on the Actual Delivery Date; |
(iii) | if the Hermes Commitment is cancelled in full by the Borrower or the Lenders on or prior to the Actual Delivery Date, Hermes shall be required to reimburse the Hermes Agent the amount of the First Fee less an administration fee (such administration fee to be no greater than 5% of the amount refunded but in any event not exceeding EUR2,500); |
(iv) | if the Hermes Commitment is cancelled in part by the Borrower on or prior to the Actual Delivery Date, Hermes shall be required to reimburse the Hermes Agent an amount equal to a corresponding proportion of the First Fee, based on the proportion of the aggregate Hermes Commitment prior to such cancellation to the aggregate Hermes Commitment after giving effect to such cancellation, less an administration fee (such administration fee to be no greater than 5% of the amount refunded but in any event not exceeding EUR2,500); and |
(v) | if, after the Actual Delivery Date, the Borrower prepays all or part of the Hermes Loan in accordance with this Agreement, Hermes shall be required to reimburse the Hermes Agent an amount equal to a corresponding proportion of the unexpired portion of the Hermes Fee, having regard to the amount of the prepayment and the remaining term of the Hermes Loan less the sum of (x) a break funding fee equal to 20% of the unexpired portion of the Hermes Fee and (y) an administration fee (such fee to be no greater than 5% of the amount refunded but in any event not exceeding EUR2,500). |
(a) | Provided that the Hermes Insurance Policy complies with Section 11.13.1, the Borrower shall pay (a) the First Fee to the Hermes Agent in accordance with Section 11.13.1(c)(i) and (b) the Second Fee to the Hermes Agent on the Actual Delivery Date. In each case, if received by the Hermes Agent, the Hermes Agent shall pay such amount to Hermes. |
(b) | Provided that the Hermes Insurance Policy complies with Section 11.13.1, the Borrower shall pay to the Hermes Agent an issue fee of EUR12,500 for the issue of the Hermes Insurance Policy at the same time that the First Fee is payable. |
(a) | Promptly upon receipt of the Hermes Insurance Policy from Hermes, the Hermes Agent shall (subject to any confidentiality undertakings given to Hermes by the Hermes Agent pursuant to the terms of the Hermes Insurance Policy) send a copy thereof to the Borrower. |
(b) | The Hermes Agent shall perform such acts or provide such information which are, acting reasonably, within its power so to perform or so to provide, as required by Hermes under the Hermes Insurance Policy and as are necessary to ensure that the Lenders obtain the support of Hermes pursuant to the Hermes Insurance Policy. |
(c) | The Hermes Agent shall (in the circumstances described in Section 11.13.1(c)(iii), (iv) or (v)): |
(i) | make written requests to Hermes seeking a reimbursement of the Hermes Fee promptly after the relevant cancellation or prepayment and (subject to any confidentiality undertakings given to Hermes by the Hermes Agent pursuant to the terms of the Hermes Insurance Policy) provide a copy of the request to the Borrower; |
(ii) | use its reasonable endeavours to maximise the amount of any reimbursement of the Hermes Fee to which the Hermes Agent is entitled; |
(iii) | pay to the Facility Agent the full amount of any reimbursement of the Hermes Fee that the Hermes Agent receives from Hermes within two (2) Business Days of receipt with same day value for application as a prepayment towards the Hermes Loan in such order as the Hermes Lenders (in consultation with the Borrower) shall require; and |
(iv) | relay the good faith concerns of the Borrower to Hermes regarding the amount it is required to pay to Hermes or the amount of any reimbursement to which the Hermes Agent is entitled, it being agreed that the Hermes Agent's obligation shall be no greater than simply to pass on to Hermes the Borrower's concerns. |
(d) | Each Hermes Lender will co‑operate with the Hermes Agent, the Facility Agent and each other Hermes Lender, and take such action and/or refrain from taking such action as may be reasonably necessary, to ensure that the Hermes Insurance Policy continues in full force and effect and shall indemnify and hold harmless each other Lender in the event that the Hermes Insurance Policy does not continue in full force and effect due to its gross negligence or wilful default. |
(a) | Promptly upon receipt of the Finnvera Guarantee and, if applicable, the Second Finnvera Guarantee from Finnvera and provided that the Borrower provides a confidentiality undertaking to Finnvera in respect of the Finnvera Guarantee and, if applicable, the Second Finnvera Guarantee, the Facility Agent shall (subject to any confidentiality undertakings given to Finnvera by the Facility Agent pursuant to the terms of the Finnvera Guarantee and, if applicable, the Second Finnvera Guarantee) send a copy thereof to the Borrower. |
(b) | The Facility Agent shall procure that if, after the Disbursement Date, the Borrower prepays the FEC Loan and/or the Finnvera Balancing Loan in part or in full in accordance with Section 3.2.1, the Finnvera Guarantee and, if applicable, the Second Finnvera Guarantee will require Finnvera to reimburse the Guarantee Holder for the account of the Borrower all or a corresponding portion of any Finnvera Premium or the Finnvera Balancing Premium (as the case may be) paid prior to the date of such prepayment in an amount calculated in accordance with the Finnvera Premium Refund Formula. |
(c) | Any refund of the Finnvera Premium and/or the Finnvera Balancing Premium (as the case maybe) pursuant to Section 11.14.1(b) above shall be subject to: |
(i) | there not having been any claims for indemnification under the Finnvera Guarantee and/or the Second Finnvera Guarantee (as the case may be) up to the date of such refund payment by Finnvera; and |
(ii) | the irrevocable release of Finnvera from any liability under (i) the Finnvera Guarantee in respect of the portion of the FEC Loan prepaid and/or (ii) the Second Finnvera Guarantee in respect of the portion of the Finnvera Balancing Loan prepaid. |
(d) | The Facility Agent shall procure that the Guarantee Holder shall: |
(i) | make a written request to Finnvera seeking a reimbursement of the Finnvera Premium and/or the Finnvera Balancing Premium (as the case may be) in the circumstances described in Section 11.14.1(b) and (c) above promptly after the relevant prepayment and (subject to any confidentiality undertakings given to Finnvera by the Facility Agent pursuant to the terms of the Finnvera Guarantee and/or the Second Finnvera Guarantee (as the case may be)) provide a copy of the request to the Borrower; |
(ii) | use its reasonable endeavours to maximize the amount of any reimbursement of the Finnvera Premium and/or the Finnvera Balancing Premium (as the case may be) from Finnvera to which the Guarantee Holder is entitled; |
(iii) | agree to the irrevocable release of Finnvera from any liability under the (i) Finnvera Guarantee in respect of the portion of the FEC Loan prepaid and/or (ii) the Second Finnvera Guarantee in respect of the portion of the Finnvera Balancing Loan prepaid; and |
(iv) | pay to the Borrower the full amount of any reimbursement of the Finnvera Premium and/or Finnvera Balancing Premium (as the case may be) that the Guarantee Holder receives from Finnvera pursuant to the terms of the Finnvera Guarantee and/or the Second Finnvera Guarantee (as the case may be) within five (5) Business Days of receipt with same day value and such amount of any such reimbursement shall be applied as a prepayment against the FEC Loan and the Finnvera Balancing Loan on a pro rata basis provided that the Borrower may direct how such pro rata prepayment shall be applied between the FEC Tranche A Loan and the FEC Tranche B Loan. |
(e) | The Borrower acknowledges that the Finnvera Premium and, if applicable, the Finnvera Balancing Premium shall be calculated as provided in Section 3.5.4 and Section 3.5.5 respectively and shall be paid to Finnvera from the proceeds of the FEC Loan and, if applicable, the Finnvera Balancing Loan respectively on the Disbursement Date and duly authorises (i) FEC to pay the Finnvera Premium to Finnvera on the Disbursement Date by utilising the proceeds of the FEC Loan and (ii) if applicable, the Original Finnvera Balancing Lenders to pay the Finnvera Balancing Premium to Finnvera on the Disbursement Date by utilising the proceeds of the Finnvera Balancing Loan. |
(a) | The parties to this Agreement agree that the Facility Agent may act on the instructions of Finnvera in relation to this Agreement, provided that nothing in this Clause shall permit the Facility Agent to do anything which would alter the rights and/or obligations of any Finance Party or the Borrower as set out in this Agreement. |
(b) | Subject to any provision of the FEC Transfer Documents to the contrary, the Facility Agent as the Guarantee Holder under the Finnvera Guarantee, and, if applicable, the Second Finnvera Guarantee agrees with the Lenders to act in compliance with the Finnvera Guarantee, and, if applicable, the Second Finnvera Guarantee. |
(c) | The Facility Agent as the Guarantee Holder under the Finnvera Guarantee, and, if applicable, the Second Finnvera Guarantee may inform Finnvera of any increase or material change in any risk covered by the Finnvera Guarantee to the extent it is required to do so under the terms of the Finnvera Guarantee, and, if applicable, the Second Finnvera Guarantee and/or related Finnvera General Terms or for the purposes of ensuring the continuing validity of the Finnvera Guarantee, and, if applicable, the Second Finnvera Guarantee and shall notify the Borrower in case it so informs Finnvera. |
(a) | The Borrower acknowledges that: |
(i) | the Original FEC Lenders have entered into or will enter into (as applicable) the FEC Transfer Documents pursuant to which the Original FEC Lenders will, amongst other things, assign and transfer their respective rights and obligations under this Agreement to FEC; and |
(ii) | following the assignment and transfer referred to above, the Facility Agent shall act as agent for FEC under the Loan Documents and the Guarantee Holder shall continue to act as holder of the Finnvera Guarantee for and on behalf of the FEC Lender(s). |
(b) | The Borrower and each Finance Party shall co-operate and actively assist each other with respect to any obligations such Finance Party may have under or in connection with any Credit Support Document provided however, the Borrower shall not be required to act in a manner that it considers to be contrary or adverse to its own interests or may, directly or indirectly, result in any increased or additional cost or liability to the Borrower whether under the Loan Documents or otherwise (except for costs and expenses which the Borrower has agreed, pursuant to any Loan Document or otherwise, to pay). |
(c) | The Finance Parties have obligations under the FEC Transfer Documents (to which they are a party) and the Facility Agent has obligations as holder of the Finnvera Guarantee, and, if applicable, the Second Finnvera Guarantee which they would not have incurred (or in relation to which it would not have had any liability) if they had not entered into the FEC Transfer Documents or become holder of the Finnvera Guarantee, and, if applicable, the Second Finnvera Guarantee. Accordingly, the Borrower agrees to indemnify each Finance Party against any cost, loss or liability incurred by such Finance Party in connection with the FEC Transfer Documents (to which such Finance Party is a party and acting in whatever capacity) or as holder of the Finnvera Guarantee, and, if applicable, the Second Finnvera Guarantee and for any cost, loss or liability for which such Finance Party may be liable to FEC or Finnvera or otherwise under any FEC Transfer Document to which it is a party (acting in whatever capacity) or in respect of the Finnvera Guarantee, and, if applicable, the Second Finnvera Guarantee unless caused by the gross negligence or wilful misconduct of that Finance Party or the failure to perform or any default by that Finance Party under the relevant FEC Transfer Document, this Agreement, any other Loan Document, the Finnvera Guarantee, or, if applicable, the Second Finnvera Guarantee. |
(d) | The FEC Transfer Documents shall be executed concurrently with signing this Agreement. |
(e) | The Facility Agent shall or (as the case may be) shall procure that the Guarantee Holder shall, provide a copy of each FEC Transfer Document to the Borrower promptly following execution of the same. |
(a) | If any Finance Party receives any proceeds under the Finnvera Guarantee, the Second Finnvera Guarantee or the Hermes Insurance Policy, it shall transfer such moneys to the Facility Agent. |
(b) | Any proceeds referred to in (a) above shall be applied by the Facility Agent in favour of (i) an FEC Lender only in relation to monies received under the Finnvera Guarantee (ii) if applicable, the Finnvera Balancing Lenders only in relation to monies received under the Second Finnvera Guarantee and (iii) the Hermes Lenders only in relation to monies received under the Hermes Insurance Policy and, for the avoidance of doubt, no such proceeds shall be made available to the Borrower. |
(c) | Such proceeds shall be ignored when calculating the amount owing to the Lenders in respect of the FEC Loan, the Finnvera Balancing Loan (if applicable) or the Hermes Loan (as the case may be) and, for the avoidance of doubt, the obligations of the Borrower under the Loan Documents to which it is a party shall remain in full force and effect, notwithstanding the receipt of any such proceeds under the Finnvera Guarantee, the Second Finnvera Guarantee (if applicable) or the Hermes Insurance Policy (as the case may be). |
(a) | If the provisions of Section 3.2.2(b), 3.2.2(c) or 9.1.10(C) apply (and having regard to clause (b) below), the Facility Agent, the Borrower and the Lenders (or, in the case of Section 3.2.2(b) or 3.2.2(c), any affected Lender) shall discuss in good faith (but without obligation) for a period (the "Mitigation Period") of not less than, in the case of Sections 3.2.2(b) and 3.2.2(c), 50 days and, in the case of Section 9.1.10(C), 30 days (and which in the case of Section 3.2.2(b) and 3.2.2(b) shall commence on the first day of the 50-day period referred to in those respective Sections and, in the case of Section 9.1.10(C), shall run concurrently with the 30 day period referred to in that Section or, concurrently with the three (3) month grace period applicable in the case of a suspension of the Hermes Insurance Policy ) after (x) in the case of Section 3.2.2(b) and 3.2.2(c), the date on which the Illegality Notice is given or (y) in the case of Section 9.1.10(C), the date such Section becomes applicable, as the case may be: |
(i) | in the case of Section 3.2.2(b) or 3.2.2(c), what steps may be open to the relevant Lender to mitigate or remove such circumstances (including, without limitation, the possibility of assigning the Lender's Commitment to an Affiliate or another Lending Office); and |
(ii) | in the case of Section 9.1.10(C), the circumstances in which Section 9.1.10(C) has become applicable and whether there are any steps or actions which can be taken to remove the effect of the circumstances as described in such Section and/or reinstate or replace the Hermes Insurance Policy. |
(b) | To the extent required by or considered necessary by any party to this Agreement, the Lenders (and, in the case of Section 3.2.2(b) or 3.2.2(c), any affected Lender) shall use commercially reasonable efforts to include the Finnish Authorities and Hermes in all foregoing discussions. |
Dated 3 July 2018 | ||||
ROYAL CARIBBEAN CRUISES LTD. (1) (as Borrower) KFW IPEX-BANK GMBH (2) (as Hermes Agent) KFW IPEX-BANK GMBH (3) (as Facility Agent and Documentation Agent) BNP PARIBAS FORTIS SA/NV (4) (as Finnvera Agent) KFW IPEX-BANK GMBH (5) (as Initial Mandated Lead Arranger) BNP PARIBAS FORTIS SA/NV (6) HSBC BANK PLC COMMERZBANK AG, NEW YORK BRANCH BANCO SANTANDER S.A. (as Other Mandated Lead Arrangers) BANCO BILBAO VIZCAYA ARGENTARIA, S.A, (7) NIEDERLASSUNG DEUTSCHLAND BAYERISCHE LANDESBANK, NEW YORK BRANCH DZ BANK AG, NEW YORK BRANCH JPMORGAN CHASE BANK, N.A., LONDON BRANCH SUMITOMO MITSUI BANKING CORPORATION EUROPE LIMITED (as Lead Arrangers) and CERTAIN FINANCIAL INSTITUTIONS (8) (as Lenders) | ||||
Amendment No. 1 in connection with the Credit Agreement in respect of ICON 2 Hull No. 1401 |
(1) | Royal Caribbean Cruises Ltd. (a corporation organised and existing under the laws of The Republic of Liberia) (the Borrower); |
(2) | KfW IPEX-Bank GmbH as facility agent and documentation agent (the Facility Agent); |
(3) | KfW IPEX-Bank GmbH as Hermes agent (the Hermes Agent); |
(4) | BNP Paribas Fortis SA/NV as Finnvera Agent (the Finnvera Agent) |
(5) | KfW IPEX-Bank GmbH as initial mandated lead arranger (the Initial Mandated Lead Arranger); |
(6) | BNP Paribas Fortis SA/NV, HSBC Bank plc, Commerzbank AG, New York Branch and Banco Santander S.A. as other mandated lead arrangers (the Other Mandated Lead Arrangers and, together with the Initial Mandated Lead Arranger, the Mandated Lead Arrangers); |
(7) | Banco Bilbao Vizcaya Argentaria, S.A., Niederlassung Deutschland, Bayersiche Landesbank, New York Branch, DZ Bank AG, New York Branch, JPMorgan Chase Bank, N.A., London Branch and Sumitomo Mitsui Banking Corporation Europe Limited as lead arrangers; and |
(8) | The financial institutions party listed in Schedule 1 hereto as lenders (the Lenders). |
(A) | The Borrower, the Facility Agent, the Hermes Agent, the Finnvera Agent, the Mandated Lead Arrangers and the Lenders are parties to a credit agreement dated 11 October 2017 (the Existing Credit Agreement), in respect of the vessel with hull number 1401 (the Vessel) whereby it was agreed that the Lenders would make available to the Borrower, upon the terms and conditions therein, a US dollar loan facility (the Facility) calculated on the amount equal to the sum of (a) up to eighty per cent (80%) of the Contract Price (as defined in the Existing Credit Agreement) of the Vessel but which Contract Price will not exceed EUR 1,650,000,000, (b) up to 100% of the Finnvera Premium (as defined in the Existing Credit Agreement) and, if applicable, the Finnvera Balancing Premium (as defined in the Existing Credit Agreement) and (c) the US Dollar Equivalent (as defined in the Existing Credit Agreement) of 100% of the Hermes Fee (as defined in the Existing Credit Agreement). |
(B) | The Parties wish to amend and restate the Existing Credit Agreement to the extent set out in this Amendment. |
1 | Interpretation and definitions |
1.1 | Definitions in the Existing Credit Agreement |
(a) | Unless the context otherwise requires or unless otherwise defined in this Amendment, words and expressions defined in the Existing Credit Agreement shall have the same meanings when used in this Amendment. |
(b) | The principles of construction set out in the Existing Credit Agreement shall have effect as if set out in this Amendment. |
1.2 | Definitions |
1.3 | Third party rights |
1.4 | Designation |
2 | Amendment of the Existing Credit Agreement |
3 | Conditions of Effectiveness of Amended Agreement |
3.1 | The Amended Agreement shall become effective in accordance with the terms of this Amendment on the date on which each of the following conditions has been satisfied to the reasonable satisfaction of the Facility Agent (the Effective Date): |
(a) | the Facility Agent shall have received from the Borrower: |
(i) | a certificate of its Secretary or Assistant Secretary as to the incumbency and signatures of those of its officers authorised to act with respect to this Amendment and as to the truth and completeness of the attached resolutions of its Board of Directors then in full force and effect authorising the execution, delivery and performance of this Amendment, and upon which certificate the Lenders may conclusively rely until the Facility Agent shall have received a further certificate of the Secretary or Assistant Secretary of the Borrower canceling or amending such prior certificate; and |
(ii) | a Certificate of Good Standing issued by the relevant Liberian authorities in respect of the Borrower; |
(b) | the Facility Agent shall have received all invoiced expenses of the Facility Agent (including the agreed fees and expenses of counsel to the Facility Agent) required to be paid by the Borrower pursuant to clause 6 below or that the Borrower has otherwise agreed in writing to pay to the Facility Agent, in each case on or prior to the Effective Date; |
(c) | the Facility Agent shall have received: |
(i) | the amendment to the Hermes Insurance Policy duly issued by Hermes; and |
(ii) | the amendment to the Finnvera Guarantee duly issued by Finnvera; and |
(d) | the representations and warranties set forth in clause 4 are true as of the Effective Date. |
3.2 | The Facility Agent shall notify the Lenders and the Borrower of the Effective Date and such notice shall be conclusive and binding. |
4 | Representations and Warranties |
5 | Incorporation of Terms |
6 | Costs and Expenses |
7 | Counterparts |
8 | Governing Law |
1. | KfW IPEX-Bank GmbH |
2. | BNP Paribas Fortis SA/NV |
3. | HSBC Bank USA, National Association |
4. | Commerzbank AG, New York Branch |
5. | Banco Santander, S.A. |
6. | Banco Bilbao Vizcaya Argentaria, S.A., Niederlassung Deutschland |
7. | Bayerische Landesbank, New York Branch |
8. | DZ Bank AG, New York Branch |
9. | JPMorgan Chase Bank, N.A., London Branch |
10. | Sumitomo Mitsui Banking Corporation Europe Limited |
(1) | Royal Caribbean Cruises Ltd., a Liberian corporation (the "Borrower"); |
(2) | KfW IPEX-Bank GmbH, in its capacity as facility agent and documentation agent (in such capacities, the "Facility Agent"); |
(3) | KfW IPEX-Bank GmbH as Hermes agent (in that capacity the "Hermes Agent"); |
(4) | BNP Paribas Fortis SA/NV as Finnvera agent (in that capacity the "Finnvera Agent"); |
(5) | KfW IPEX-Bank GmbH as initial mandated lead arranger (in that capacity the "Initial Mandated Lead Arranger"); |
(6) | BNP Paribas Fortis SA/NV, HSBC Bank plc, Commerzbank AG, New York Branch and Banco Santander, S.A. as the other mandated lead arrangers (the "Other Mandated Lead Arrangers" and together with the Initial Mandated Lead Arranger the "Mandated Lead Arrangers"); |
(7) | Banco Bilbao Vizcaya Argentaria, S.A., Niederlassung Deutschland, Bayerische Landesbank, New York Branch, DZ Bank AG, New York Branch, JPMorgan Chase Bank, N.A., London Branch and Sumitomo Mitsui Banking Corporation Europe Limited as lead arrangers; and |
(8) | KfW IPEX-Bank GmbH ("KfW IPEX"), BNP Paribas Fortis SA/NV, HSBC Bank plc, Commerzbank AG, New York Branch, Banco Santander, S.A., Banco Bilbao Vizcaya Argentaria, S.A., Niederlassung Deutschland, Bayerische Landesbank, New York Branch, DZ Bank AG, New York Branch, JPMorgan Chase Bank, N.A., London Branch and Sumitomo Mitsui Banking Corporation Europe Limited as original FEC lenders (in that capacity the "Original FEC Lenders"), KfW IPEX, BNP Paribas Fortis SA/NV, HSBC Bank USA, National Association, Commerzbank AG, New York Branch, Banco Santander, S.A., Banco Bilbao Vizcaya Argentaria, S.A., Niederlassung Deutschland, Bayerische Landesbank, New York Branch, DZ Bank AG, New York Branch, JPMorgan Chase Bank, N.A., London Branch and Sumitomo Mitsui Banking Corporation Europe Limited as original Hermes lenders (in that capacity the "Original Hermes Lenders") and KfW IPEX, BNP Paribas Fortis SA/NV, HSBC Bank USA, National Association, Commerzbank AG, New York Branch, Banco Santander, S.A., Banco Bilbao Vizcaya Argentaria, S.A., Niederlassung Deutschland, Bayerische Landesbank, New York Branch, DZ Bank AG, New York Branch, JPMorgan Chase Bank, N.A., London Branch and Sumitomo Mitsui Banking Corporation Europe Limited as original Finnvera balancing lenders (in that capacity the "Original Finnvera Balancing Lenders" together with the Original FEC Lenders, the Original Hermes Lenders and each other Person that shall become a |
(A) | The Borrower and Meyer Turku Oy, Finland (the "Builder") have on 12 April 2017 entered into a Contract for the Construction and Sale of ICON 2 Hull No. 1401 (as amended from time to time, the "Construction Contract") pursuant to which the Builder has agreed to design, construct, equip, complete, sell and deliver the passenger cruise vessel bearing Builder's ICON 2 hull number 1401 (the "Purchased Vessel"); and |
(B) | The Lenders have agreed to make available to the Borrower, upon the terms and conditions contained herein, a US dollar loan facility calculated on the amount (the "US Dollar Maximum Loan Amount") equal to: |
(C) | Pursuant to an Amendment Agreement dated as of _3 July_______________, 2018 (the “Amendment Agreement’), and upon satisfaction of the conditions set forth therein, the Credit Agreement is being amended and restated in the form of this Agreement. |
(a) | for each of the Original FEC Lenders, the amount set opposite its name in Exhibit A-1 under the heading "FEC Tranche A Commitments" and the amount of any other Commitment in relation to the FEC Tranche A Commitment Amount transferred to it under this Agreement; and |
(b) | for any other Lender, the amount of any Commitment in relation to the FEC Tranche A Commitment Amount transferred to it under a Transfer Certificate or under Section 11.11.1 of this Agreement, |
(a) | for each of the Original FEC Lenders, the amount set opposite its name in Exhibit A-1 under the heading "FEC Tranche B Commitments" and the amount of any other Commitment in relation to the FEC Tranche B Commitment Amount transferred to it under this Agreement; and |
(b) | for any other Lender, the amount of any Commitment in relation to the FEC Tranche B Commitment Amount transferred to it under a Transfer Certificate or under Section 11.11.1 of this Agreement, |
(a) | net cash from operating activities (determined in accordance with GAAP) for such period, as shown in the Borrower's consolidated statement of cash flow for such period, to |
(b) | the sum of: |
(a) | for each of the Original Hermes Lenders, the amount set opposite its name in Exhibit A-1 under the heading "Hermes Commitments" and the amount of any other Commitment in relation to the Hermes Commitment Amount transferred to it under this Agreement; and |
(b) | for any other Lender, the amount of any Commitment in relation to the Hermes Commitment Amount transferred to it under Section 11.11.1 of this Agreement, |
(a) | any Interest Period which would otherwise end on a day which is not a Business Day shall end on the next Business Day to occur, except if such Business Day does not fall in the same calendar month, the Interest Period will end on the |
(b) | if any Interest Period is altered by the application of a) above, the subsequent Interest Period shall end on the day on which it would have ended if the preceding Interest Period had not been so altered. |
(a) | the applicable Screen Rate for the longest period (for which that Screen Rate is available) which is less than the relevant Interest Period; and |
(b) | the applicable Screen Rate for the shortest period (for which that Screen Rate is available) which exceeds the relevant Interest Period. |
(a) | the Screen Rate; or |
(b) | (if no Screen Rate is available for the relevant Interest Period) the Interpolated Screen Rate; or |
(c) | (if (i) no Screen Rate is available for the Floating Rate Loan or (ii) no Screen Rate is available for the relevant Interest Period and it is not possible to calculate the Interpolated Screen Rate), subject to Section 3.3.6, the Reference Bank Rate, |
(d) | for the purposes of determining the post-maturity rate of interest under Section 3.3.4, the LIBO Rate shall be determined by reference to deposits on an overnight or call basis or for such other period or periods as the Facility Agent may determine after consultation with the Lenders, which period shall be no longer than one month unless the Borrower otherwise agrees; and |
(e) | if the LIBO Rate determined in accordance with the foregoing provisions of this definition is less than zero, such rate shall be deemed to be zero for purposes of this Agreement. |
(a) | all cash on hand of the Borrower and its Subsidiaries; plus |
(b) | all Cash Equivalents. |
(a) | borrowed money (whether by loan or issuance and sale of debt securities), including drawings under this Agreement and any revolving credit facilities, and |
(b) | the issuance and sale of equity securities. |
(a) | for all EUR amounts payable in respect of the Contract Price (excluding the portion thereof comprising the NYC Allowance), the total of such EUR amounts converted to a corresponding Dollar amount as determined using the weighted average rate of exchange that the Borrower has agreed, either in the spot or forward currency markets, to pay its counterparties for the purchase of the relevant amounts of EUR with Dollars for the payment of the instalments of the Contract Price (including the final instalment payable on the Actual Delivery Date) and including in such weighted average the spot rates for any EUR amounts due that have not been hedged by the Borrower (the "Weighted Average Rate"); |
(b) | for all EUR amounts payable in respect of the NYC Allowance, the total of such EUR amounts converted to a corresponding Dollar amount as determined using the USD-to-EUR rate used by the Borrower to convert the relevant USD amount of the amount of the NYC Allowance into EUR for the purpose of the Builder invoicing the same to the Borrower in EUR in accordance with the Construction Contract; and |
(c) | for the calculation and payment of the Hermes Fee in Dollars, the amount thereof in EUR converted to a corresponding Dollar amount as determined by Hermes on the basis of the latest rate for the purchase of EUR with Dollars to be published by the German Federal Ministry of Finance prior to the time that Hermes issues its invoice for the Hermes Fee. |
(a) | any reduction, or cancellation of the FEC Tranche A Commitment shall adjust, reduce or cancel (as applicable) each FEC Lender's respective FEC Tranche A Commitment pro rata according to the amount of its respective FEC Tranche A Commitment immediately prior to such adjustment, reduction or cancellation; |
(b) | any reduction or cancellation of the FEC Tranche B Commitment shall adjust, reduce, increase or cancel (as applicable) each FEC Lender's respective FEC Tranche B Commitment pro rata according to the amount of its respective FEC Tranche B Commitment immediately prior to such adjustment, reduction or cancellation; |
(c) | any reduction or cancellation of the Hermes Commitment shall reduce or cancel (as applicable) each Hermes Lender's Hermes Commitment pro rata according to the amount of its respective Hermes Commitment immediately prior to such reduction or cancellation; and |
(d) | any increase, reduction or cancellation of Finnvera Balancing Commitment shall adjust, reduce or cancel (as applicable) each Finnvera Balancing Lender's Finnvera Balancing Commitment pro rata according to the amount of its |
(a) | The Borrower may at any time prior to the date of a Loan Request terminate, or from time to time partially reduce, the Commitments upon written notice to the Facility Agent setting forth the total amount of the reduction in Commitments (the "Reduction Notice"); provided that any such reduction shall be applied (i) pro rata among the FEC Commitment Amount, the Hermes Commitment Amount and the Finnvera Balancing Commitment Amount determined immediately prior to giving effect to such reduction and provided that any such reduction shall not result in the Hermes Commitment at any time being less than 5% of the amount of the total Commitments, (ii) as between the FEC Tranche A Commitment Amount and the FEC Tranche B Commitment Amount, as directed by the Borrower in the Reduction Notice and (iii) as among each FEC Lender holding an FEC Tranche A Commitment, pro rata according to the amount of its respective FEC Tranche A Commitment immediately prior to giving effect to such reduction, (iv) as among each FEC Lender holding an FEC Tranche B Commitment, pro rata according to the amount of its respective FEC Tranche B Commitment immediately prior to giving effect to such reduction, (v) as among each Hermes Lender holding a Hermes Commitment, pro rata according to the amount of its respective Hermes Commitment immediately prior to giving effect to such reduction and (vi) as among each Finnvera Balancing Lender holding a Finnvera Balancing Commitment, pro rata according to the amount of its respective Finnvera Balancing Commitment immediately prior to giving effect to such reduction. The requested reduction shall be effective two Business Days after the date of delivery of the Reduction Notice to the Facility Agent. |
(b) | Except as provided in Sections 2.2(c) and 2.2(d) below, each voluntary reduction in Commitments pursuant to this Section 2.2 shall be without premium or penalty. |
(c) | If, during the period commencing on the Effective Date and ending on the Disbursement Date, the Borrower howsoever reduces the FEC Tranche A Commitment Amount to less than the US Dollar equivalent of EUR1,018,794,290, the Borrower shall pay such Break Costs as required by, and in accordance with, Section 4.4. |
(d) | Where the Commitments are terminated or reduced pursuant to this Section 2.2, the Borrower shall pay to the Facility Agent and the Lenders any fees and commissions that have accrued to but excluding the date of termination or partial reduction (but, in the case of a partial reduction of Commitments, only in respect of the amount of the partial reduction). Any such payment shall be made on the second (2nd) Business Day following receipt by the Borrower of an invoice setting forth the accrued fees and commissions so payable. |
(a) | Promptly following its receipt of the Hermes Insurance Policy, the Facility Agent shall notify the Borrower in writing (with a copy to the Builder) of the documentary requirements specified by Hermes in the letter from Hermes and the letter from Hermes to the Hermes Agent detailing the Hermes Documentary Requirements (as defined below) in order for the Hermes Insurance Policy to become effective in relation to any specified German Construction Contract Component from time to time (the "Hermes Documentary Requirements"). |
(b) | The Hermes Documentary Requirements as notified by the Facility Agent to the Borrower pursuant to Section 2.3(a) shall constitute the definitive list of documents which are to be delivered to the Facility Agent pursuant to Section 5.1.6(d) |
(a) | The Finnvera Balancing Commitment Amount may be increased from zero to an amount up to but not exceeding the aggregate of the Maximum Balancing Amount and the Finnvera Balancing Premium subject to and in accordance with this Section 2.4 only. In order to determine the Maximum Balancing Amount, from time to time, the Facility Agent shall request the Builder (up to 4 weeks before each German Content Review Date) to (a) confirm to the Facility Agent and the Borrower in writing the amount of the Actual German Content Component which is known or confirmed at that time and that part of such Actual German Content Component (if any) for which the Hermes Documentary Requirements can be satisfied and (b) provide copies of all the Hermes Documentary Requirements which are then available for any or all of the confirmed Actual German Content Component. On each German Content Review Date the Maximum Balancing Amount shall reduce by the Eligible German Content Amount which is confirmed at that time provided that the Facility Agent has received from the Builder (in satisfactory form) the relevant Hermes Documentary Requirements for such Eligible German Content Amount. Following each German Content Review Date the Facility Agent shall calculate and confirm to the Borrower in writing the Maximum Balancing Amount then available in accordance with this Agreement which amount cannot be increased following each such confirmation. |
(b) | At any time up to the Final German Content Notice Date, the Borrower may, by written notice to the Facility Agent (the "Final German Content Notice"), elect without premium or penalty to re-allocate a portion of the Hermes Commitment Amount to the Finnvera Balancing Commitment Amount in the |
(c) | It is agreed that any partial deficiency in the fulfilment of the Hermes Documentary Requirements relating to a part of the German Construction Contract Component shall not affect the validity of the Hermes Insurance Policy in relation to the remaining German Construction Contract Component and shall not affect the Borrower's right to draw such portion of the Hermes Commitment Amount upon the terms of this Agreement in relation to all those elements of the German Construction Contract Component for which the Hermes Documentary Requirements have been met. |
(d) | In the circumstances set forth in this Section 2.4 only, the Finnvera Balancing Commitment Amount (including any amount specified in Section 2.4(b)) shall be available to the Borrower under the terms of this Agreement. |
(e) | Section 2.1.6 shall apply to any adjustment of the Hermes Commitment Amount and/or the Finnvera Balancing Commitment Amount under this Section 2.4. |
(f) | In the event the Facility Agent has not received the Final German Content Notice by the Final German Content Notice Date or, if as of such Final German Content Notice Date, the Facility Agent has received written notice from the Borrower (accompanied by a letter from the Builder) indicating that the German Construction Contract Component is equal to or greater than EUR200,000,000 and that all Hermes Documentary Requirements can be met in relation to the German Construction Component, then the Finnvera Balancing Commitment will be automatically cancelled without premium or penalty and will not be available for drawing. |
i. | the aggregate amount of FEC Tranche A Loan shall not exceed the FEC Tranche A Commitment Amount as of the Loan Request Date; |
ii. | the aggregate amount of FEC Tranche B Loan shall not exceed the FEC Tranche B Commitment Amount as of the Loan Request Date; |
iii. | the aggregate amount of Hermes Loan shall not exceed the Hermes Commitment Amount as of the Loan Request Date and shall not be less than 5% of the aggregate amount of the Loan; |
iv. | the aggregate amount of Finnvera Balancing Loan shall not exceed the Finnvera Balancing Commitment Amount as of the Loan Request Date; and |
v. | the aggregate amount of the Loan shall not exceed the US Dollar Maximum Loan Amount. |
(a) | The Facility Agent shall, no later than 11:00 a.m., London time, eight (8) Business Days prior to the Disbursement Date, notify each Lender of any Loan Request by forwarding a copy thereof to each Lender, together with its attachments. On the terms and subject to the conditions of this Agreement, the Loan shall be made on the date specified in such Loan Request provided that it is a Business Day. On or before 2:00 p.m., London time, on the Business Day specified in such Loan Request, each Lender shall, without any set-off or counterclaim, deposit with the Facility Agent same day Dollar funds in an amount equal to such Lender's Percentage of each of the FEC Loan, Hermes Loan and, if applicable, Finnvera Balancing Loan requested by such Loan Request. Such deposit will be made to an account which the Facility Agent shall specify from time to time by notice to the Lenders. To the extent funds are so received from the Lenders, the Facility Agent shall, without any set-off or counterclaim, make such funds available to the Borrower on the Business Day specified in the Loan Request by wire transfer of same day funds to the account or accounts the Borrower shall have specified in its Loan Request. |
(b) | The Borrower shall be entitled, upon receipt of the Dollar funds into the account referred to in Section 2.5(b) above, (i) to complete the purchase of EUR with its counterparties or otherwise as set out in the Loan Request (by authorising and instructing the Facility Agent to remit the necessary Dollar funds to the said counterparties) and shall procure the payment of all EUR proceeds of such transactions to the EUR Pledged Account no later than the Business Day immediately following the Business Day specified in the Loan Request and (ii) to the extent of any such Dollar funds as shall not be used to purchase EUR, shall procure (by authorising and instructing the Facility Agent accordingly) the payment of such Dollar funds to the Dollar Pledged Account on the Disbursement Date. |
(c) | The Facility Agent shall direct that moneys standing to the credit of the Pledged Accounts shall, in the manner set out in the Loan Request and in accordance with the requirements and provisions of the Pledge Agreement, be disbursed as follows on the dates specified below: |
(i) | on the Actual Delivery Date, in EUR, to the account of the Builder, as designated by the Builder and identified by the Borrower in the Loan Request, to the extent necessary to meet the final instalment of the Contract Price (including any portion thereof attributable to the NYC Allowance) provided that the Hermes Loan shall only finance up to the lesser of EUR160,000,000 and 80% of the German Construction Contract Component, with the FEC Tranche A Loan, FEC Tranche B Loan and, if applicable, Finnvera Balancing Loan financing the balance of the final instalment. |
(ii) | on the Disbursement Date, in Dollars to Finnvera in payment of (a) the Finnvera Premium; and (b) if applicable, the Finnvera Balancing Premium provided that the relevant portion of the FEC Tranche A Loan and/or the FEC Tranche B Loan shall only finance the Finnvera Premium and, if applicable, the relevant portion of the Finnvera Balancing Loan shall only finance the Finnvera Balancing Premium; and |
(iii) | on the Actual Delivery Date, in Dollars (based on the spot rate of exchange specified in the invoice issued by Hermes prior to the Actual Delivery Date) (a) to Hermes in payment of the Second Fee; and (b) to the account of the Borrower, as designated by the Borrower and identified by the Borrower in the Loan Request, in reimbursement of the First Fee and in respect of any additional amounts standing to the Dollar Pledged Account as of the date of such disbursement provided that the relevant portion of the Hermes Loan shall only finance payment of such First Fee and Second Fee. |
(a) | If, on the Actual Delivery Date, the outstanding principal amount of the Loan exceeds the US Dollar Maximum Loan Amount (as a result of a reduction in the Contract Price after the Disbursement Date and before the delivery of the Purchased Vessel), the Borrower shall prepay the Loan in an amount equal to such excess within two (2) Business Days after the Actual Delivery Date. Any such partial prepayment shall be applied on a pro rata basis across each of the FEC Loan, the Hermes Loan and, if applicable, the Finnvera Balancing Loan provided that the Borrower may direct how such pro rata prepayment shall be applied between the FEC Tranche A Loan and the FEC Tranche B Loan and provided that such pro rata application across the Loan shall not result in the Hermes Loan being less than 5% of the amount of the Loan. |
(b) | No amount repaid or prepaid by the Borrower pursuant to this Section 3.1 may be re-borrowed under the terms of this Agreement. |
(a) | may, from time to time on any Business Day, make a voluntary prepayment, in whole or in part, of the outstanding principal amount of the Loan; provided that: |
(i) | all such voluntary prepayments shall require (x) for prepayments on or after the Disbursement Date made prior to the Actual Delivery Date in respect of the advance made on the Disbursement Date, at least two (2) Business Days' prior written notice to the Facility Agent, and (y) for all other prepayments, at least thirty (30) calendar days' prior written notice (or such shorter period as the Majority Lenders may agree), if all or any portion of the prepayment is to be applied in prepayment of the Fixed Rate Loan, or otherwise at least five (5) Business Days' (or, if such prepayment is to be made on the last day of an Interest Period for the Loan, four (4) Business Days') prior written notice, in each case to the Facility Agent; and |
(ii) | all such voluntary partial prepayments shall be in an aggregate minimum amount of $10,000,000 and a multiple of $1,000,000 (or in the remaining amount of the Loan) and shall be applied in forward order of maturity, inverse order of maturity or rateably at the Borrower's option against the remaining instalments; provided, however, that any such partial prepayment shall be applied on a pro rata basis across each of the FEC Loan, the Hermes Loan and, if applicable, the Finnvera Balancing Loan and provided further that the Borrower may direct how such pro rata prepayment shall be applied between the FEC Tranche A Loan and the FEC Tranche B Loan; and |
(iii) | any voluntary prepayment shall not result in the Hermes Loan being less than 5% of the amount of the Loan at any time. |
(a) | If, by reason of a Change in Law, it becomes unlawful under any applicable law (i) for a Lender to be subject to a commitment to make available to the Borrower such Lender's portion of the FEC Loan, Hermes Loan and/or Finnvera Balancing Loan, (ii) for a Lender to make or hold its portion of the FEC Loan, Hermes Loan and/or Finnvera Balancing Loan in its Lending Office, (iii) for a Lender to receive a payment under this Agreement or any other Loan Document or (iv) for a Lender to comply with any other material provision of, or to perform its obligations as contemplated by, this Agreement or any other Loan Document, the Lender affected by such Change in Law may give written notice (the "Illegality Notice") to the Borrower and the Facility Agent of such Change in Law, including reasonable details of the relevant Change of Law and specifying which, if not all, of its Commitment (the "Affected Commitment") and portion of the Loan (the "Affected Loan") is affected by such Change in Law. Any Illegality Notice must be given by a Lender no later than 120 days after such Lender first obtains actual knowledge or written notice of the relevant Change in Law. |
(b) | If an affected Lender delivers an Illegality Notice prior to the Disbursement Date, then, subject to Section 11.20, (1) while the arrangements contemplated by the following clause (2) have not yet been completed and the Affected Commitment of such Lender has not been formally cancelled, such Lender shall not be obliged to fund its Affected Commitment and (2) the Borrower shall be entitled at any time within 50 days after receipt of such Illegality Notice to replace such Lender with another Lender hereunder or one or more other financial institutions (I) reasonably acceptable to the Facility Agent and (II) acceptable to each of Finnvera (in respect of the FEC Loan and, if applicable the Finnvera Balancing Loan) and/or Hermes (in respect of the Hermes Loan) (as applicable); provided that any such assignment or transfer shall be either (x) in the case of a single assignment or transfer, an assignment or transfer of all of the rights and obligations of the assigning or transferring Lender under this Agreement with respect to the Affected Commitment or (y) in the case of more than one assignment or transfer, an assignment or transfer of a portion of such rights and obligations made concurrently with another such assignment or transfer or other such assignments or transfers that collectively cover all of the rights and obligations of the assigning or transferring Lender under this Agreement with respect to the Affected Commitment. If, at the end of such 50-day period, the Borrower has not so replaced such affected Lender as aforesaid and no alternative arrangements have been implemented pursuant to Section 11.20, the Affected Commitment held by such Lender shall be cancelled. |
(c) | Subject to Proviso (a) in Section 9.2, if an affected Lender delivers an Illegality Notice on or following the Disbursement Date, then the Borrower shall have the right, but not the obligation, exercisable at any time within 50 days after receipt of such Illegality Notice (the "Option Period"), either (1) to prepay the portion of the Affected Loan held by such Lender in full on or before the expiry of the Option Period, together with all unpaid interest and fees thereon accrued to but excluding the date of such prepayment, or (2) to replace such Lender on or before the expiry of the Option Period with another Lender hereunder or one or more other financial institutions (I) reasonably acceptable to the Facility Agent and (II) |
(a) | The Loan shall accrue interest from the Disbursement Date to the date of repayment or prepayment of the Loan in full to the Lenders as follows: |
(i) | on the FEC Tranche A Loan at the Fixed Rate; |
(ii) | on the FEC Tranche B Loan, Hermes Loan and the Finnvera Balancing Loan, at the applicable Floating Rate, |
(b) | In relation to interest accruing on the FEC Loan it is agreed that interest shall accrue at the rates specified in Section 3.3.1(a) above and that a portion of the interest which has accrued at a rate equal to 0.05% per annum shall be paid to the Facility Agent for the account of each of the FEC Margin Lenders and the remainder of such interest shall be paid to the Facility Agent for the account of FEC. |
(a) | The parties to this Agreement acknowledge and agree that, at any time when the FEC Tranche A Loan is payable at the Fixed Rate, FEC will have the right to effect an FEC Conversion with respect to the FEC Tranche A Loan (if it has been advanced) or the FEC Commitment relating to the FEC Tranche A Loan (if the FEC Tranche A Loan has not been advanced) if: |
(i) | the funds made available under the Loan have been used for a purpose other than pursuant to Section 2.5(d); |
(ii) | the Borrower has provided incorrect information in relation to an essential issue or failed to disclose matters that have an essential impact on the terms and conditions set out in schedule 3 of the FEC Supplemental Assignment Agreement or the approval of the FEC Financing; |
(iii) | a Transferring Lender or the Facility Agent has provided incorrect information in an essential matter in connection with the Application or failed to disclose matters that have an essential impact on the approval of the FEC Financing; or |
(iv) | a Transferring Lender or the Facility Agent is, in connection with the export transaction pursuant to the Construction Contract or the Loan, found by a court of competent jurisdiction to have been engaged prior |
(b) | In the event that FEC is entitled under the terms of clause 13.1.1 of the FEC Supplemental Assignment Agreement to effect an FEC Conversion, it shall notify the Borrower through the Facility Agent and advise of the date on which the Fixed Rate will terminate and the FEC Tranche A Floating Rate will apply (the "FEC Conversion Notice") and the Borrower and FEC shall agree the FEC Tranche A Floating Rate Margin which is to apply for purposes of determining the FEC Tranche A Floating Rate in accordance with the procedure set out in a separate side letter between the Borrower and FEC. Any margin agreed shall constitute the FEC Tranche A Floating Rate Margin to apply to the FEC Tranche A Loan effective on and from the date specified in the Conversion Notice. |
(c) | If the Borrower and FEC are unable to agree upon the alternative margin to apply for purposes of determining the FEC Tranche A Floating Rate as provided in Section 3.3.3(b), FEC shall set the FEC Tranche A Floating Rate Margin and FEC shall furnish a certificate to the Borrower and the Facility Agent (the "FEC Conversion Floating Rate Certificate") setting forth such rate (including margin) as soon as reasonably practicable, which FEC Tranche A Floating Rate Margin shall be effective on and from the date specified in the Conversion Notice. |
(d) | If an FEC Conversion occurs due to occurrence of the events or circumstances specified in Section 3.3.3(a)(ii), the Borrower shall indemnify FEC in its capacity as Fixed Rate Provider for (x) any Break Costs incurred because of the change of the interest rate and regardless of whether any FEC Commitment is cancelled or any portion of the FEC Tranche A Loan is prepaid in connection with such change of interest and (y) the Interest Subsidy Amount Repayable. |
(e) | If an FEC Conversion occurs due to the occurrence of the events or circumstances specified in Section 3.3.3(a)(i), (iii) or (iv), then, unless such events or circumstances are directly attributable to a breach by the Borrower of its obligations under the Loan Documents, the Facility Agent or Transferring Lender or Transferring Lenders who provided such incorrect information or engaged in such corrupt activity shall (A) indemnify FEC in its capacity as Fixed Rate Provider for (x) any Break Costs incurred because of the change of the interest rate and regardless of whether any FEC Commitment is cancelled or any portion of the FEC Tranche A Loan is prepaid in connection with such change of interest and, except when Section 3.3.3(a)(iv) is applicable, (y) the Interest Subsidy Amount Repayable and (B) indemnify the Borrower no later than three (3) Business Days following the end of each Interest Period for any increase in the amount of interest which the Borrower has paid to the Facility |
(f) | If an FEC Conversion occurs due to the occurrence of the events or circumstances specified in Section 3.3.3(a)(i), (iii) or (iv) which are directly attributable to a breach by the Borrower of its obligations under the Loan Documents, the Borrower shall indemnify FEC in its capacity as Fixed Rate Provider for (x) any Break Costs incurred because of the change of the interest rate and regardless of whether any FEC Commitment is cancelled or any portion of the FEC Tranche A Loan is prepaid in connection with such change of interest and (y) the Interest Subsidy Amount Repayable. |
(g) | In the case of the indemnity under paragraph (d) or (f), the Facility Agent shall provide the Borrower with a certificate prepared by FEC to show, in sufficient detail, the method and basis of the computation of such Break Costs and Interest Subsidy Amount Repayable. In any case referred to in this Section 3.3.3(g), the Facility Agent shall collect from the Borrower the payments payable by the Borrower hereunder and pay such collected payments to FEC without delay upon receipt of such payments from the Borrower. |
(a) | each Repayment Date; |
(b) | the date of any prepayment, in whole or in part, of principal outstanding on the Loan (but only on the principal so prepaid); |
(c) | on that portion of the Loan the repayment of which is accelerated pursuant to Section 8.2 or Section 8.3, immediately upon such acceleration; and |
(d) | in the case of any interest on any principal, interest or other amount owing under this Agreement or any other Loan Document that is overdue, from time to time on demand of the Facility Agent until such overdue amount is paid in full. |
(a) | the Screen Rate shall cease to be available as a publicly available benchmark rate; or |
(b) | Dollar deposits in the relevant amount and for the relevant Interest Period are not available to each Reference Bank in its relevant market; or |
(c) | by reason of circumstances affecting the Reference Banks' relevant markets, adequate means do not exist for ascertaining the interest rate applicable hereunder to LIBO Rate loans for the relevant Interest Period, |
(a) | subject any Lender to any taxes, levies, duties, charges, fees, deductions or withholdings of any nature with respect to its portion of the Loan or any part thereof imposed, levied, collected, withheld or assessed by any jurisdiction or any political subdivision or taxing authority thereof (other than (i) taxes as to which such Lender is indemnified under Section 4.6 and (ii) taxes excluded from the indemnity set forth in Section 4.6); or |
(b) | change the basis of taxation to any Lender (other than a change in taxation on the overall net income of any Lender) of payments of principal or interest or any other payment due or to become due pursuant to this Agreement; or |
(c) | impose, modify or deem applicable any reserve or capital adequacy requirements (other than the increased capital costs described in Section 4.5) or other banking or monetary controls or requirements which affect the manner in which a Lender shall allocate its capital resources to its obligations hereunder or require the making of any special deposits against or in respect of any assets or liabilities of, deposits with or for the account of, or loans by, any Lender (provided that such Lender shall, unless prohibited by law, allocate its capital resources to its obligations hereunder in a manner which is consistent with its present treatment of the allocation of its capital resources); or |
(d) | impose on any Lender any other condition affecting its portion of the Loan or any part thereof, |
(a) | if at the time interest is calculated at the Floating Rate or, if applicable, the FEC Tranche A Floating Rate on such Lender's portion of the Loan, any conversion or repayment or prepayment or acceleration of the principal amount of such Lender's portion of the Loan on a date other than the scheduled last day of an Interest Period or otherwise scheduled date for repayment or payment (in each case, including any payments as a result of an FEC Reassignment made in accordance with Section 9.1.10(A) where the Borrower is liable to pay Break Costs under Section 9.1.10(A)(b)), but excluding any prepayment made following an election by the Borrower to effect a prepayment pursuant |
(b) | if at the time interest is calculated at the Fixed Rate on such Lender's portion of the Loan, any repayment or prepayment or acceleration of the principal amount of such Lender's portion of the Loan, other than any repayment made on the date scheduled for such repayment (in each case, including any payments whatsoever as a result of an FEC Conversion or an FEC Reassignment where the Borrower is liable to pay Break Costs under Section 3.3.3(d) or Section 3.3.3(f) in the case of an FEC Conversion and Section 9.1.10(A)(b) in the case of an FEC Reassignment) excluding any repayment pursuant to Section 9.1.11, by reason of a Non-Borrower Related Change in Law); |
(c) | a voluntary reduction of the FEC Tranche A Commitment below EUR1,018,794,290; |
(d) | the Loan not being advanced in accordance with the Loan Request therefor due to the fault of the Borrower or as a result of any of the conditions precedent set forth in Article V not being satisfied; |
(e) | any prepayment of the Loan by the Borrower pursuant to Section 4.12 or Section 9.2; or |
(f) | the FEC Tranche A Loan not being advanced on or before the Commitment Termination Date, |
a. | if at that time interest is calculated at the Floating Rate or, if applicable, the FEC Tranche A Floating Rate on such Lender's portion of the Loan, pay directly to the Facility Agent for the account of such Lender an amount (the "Floating Rate Indemnity Amount") equal to the amount, if any, by which: |
(i) | interest calculated at the Floating Rate or, if applicable, the FEC Tranche A Floating Rate which such Lender would have received on its share of the amount of the Loan subject to such Funding Losses Event for the period from the date of receipt of any part of its share in the Loan to the last day of the applicable Interest Period, |
(ii) | the amount which such Lender would be able to obtain by placing an amount equal to the amount received by it on |
b. | if at that time the Fixed Rate is applied to the FEC Tranche A Commitment or the FEC Tranche A Loan (as applicable), pay to the Facility Agent acting on the instructions of FEC, in its capacity as the Fixed Rate Provider) for the account of FEC, in its capacity as the Fixed Rate Provider, the amount (if any) in Dollars determined by FEC, as Fixed Rate Provider, by which: |
(i) | the sum of the present value, discounted at the Reinvestment Rate, of each principal payment and interest payment which the FEC Lender would have received on its share of any amount of the FEC Tranche A Commitment that is cancelled or any outstanding amount of the FEC Tranche A Loan that is prepaid for the period from the date of cancellation or from the date of receipt of the prepayment of the principal amount of the FEC Tranche A Loan by the FEC Lender, until the date of Final Maturity (assuming for these purposes that interest would have accrued during the relevant period on a loan ("Deemed Loan") made on the date of cancellation or receipt of the principal amount prepaid in an amount equal to the FEC Tranche A Commitment so cancelled or the principal amount of the FEC Tranche A Loan so prepaid and where such Deemed Loan is repaid in proportional repayment instalments on each of the subsequent Repayment Dates), |
(ii) | the cancelled amount of the FEC Tranche A Commitment or the principal amount of the FEC Tranche A Loan prepaid plus accrued interest paid thereon since the previous interest payment date. |
(a) | pay directly to the relevant authority the full amount required to be so withheld or deducted; |
(b) | promptly forward to the Facility Agent an official receipt or other documentation satisfactory to the Facility Agent evidencing such payment to such authority; and |
(c) | pay to the Facility Agent for the account of the Lenders such additional amount or amounts as is necessary to ensure that the net amount actually received by each Lender will equal the full amount such Lender would have received had no such withholding or deduction been required. |
(a) | Unless otherwise expressly provided in this Agreement or any other Loan Document, all payments by the Borrower in respect of amounts of principal, interest and fees or any other applicable amounts owing to the Lenders hereunder shall be made by the Borrower to the Facility Agent for the account of the Lenders entitled to receive such payments and rateably in accordance with the respective amounts then due and payable to the Lenders. All such payments required to be made to the Facility Agent shall be made by the Borrower, without set-off, deduction or counterclaim, not later than 11:00 a.m., New York time, on the date due, in same day or immediately available funds through the New York Clearing House Interbank Payments System (or such other funds as may be customary for the settlement of international banking transactions in Dollars), to such account as the Facility Agent shall specify from time to time by notice to the Borrower. Funds received after that time shall be deemed to have been received by the Lenders on the next succeeding Business Day. |
(b) | The Facility Agent shall promptly (but in any event on the same Business Day that the same are received or, as contemplated in clause (a) of this Section, deemed received) remit in same day funds to each Lender its share, if any, of such payments received by the Facility Agent for the account of such Lender without any set-off, deduction or counterclaim. All interest and fees shall be computed on the basis of the actual number of days (including the first day but excluding the last day) occurring during the period for which such interest or fee is payable over a year comprised of 360 days. Whenever any payment to be made shall otherwise be due on a day which is not a Business Day, such payment shall (except as otherwise required by paragraph (a) of the definition of the term "Interest Period") be made on the next succeeding Business Day and such extension of time shall be included in computing interest and fees, if any, in connection with such payment. |
(a) | the Recovering Lender shall, within three (3) Business Days, notify details of the receipt or recovery to the Facility Agent; |
(b) | the Facility Agent shall determine whether the receipt or recovery is in excess of the amount the Recovering Lender would have been paid had the receipt or recovery been received or made by the Facility Agent and distributed in accordance with the said Section 4.8, without taking account of any taxes which would be imposed on the Facility Agent in relation to the receipt, recovery or distribution; and |
(c) | the Recovering Lender shall, within three (3) Business Days of demand by the Facility Agent, pay to the Facility Agent an amount (the "Sharing Payment") |
(a) | each Sharing Lender shall, upon request of the Facility Agent, pay to the Facility Agent for the account of that Recovering Lender an amount equal to the appropriate part of its share of the Sharing Payment (together with an amount as is necessary to reimburse that Recovering Lender for its proportion of any interest on the Sharing Payment which that Recovering Lender is required to pay) (the "Redistributed Amount"); and |
(b) | solely as between the Borrower and each relevant Sharing Lender, an amount equal to the relevant Redistributed Amount will be treated as not having been paid by the Borrower. |
(a) | This Section 4.10 shall not apply to the extent that the Recovering Lender would not, after making any payment pursuant to this Section 4.10, have a valid and enforceable claim against the Borrower. |
(b) | A Recovering Lender is not obliged to share with any other Lender any amount which the Recovering Lender has received or recovered as a result of taking legal or arbitration proceedings, if: |
i. | it notified the other Lender of the legal or arbitration proceedings; and |
ii. | the other Lender had an opportunity to participate in those legal or arbitration proceedings but did not do so as soon as reasonably practicable having received notice and did not take separate legal or arbitration proceedings. |
(e) | If the Borrower becomes a US Tax Obligor or the Facility 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 the Borrower is a US Tax Obligor, the date of this Agreement; |
(ii) | where the Borrower is a US Tax Obligor on a date an assignment or transfer is made pursuant to Section 11.11.1 and the relevant Lender is an Assignee Lender or a Transferee Lender that becomes a Lender in accordance with Section 11.11.1, the date on which such Assignee Lender or Transferee Lender becomes a Lender; |
(iii) | the date of a request from the Facility Agent, |
(A) | a withholding certificate on Form W-8 (or any successor form), Form W-9 (or any successor form) or any other relevant form; or |
(B) | any withholding statement or other document, authorisation or waiver as the Facility Agent may require to certify or establish the status of such Lender under FATCA or that other law or regulation. |
(f) | The Facility Agent shall provide any withholding certificate, withholding statement, document, authorisation or waiver it receives from a Lender pursuant to paragraph (e) above to the Borrower. |
(g) | If any withholding certificate, withholding statement, document, authorisation or waiver provided to the Facility Agent by a Lender pursuant to paragraph (e) 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 Facility Agent unless it is unlawful for the Lender to do so (in which case the Lender shall promptly notify the Facility Agent). The Facility Agent shall provide any such updated withholding certificate, withholding statement, document, authorisation or waiver to the Borrower. |
(h) | The Facility Agent may rely on any withholding certificate, withholding statement, document, authorisation or waiver it receives from a Lender pursuant to paragraph (e) or (g) above without further verification. The Facility Agent shall not be liable for any action taken by it under or in connection with paragraph (e), (f) or (g) above. |
(a) | a certificate of its Secretary or Assistant Secretary as to the incumbency and signatures of those of its officers authorised to act with respect to this Agreement and each other Loan Document and as to the truth and completeness of the attached: |
i. | resolutions of its Board of Directors then in full force and effect authorising the execution, delivery and performance of this Agreement and each other Loan Document, and |
ii. | Organic Documents of the Borrower, |
(b) | a Certificate of Good Standing issued by the relevant Liberian authorities in respect of the Borrower. |
(a) | Watson Farley & Williams LLP, counsel to the Borrower, as to Liberian law, covering the matters set forth in Exhibit B-1 hereto; |
(b) | Stephenson Harwood LLP, counsel to the Facility Agent, as to English law, covering the matters set forth in Exhibit B-2 hereto; |
(c) | Norton Rose Fulbright (Germany) LLP, counsel to the Facility Agent and the Lenders as to German law; |
(d) | Clifford Chance US LLP, United States tax counsel to the Facility Agent for the benefit of the Lenders, covering the matters set forth in Exhibit B-3 hereto; |
(e) | DLA Piper Finland Oy, counsel to the Facility Agent for the benefit of the Lenders, as to Finnish law, covering the matters set forth in Exhibit B-4 hereto including, among others, the validity and enforceability of the Second Finnvera Guarantee; |
(f) | counsel to the Facility Agent and the Lenders as to the law governing the Pledge Agreement, covering the validity and enforceability of the Pledge Agreement; and |
(g) | if requested by a Lender at least 90 days prior to the expected Disbursement Date in order to comply with Article 194 of the Regulation (EU) No 575/2013 (CRR), a single legal opinion (for the benefit of all the Lenders notwithstanding that not all the Lenders have requested the same) on matters of German law related to the validity and enforceability of the Hermes Insurance Policy, |
(a) | The Finnvera Guarantee shall have been duly executed and delivered to the Facility Agent and shall be in full force and effect subject only to payment of the Finnvera Premium to Finnvera out of the proceeds of the FEC Loan and, as at the Disbursement Date, there are no written instructions from Finnvera in effect under clause 6.1 of the Finnvera General Terms requiring the FEC Lenders to cease disbursement of the FEC Loan. |
(b) | If applicable, the Second Finnvera Guarantee shall have been duly executed and delivered to the Facility Agent and shall be in full force and effect subject only to payment of the Finnvera Balancing Premium to Finnvera out of the proceeds of the FEC Balancing Loan and, as at the Disbursement Date, there are no written instructions from Finnvera in effect under clause 6.1 of the Finnvera General Terms requiring the Finnvera Balancing Lenders to cease disbursement of the Finnvera Balancing Loan. |
(c) | The Facility Agent shall have received the Hermes Insurance Policy duly issued and shall be in full force and effect subject only to payment of the Hermes Fee out of the proceeds of the Hermes Loan. |
(d) | Hermes shall not have, prior to the advance of the Loan, delivered to the Facility Agent or the Hermes Agent any notice that the Federal Republic of Germany has determined that the Loan is excluded from cover under the Hermes Insurance Policy. |
(a) | the representations and warranties set forth in Article VI (excluding, however, those set forth in Section 6.10) shall be true and correct in all material respects except for those representations and warranties that are qualified by materiality or Material Adverse Effect, which shall be true and correct, with the same effect as if then made; and |
(b) | no Default and no Prepayment Event and no event which (with notice or lapse of time or both) would become a Prepayment Event shall have then occurred and be continuing. |
(a) | certified as true (by the Builder) copies of the "Buyer's Invoice" received by the Builder from the Borrower pursuant to sub-paragraph (b) of paragraph 2 of Appendix B of the Construction Contract in relation to the incurred NYC Allowance; |
(b) | a copy of the final invoice from the Builder showing the amount of the Contract Price (including the NYC Allowance) and the portion thereof payable to the Builder on the Actual Delivery Date under the Construction Contract; |
(c) | copies of the wire transfers for all payments by the Borrower to the Builder under the Construction Contract in respect of the Contract Price prior to the Borrower's service of the Loan Request; |
(d) | the Hermes Documentary Requirements as notified by the Facility Agent to the Borrower pursuant to Section 2.3(a); and |
(e) | a certified true copy of the Construction Contract together with each addendum thereto which is in effect on the date of the Loan Request. |
(a) | The Facility Agent shall have received a copy of each foreign exchange counterparty confirmation entered into by the Borrower in respect of the payment of the instalments of the Contract Price (other than that relating to the NYC Allowance) at least ten (10) Business Days prior to the proposed Disbursement Date. |
(b) | Following consultation with the Facility Agent the Borrower shall supply to the Facility Agent at least three (3) Business Days prior to the date of the Loan Request its calculation of the US Dollar Maximum Loan Amount under paragraph (a) of the definition of the term "US Dollar Equivalent". |
(a) | A copy of the duly executed FEC Transfer Documents. |
(b) | The FEC Transfer Documents being in full force and effect and where applicable, from and after the Disbursement Date. |
(a) | contravene the Borrower's Organic Documents; |
(b) | contravene any law or governmental regulation of any Applicable Jurisdiction except as would not reasonably be expected to result in a Material Adverse Effect; |
(c) | contravene any court decree or order binding on the Borrower or any of its property except as would not reasonably be expected to result in a Material Adverse Effect; |
(d) | contravene any contractual restriction binding on the Borrower or any of its property except as would not reasonably be expected to result in a Material Adverse Effect; or |
(e) | result in, or require the creation or imposition of, any Lien on any of the Borrower's properties except: (i) as would not reasonably be expected to result in a Material Adverse Effect or (ii) or Liens created under the Loan Documents. |
(a) | legally and beneficially owned by the Borrower or one of the Borrower's wholly owned Subsidiaries, |
(b) | registered in the name of the Borrower or one of the Borrower's wholly owned Subsidiaries under the Bahamian or Maltese flag or such other flag as the parties may mutually agree, |
(c) | classed as required by Section 7.1.4(b), |
(d) | free of all recorded Liens, other than Liens permitted by Section 7.2.3, |
(e) | insured against loss or damage in compliance with Section 7.1.5, and |
(f) | exclusively operated by or chartered to the Borrower or one of the Borrower's wholly owned Subsidiaries. |
(a) | as soon as available and in any event within 60 days after the end of each of the first three Fiscal Quarters of each Fiscal Year of the Borrower, a copy of the Borrower's report on Form 10-Q (or any successor form) as filed by the Borrower with the SEC for such Fiscal Quarter, containing unaudited consolidated financial statements of the Borrower for such Fiscal Quarter (including a balance sheet and profit and loss statement) prepared in accordance with GAAP, subject to normal year-end audit adjustments; |
(b) | as soon as available and in any event within 120 days after the end of each Fiscal Year of the Borrower, a copy of the Borrower's annual report on Form 10-K (or any successor form) as filed by the Borrower with the SEC for such Fiscal Year, containing audited consolidated financial statements of the Borrower for such Fiscal Year prepared in accordance with GAAP (including a balance sheet and profit and loss statement) and audited by PricewaterhouseCoopers LLP or another firm of independent public accountants of similar standing; |
(c) | together with each of the statements delivered pursuant to the foregoing clause (a) or (b), a certificate, executed by the chief financial officer, the treasurer or the corporate controller of the Borrower, showing, as of the last day of the relevant Fiscal Quarter or Fiscal Year compliance with the covenants set forth in Section 7.2.4 (in reasonable detail and with appropriate calculations and computations in all respects reasonably satisfactory to the Facility Agent); |
(d) | as soon as possible after the occurrence of a Default or Prepayment Event, a statement of the chief financial officer of the Borrower setting forth details of such Default or Prepayment Event (as the case may be) and the action which the Borrower has taken and proposes to take with respect thereto; |
(e) | as soon as the Borrower becomes aware thereof, notice of any Material Litigation except to the extent that such Material Litigation is disclosed by the Borrower in filings with the SEC; |
(f) | promptly after the sending or filing thereof, copies of all reports which the Borrower sends to all holders of each security issued by the Borrower, and all registration statements which the Borrower or any of its Subsidiaries files with the SEC or any national securities exchange; |
(g) | such other information respecting the condition or operations, financial or otherwise, of the Borrower or any of its Subsidiaries as any Lender through the Facility Agent may from time to time reasonably request; and |
(h) | information that identifies the Borrower and any Affiliate of the Borrower party to a Loan Document, which may include the name and address of the Borrower and that Affiliate, the organisational documents of the Borrower and any such Affiliate and such other information that will allow the Facility Agent or a Lender and/or its Affiliates to comply with its obligations under the USA Patriot Act. |
(a) | in the case of the Borrower, the maintenance and preservation of its corporate existence (subject to the provisions of Section 7.2.6); |
(b) | in the case of the Borrower, maintenance of its qualification as a foreign corporation in the State of Florida; |
(c) | the payment, before the same become delinquent, of all taxes, assessments and governmental charges imposed upon it or upon its property, except to the extent being diligently contested in good faith by appropriate proceedings; |
(d) | compliance with all applicable Environmental Laws; |
(e) | compliance with all anti-money laundering laws and Anti-Corruption Laws applicable to the Borrower, including by not making or causing to be made any offer, gift or payment, consideration or benefit of any kind to anyone, either directly or indirectly, as an inducement or reward for the performance of any of the transactions contemplated by this Agreement to the extent the same would be in contravention of such applicable laws; and |
(f) | the Borrower will maintain in effect policies and procedures designed to procure compliance by the Borrower, its Subsidiaries and their respective directors, officers and employees with Anti-Corruption Laws and applicable Sanctions. |
(a) | from the Actual Delivery Date, cause the Purchased Vessel to be exclusively operated by or chartered to the Borrower or one of the Borrower's wholly owned Subsidiaries, provided that the Borrower or such Subsidiary may charter out the Purchased Vessel (i) to entities other than the Borrower and the Borrower's wholly owned Subsidiaries and (ii) on a time charter with a stated duration not in excess of one year; |
(b) | from the Actual Delivery Date, cause the Purchased Vessel to be kept in such condition as will entitle her to classification by a classification society of recognised standing; |
(c) | on the Actual Delivery Date, provide the following to the Facility Agent with respect to the Purchased Vessel: |
(d) | within seven days after the Actual Delivery Date, provide the following to the Facility Agent with respect to the Purchased Vessel: |
(a) | The Borrower shall, on the reasonable request of the Facility Agent, provide such information or documents as required under the Credit Support Documents as necessary in each case to enable the Lenders to obtain the full support of FEC and Finnvera as provided for in the Credit Support Documents. In particular but without limitation the Borrower shall provide to the Finnish Ministry such information as required for monitoring and supervision purposes and is relevant to the FEC Financing and the Borrower, the Facility Agent and each of the Original Lenders shall allow representatives of the Finnish Ministry to visit their offices for this purpose. |
(b) | The Borrower shall, on the reasonable request of the Hermes Agent or the Facility Agent, provide such other information as required under the Hermes Insurance Policy and/or the Hermes Conditions as necessary in each case to enable the Hermes Agent, the Facility Agent or the Hermes Lenders to obtain the full support of Hermes and/or the government of the Federal Republic of Germany (as the case may be) pursuant to the Hermes Insurance Policy and/or the Hermes Conditions (as the case may be). The Borrower shall pay to the Hermes Agent, the Facility Agent or the Hermes Lenders the amount of all reasonable costs and expenses reasonably incurred by the Hermes Agent, the Facility Agent or the Hermes Lenders in connection with complying with a request by Hermes or the government of the Federal Republic of Germany for any additional information necessary or desirable in connection with the Hermes Insurance Policy or the Hermes Conditions; provided that the Borrower is consulted before the Hermes Agent, the Facility Agent or Hermes Lenders incurs any such cost or expense. |
(a) | Indebtedness secured by Liens of the type described in Section 7.2.3; |
(b) | Indebtedness owing to the Borrower or a direct or indirect Subsidiary of the Borrower; |
(c) | Indebtedness incurred to finance, refinance or refund the cost (including the cost of construction) of assets acquired after the Effective Date; |
(d) | Indebtedness in an aggregate principal amount, together with (but without duplication of) Indebtedness permitted to be secured under Section 7.2.3(c), at any one time outstanding not exceeding (determined at the time of creation of such Lien or the incurrence by any Existing Principal Subsidiary of such Indebtedness, as applicable) 10.0% of the total assets of the Borrower and its Subsidiaries taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter; and |
(e) | obligations in respect of Hedging Instruments entered into for the purpose of managing interest rate, foreign currency exchange or commodity exposure risk and not for speculative purposes. |
(a) | Liens on assets (including, without limitation, shares of capital stock of corporations and assets owned by any corporation that becomes a Subsidiary of the Borrower after the Effective Date) acquired after the Effective Date (whether by purchase, construction or otherwise) by the Borrower or any of its Subsidiaries (other than (x) an Existing Principal Subsidiary or (y) any other Principal Subsidiary which, at any time, after three months after the acquisition of a Vessel, owns a Vessel free of any mortgage Lien), which Liens were created solely for the purpose of securing Indebtedness representing, or incurred to finance, refinance or refund, the cost (including the cost of construction) of such assets, so long as (i) the acquisition of such assets is not otherwise prohibited by the terms of this Agreement and (ii) each such Lien is created within three months after the acquisition of the relevant assets; |
(b) | the Construction Mortgage but only to the extent that the same is discharged on the Actual Delivery Date; |
(c) | in addition to other Liens permitted under this Section 7.2.3, Liens securing Indebtedness in an aggregate principal amount, together with (but without duplication of) Indebtedness permitted under Section 7.2.2(d), at any one time outstanding not exceeding (determined at the time of creation of such Lien or the incurrence by any Existing Principal Subsidiary of such indebtedness, as applicable) (i) 10.0% of the total assets of the Borrower and its Subsidiaries (the “Lien Basket Amount”) taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter; provided, however that, if, at any time, the Senior Debt Rating of the Borrower is less than Investment Grade as given by both Moody’s and S&P, the Lien Basket Amount shall be the greater of (x) 5.0% of the total assets of the Borrower and its Subsidiaries taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter and (y) $735,000,000; |
(d) | Liens on assets acquired after the Effective Date by the Borrower or any of its Subsidiaries (other than by (x) any Subsidiary that is an Existing Principal Subsidiary or (y) any other Principal Subsidiary which, at any time, owns a Vessel free of any mortgage Lien) so long as (i) the acquisition of such assets is not otherwise prohibited by the terms of this Agreement and (ii) each of such Liens existed on such assets before the time of its acquisition and was not created by the Borrower or any of its Subsidiaries in anticipation thereof; |
(e) | Liens on any asset of any corporation that becomes a Subsidiary of the Borrower (other than a corporation that also becomes a Subsidiary of an Existing Principal Subsidiary) after the Effective Date so long as (i) the acquisition or creation of such corporation by the Borrower is not otherwise prohibited by the terms of this Agreement and (ii) such Liens are in existence at the time such corporation becomes a Subsidiary of the Borrower and were not created by the Borrower or any of its Subsidiaries in anticipation thereof; |
(f) | Liens securing Government-related Obligations; |
(g) | Liens for taxes, assessments or other governmental charges or levies not at the time delinquent or thereafter payable without penalty or being diligently contested in good faith by appropriate proceedings; |
(h) | Liens of carriers, warehousemen, mechanics, materialmen and landlords incurred in the ordinary course of business for sums not overdue by more than 60 days or being diligently contested in good faith by appropriate proceedings; |
(i) | Liens incurred in the ordinary course of business in connection with workers' compensation, unemployment insurance or other forms of governmental insurance or benefits; |
(j) | Liens for current crew's wages and salvage; |
(k) | Liens arising by operation of law as the result of the furnishing of necessaries for any Vessel so long as the same are discharged in the ordinary course of business or are being diligently contested in good faith by appropriate proceedings; |
(l) | Liens on Vessels that: |
(m) | normal and customary rights of set-off upon deposits of cash or other Liens originating solely by virtue of any statutory or common law provision relating to bankers' liens, rights of set-off or similar rights in favour of banks or other depository institutions; |
(n) | Liens in respect of rights of set-off, recoupment and holdback in favour of credit card processors securing obligations in connection with credit card processing services incurred in the ordinary course of business; |
(o) | Liens on cash or Cash Equivalents or marketable securities securing: |
(p) | deposits to secure the performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case in the ordinary course of business and deposits securing liabilities to insurance carriers under insurance or self-insurance arrangements; |
(q) | easements, zoning restrictions, rights-of-way and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or interfere with the ordinary conduct of business of the Borrower or any Subsidiary; and |
(r) | licenses, sublicenses, leases or subleases granted to other Persons not materially interfering with the conduct of the business of the Borrower or any of its Subsidiaries. |
(a) | Net Debt to Capitalisation Ratio, as at the end of any Fiscal Quarter, to be greater than 0.625 to 1. |
(b) | Fixed Charge Coverage Ratio to be less than 1.25 to 1 as at the last day of any Fiscal Quarter. |
(a) | any such Subsidiary may (i) liquidate or dissolve voluntarily into, and may merge with and into, the Borrower or any other Subsidiary, and the assets or stock of any Subsidiary may be purchased or otherwise acquired by the Borrower or any other Subsidiary or (ii) merge with and into another Person in connection with a sale or other disposition permitted by Section 7.2.7; and |
(b) | so long as no Event of Default or Prepayment Event has occurred and is continuing or would occur after giving effect thereto, the Borrower or any of its Subsidiaries may merge into any other Person, or any other Person may merge into the Borrower or any such Subsidiary, or the Borrower or any of its Subsidiaries may purchase or otherwise acquire all or substantially all of the assets of any Person, in each case so long as: |
(A) | the surviving corporation shall have assumed in writing, delivered to the Facility Agent, all of the Borrower's obligations hereunder and under the other Loan Documents; |
(B) | the surviving corporation shall, promptly upon the request of the Facility Agent or any Lender, supply such documentation and other evidence as is reasonably requested by the Facility Agent or any Lender in order for the Facility Agent or such Lender to carry out and be satisfied it has complied with the results of all necessary “know your customer” or other similar checks under all applicable laws and regulations; and |
(C) | as soon as practicable after receiving notice from the Borrower of such merger, and in any event no later than five Business Days after the delivery of such notice, for a surviving corporation that is organized under the laws of a jurisdiction other than of the United States or a political subdivision thereof or Liberia, any Lender that may not legally lend to, establish credit for the account of and/or do any business whatsoever with such surviving corporation, either directly or through an Affiliate of such Lender (a “Protesting Lender”) shall so notify the Borrower and the Facility Agent in writing. With respect to each Protesting Lender, the Borrower shall, effective on or before the date that such surviving corporation shall have the right to borrow hereunder, notify the Facility Agent and such Protesting Lender that the Commitments of such Protesting Lender shall be terminated; provided that such Protesting Lender shall have received one or more payments from either the Borrower or one or more assignees in an aggregate amount at least equal to the aggregate outstanding principal amount of the Loan owing to such Protesting Lender, together with accrued interest thereon to the date of payment of such principal amount and all other amounts payable to such Protesting Lender under this Agreement. |
(a) | generally fail to pay, or admit in writing its inability to pay, its debts as they become due; |
(b) | apply for, consent to, or acquiesce in, the appointment of a trustee, receiver, sequestrator or other custodian for it or any of its property, or make a general assignment for the benefit of creditors; |
(c) | in the absence of such application, consent or acquiescence, permit or suffer to exist the appointment of a trustee, receiver, sequestrator or other custodian for it or for a substantial part of its property, and such trustee, receiver, sequestrator or other custodian shall not be discharged within 60 days, provided that in the case of such an event in respect of the Borrower, the Borrower hereby expressly authorises the Facility Agent and each Lender to appear in any court conducting any relevant proceeding during such 60-day period to preserve, protect and defend their respective rights under the Loan Documents; |
(d) | permit or suffer to exist the commencement of any bankruptcy, reorganisation, debt arrangement or other case or proceeding under any bankruptcy or insolvency law, or any dissolution, winding up or liquidation proceeding, in respect of the Borrower or any of such Subsidiaries, and, if any such case or proceeding is not commenced by the Borrower or such Subsidiary, such case or proceeding shall be consented to or acquiesced in by the Borrower or such Subsidiary or shall result in the entry of an order for relief or shall remain for 60 days undismissed, provided that the Borrower hereby expressly authorises the Facility Agent and each Lender to appear in any court conducting any such case or proceeding during such 60-day period to preserve, protect and defend their respective rights under the Loan Documents; or |
(e) | take any corporate action authorising, or in furtherance of, any of the foregoing. |
(a) | cancel all or any part of the (i) FEC Tranche A Commitment and/or the FEC Tranche B Commitment in the case of FEC and/or (ii) the Finnvera Balancing Commitment and/or the Hermes Commitment (as the case may be) in the case of the Majority Lenders (other than FEC); and/or |
(b) | declare that all or part of any amounts outstanding under the Loan Documents in respect of the Loan or any part thereof are: |
(ii) | payable on demand by the Facility Agent acting on the instructions of FEC in relation to the FEC Loan and the Majority Lenders (other than FEC) in relation to the Hermes Loan, and/or, if applicable, the Finnvera Balancing Loan. |
(a) | enforcement proceedings in respect of any material assets of the Borrower or such Principal Subsidiary shall have been commenced by any creditor upon such judgment or order and shall not have been stayed or enjoined within five (5) Business Days after the commencement of such enforcement proceedings; or |
(b) | there shall be any period of 30 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect. |
(a) | If an FEC Reassignment is at any time effected by FEC other than as a result of any gross negligence or wilful misconduct of the Facility Agent, the Guarantee Holder or any of the Transferring Lenders, (any such FEC Reassignment hereinafter referred to as the "FEC Prepayment Event"), the mandatory prepayments and cancellation provisions contained in Section 9.2 shall apply and the Borrower shall be liable to pay any Break Costs determined in accordance with Section 4.4.1. |
(b) | In the event of an FEC Reassignment as a result of any gross negligence or wilful misconduct of the Facility Agent, the Guarantee Holder or any of the Transferring Lenders, no such mandatory prepayment shall be required and the parties to this Agreement acknowledge and agree that: |
(c) | References to the provisions of the FEC Supplemental Assignment Agreement referred to in this Section 9.1.10(A) shall be to such provisions in the form of the FEC Supplemental Assignment Agreement as originally executed provided no amendments or supplements thereto shall be agreed without the Borrower's prior written consent in which case such references shall be to such provisions of the FEC Supplemental Assignment Agreement as amended or supplemented. |
(d) | The parties to this Agreement acknowledge and agree that if the Transferring Lenders exercise their right to request a re-assignment and/or re-transfer of the FEC Loan pursuant to clause 13.2 of the FEC Supplemental Assignment Agreement, the Borrower shall not be liable to pay any costs and expenses, including but not limited to Break Costs, that are incurred by any party as a result of such re-assignment and/or re-transfer. |
(e) | If Section 9.1.10(A)(c)(ii) applies, the Facility Agent and the Borrower shall enter in good faith negotiations (for a period of not more than thirty (30) days commencing from the date of the FEC Reassignment) with a view to agreeing a substitute basis for determining the rate of interest taking into account the creditworthiness and borrowing credentials of the Borrower and the cost to the Transferring Lenders of funding their respective participations in the FEC Loan. |
(f) | From the date of the FEC Reassignment and unless and until an alternative rate is agreed in accordance with paragraph (f) above, the rate of interest on the relevant part of the FEC Loan for the relevant Interest Period shall be the percentage rate per annum which is the weighted average of the rates notified in good faith to the Facility Agent by each Transferring Lender as soon as practicable and in any event within seven (7) Business Days of the date of the FEC Reassignment (or, if earlier, on the date falling three (3) Business Days before the date on which interest is due to be paid in respect of that Interest Period), to be that which expresses as a percentage rate per annum and in the relevant Transferring Lender's good faith the cost to the relevant Transferring Lender of funding its participation in that FEC Loan from whatever source it may reasonably select. |
(g) | Any alternative basis agreed pursuant to paragraph (f) above shall, with the prior consent of all the Transferring Lenders and the Borrower, be binding on those parties. |
(i) | a reason attributable to the gross negligence or wilful misconduct of FEC, the Facility Agent, the Guarantee Holder or any of the Lenders; or |
(a) | if such Prepayment Event arises under Section 9.1.11, the remedy available under this Section 9.2 shall be limited to that provided in clause (i) above and only with respect to the portion of the Loan held by the affected Lender that gave the relevant Illegality Notice (the "Affected Lender") unless the Affected Lender is a Hermes Lender and any such prepayment of that Hermes Lender's portion of the Loan would result in the Hermes Loan being less than 5% of the Loan outstanding at any time in which event the Borrower shall prepay that portion of the Loan required in order to ensure the Hermes Loan is not less than 5% of the aggregate Loans together with interest and all other Obligations as provided by clause (i) above; |
(b) | if the Prepayment Event arises under Section 9.1.10(A) or (B), the Borrower shall (i) prepay the FEC Loan together with interest and all other Obligations or the FEC Commitment shall be cancelled (as the case may be) in respect of any termination of the Finnvera Guarantee or any FEC Reassignment resulting therefrom and/or (ii) in the case of Section 9.1.10(B) only and if applicable, prepay the Finnvera Balancing Loan together with interest and all other Obligations or the Finnvera Balancing Commitment shall be cancelled (as the case may be) in respect of any termination of the Second Finnvera Guarantee; and |
(c) | if the Prepayment Event arises under Section 9.1.10(C) and no alternative arrangements have been agreed during the Mitigation Period under and in accordance with Section 11.20, the Borrower shall prepay the Loan together with interest and all other Obligations or the total Commitments shall be cancelled (as the case may be) as provided above in clause (i) above. |
(a) | this Article X shall inure to its benefit as to any actions taken or omitted to be taken by it while it was the Facility Agent under this Agreement; and |
(b) | Section 11.3 and Section 11.4 shall continue to inure to its benefit. |
(A) | The provisions of this Agreement and of each other Loan Document may from time to time be amended, modified or waived, if such amendment, modification or waiver is in writing and consented to by the Borrower and the Majority Lenders (acting with the consent of Finnvera and Hermes in respect of any material amendment, modification or waiver); provided that no such amendment, modification or waiver which would: |
(a) | modify any requirement hereunder that any particular action be taken by all the Lenders, Hermes or Finnvera shall be effective unless consented to by each Lender; |
(b) | modify this Section 11.1 or change the definition of "Majority Lenders" shall be made without the consent of each Lender; |
(c) | increase the Commitment of any Lender shall be made without the consent of such Lender; |
(d) | reduce any fees described in Article III payable to any Lender shall be made without the consent of such Lender; |
(e) | extend the Commitment Termination Date of any Lender shall be made without the consent of such Lender; |
(f) | extend the due date for, or reduce the amount of, any scheduled repayment or prepayment of principal of or interest on the Loan (or reduce the principal amount of or rate of interest on the Loan) owed to any Lender shall be made without the consent of such Lender; or |
(g) | affect adversely the interests, rights or obligations of the Facility Agent in its capacity as such shall be made without consent of the Facility Agent. |
(B) | The Facility Agent shall be entitled to request instructions, or clarification of any instruction, from the Majority Lenders in relation to the Loan (or, if the relevant Loan Document stipulates the matter is a decision for any other Lender, Hermes, Finnvera or group of Lenders from that Lender, Hermes, Finnvera or group of Lenders) as to whether, and in what manner, it should exercise or refrain from exercising any right, power, authority or discretion and the Facility Agent may refrain from acting unless and until it receives any such instructions or clarification that it has requested. |
(C) | The Facility Agent is fully protected if it acts on the instructions of the Majority Lenders in relation to the Loan in the exercise of any right, authority, power or discretion or any matter not expressly provided for in the Loan Documents or the Credit Support Documents. Any such instructions given by the Majority Lenders will be binding on the relevant Lenders or all the Lenders (as the case may be). In the absence of instructions, the Facility Agent may act as it considers to be in the best interests of all the Lenders. |
(D) | No failure or delay on the part of the Facility Agent or any Lender in exercising any power or right under this Agreement or any other Loan Document shall operate as a waiver thereof, nor shall any single or partial exercise of any such power or right preclude any other or further exercise thereof or the exercise of any other power or right. No notice to or demand on the Borrower in any case shall entitle it to any notice or demand in similar or other circumstances. No waiver or approval by the Facility Agent or any Lender under this Agreement or any other Loan Document shall, except as may be otherwise stated in such waiver or approval, be applicable to subsequent transactions. No waiver or approval hereunder shall require any similar or dissimilar waiver or approval thereafter to be granted hereunder. The Lenders hereby agree, at any time and from time to time that the Nordea Agreement or the Bank of Nova Scotia Agreement is amended or refinanced to negotiate in good faith to amend this Agreement (but expressly without obligation to agree on any amendment and only on a basis which is strictly a without prejudice to the rights and benefits of the Finance Parties currently existing under this Agreement) to conform any representations, warranties, covenants or events of default in this Agreement to the amendments made to any substantially comparable provisions in the Nordea Agreement or the Bank of Nova Scotia Agreement or any refinancing thereof. |
(a) | All notices and other communications provided to any party hereto under this Agreement or any other Loan Document shall be in writing or by electronic mail and addressed, delivered or transmitted to such party at its address, facsimile number or electronic mail address set forth below its signature hereto or set forth in a Lender Assignment Agreement or Transfer Certificate (as the case may be) or at such other address as may be designated by such party in a notice to the other parties. Any notice, if mailed and properly addressed with postage prepaid or if properly addressed and sent by pre-paid courier service, shall be deemed given when received; any notice, if transmitted by electronic mail, shall be deemed given upon acknowledgment of receipt by the recipient. |
(b) | So long as KfW IPEX is the Facility Agent, the Borrower may provide to the Facility Agent all information, documents and other materials that it furnishes to the Facility Agent hereunder or any other Loan Document (and any guaranties, security agreements and other agreements relating thereto), including, without limitation, all notices, requests, financial statements, financial and other reports, certificates and other materials, but excluding any such communication that (i) relates to a request for a new, or a conversion of an existing advance or other extension of credit (including any election of an interest rate or interest period relating thereto), (ii) relates to the payment of any principal or other amount due hereunder or any other Loan Document prior to the scheduled date therefor, (iii) provides notice of any Default or Event of Default or (iv) is required to be delivered to satisfy any condition precedent to the effectiveness of the Agreement and/or any advance or other extension of credit hereunder (all such non-excluded communications being referred to herein collectively as "Communications"), by transmitting the Communications in an electronic/pdf medium in a format acceptable to the Facility Agent at andre.mutter@kfw.de (or such other email address notified by the Facility Agent to the Borrower). |
(c) | The Borrower agrees that the Facility Agent may make such items included in the Communications as the Borrower may specifically agree available to the Lenders by posting such notices, at the option of the Borrower, on Intralinks or any similar such platform (the "Platform") acceptable to the Borrower. Although the primary web portal is secured with a dual firewall and a User ID/Password Authorisation System and the Platform is secured through a single user per deal authorisation method whereby each user may access the Platform only on a deal-by-deal basis, the Borrower acknowledges that (i) the distribution of material through an electronic medium is not necessarily secure and that there are confidentiality and other risks associated with such distribution, (ii) the Platform is provided "as is" and "as available" and (iii) neither the Facility Agent nor any of its Affiliates warrants the accuracy, adequacy or completeness of the Communications or the Platform and each expressly disclaims liability for errors or omissions in the Communications or the Platform. No warranty of any kind, express, implied or statutory, including, without limitation, any warranty of merchantability, fitness for a particular purpose, non-infringement of third party rights or freedom from viruses or other code defects, is made by the Facility Agent or any of its Affiliates in connection with the Platform. |
(d) | The Facility Agent agrees that the receipt of Communications by the Facility Agent at its e-mail address set forth above shall constitute effective delivery of such Communications to the Facility Agent for purposes hereunder and any other Loan Document (and any guaranties, security agreements and other agreements relating thereto). |
(a) | A person who is not a party to this Agreement 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 except that each of Finnvera and Hermes may enforce and enjoy any rights specifically conferred upon Finnvera or Hermes pursuant to this Agreement. |
(b) | Notwithstanding any term of any Loan Document, the consent of any person who is not a party to a Loan Document (other than Finnvera, FEC (until such time as it becomes a party thereto pursuant to the FEC Transfer Certificates) or Hermes) is not required to rescind or vary this Agreement at any time. |
(a) | except to the extent permitted under Section 7.2.6, the Borrower may not assign or transfer its rights or obligations hereunder without the prior written consent of the Facility Agent and each Lender; and |
(b) | the rights of sale, assignment and transfer of the Lenders are subject to Section 11.11. |
(a) | written notice of such assignment or transfer, together with payment instructions, addresses and related information with respect to such Assignee Lender or Transferee Lender, shall have been given to the Borrower and the Facility Agent by such Lender and such Assignee Lender or Transferee Lender; |
(b) | such Assignee Lender or Transferee Lender shall have executed and delivered to the Borrower and the Facility Agent a Lender Assignment Agreement or a Transfer Certificate as set out in (B) below, accepted by the Facility Agent; |
(c) | the Facility Agent on behalf of FEC shall have received the Additional FEC Transfer Documents where required; and |
(d) | the processing fees described below shall have been paid. |
(a) | A novation is effected if: |
(i) | the Existing Lender and FEC or Transferee Lender (as the case may be) deliver to the Facility Agent a duly completed FEC Transfer Certificate or Transfer Certificate (as the case may be); and |
(ii) | the Facility Agent executes it. |
(b) | The Facility Agent shall only be obliged to execute an FEC Transfer Certificate or Transfer Certificate delivered to it by (i) the Existing Lender and FEC or (ii) the Existing Lender and the Transferee Lender upon its completion of all "know your customer" checks that it is required to carry out in relation to the transfer to FEC or such Transferee Lender and upon receipt of the Additional FEC Transfer Documents where required. |
(c) | Each party to this Agreement (other than the Existing Lender and FEC or Transferee Lender (as the case may be)) irrevocably authorises the Facility Agent to execute any duly completed FEC Transfer Certificate or Transfer Certificate, as applicable on its behalf. |
(d) | On the Effective Date (as defined in the relevant Transfer Certificate): |
(i) | FEC or the Transferring Lender (as applicable) will assume the rights and obligations of the Existing Lender in connection with (i) the FEC Loan in the relevant FEC Transfer Certificate or (ii) any portion of the Loan in the relevant Transfer Certificate by way of novation in substitution for the Existing Lender; and |
(ii) | the Existing Lender will be released from those obligations and cease to have those rights. |
(a) | Unless expressly agreed to the contrary and save in the case of a transfer by the Original Lenders to FEC on the Effective Date, an Existing Lender makes no representation or warranty and assumes no responsibility to a New Lender for: |
(i) | the legality, validity, effectiveness, adequacy or enforceability of the Loan Documents or the Credit Support Documents; |
(ii) | the financial condition of the Borrower; |
(iii) | the performance and observance by the Borrower of its obligations under the Loan Documents; or |
(iv) | the accuracy of any statements (whether written or oral) made in or in connection with any Loan Document or the Credit Support Documents, |
(b) | Each New Lender confirms to the Existing Lender and the other Finance Parties that it: |
(i) | has made (and shall continue to make) its own independent investigation and assessment of the financial condition and affairs of the Borrower and its related entities in connection with its participation in this Agreement and has not relied exclusively on any information provided to it by the Existing Lender or any other Finance Party in connection with any Loan Document or Credit Support Document; and |
(ii) | will continue to make its own independent appraisal of the creditworthiness of the Borrower and its related entities whilst any amount is or may be outstanding under the Loan Documents or any Commitment is in force. |
(c) | Nothing in any Loan Document obliges an Existing Lender to: |
(i) | accept a re-transfer or re-assignment from a New Lender of any of the rights and obligations assigned or transferred under this Section 11.11.1 except in the case of an FEC Reassignment; or |
(ii) | support any losses directly or indirectly incurred by the New Lender by reason of the non-performance by the Borrower of its obligations under the Loan Documents or otherwise, save where Lenders are obliged to reimburse FEC for any Break Costs. |
(a) | no participation contemplated in this Section 11.11.2 shall relieve such Lender from its obligations hereunder; |
(b) | such Lender shall remain solely responsible for the performance of its obligations hereunder; |
(c) | the Borrower and the Facility Agent shall continue to deal solely and directly with such Lender in connection with such Lender's rights and obligations under this Agreement and each of the other Loan Documents; |
(d) | no Participant, unless such Participant is an Affiliate of such Lender, shall be entitled to require such Lender to take or refrain from taking any action hereunder or under any other Loan Document, except that such Lender may agree with any Participant that such Lender will not, without such Participant's consent, take any actions of the type described in clauses (b) through (f) of Section 11.1(A); |
(e) | the Borrower shall not be required to pay any amount under Section 4.3, 4.4, 4.5 and 4.6 that is greater than the amount which it would have been required to pay had no participating interest been sold; and |
(f) | each Lender that sells a participation under this Section 11.11.2 that constitutes a sale of its share in the Loan or an interest therein for U.S. federal income tax purposes shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts of (and stated interest on) each of the Participant's interest in that Lender's portion of the Loan, Commitments or other interests hereunder (the "Participant Register"). The entries in the Participant Register shall be conclusive absent manifest error, and such Lender may treat each person whose name is recorded in the Participant Register as the owner of such participation for all purposes hereunder. |
(a) | The Hermes Insurance Policy will cover 95% of the Hermes Loan. |
(b) | The Hermes Fee will equal 2.79% of the aggregate principal amount of the Hermes Loan as at the Actual Delivery Date. |
(c) | The parties have entered into this Agreement on the basis that the Hermes Insurance Policy shall contain the following terms and should such terms not be included within the Hermes Insurance Policy, then the Borrower may cancel the Commitment(s): |
(i) | 25% of the Hermes Fee as in effect on the date of issuance of the Hermes Insurance Policy ("First Fee") will be payable to the Hermes Agent or Hermes in Dollars within two (2) Business Days of receipt by the Borrower of demand from the Hermes Agent following the later to occur of (i) the issue of the Hermes Insurance Policy and (ii) the Effective Date; |
(ii) | the balance of the Hermes Fee (being the amount thereof under paragraph (b) above less the First Fee) ("Second Fee") will be payable in Dollars to the Hermes Agent or Hermes on the Actual Delivery Date; |
(iii) | if the Hermes Commitment is cancelled in full by the Borrower or the Lenders on or prior to the Actual Delivery Date, Hermes shall be required to reimburse the Hermes Agent the amount of the First Fee less an administration fee (such administration fee to be no greater than 5% of the amount refunded but in any event not exceeding EUR2,500); |
(iv) | if the Hermes Commitment is cancelled in part by the Borrower on or prior to the Actual Delivery Date, Hermes shall be required to reimburse the Hermes Agent an amount equal to a corresponding proportion of the First Fee, based on the proportion of the aggregate Hermes Commitment prior to such cancellation to the aggregate Hermes Commitment after giving effect to such cancellation, less an administration fee (such administration fee to be no greater than 5% of the amount refunded but in any event not exceeding EUR2,500); and |
(v) | if, after the Actual Delivery Date, the Borrower prepays all or part of the Hermes Loan in accordance with this Agreement, Hermes shall be required to reimburse the Hermes Agent an amount equal to a corresponding proportion of the unexpired portion of the Hermes Fee, having regard to the amount of the prepayment and the remaining term of the Hermes Loan less the sum of (x) a break funding fee equal to 20% of the unexpired portion of the Hermes Fee and (y) an administration fee (such fee to be no greater than 5% of the amount refunded but in any event not exceeding EUR2,500). |
(a) | Provided that the Hermes Insurance Policy complies with Section 11.13.1, the Borrower shall pay (a) the First Fee to the Hermes Agent in accordance with Section 11.13.1(c)(i) and (b) the Second Fee to the Hermes Agent on the Actual Delivery Date. In each case, if received by the Hermes Agent, the Hermes Agent shall pay such amount to Hermes. |
(b) | Provided that the Hermes Insurance Policy complies with Section 11.13.1, the Borrower shall pay to the Hermes Agent an issue fee of EUR12,500 for the issue of the Hermes Insurance Policy at the same time that the First Fee is payable. |
(a) | Promptly upon receipt of the Hermes Insurance Policy from Hermes, the Hermes Agent shall (subject to any confidentiality undertakings given to Hermes by the Hermes Agent pursuant to the terms of the Hermes Insurance Policy) send a copy thereof to the Borrower. |
(b) | The Hermes Agent shall perform such acts or provide such information which are, acting reasonably, within its power so to perform or so to provide, as required by Hermes under the Hermes Insurance Policy and as are necessary to ensure that the Lenders obtain the support of Hermes pursuant to the Hermes Insurance Policy. |
(c) | The Hermes Agent shall (in the circumstances described in Section 11.13.1(c)(iii), (iv) or (v)): |
(i) | make written requests to Hermes seeking a reimbursement of the Hermes Fee promptly after the relevant cancellation or prepayment and (subject to any confidentiality undertakings given to Hermes by the Hermes Agent pursuant to the terms of the Hermes Insurance Policy) provide a copy of the request to the Borrower; |
(ii) | use its reasonable endeavours to maximise the amount of any reimbursement of the Hermes Fee to which the Hermes Agent is entitled; |
(iii) | pay to the Facility Agent the full amount of any reimbursement of the Hermes Fee that the Hermes Agent receives from Hermes within two (2) Business Days of receipt with same day value for application as a prepayment towards the Hermes Loan in such order as the Hermes Lenders (in consultation with the Borrower) shall require; and |
(iv) | relay the good faith concerns of the Borrower to Hermes regarding the amount it is required to pay to Hermes or the amount of any reimbursement to which the Hermes Agent is entitled, it being agreed that the Hermes Agent's obligation shall be no greater than simply to pass on to Hermes the Borrower's concerns. |
(d) | Each Hermes Lender will co‑operate with the Hermes Agent, the Facility Agent and each other Hermes Lender, and take such action and/or refrain from taking such action as may be reasonably necessary, to ensure that the Hermes Insurance Policy continues in full force and effect and shall indemnify and hold harmless each other Lender in the event that the Hermes Insurance Policy does not continue in full force and effect due to its gross negligence or wilful default. |
(a) | Promptly upon receipt of the Finnvera Guarantee and, if applicable, the Second Finnvera Guarantee from Finnvera and provided that the Borrower provides a confidentiality undertaking to Finnvera in respect of the Finnvera Guarantee and, if applicable, the Second Finnvera Guarantee, the Facility Agent shall (subject to any confidentiality undertakings given to Finnvera by the Facility Agent pursuant to the terms of the Finnvera Guarantee and, if applicable, the Second Finnvera Guarantee) send a copy thereof to the Borrower. |
(b) | The Facility Agent shall procure that if, after the Disbursement Date, the Borrower prepays the FEC Loan and/or the Finnvera Balancing Loan in part or in full in accordance with Section 3.2.1, the Finnvera Guarantee and, if applicable, the Second Finnvera Guarantee will require Finnvera to reimburse the Guarantee Holder for the account of the Borrower all or a corresponding portion of any Finnvera Premium or the Finnvera Balancing Premium (as the case may be) paid prior to the date of such prepayment in an amount calculated in accordance with the Finnvera Premium Refund Formula. |
(c) | Any refund of the Finnvera Premium and/or the Finnvera Balancing Premium (as the case maybe) pursuant to Section 11.14.1(b) above shall be subject to: |
(i) | there not having been any claims for indemnification under the Finnvera Guarantee and/or the Second Finnvera Guarantee (as the case may be) up to the date of such refund payment by Finnvera; and |
(ii) | the irrevocable release of Finnvera from any liability under (i) the Finnvera Guarantee in respect of the portion of the FEC Loan prepaid and/or (ii) the Second Finnvera Guarantee in respect of the portion of the Finnvera Balancing Loan prepaid. |
(d) | The Facility Agent shall procure that the Guarantee Holder shall: |
(i) | make a written request to Finnvera seeking a reimbursement of the Finnvera Premium and/or the Finnvera Balancing Premium (as the case may be) in the circumstances described in Section 11.14.1(b) and (c) above promptly after the relevant prepayment and (subject to any confidentiality undertakings given to Finnvera by the Facility Agent pursuant to the terms of the Finnvera Guarantee and/or the Second Finnvera Guarantee (as the case may be)) provide a copy of the request to the Borrower; |
(ii) | use its reasonable endeavours to maximize the amount of any reimbursement of the Finnvera Premium and/or the Finnvera Balancing Premium (as the case may be) from Finnvera to which the Guarantee Holder is entitled; |
(iii) | agree to the irrevocable release of Finnvera from any liability under the (i) Finnvera Guarantee in respect of the portion of the FEC Loan prepaid and/or (ii) the Second Finnvera Guarantee in respect of the portion of the Finnvera Balancing Loan prepaid; and |
(iv) | pay to the Borrower the full amount of any reimbursement of the Finnvera Premium and/or Finnvera Balancing Premium (as the case may be) that the Guarantee Holder receives from Finnvera pursuant to the terms of the Finnvera Guarantee and/or the Second Finnvera Guarantee (as the case may be) within five (5) Business Days of receipt with same day value and such amount of any such reimbursement shall be applied as a prepayment against the FEC Loan and the Finnvera Balancing Loan on a pro rata basis provided that the Borrower may direct how such pro rata prepayment shall be applied between the FEC Tranche A Loan and the FEC Tranche B Loan. |
(e) | The Borrower acknowledges that the Finnvera Premium and, if applicable, the Finnvera Balancing Premium shall be calculated as provided in Section 3.5.4 and Section 3.5.5 respectively and shall be paid to Finnvera from the proceeds of the FEC Loan and, if applicable, the Finnvera Balancing Loan respectively on the Disbursement Date and duly authorises (i) FEC to pay the Finnvera Premium to Finnvera on the Disbursement Date by utilising the proceeds of the FEC Loan and (ii) if applicable, the Original Finnvera Balancing Lenders to pay the Finnvera Balancing Premium to Finnvera on the Disbursement Date by utilising the proceeds of the Finnvera Balancing Loan. |
(a) | The parties to this Agreement agree that the Facility Agent may act on the instructions of Finnvera in relation to this Agreement, provided that nothing in this Clause shall permit the Facility Agent to do anything which would alter the rights and/or obligations of any Finance Party or the Borrower as set out in this Agreement. |
(b) | Subject to any provision of the FEC Transfer Documents to the contrary, the Facility Agent as the Guarantee Holder under the Finnvera Guarantee, and, if applicable, the Second Finnvera Guarantee agrees with the Lenders to act in compliance with the Finnvera Guarantee, and, if applicable, the Second Finnvera Guarantee. |
(c) | The Facility Agent as the Guarantee Holder under the Finnvera Guarantee, and, if applicable, the Second Finnvera Guarantee may inform Finnvera of any increase or material change in any risk covered by the Finnvera Guarantee to the extent it is required to do so under the terms of the Finnvera Guarantee, and, if applicable, the Second Finnvera Guarantee and/or related Finnvera General Terms or for the purposes of ensuring the continuing validity of the Finnvera Guarantee, and, if applicable, the Second Finnvera Guarantee and shall notify the Borrower in case it so informs Finnvera. |
(a) | The Borrower acknowledges that: |
(i) | the Original FEC Lenders have entered into or will enter into (as applicable) the FEC Transfer Documents pursuant to which the Original FEC Lenders will, amongst other things, assign and transfer their respective rights and obligations under this Agreement to FEC; and |
(ii) | following the assignment and transfer referred to above, the Facility Agent shall act as agent for FEC under the Loan Documents and the Guarantee Holder shall continue to act as holder of the Finnvera Guarantee for and on behalf of the FEC Lender(s). |
(b) | The Borrower and each Finance Party shall co-operate and actively assist each other with respect to any obligations such Finance Party may have under or in connection with any Credit Support Document provided however, the Borrower shall not be required to act in a manner that it considers to be contrary or adverse to its own interests or may, directly or indirectly, result in any increased or additional cost or liability to the Borrower whether under the Loan Documents or otherwise (except for costs and expenses which the Borrower has agreed, pursuant to any Loan Document or otherwise, to pay). |
(c) | The Finance Parties have obligations under the FEC Transfer Documents (to which they are a party) and the Facility Agent has obligations as holder of the Finnvera Guarantee, and, if applicable, the Second Finnvera Guarantee which they would not have incurred (or in relation to which it would not have had any liability) if they had not entered into the FEC Transfer Documents or become holder of the Finnvera Guarantee, and, if applicable, the Second Finnvera Guarantee. Accordingly, the Borrower agrees to indemnify each Finance Party against any cost, loss or liability incurred by such Finance Party in connection with the FEC Transfer Documents (to which such Finance Party is a party and acting in whatever capacity) or as holder of the Finnvera Guarantee, and, if applicable, the Second Finnvera Guarantee and for any cost, loss or liability for which such Finance Party may be liable to FEC or Finnvera or otherwise under any FEC Transfer Document to which it is a party (acting in whatever capacity) or in respect of the Finnvera Guarantee, and, if applicable, the Second Finnvera Guarantee unless caused by the gross negligence or wilful misconduct of that Finance Party or the failure to perform or any default by that Finance Party under the relevant FEC Transfer Document, this Agreement, any other Loan Document, the Finnvera Guarantee, or, if applicable, the Second Finnvera Guarantee. |
(d) | The FEC Transfer Documents shall be executed concurrently with signing this Agreement. |
(e) | The Facility Agent shall or (as the case may be) shall procure that the Guarantee Holder shall, provide a copy of each FEC Transfer Document to the Borrower promptly following execution of the same. |
(a) | If any Finance Party receives any proceeds under the Finnvera Guarantee, the Second Finnvera Guarantee or the Hermes Insurance Policy, it shall transfer such moneys to the Facility Agent. |
(b) | Any proceeds referred to in (a) above shall be applied by the Facility Agent in favour of (i) an FEC Lender only in relation to monies received under the Finnvera Guarantee (ii) if applicable, the Finnvera Balancing Lenders only in relation to monies received under the Second Finnvera Guarantee and (iii) the Hermes Lenders only in relation to monies received under the Hermes Insurance Policy and, for the avoidance of doubt, no such proceeds shall be made available to the Borrower. |
(c) | Such proceeds shall be ignored when calculating the amount owing to the Lenders in respect of the FEC Loan, the Finnvera Balancing Loan (if applicable) or the Hermes Loan (as the case may be) and, for the avoidance of doubt, the obligations of the Borrower under the Loan Documents to which it is a party shall remain in full force and effect, notwithstanding the receipt of any such proceeds under the Finnvera Guarantee, the Second Finnvera Guarantee (if applicable) or the Hermes Insurance Policy (as the case may be). |
(a) | If the provisions of Section 3.2.2(b), 3.2.2(c) or 9.1.10(C) apply (and having regard to clause (b) below), the Facility Agent, the Borrower and the Lenders (or, in the case of Section 3.2.2(b) or 3.2.2(c), any affected Lender) shall discuss in good faith (but without obligation) for a period (the "Mitigation Period") of not less than, in the case of Sections 3.2.2(b) and 3.2.2(c), 50 days and, in the case of Section 9.1.10(C), 30 days (and which in the case of Section 3.2.2(b) and 3.2.2(b) shall commence on the first day of the 50-day period referred to in those respective Sections and, in the case of Section 9.1.10(C), shall run concurrently with the 30 day period referred to in that Section or, concurrently with the three (3) month grace period applicable in the case of a suspension of the Hermes Insurance Policy ) after (x) in the case of Section 3.2.2(b) and 3.2.2(c), the date on which the Illegality Notice is given or (y) in the case of Section 9.1.10(C), the date such Section becomes applicable, as the case may be: |
(i) | in the case of Section 3.2.2(b) or 3.2.2(c), what steps may be open to the relevant Lender to mitigate or remove such circumstances (including, without limitation, the possibility of assigning the Lender's Commitment to an Affiliate or another Lending Office); and |
(ii) | in the case of Section 9.1.10(C), the circumstances in which Section 9.1.10(C) has become applicable and whether there are any steps or actions which can be taken to remove the effect of the circumstances as described in such Section and/or reinstate or replace the Hermes Insurance Policy. |
(b) | To the extent required by or considered necessary by any party to this Agreement, the Lenders (and, in the case of Section 3.2.2(b) or 3.2.2(c), any affected Lender) shall use commercially reasonable efforts to include the Finnish Authorities and Hermes in all foregoing discussions. |
(c) | If an Illegality Notice shall be given by any Lender during the period falling 20 days prior to the Actual Delivery Date, the affected Lender will use all reasonable efforts to accelerate the mitigation steps of the type described or to be discussed pursuant to this Section to try and enable the Commitment of such Lender to still be available for drawing by the Borrower two (2) Business Days |
Date: August 2, 2018 | ||
/s/ | RICHARD D. FAIN | |
Richard D. Fain | ||
Chairman and | ||
Chief Executive Officer | ||
(Principal Executive Officer) |
Date: August 2, 2018 | ||
/s/ | JASON T. LIBERTY | |
Jason T. Liberty | ||
Executive Vice President, Chief Financial Officer | ||
(Principal Financial Officer) |
Date: August 2, 2018 | |||
By: | /s/ | RICHARD D. FAIN | |
Richard D. Fain | |||
Chairman and | |||
Chief Executive Officer | |||
(Principal Executive Officer) | |||
By: | /s/ | JASON T. LIBERTY | |
Jason T. Liberty | |||
Executive Vice President, Chief Financial Officer | |||
(Principal Financial Officer) |
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Document and Entity Information - shares |
6 Months Ended | |
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Jun. 30, 2018 |
Jul. 26, 2018 |
|
Document and Entity Information | ||
Entity Registrant Name | ROYAL CARIBBEAN CRUISES LTD | |
Entity Central Index Key | 0000884887 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2018 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 208,970,026 | |
Document Fiscal Year Focus | 2018 | |
Document Fiscal Period Focus | Q2 |
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares |
Jun. 30, 2018 |
Dec. 31, 2017 |
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Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 20,000,000 | 20,000,000 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, shares issued (in shares) | 235,779,344 | 235,198,901 |
Treasury stock, common shares (in shares) | 25,293,576 | 21,861,308 |
General |
6 Months Ended |
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Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
General | General Description of Business We are a global cruise company. As of June 30, 2018, we own and operate three global cruise brands: Royal Caribbean International, Celebrity Cruises and Azamara Club Cruises (collectively, our "Global Brands"). We also own a 50% joint venture interest in the German brand TUI Cruises, a 49% interest in the Spanish brand Pullmantur and a 36% interest in the Chinese brand SkySea Cruises (collectively, our "Partner Brands"). We account for our investments in our Partner Brands under the equity method of accounting. In March 2018, we and Ctrip.com International Ltd. ("Ctrip") announced the decision to end the Skysea Holding International Ltd. ("Skysea Holding") venture. Skysea Holding expects to cease business operations by the end of 2018. The Golden Era, the ship operated by SkySea Cruises and owned by a wholly owned subsidiary of Skysea Holding, is expected to be sold to an affiliate of TUI AG, our joint venture partner in TUI Cruises, and is expected to be delivered in December 2018. Refer to Note 5. Other Assets for further information regarding our investment in SkySea Holding. On July 31, 2018, we acquired a 66.7% equity stake in Silversea Cruises Holding Ltd. ("Silversea Cruises"), a privately-owned ultra-luxury cruise line with nine ships operating in all seven continents, for approximately $1.0 billion. Refer to Note 6. Long-Term Debt for information on debt issued to finance a portion of the acquisition. In addition to the purchase price, Manfredi Lefebvre D'Ovidio, Executive Chairman of Silversea Cruises, will qualify for contingent consideration of approximately 472,000 shares of our common stock, payable upon achievement of certain 2019-2020 performance metrics. For reporting purposes, we will account for this transaction under the provisions of Accounting Standard Codification ("ASC") 805, Business Combinations, and we expect to include Silversea Cruises’ results of operations on a three-month reporting lag beginning with the fourth quarter of 2018. During the subsequent measurement period, we expect to receive additional information to perform the purchase price allocation. Basis for Preparation of Consolidated Financial Statements The unaudited consolidated financial statements are presented pursuant to the rules and regulations of the Securities and Exchange Commission. In our opinion, these statements include all adjustments necessary for a fair statement of the results of the interim periods reported herein. Adjustments consist only of normal recurring items, except for any discussed in the notes below. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted as permitted by such rules and regulations. Estimates are required for the preparation of financial statements in accordance with GAAP and actual results could differ from these estimates. Refer to Note 2. Summary of Significant Accounting Policies in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2017 for a discussion of our significant accounting policies. All significant intercompany accounts and transactions are eliminated in consolidation. We consolidate entities over which we have control, usually evidenced by a direct ownership interest of greater than 50%, and variable interest entities where we are determined to be the primary beneficiary. Refer to Note 5. Other Assets for further information regarding our variable interest entities. For affiliates we do not control but over which we have significant influence on financial and operating policies, usually evidenced by a direct ownership interest from 20% to 50%, the investment is accounted for using the equity method. |
Summary of Significant Accounting Policies |
6 Months Ended |
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Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Adoption of Accounting Pronouncements On January 1, 2018, we adopted the guidance in ASC 606, Revenue from Contracts with Customers, and applied the guidance to all contracts using the modified retrospective method. The new standard converged wide-ranging revenue recognition concepts and requirements that lead to diversity in application for particular industries and transactions into a single revenue standard containing comprehensive principles for recognizing revenue. The cumulative effect of applying the newly issued guidance was not material and accordingly there was no adjustment made to our retained earnings upon adoption on January 1, 2018. We do not expect the newly issued guidance to have a material impact on our consolidated financial statements on an ongoing basis. Due to the adoption of ASC 606, we currently present prepaid commissions as an asset within Prepaid expenses and other assets. In addition, we have reclassified prepaid commissions of $64.6 million from Customer deposits to Prepaid expenses and other assets in our consolidated balance sheet as of December 31, 2017. Refer to Note 3. Revenues for disclosures with respect to our revenue recognition policies. On January 1, 2018, we adopted the guidance in Accounting Standard Update ("ASU") 2016-16, Income Taxes 740: Intra-Entity Transfers of Assets Other Than Inventory, which requires the income tax consequences of an intra-entity transfer of an asset, other than inventory, to be recognized at the time that the transfer occurs, rather than when the asset is sold to an outside party. We adopted the standard using the modified retrospective method and recorded a cumulative-effect adjustment to reduce retained earnings as of January 1, 2018 by $6.6 million, which reflects the elimination of the deferred tax asset related to intercompany asset transfers. On January 1, 2018, we adopted the guidance in ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities, that was issued to simplify and align the financial reporting of hedging relationships to the economic results of an entity’s risk management activities. We adopted the amended guidance using the modified retrospective approach. Adoption of the guidance allowed us to modify the designated risk in our fair value interest rate hedges to the benchmark interest rate component, resulting in changes to the cumulative and ongoing fair value measurement for the hedged debt. Upon adoption, we also elected to hedge the contractually specified components of our commodities purchase contracts. For our cash flow hedges, there will be no periodic measurement or recognition of ineffectiveness. For all hedges, the earnings effect of the hedging instrument will be reported in the same period and in the same income statement line item in which the earnings effect of the hedged item is reported. As a result of the adoption of this guidance, we recorded a cumulative-effect adjustment to reduce retained earnings as of January 1, 2018 by $16.9 million. The cumulative-effect adjustment includes an increase to the debt carrying value of $14.4 million for our fair value interest rate hedges as of January 1, 2018, which reflects the cumulative fair value measurement change to debt at adoption resulting from the modified designated risk, and an increase to other comprehensive income of $2.5 million, which represents an increase to the deferred gain on active cash flow hedges at adoption. Additionally, the new standard requires modifications to existing presentation and disclosure requirements on a prospective basis. As such, certain disclosures for the six months ended June 30, 2018 conform to these disclosure requirements. Refer to Note 9. Changes in Accumulated Other Comprehensive Income (Loss) and Note 10. Fair Value Measurements and Derivative Instruments for additional information. Recent Accounting Pronouncements Leases In February 2016, amended GAAP guidance was issued to increase the transparency and comparability of lease accounting among organizations. For leases with a term greater than 12 months, the amendments require the lease rights and obligations arising from the leasing arrangements, including operating leases, to be recognized as assets and liabilities on the balance sheet. The amendments also expand the required disclosures surrounding leasing arrangements. The guidance must be applied using a retrospective application method and will be effective for financial statements issued for fiscal years beginning after December 15, 2018 and interim periods within those years. Early adoption is permitted. We are currently evaluating the impact of adopting this guidance. In our evaluation, we have identified the contracts that provide an explicit right to use an asset and qualify as a leasing arrangement under the new guidance. We are currently evaluating certain contractual arrangements to determine if they contain an implicit or embedded right to use an asset that would qualify as a leasing arrangement under the new guidance. Upon implementation of the guidance, we expect an increase to both the assets and liabilities on our consolidated balance sheet to reflect the lease rights and obligations arising from our operating lease arrangements. In addition, we expect to include additional qualitative and quantitative disclosures regarding our leasing arrangements as required by the guidance. Change in Accounting Principle - Stock-based Compensation In January 2018, we elected to change our accounting policy for recognizing stock-based compensation expense from the graded attribution method to the straight-line attribution method for time-based stock awards. The adoption of the straight-line attribution method for time-based stock awards represents a change in accounting principle which we believe to be preferable because it is the predominant method used in our industry. A change in accounting principle requires retrospective application, if material. The impact of the adoption of the straight-line attribution method to our time-based awards was immaterial to prior periods and is expected to be immaterial for our fiscal year ended December 31, 2018. As a result, we have accounted for this change in accounting principle in our consolidated results for the six months ended June 30, 2018. The effect of this change was an increase to net income of $9.2 million, or $0.04 per share for each of basic and diluted earnings per share, for the six months ended June 30, 2018, which is reported within Marketing, selling and administrative expenses in our consolidated statements of comprehensive income (loss) for the six months ended June 30, 2018. |
Revenues |
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Revenues | Revenues Revenue Recognition Revenues are measured based on consideration specified in our contracts with customers and are recognized as the related performance obligations are satisfied. The majority of our revenues are derived from passenger cruise contracts which are reported within Passenger ticket revenues in our consolidated statements of comprehensive income (loss). Our performance obligation under these contracts is to provide a cruise vacation in exchange for the ticket price. We satisfy this performance obligation and recognize revenue over the duration of each cruise, which generally range from two to 23 nights. Passenger ticket revenues include charges to our guests for port costs that vary with passenger head counts. These type of port costs, along with port costs that do not vary by passenger head counts, are included in our operating expenses. The amounts of port costs charged to our guests and included within Passenger ticket revenues on a gross basis were $151.4 million and $143.4 million for the second quarter of 2018 and 2017, respectively, and $288.1 million and $277.9 million for the six months ended June 30, 2018 and 2017, respectively. Our total revenues also include onboard and other revenues, which consist primarily of revenues from the sale of goods and services onboard our ships that are not included in passenger ticket prices. We receive payment before or concurrently with the transfer of these goods and services to passengers during a cruise and recognize revenue at the time of transfer over the duration of the related cruise. As a practical expedient, we have omitted disclosures on our remaining performance obligations as the duration of our contracts with customers is less than a year. Disaggregated Revenues The following table disaggregates our total revenues by geographic regions where we provide cruise itineraries (in thousands):
Passenger ticket revenues are attributed to geographic areas based on where the reservation originates. For the quarters ended June 30, 2018 and 2017, our guests were sourced from the following areas:
For the six months ended June 30, 2018 and 2017, our guests were sourced from the following areas:
Customer Deposits and Contract Liabilities Our payment terms generally require an upfront deposit to confirm a reservation, with the balance due prior to the cruise. Deposits received on sales of passenger cruises are initially recorded as Customer deposits in our consolidated balance sheets and subsequently recognized as passenger ticket revenues during the duration of the cruise. ASC 606 defines a “contract liability” as an entity’s obligation to transfer goods or services to a customer for which the entity has received consideration from the customer. We do not consider customer deposits to be a contract liability until the customer no longer retains the unilateral right, resulting from the passage of time, to cancel such customer's reservation and receive a full refund. Customer deposits presented in our consolidated balance sheets include contract liabilities of $2.0 billion and $1.4 billion as of June 30, 2018 and December 31, 2017, respectively. Substantially all of our contract liabilities as of December 31, 2017 were expensed and reported within Total revenues in our consolidated statements of comprehensive income (loss) for the six months ended June 30, 2018. Contract Receivables and Contract Assets Although we generally require full payment from our customers prior to their cruise, we grant credit terms to a relatively small portion of our revenue source in select markets outside of the United States. As a result, we have outstanding receivables from passenger cruise contracts in those markets. We also have receivables from credit card merchants for cruise ticket purchases and goods and services sold to guests during cruises that are collected before, during or shortly after the cruise voyage. In addition, we have receivables due from concessionaires onboard our vessels. These receivables are included within Trade and other receivables, net in our consolidated balance sheets. We have contract assets that are conditional rights to consideration for satisfying the construction services performance obligations under a service concession arrangement. As of June 30, 2018 and December 31, 2017, our contract assets were $58.9 million and $60.1 million, respectively, and were included within Other assets in our consolidated balance sheets. Given the short duration of our cruises and our collection terms, we do not have any other significant contract assets. Assets Recognized from the Costs to Obtain a Contract with a Customer Prepaid travel agent commissions are an incremental cost of obtaining contracts with customers that we recognize as an asset and include within Prepaid expenses and other assets in our consolidated balance sheets. Prepaid travel agent commissions were $148.2 million and $64.6 million as of June 30, 2018 and December 31, 2017, respectively. Substantially all of our prepaid travel agent commissions at December 31, 2017 were expensed and reported within Commissions, transportation and other in our consolidated statements of comprehensive income (loss) for the six months ended June 30, 2018. |
Earnings Per Share |
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Earnings Per Share | Earnings Per Share A reconciliation between basic and diluted earnings per share is as follows (in thousands, except per share data):
There were no antidilutive shares for the quarters and six months ended June 30, 2018 and 2017. |
Other Assets |
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Other Assets | Other Assets A Variable Interest Entity (“VIE”) is an entity in which the equity investors have not provided enough equity to finance the entity’s activities or the equity investors: (1) cannot directly or indirectly make decisions about the entity’s activities through their voting rights or similar rights; (2) do not have the obligation to absorb the expected losses of the entity; (3) do not have the right to receive the expected residual returns of the entity; or (4) have voting rights that are not proportionate to their economic interests and the entity’s activities involve or are conducted on behalf of an investor with a disproportionately small voting interest. We have determined that TUI Cruises GmbH, our 50%-owned joint venture, which operates the brand TUI Cruises, is a VIE. As of June 30, 2018, the net book value of our investment in TUI Cruises was approximately $537.4 million, primarily consisting of $349.3 million in equity and a loan of €158.5 million, or approximately $185.1 million based on the exchange rate at June 30, 2018. As of December 31, 2017, the net book value of our investment in TUI Cruises was approximately $624.5 million, primarily consisting of $422.8 million in equity and a loan of €166.5 million, or approximately $199.8 million based on the exchange rate at December 31, 2017. The loan, which was made in connection with the sale of Splendour of the Seas in April 2016, accrues interest at a rate of 6.25% per annum and is payable over 10 years. This loan is 50% guaranteed by TUI AG, our joint venture partner in TUI Cruises, and is secured by a first priority mortgage on the ship. The majority of these amounts were included within Other assets in our consolidated balance sheets. In addition, we and TUI AG have each guaranteed the repayment by TUI Cruises of 50% of a bank loan. As of June 30, 2018, the outstanding principal amount of the loan was €41.3 million, or approximately $48.2 million based on the exchange rate at June 30, 2018. In April 2018, Mein Schiff 1 was sold to an affiliate of TUI AG. The proceeds were used to repay €44.2 million of the bank loan during the six months ended June 30, 2018 and secure the release of the first mortgage on Mein Schiff 1. The loan amortizes quarterly and is currently secured by a first mortgage on Mein Schiff 2. Based on current facts and circumstances, we do not believe potential obligations under our guarantee of this bank loan are probable. In addition to our guarantee of the bank loan, TUI Cruises has various ship construction and financing agreements which include certain restrictions on each of our and TUI AG’s ability to reduce our current ownership interest in TUI Cruises below 37.55% through May 2028. Our investment amount, outstanding term loan and the potential obligations under the bank loan guarantee are substantially our maximum exposure to loss in connection with our investment in TUI Cruises. We have determined that we are not the primary beneficiary of TUI Cruises. We believe that the power to direct the activities that most significantly impact TUI Cruises’ economic performance are shared between ourselves and TUI AG. All the significant operating and financial decisions of TUI Cruises require the consent of both parties, which we believe creates shared power over TUI Cruises. Accordingly, we do not consolidate this entity and account for this investment under the equity method of accounting. In March 2009, we sold Celebrity Galaxy to TUI Cruises for €224.4 million or $290.9 million to serve as the original Mein Schiff 1. Due to the related party nature of this transaction, the gain on the sale of the ship of $35.9 million was deferred and being recognized over the remaining life of the ship which was estimated to be 23 years. As mentioned above, in April 2018, TUI Cruises sold the original Mein Schiff 1 and as a result we accelerated the recognition of the remaining balance of the deferred gain which was $21.8 million. This amount is included within Other income (expense) in our consolidated statements of comprehensive income (loss) for the quarter and six months ended June 30, 2018. We have determined that Pullmantur Holdings S.L. ("Pullmantur Holdings"), in which we have a 49% noncontrolling interest, is a VIE for which we are not the primary beneficiary, as we do not have the power to direct the activities that most significantly impact the entity's economic performance. Accordingly, we do not consolidate this entity and we account for this investment under the equity method of accounting. As of June 30, 2018, our maximum exposure to loss in Pullmantur Holdings was approximately $58.8 million consisting of loans and other receivables. As of December 31, 2017, our maximum exposure to loss in Pullmantur Holdings was approximately $53.7 million consisting of loans and other receivables. These amounts were included within Trade and other receivables, net and Other assets in our consolidated balance sheets. We have provided a non-revolving working capital facility to a Pullmantur Holdings subsidiary in the amount of up to €15.0 million or approximately $17.5 million based on the exchange rate at June 30, 2018. Proceeds of the facility, which may be drawn through December 2018, will bear interest at the rate of 6.5% per annum and are payable through 2022. Springwater Capital LLC, 51% owner of Pullmantur Holdings, has guaranteed repayment of 51% of the outstanding amounts under the facility. As of June 30, 2018, €8.0 million, or approximately $9.3 million, based on the exchange rate at June 30, 2018, was drawn on this facility. We have determined that Grand Bahama Shipyard Ltd. (“Grand Bahama”), a ship repair and maintenance facility in which we have a 40% noncontrolling interest, is a VIE. This facility serves cruise and cargo ships, oil and gas tankers and offshore units. We utilize this facility, among other ship repair facilities, for our regularly scheduled drydocks and certain emergency repairs as may be required. During the quarter and six months ended June 30, 2018, we made payments of $1.9 million and $24.3 million respectively, to Grand Bahama for ship repair and maintenance services. During the quarter and six months ended June 30, 2017, we made payments of $3.9 million and $5.5 million, respectively, to Grand Bahama for ship repair and maintenance services. We have determined that we are not the primary beneficiary of this facility as we do not have the power to direct the activities that most significantly impact the facility’s economic performance. Accordingly, we do not consolidate this entity and we account for this investment under the equity method of accounting. As of June 30, 2018, the net book value of our investment in Grand Bahama was approximately $58.7 million, consisting of $44.6 million in equity and a loan of $14.1 million. As of December 31, 2017, the net book value of our investment in Grand Bahama was approximately $49.4 million, consisting of $32.4 million in equity and a loan of $17.0 million. These amounts represent our maximum exposure to loss related to our investment in Grand Bahama. Our loan to Grand Bahama matures in March 2025 and bears interest at the lower of (i) LIBOR plus 3.50% and (ii) 5.5%. Interest payable on the loan is due on a semi-annual basis. We have experienced strong payment performance on the loan since its amendment in 2016, and as a result completed an evaluation and review of the loan resulting in a reclassification of the loan to accrual status as of October 2017. During the quarter and six months ended June 30, 2018, we received principal and interest payments of approximately $11.2 million and $14.2 million, respectively. During the quarter and six months ended June 30, 2017, we received principal payments of approximately $3.9 million and $4.2 million, respectively. The loan balance is included within Other assets in our consolidated balance sheets. The loan is currently accruing interest under the effective yield method, which includes the recognition of previously unrecognized interest that accumulated while the loan was in non-accrual status. We monitor credit risk associated with the loan through our participation on Grand Bahama’s board of directors along with our review of Grand Bahama’s financial statements and projected cash flows. Based on this review, we believe the risk of loss associated with the outstanding loan is not probable as of June 30, 2018. We have determined that Skysea Holding International Ltd. ("Skysea Holding"), in which we currently have a 36% noncontrolling interest, is a VIE for which we are not the primary beneficiary, as we do not have the power to direct the activities that most significantly impact the entity's economic performance. Accordingly, we do not consolidate this entity and we account for this investment under the equity method of accounting. In December 2014, we and Ctrip, which also owns 36% of Skysea Holding, each provided a debt facility to a wholly owned subsidiary of Skysea Holding in the amount of $80.0 million, with an applicable interest rate of 6.5% per annum, which originally matured in January 2030. The facilities, which are pari passu to each other, are each 100% guaranteed by Skysea Holding and are secured by first priority mortgages on the ship, Golden Era. Due to payment performance, the loans were classified to non-accrual status in 2017. In March 2018, Skysea Holding's board of directors agreed to exit the business given increasing challenges faced by the brand. We expect Skysea Holding will cease business operations by the end of 2018. In connection with the decision to dissolve the brand, SkySea Holding has agreed to sell the Golden Era to an affiliate of TUI AG, our joint venture partner in TUI Cruises. We review our equity method investments for impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may not be recoverable. Given SkySea Holding’s planned dissolution and sale of Golden Era, we reviewed the recoverability of our investment, debt facility and other receivables due from the brand. As a result of this analysis, we determined that our investment in SkySea Holding and the carrying value of our debt facility and other receivables due from the brand were impaired as of March 31, 2018 and recognized an impairment charge of $23.3 million. The charge reflected a full impairment of our investment in SkySea Holding and reduced the debt facility and other receivables due to us to their net realizable value as of March 31, 2018. This impairment charge was recognized in Other income (expense) within our consolidated statements of comprehensive income (loss) for the six months ended June 30, 2018. Refer to Note 10. Fair Value Measurements and Derivative Instruments for further information on the fair value calculation of the debt facility. As of June 30, 2018, the net book value of our investment in Skysea Holding and its subsidiaries was approximately $64.7 million, consisting of the net book value of the $80.0 million debt facility, its related accrued interest and other receivables due from Skysea Holding. Due to the expected sale of Golden Era in December of 2018, the amount was included within Trade and other receivables, net in our consolidated balance sheets and represents our maximum exposure to loss related to our investment in Skysea Holding as of June 30, 2018. As of December 31, 2017, the net book value of our investment in Skysea Holding and its subsidiaries was approximately $96.0 million, which consisted of $4.4 million in equity and loans and other receivables of $91.6 million. The majority of these amounts were included within Other assets in our consolidated balance sheets and represented our maximum exposure to loss related to our investment in Skysea Holding as of December 31, 2017. The following tables set forth information regarding our investments accounted for under the equity method of accounting, including the entities discussed above (in thousands):
We also provide ship management services to TUI Cruises GmbH, Pullmantur Holdings and Skysea Holding. Additionally, we bareboat charter to Pullmantur Holdings the vessels currently operated by its brands, which were retained by us following the sale of our 51% interest in Pullmantur Holdings. We recorded the following as it relates to these services in our operating results within our consolidated statements of comprehensive income (loss) (in thousands):
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Long-Term Debt |
6 Months Ended |
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Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt In June 2018, we entered into a credit agreement for the financing of a portion of the purchase price payable for the Silversea Cruises acquisition and to pay related fees and expenses. This agreement makes available to us an unsecured U.S. dollar denominated term loan with a maximum aggregate principal amount of $700 million. On July 31, 2018, we closed on the Silversea Cruises acquisition and subsequently drew in full on this credit agreement. The loan is due in July 2019 and we are required to prepay the loan with the proceeds of certain debt issuances prior to maturity. Interest on the loan will accrue at a floating rate based on LIBOR plus a margin that varies with our credit rating and which is currently 1.00%. In June 2018, we established a commercial paper program pursuant to which we may issue short-term unsecured notes from time to time in an aggregate amount of up to $1.2 billion. The commercial paper issued will be backstopped by our revolving credit facilities. As of June 30, 2018, we had not issued any notes under this program and as of July 31, 2018, we had $415.0 million of commercial paper notes outstanding. In March 2018, we took delivery of Symphony of the Seas. We had previously entered into a financing arrangement for the United States dollar financing of this ship in January 2015. Through the financing arrangement, we had the right, but not the obligation, to satisfy the obligations to be incurred upon delivery and acceptance of the vessel under the shipbuilding contract by assuming through a novation agreement, at delivery and acceptance, the debt indirectly incurred by the shipbuilder during the construction of the ship. We borrowed a total of $1.2 billion under our previously committed unsecured term loan, which includes the execution of the novation to satisfy a portion of our final obligation under our shipbuilding agreement. The loan amortizes semi-annually over 12 years and bears interest at a fixed rate of 3.82%. In our consolidated statement of cash flows for the six months ended June 30, 2018, the acceptance of the ship and satisfaction of our obligation under the shipbuilding contract was classified as an outflow and constructive disbursement within Investing Activities while the amounts novated and effectively advanced from our lender under our previously committed unsecured term loan were classified as an inflow and constructive receipt within Financing Activities. In March 2018, we entered into and drew in full on a credit agreement in the amount of $130.0 million due February 2023. The loan accrues interest at a floating rate of LIBOR plus an applicable margin. The applicable margin varies with our debt rating and was 1.195% as of June 30, 2018. Amounts from the issuance of this loan were used for capital expenditures. |
Commitments and Contingencies |
6 Months Ended |
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Jun. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Ship Purchase Obligations Our future capital commitments consist primarily of new ship orders. As of June 30, 2018, we had two Quantum-class ships, one Oasis-class ship and two ships of a new generation of ships, known as our Icon-class, on order for our Royal Caribbean International brand with an aggregate capacity of approximately 25,300 berths. Additionally, as of June 30, 2018, we have four ships of a new generation of ships, known as our Edge-class, and a ship designed for the Galapagos Islands on order for our Celebrity Cruises brand with an aggregate capacity of approximately 12,300 berths. As of June 30, 2018, the aggregate cost of our ships on order, not including any ships on order by our Partner Brands, was approximately $11.4 billion, of which we had deposited $586.1 million. Approximately 54.3% of the aggregate cost was exposed to fluctuations in the Euro exchange rate at June 30, 2018. Refer to Note 10. Fair Value Measurements and Derivative Instruments for further information. Litigation We are routinely involved in claims typical within the cruise vacation industry. The majority of these claims are covered by insurance. We believe the outcome of such claims, net of expected insurance recoveries, will not have a material adverse impact on our financial condition or results of operations and cash flows. Other In July 2016, we executed an agreement with Miami Dade County (“MDC”), which was simultaneously assigned to Sumitomo Banking Corporation (“SMBC”), to lease land from MDC and construct a new cruise terminal at PortMiami in Miami, Florida. The terminal is expected to be approximately 170,000 square feet and will serve as a homeport. During the construction period, SMBC will fund the costs of the terminal’s construction and land lease. Upon completion of the terminal's construction, which is expected to occur during the fourth quarter of 2018, we will operate and lease the terminal from SMBC for a five-year term. We determined that the lease arrangement between SMBC and us should be accounted for as an operating lease upon completion of the terminal. If any person acquires ownership of more than 50% of our common stock or, subject to certain exceptions, during any 24-month period, a majority of our board of directors is no longer comprised of individuals who were members of our board of directors on the first day of such period, we may be obligated to prepay indebtedness outstanding under our credit facilities, which we may be unable to replace on similar terms. Our public debt securities also contain change of control provisions that would be triggered by a third-party acquisition of greater than 50% of our common stock coupled with a ratings downgrade. If this were to occur, it would have an adverse impact on our liquidity and operations. |
Shareholders' Equity |
6 Months Ended |
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Jun. 30, 2018 | |
Equity [Abstract] | |
Shareholders' Equity | Shareholders’ Equity During both first and second quarters of 2018, we declared a cash dividend on our common stock of $0.60 per share which was paid in April 2018 and July 2018, respectively. During the first quarter of 2018, we also paid a cash dividend on our common stock of $0.60 per share which was declared during the fourth quarter of 2017. During both first and second quarters of 2017, we declared a cash dividend on our common stock of $0.48 per share which was paid in April 2017 and July 2017, respectively. During the first quarter of 2017, we also paid a cash dividend on our common stock of $0.48 per share which was declared during the fourth quarter of 2016. In May 2018, our board of directors authorized a 24-month common stock repurchase program for up to $1.0 billion. The timing and number of shares to be repurchased will depend on a variety of factors, including price and market conditions. Repurchases under the program may be made at management's discretion from time to time on the open market or through privately negotiated transactions. During the second quarter of 2018, we repurchased 1.3 million shares of our common stock under this program for a total of $137.5 million in open market transactions that were recorded within Treasury stock in our consolidated balance sheet. In July 2018, we repurchased an additional 1.5 million shares for a total of $162.5 million in open market transactions. In April 2017, our board of directors authorized a 12-month common stock repurchase program for up to $500.0 million that was completed in February 2018. During the first quarter of 2018, we repurchased 2.1 million shares of our common stock for a total of $275.0 million in open market transactions that were recorded within Treasury stock in our consolidated balance sheet. Our repurchases under this program, including the 1.8 million shares repurchased for $225.0 million during 2017, totaled $500.0 million. |
Changes in Accumulated Other Comprehensive Income (Loss) |
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Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) | Changes in Accumulated Other Comprehensive Income (Loss) The following table presents the changes in accumulated other comprehensive income (loss) by component for the six months ended June 30, 2018 and 2017 (in thousands):
The following table presents reclassifications out of accumulated other comprehensive income (loss) for the quarters and six months ended June 30, 2018 and 2017 (in thousands):
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Fair Value Measurements and Derivative Instruments |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements and Derivative Instruments | Fair Value Measurements and Derivative Instruments Fair Value Measurements The estimated fair value of our financial instruments that are not measured at fair value, categorized based upon the fair value hierarchy, are as follows (in thousands):
(1) Inputs based on quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment. (2) Inputs other than quoted prices included within Level 1 that are observable for the liability, either directly or indirectly. For unsecured revolving credit facilities and unsecured term loans, fair value is determined utilizing the income valuation approach. This valuation model takes into account the contract terms of our debt such as the debt maturity and the interest rate on the debt. The valuation model also takes into account the creditworthiness of the Company. (3) Inputs that are unobservable. The Company did not use any Level 3 inputs as of June 30, 2018 and December 31, 2017. (4) Consists of cash and marketable securities with original maturities of less than 90 days. (5) Consists of unsecured revolving credit facilities, senior notes, senior debentures and term loans. This does not include our capital lease obligations. Other Financial Instruments The carrying amounts of accounts receivable, accounts payable, accrued interest and accrued expenses approximate fair value at June 30, 2018 and December 31, 2017. Assets and liabilities that are recorded at fair value have been categorized based upon the fair value hierarchy. The following table presents information about the Company’s financial instruments recorded at fair value on a recurring basis (in thousands):
(1) Inputs based on quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment. (2) Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. For foreign currency forward contracts, interest rate swaps and fuel swaps, fair value is derived using valuation models that utilize the income valuation approach. These valuation models take into account the contract terms, such as maturity, as well as other inputs, such as foreign exchange rates and curves, fuel types, fuel curves and interest rate yield curves. All derivative instrument fair values take into account the creditworthiness of the counterparty and the Company. (3) Inputs that are unobservable. The Company did not use any Level 3 inputs as of June 30, 2018 and December 31, 2017. (4) Consists of foreign currency forward contracts, interest rate swaps and fuel swaps. Refer to the “Fair Value of Derivative Instruments” table for breakdown by instrument type. (5) Consists of exchange-traded equity securities and mutual funds reported within Other assets in our consolidated balance sheets. (6) Consists of foreign currency forward contracts, interest rate swaps and fuel swaps. Refer to the “Fair Value of Derivative Instruments” table for breakdown by instrument type. The reported fair values are based on a variety of factors and assumptions. Accordingly, the fair values may not represent actual values of the financial instruments that could have been realized as of June 30, 2018 or December 31, 2017, or that will be realized in the future, and do not include expenses that could be incurred in an actual sale or settlement. The following table presents information about the fair value of our equity method investment and note and other receivables due related to SkySea Holding, further discussed in Note 5. Other Assets, recorded at fair value on a nonrecurring basis (in thousands):
(1) Due to the expectation that Skysea Holding will cease business operations by the end of 2018, we do not deem our investment balance to be recoverable and therefore, we estimated the fair value of our investment to be zero. The fair value of our equity investment in Skysea Holding was estimated as of March 31, 2018, the date of the last impairment test, at which point the investment was fully impaired. (2) We estimated the fair value of our debt facility and other receivables due from Skysea Holding based on the fair value of the collateral of the debt facility, Skysea Holding's ship, Golden Era, as of March 31, 2018, the date of the last impairment test, adjusted for foreign exchange rates as of June 30, 2018. We believe this amount estimates fair value as of June 30, 2018. The fair value of the ship represents the net realizable value based on the agreed upon sale price of the ship, which is expected to be completed in December 2018. For further information on the Skysea Holding impairment, refer to Note 5. Other Assets. We have master International Swaps and Derivatives Association (“ISDA”) agreements in place with our derivative instrument counterparties. These ISDA agreements provide for final close out netting with our counterparties for all positions in the case of default or termination of the ISDA agreement. We have determined that our ISDA agreements provide us with rights of setoff on the fair value of derivative instruments in a gain position and those in a loss position with the same counterparty. We have elected not to offset such derivative instrument fair values in our consolidated balance sheets. See Credit Related Contingent Features for further discussion on contingent collateral requirements for our derivative instruments. The following table presents information about the Company’s offsetting of financial assets under master netting agreements with derivative counterparties (in thousands):
The following table presents information about the Company’s offsetting of financial liabilities under master netting agreements with derivative counterparties (in thousands):
Concentrations of Credit Risk We monitor our credit risk associated with financial and other institutions with which we conduct significant business and, to minimize these risks, we select counterparties with credit risks acceptable to us and we seek to limit our exposure to an individual counterparty. Credit risk, including but not limited to counterparty nonperformance under derivative instruments, our credit facilities and new ship progress payment guarantees, is not considered significant, as we primarily conduct business with large, well-established financial institutions, insurance companies and export credit agencies many of which we have long-term relationships with and which have credit risks acceptable to us or where the credit risk is spread out among a large number of counterparties. As of June 30, 2018 and December 31, 2017, we had counterparty credit risk exposure under our derivative instruments of approximately $205.6 million and $212.8 million, respectively, which were limited to the cost of replacing the contracts in the event of non-performance by the counterparties to the contracts, the majority of which are currently our lending banks. We do not anticipate nonperformance by any of our significant counterparties. In addition, we have established guidelines we follow regarding credit ratings and instrument maturities to maintain safety and liquidity. We do not normally require collateral or other security to support credit relationships; however, in certain circumstances this option is available to us. Derivative Instruments We are exposed to market risk attributable to changes in interest rates, foreign currency exchange rates and fuel prices. We try to mitigate these risks through a combination of our normal operating and financing activities and through the use of derivative financial instruments pursuant to our hedging practices and policies. The financial impact of these hedging instruments is primarily offset by corresponding changes in the underlying exposures being hedged. We achieve this by closely matching the notional amount, term and conditions of the derivative instrument with the underlying risk being hedged. Although certain of our derivative financial instruments do not qualify or are not accounted for under hedge accounting, our objective is not to hold or issue derivative financial instruments for trading or other speculative purposes. We enter into various forward, swap and option contracts to manage our interest rate exposure and to limit our exposure to fluctuations in foreign currency exchange rates and fuel prices. These instruments are recorded on the balance sheet at their fair value and the vast majority are designated as hedges. We also use non-derivative financial instruments designated as hedges of our net investment in our foreign operations and investments. At inception of the hedge relationship, a derivative instrument that hedges the exposure to changes in the fair value of a firm commitment or a recognized asset or liability is designated as a fair value hedge. A derivative instrument that hedges a forecasted transaction or the variability of cash flows related to a recognized asset or liability is designated as a cash flow hedge. Changes in the fair value of derivatives that are designated as fair value hedges are offset against changes in the fair value of the underlying hedged assets, liabilities or firm commitments. Gains and losses on derivatives that are designated as cash flow hedges are recorded as a component of Accumulated other comprehensive loss until the underlying hedged transactions are recognized in earnings. The foreign currency transaction gain or loss of our non-derivative financial instruments and the changes in the fair value of derivatives designated as hedges of our net investment in foreign operations and investments are recognized as a component of Accumulated other comprehensive loss along with the associated foreign currency translation adjustment of the foreign operation or investment, with the amortization of excluded components affecting earnings. On an ongoing basis, we assess whether derivatives used in hedging transactions are “highly effective” in offsetting changes in the fair value or cash flow of hedged items. We use the long-haul method to assess hedge effectiveness using regression analysis for each hedge relationship under our interest rate, foreign currency and fuel hedging programs. We apply the same methodology on a consistent basis for assessing hedge effectiveness to all hedges within each hedging program (i.e., interest rate, foreign currency and fuel). We perform regression analyses over an observation period of up to three years, utilizing market data relevant to the hedge horizon of each hedge relationship. High effectiveness is achieved when a statistically valid relationship reflects a high degree of offset and correlation between the changes in the fair values of the derivative instrument and the hedged item. If it is determined that a derivative is not highly effective as a hedge or hedge accounting is discontinued, any change in fair value of the derivative since the last date at which it was determined to be effective is recognized in earnings. Cash flows from derivative instruments that are designated as fair value or cash flow hedges are classified in the same category as the cash flows from the underlying hedged items. In the event that hedge accounting is discontinued, cash flows subsequent to the date of discontinuance are classified within investing activities. Cash flows from derivative instruments not designated as hedging instruments are classified as investing activities. We consider the classification of the underlying hedged item’s cash flows in determining the classification for the designated derivative instrument’s cash flows. We classify derivative instrument cash flows from hedges of benchmark interest rate or hedges of fuel expense as operating activities due to the nature of the hedged item. Likewise, we classify derivative instrument cash flows from hedges of foreign currency risk on our newbuild ship payments as investing activities and derivative instrument cash flows from hedges of foreign currency risk on debt payments as financing activities. Interest Rate Risk Our exposure to market risk for changes in interest rates relates to our long-term debt obligations including future interest payments. At June 30, 2018 and December 31, 2017, approximately 60.6% and 57.4%, respectively, of our long-term debt was effectively fixed. We use interest rate swap agreements to modify our exposure to interest rate movements and to manage our interest expense. Market risk associated with our long-term fixed rate debt is the potential increase in fair value resulting from a decrease in interest rates. We use interest rate swap agreements that effectively convert a portion of our fixed-rate debt to a floating-rate basis to manage this risk. At June 30, 2018 and December 31, 2017, we maintained interest rate swap agreements on the following fixed-rate debt instruments:
These interest rate swap agreements are accounted for as fair value hedges. Market risk associated with our long-term floating rate debt is the potential increase in interest expense from an increase in interest rates. We use interest rate swap agreements that effectively convert a portion of our floating-rate debt to a fixed-rate basis to manage this risk. At June 30, 2018 and December 31, 2017, we maintained interest rate swap agreements on the following floating-rate debt instruments:
(1) Interest rate swap agreements hedging the Euro-denominated term loan for Harmony of the Seas include EURIBOR zero-floor matching the hedged debt EURIBOR zero-floor. Amount presented is based on the exchange rate as of June 30, 2018. These interest rate swap agreements are accounted for as cash flow hedges. The notional amount of interest rate swap agreements related to outstanding debt as of June 30, 2018 and December 31, 2017 was $3.6 billion and $3.8 billion, respectively. Foreign Currency Exchange Rate Risk Derivative Instruments Our primary exposure to foreign currency exchange rate risk relates to our ship construction contracts denominated in Euros, our foreign currency denominated debt and our international business operations. We enter into foreign currency forward contracts, to manage portions of the exposure to movements in foreign currency exchange rates. As of June 30, 2018, the aggregate cost of our ships on order, not including any ships on order by our Partner Brands, was approximately $11.4 billion, of which we had deposited $586.1 million. At June 30, 2018 and December 31, 2017, approximately 54.3% and 54.0%, respectively, of the aggregate cost of the ships under construction was exposed to fluctuations in the Euro exchange rate. The majority of our foreign currency forward contracts, collar options and cross currency swap agreements are accounted for as cash flow, fair value or net investment hedges depending on the designation of the related hedge. On a regular basis, we enter into foreign currency forward contracts and, from time to time, we utilize cross-currency swap agreements to minimize the volatility resulting from the remeasurement of net monetary assets and liabilities denominated in a currency other than our functional currency or the functional currencies of our foreign subsidiaries. During the second quarter of 2018, we maintained an average of approximately $733.6 million of these foreign currency forward contracts. These instruments are not designated as hedging instruments. For the quarters ended June 30, 2018 and 2017, changes in the fair value of the foreign currency forward contracts resulted in a (loss) gain of $(36.9) million and $21.3 million, respectively. For the six months ended June 30, 2018 and 2017, changes in the fair value of the foreign currency forward contracts resulted in a (loss) gain of $(31.3) million and $35.1 million , respectively. These amounts were recognized in earnings within Other income (expense) in our consolidated statements of comprehensive income (loss). We consider our investments in our foreign operations to be denominated in relatively stable currencies and of a long-term nature. As of June 30, 2018, we maintained foreign currency forward contracts and designated them as hedges of a portion of our net investments primarily in TUI Cruises of €101.0 million, or approximately $117.9 million based on the exchange rate at June 30, 2018. These forward currency contracts mature in October 2021. The notional amount of outstanding foreign exchange contracts, excluding the forward contracts entered into to minimize remeasurement volatility, as of June 30, 2018 and December 31, 2017 was $3.8 billion and $4.6 billion, respectively. Non-Derivative Instruments We also address the exposure of our investments in foreign operations by denominating a portion of our debt in our subsidiaries’ and investments’ functional currencies and designating it as a hedge of these subsidiaries and investments. We had designated debt as a hedge of our net investments primarily in TUI Cruises of approximately €256.0 million, or approximately $298.9 million, as of June 30, 2018. As of December 31, 2017, we had designated debt as a hedge of our net investments in TUI Cruises of approximately €246.0 million, or approximately $295.3 million. Fuel Price Risk Our exposure to market risk for changes in fuel prices relates primarily to the consumption of fuel on our ships. We use fuel swap agreements to mitigate the financial impact of fluctuations in fuel prices. Our fuel swap agreements are accounted for as cash flow hedges. At June 30, 2018, we have hedged the variability in future cash flows for certain forecasted fuel transactions occurring through 2022. As of June 30, 2018 and December 31, 2017, we had the following outstanding fuel swap agreements:
At June 30, 2018 and December 31, 2017, $53.0 million and $(23.7) million, respectively, of estimated unrealized net gain (loss) associated with our cash flow hedges pertaining to fuel swap agreements were expected to be reclassified to earnings from Accumulated other comprehensive loss within the next twelve months. Reclassification is expected to occur as the result of fuel consumption associated with our hedged forecasted fuel purchases. The fair value and line item caption of derivative instruments recorded within our consolidated balance sheets were as follows (in thousands):
(1) Accounting Standard Codification 815-20 “Derivatives and Hedging.” The location and amount of gain or (loss) recognized in income on fair value and cash flow hedging relationships were as follows (in thousands):
The carrying value and line item caption of non-derivative instruments designated as hedging instruments recorded within our consolidated balance sheets were as follows (in thousands):
The effect of derivative instruments qualifying and designated as hedging instruments and the related hedged items in fair value hedges on the consolidated statements of comprehensive income (loss) was as follows (in thousands):
The fair value and line item caption of derivative instruments recorded within our consolidated balance sheets for the cumulative basis adjustment for fair value hedges were as follows (in thousands):
The effect of derivative instruments qualifying and designated as cash flow hedging instruments on the consolidated financial statements was as follows (in thousands):
The table below represents amounts excluded from the assessment of effectiveness for our net investment hedging instruments for which the difference between changes in fair value and periodic amortization is recorded in accumulated other comprehensive income (loss) (in thousands):
The effect of non-derivative instruments qualifying and designated as net investment hedging instruments on the consolidated financial statements was as follows (in thousands):
There was no amount recognized in income (ineffective portion and amount excluded from effectiveness testing) for the quarters and six months ended June 30, 2018 and 2017. The effect of derivatives not designated as hedging instruments on the consolidated financial statements was as follows (in thousands):
Credit Related Contingent Features Our current interest rate derivative instruments may require us to post collateral if our Standard & Poor’s and Moody’s credit ratings are below specified levels. Specifically, if on the fifth anniversary of executing a derivative instrument, or on any succeeding fifth-year anniversary, our credit ratings for our senior unsecured debt were to be rated below BBB- by Standard & Poor’s and Baa3 by Moody’s, then the counterparty may periodically demand that we post collateral in an amount equal to the difference between (i) the net market value of all derivative transactions with such counterparty that have reached their fifth year anniversary, to the extent negative, and (ii) the applicable minimum call amount. The amount of collateral required to be posted following such event will change as, and to the extent, our net liability position increases or decreases by more than the applicable minimum call amount. If our credit rating for our senior unsecured debt is subsequently equal to or above BBB- by Standard & Poor’s or Baa3 by Moody’s, then any collateral posted at such time will be released to us and we will no longer be required to post collateral unless we meet the collateral trigger requirement at the next fifth-year anniversary. At June 30, 2018, five of our interest rate derivative instruments had reached their fifth anniversary; however, our senior unsecured debt credit rating was Baa2 by Moody’s and BBB- by Standard & Poor’s and, accordingly, we were not required to post any collateral as of such date. |
Summary of Significant Accounting Policies (Policies) |
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Accounting Policies [Abstract] | |
Basis for Preparation of Consolidated Financial Statements | Basis for Preparation of Consolidated Financial Statements The unaudited consolidated financial statements are presented pursuant to the rules and regulations of the Securities and Exchange Commission. In our opinion, these statements include all adjustments necessary for a fair statement of the results of the interim periods reported herein. Adjustments consist only of normal recurring items, except for any discussed in the notes below. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted as permitted by such rules and regulations. Estimates are required for the preparation of financial statements in accordance with GAAP and actual results could differ from these estimates. Refer to Note 2. Summary of Significant Accounting Policies in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2017 for a discussion of our significant accounting policies. |
Basis of Consolidation | All significant intercompany accounts and transactions are eliminated in consolidation. We consolidate entities over which we have control, usually evidenced by a direct ownership interest of greater than 50%, and variable interest entities where we are determined to be the primary beneficiary. Refer to Note 5. Other Assets for further information regarding our variable interest entities. For affiliates we do not control but over which we have significant influence on financial and operating policies, usually evidenced by a direct ownership interest from 20% to 50%, the investment is accounted for using the equity method. |
Adoption of Accounting Pronouncements and Recent Accounting Pronouncements | Adoption of Accounting Pronouncements On January 1, 2018, we adopted the guidance in ASC 606, Revenue from Contracts with Customers, and applied the guidance to all contracts using the modified retrospective method. The new standard converged wide-ranging revenue recognition concepts and requirements that lead to diversity in application for particular industries and transactions into a single revenue standard containing comprehensive principles for recognizing revenue. The cumulative effect of applying the newly issued guidance was not material and accordingly there was no adjustment made to our retained earnings upon adoption on January 1, 2018. We do not expect the newly issued guidance to have a material impact on our consolidated financial statements on an ongoing basis. Due to the adoption of ASC 606, we currently present prepaid commissions as an asset within Prepaid expenses and other assets. In addition, we have reclassified prepaid commissions of $64.6 million from Customer deposits to Prepaid expenses and other assets in our consolidated balance sheet as of December 31, 2017. Refer to Note 3. Revenues for disclosures with respect to our revenue recognition policies. On January 1, 2018, we adopted the guidance in Accounting Standard Update ("ASU") 2016-16, Income Taxes 740: Intra-Entity Transfers of Assets Other Than Inventory, which requires the income tax consequences of an intra-entity transfer of an asset, other than inventory, to be recognized at the time that the transfer occurs, rather than when the asset is sold to an outside party. We adopted the standard using the modified retrospective method and recorded a cumulative-effect adjustment to reduce retained earnings as of January 1, 2018 by $6.6 million, which reflects the elimination of the deferred tax asset related to intercompany asset transfers. On January 1, 2018, we adopted the guidance in ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities, that was issued to simplify and align the financial reporting of hedging relationships to the economic results of an entity’s risk management activities. We adopted the amended guidance using the modified retrospective approach. Adoption of the guidance allowed us to modify the designated risk in our fair value interest rate hedges to the benchmark interest rate component, resulting in changes to the cumulative and ongoing fair value measurement for the hedged debt. Upon adoption, we also elected to hedge the contractually specified components of our commodities purchase contracts. For our cash flow hedges, there will be no periodic measurement or recognition of ineffectiveness. For all hedges, the earnings effect of the hedging instrument will be reported in the same period and in the same income statement line item in which the earnings effect of the hedged item is reported. As a result of the adoption of this guidance, we recorded a cumulative-effect adjustment to reduce retained earnings as of January 1, 2018 by $16.9 million. The cumulative-effect adjustment includes an increase to the debt carrying value of $14.4 million for our fair value interest rate hedges as of January 1, 2018, which reflects the cumulative fair value measurement change to debt at adoption resulting from the modified designated risk, and an increase to other comprehensive income of $2.5 million, which represents an increase to the deferred gain on active cash flow hedges at adoption. Additionally, the new standard requires modifications to existing presentation and disclosure requirements on a prospective basis. As such, certain disclosures for the six months ended June 30, 2018 conform to these disclosure requirements. Refer to Note 9. Changes in Accumulated Other Comprehensive Income (Loss) and Note 10. Fair Value Measurements and Derivative Instruments for additional information. Recent Accounting Pronouncements Leases In February 2016, amended GAAP guidance was issued to increase the transparency and comparability of lease accounting among organizations. For leases with a term greater than 12 months, the amendments require the lease rights and obligations arising from the leasing arrangements, including operating leases, to be recognized as assets and liabilities on the balance sheet. The amendments also expand the required disclosures surrounding leasing arrangements. The guidance must be applied using a retrospective application method and will be effective for financial statements issued for fiscal years beginning after December 15, 2018 and interim periods within those years. Early adoption is permitted. We are currently evaluating the impact of adopting this guidance. In our evaluation, we have identified the contracts that provide an explicit right to use an asset and qualify as a leasing arrangement under the new guidance. We are currently evaluating certain contractual arrangements to determine if they contain an implicit or embedded right to use an asset that would qualify as a leasing arrangement under the new guidance. Upon implementation of the guidance, we expect an increase to both the assets and liabilities on our consolidated balance sheet to reflect the lease rights and obligations arising from our operating lease arrangements. In addition, we expect to include additional qualitative and quantitative disclosures regarding our leasing arrangements as required by the guidance. |
Change in Accounting Principle - Stock-based Compensation | Change in Accounting Principle - Stock-based Compensation In January 2018, we elected to change our accounting policy for recognizing stock-based compensation expense from the graded attribution method to the straight-line attribution method for time-based stock awards. The adoption of the straight-line attribution method for time-based stock awards represents a change in accounting principle which we believe to be preferable because it is the predominant method used in our industry. A change in accounting principle requires retrospective application, if material. The impact of the adoption of the straight-line attribution method to our time-based awards was immaterial to prior periods and is expected to be immaterial for our fiscal year ended December 31, 2018. As a result, we have accounted for this change in accounting principle in our consolidated results for the six months ended June 30, 2018. The effect of this change was an increase to net income of $9.2 million, or $0.04 per share for each of basic and diluted earnings per share, for the six months ended June 30, 2018, which is reported within Marketing, selling and administrative expenses in our consolidated statements of comprehensive income (loss) for the six months ended June 30, 2018. |
Revenues (Tables) |
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Disaggregation of Revenue | Passenger ticket revenues are attributed to geographic areas based on where the reservation originates. For the quarters ended June 30, 2018 and 2017, our guests were sourced from the following areas:
For the six months ended June 30, 2018 and 2017, our guests were sourced from the following areas:
The following table disaggregates our total revenues by geographic regions where we provide cruise itineraries (in thousands):
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Earnings Per Share (Tables) |
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Reconciliation Between Basic and Diluted Earnings Per Share | A reconciliation between basic and diluted earnings per share is as follows (in thousands, except per share data):
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Other Assets (Tables) |
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Schedule of Other Nonoperating Income (Expense) | The following tables set forth information regarding our investments accounted for under the equity method of accounting, including the entities discussed above (in thousands):
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Schedule of Related Party Transactions |
We recorded the following as it relates to these services in our operating results within our consolidated statements of comprehensive income (loss) (in thousands):
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Changes in Accumulated Other Comprehensive (Loss) Income (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of changes in accumulated other comprehensive income (loss) by component | The following table presents the changes in accumulated other comprehensive income (loss) by component for the six months ended June 30, 2018 and 2017 (in thousands):
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Schedule of reclassifications out of accumulated other comprehensive income (loss) | The following table presents reclassifications out of accumulated other comprehensive income (loss) for the quarters and six months ended June 30, 2018 and 2017 (in thousands):
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Fair Value Measurements and Derivative Instruments (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements, Nonrecurring | The following table presents information about the fair value of our equity method investment and note and other receivables due related to SkySea Holding, further discussed in Note 5. Other Assets, recorded at fair value on a nonrecurring basis (in thousands):
(1) Due to the expectation that Skysea Holding will cease business operations by the end of 2018, we do not deem our investment balance to be recoverable and therefore, we estimated the fair value of our investment to be zero. The fair value of our equity investment in Skysea Holding was estimated as of March 31, 2018, the date of the last impairment test, at which point the investment was fully impaired. (2) We estimated the fair value of our debt facility and other receivables due from Skysea Holding based on the fair value of the collateral of the debt facility, Skysea Holding's ship, Golden Era, as of March 31, 2018, the date of the last impairment test, adjusted for foreign exchange rates as of June 30, 2018. We believe this amount estimates fair value as of June 30, 2018. The fair value of the ship represents the net realizable value based on the agreed upon sale price of the ship, which is expected to be completed in December 2018. For further information on the Skysea Holding impairment, refer to Note 5. Other Assets. The estimated fair value of our financial instruments that are not measured at fair value, categorized based upon the fair value hierarchy, are as follows (in thousands):
(1) Inputs based on quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment. (2) Inputs other than quoted prices included within Level 1 that are observable for the liability, either directly or indirectly. For unsecured revolving credit facilities and unsecured term loans, fair value is determined utilizing the income valuation approach. This valuation model takes into account the contract terms of our debt such as the debt maturity and the interest rate on the debt. The valuation model also takes into account the creditworthiness of the Company. (3) Inputs that are unobservable. The Company did not use any Level 3 inputs as of June 30, 2018 and December 31, 2017. (4) Consists of cash and marketable securities with original maturities of less than 90 days. (5) Consists of unsecured revolving credit facilities, senior notes, senior debentures and term loans. This does not include our capital lease obligations. |
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Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | Assets and liabilities that are recorded at fair value have been categorized based upon the fair value hierarchy. The following table presents information about the Company’s financial instruments recorded at fair value on a recurring basis (in thousands):
(1) Inputs based on quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment. (2) Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. For foreign currency forward contracts, interest rate swaps and fuel swaps, fair value is derived using valuation models that utilize the income valuation approach. These valuation models take into account the contract terms, such as maturity, as well as other inputs, such as foreign exchange rates and curves, fuel types, fuel curves and interest rate yield curves. All derivative instrument fair values take into account the creditworthiness of the counterparty and the Company. (3) Inputs that are unobservable. The Company did not use any Level 3 inputs as of June 30, 2018 and December 31, 2017. (4) Consists of foreign currency forward contracts, interest rate swaps and fuel swaps. Refer to the “Fair Value of Derivative Instruments” table for breakdown by instrument type. (5) Consists of exchange-traded equity securities and mutual funds reported within Other assets in our consolidated balance sheets. (6) Consists of foreign currency forward contracts, interest rate swaps and fuel swaps. Refer to the “Fair Value of Derivative Instruments” table for breakdown by instrument type. |
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Offsetting Assets | The following table presents information about the Company’s offsetting of financial assets under master netting agreements with derivative counterparties (in thousands):
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Offsetting Liabilities | The following table presents information about the Company’s offsetting of financial liabilities under master netting agreements with derivative counterparties (in thousands):
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Schedule of Price Risk Derivatives | As of June 30, 2018 and December 31, 2017, we had the following outstanding fuel swap agreements:
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Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The fair value and line item caption of derivative instruments recorded within our consolidated balance sheets were as follows (in thousands):
(1) Accounting Standard Codification 815-20 “Derivatives and Hedging.” The fair value and line item caption of derivative instruments recorded within our consolidated balance sheets for the cumulative basis adjustment for fair value hedges were as follows (in thousands):
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Derivative Instruments, Gain (Loss) | The location and amount of gain or (loss) recognized in income on fair value and cash flow hedging relationships were as follows (in thousands):
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Fair Value and Line Item Caption of Non-derivative Instruments | The carrying value and line item caption of non-derivative instruments designated as hedging instruments recorded within our consolidated balance sheets were as follows (in thousands):
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Non Derivative Instruments Qualifying and Designated as Hedging Instruments in Net Investment Hedges | The effect of non-derivative instruments qualifying and designated as net investment hedging instruments on the consolidated financial statements was as follows (in thousands):
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Not Designated as Hedging Instrument | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments, Gain (Loss) | The effect of derivatives not designated as hedging instruments on the consolidated financial statements was as follows (in thousands):
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|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Hedging | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Interest Rate Derivatives | At June 30, 2018 and December 31, 2017, we maintained interest rate swap agreements on the following fixed-rate debt instruments:
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Derivative Instruments, Gain (Loss) | The effect of derivative instruments qualifying and designated as hedging instruments and the related hedged items in fair value hedges on the consolidated statements of comprehensive income (loss) was as follows (in thousands):
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Cash flow hedge | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Interest Rate Derivatives | At June 30, 2018 and December 31, 2017, we maintained interest rate swap agreements on the following floating-rate debt instruments:
(1) Interest rate swap agreements hedging the Euro-denominated term loan for Harmony of the Seas include EURIBOR zero-floor matching the hedged debt EURIBOR zero-floor. Amount presented is based on the exchange rate as of June 30, 2018. |
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Derivative Instruments, Gain (Loss) | The effect of derivative instruments qualifying and designated as cash flow hedging instruments on the consolidated financial statements was as follows (in thousands):
The table below represents amounts excluded from the assessment of effectiveness for our net investment hedging instruments for which the difference between changes in fair value and periodic amortization is recorded in accumulated other comprehensive income (loss) (in thousands):
|
Revenues - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Dec. 31, 2017 |
|
Capitalized Contract Cost [Line Items] | |||||
Passenger ticket revenues | $ 2,337,605 | $ 2,195,274 | $ 4,365,361 | $ 4,203,834 | |
Contract liability | 2,000,000 | 2,000,000 | $ 1,400,000 | ||
Contract asset | 58,900 | 58,900 | 60,100 | ||
Travel Agent Sales Commissions | |||||
Capitalized Contract Cost [Line Items] | |||||
Prepaid travel agent commissions | 148,200 | $ 148,200 | $ 64,600 | ||
Minimum | |||||
Capitalized Contract Cost [Line Items] | |||||
Length of cruise | 2 days | ||||
Maximum | |||||
Capitalized Contract Cost [Line Items] | |||||
Length of cruise | 23 days | ||||
Port Costs | |||||
Capitalized Contract Cost [Line Items] | |||||
Passenger ticket revenues | $ 151,400 | $ 143,400 | $ 288,100 | $ 277,900 |
Revenues - Disaggregation of Revenue (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Total revenues | $ 2,337,605 | $ 2,195,274 | $ 4,365,361 | $ 4,203,834 | |||||||||||
Cruise Itinerary | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Total revenues | 2,246,395 | 2,109,542 | 4,203,819 | 4,052,799 | |||||||||||
Cruise Itinerary | North America | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Total revenues | [1] | 1,264,167 | 1,246,103 | 2,611,427 | 2,598,272 | ||||||||||
Cruise Itinerary | Asia Pacific | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Total revenues | [2] | 283,198 | 300,891 | 816,177 | 826,747 | ||||||||||
Cruise Itinerary | Europe | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Total revenues | [3] | 597,399 | 467,829 | 597,399 | 467,829 | ||||||||||
Cruise Itinerary | Other regions | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Total revenues | 101,631 | 94,719 | 178,816 | 159,951 | |||||||||||
Other Revenues | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Total revenues | [4] | $ 91,210 | $ 85,732 | $ 161,542 | $ 151,035 | ||||||||||
Passenger Ticket | Other regions | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Percentage of revenues by country | [5] | 27.00% | 28.00% | 38.00% | 38.00% | ||||||||||
Passenger Ticket | United States | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Percentage of revenues by country | 63.00% | 63.00% | 62.00% | 62.00% | |||||||||||
Passenger Ticket | United Kingdom | |||||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||||
Percentage of revenues by country | 10.00% | 9.00% | |||||||||||||
|
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Earnings Per Share [Abstract] | ||||
Net income for basic and diluted earnings per share | $ 466,295 | $ 369,526 | $ 684,948 | $ 584,252 |
Weighted-average common shares outstanding (in shares) | 211,673,000 | 215,085,000 | 212,139,000 | 214,978,000 |
Dilutive effect of stock-based awards and stock options (in shares) | 836,000 | 977,000 | 940,000 | 966,000 |
Diluted weighted-average shares outstanding (in shares) | 212,509,000 | 216,062,000 | 213,079,000 | 215,944,000 |
Basic earnings per share (in dollars per share) | $ 2.20 | $ 1.72 | $ 3.23 | $ 2.72 |
Diluted earnings per share (in dollars per share) | $ 2.19 | $ 1.71 | $ 3.21 | $ 2.71 |
Antidilutive securities (in shares) | 0 | 0 | 0 | 0 |
Other Assets - Share of equity income from investments (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Other Assets [Abstract] | ||||
Share of equity income from investments | $ 44,311 | $ 23,359 | $ 73,063 | $ 35,239 |
Dividends received | $ 121,024 | $ 29,405 | $ 158,942 | $ 57,402 |
Other Assets - Notes receivable due from equity instruments (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
|||||
---|---|---|---|---|---|---|---|
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||
Total notes receivable due from equity investments | $ 277,635 | $ 314,323 | |||||
Less-current portion | [1] | 89,632 | 38,658 | ||||
Long-term portion | [2] | $ 188,003 | $ 275,665 | ||||
|
Other Assets - Related party transactions (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Other Assets [Abstract] | ||||
Revenues | $ 14,157 | $ 13,318 | $ 28,230 | $ 25,933 |
Expenses | $ 3,270 | $ 4,020 | $ 6,908 | $ 7,733 |
Long-Term Debt - Narrative (Details) - USD ($) $ in Millions |
1 Months Ended | 3 Months Ended | |
---|---|---|---|
Mar. 31, 2018 |
Jun. 30, 2018 |
Jul. 31, 2018 |
|
Long-Term Debt | |||
Long-term debt | $ 130.0 | ||
Short-term debt amount outstanding | $ 1,200.0 | ||
Symphony of the Seas | |||
Long-Term Debt | |||
Long-term debt | $ 1,200.0 | ||
Long term debt, term | 12 years | ||
Fixed interest rate | 3.82% | ||
LIBOR | |||
Long-Term Debt | |||
Debt Floating Rate | 1.195% | ||
LIBOR | Silversea Cruises | |||
Long-Term Debt | |||
Debt Floating Rate | 1.00% | ||
Subsequent Event | |||
Long-Term Debt | |||
Borrowings outstanding | $ 415.0 | ||
Subsequent Event | Silversea Cruises | |||
Long-Term Debt | |||
Long-term debt | $ 700.0 |
Shareholders' Equity - Narrative (Details) - USD ($) |
1 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jul. 31, 2018 |
May 31, 2018 |
Apr. 30, 2018 |
Jul. 31, 2017 |
Apr. 30, 2017 |
Jun. 30, 2018 |
Mar. 31, 2018 |
Dec. 31, 2017 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Dec. 31, 2016 |
Jun. 30, 2018 |
Dec. 31, 2017 |
|
Subsequent Event [Line Items] | |||||||||||||
Dividend declared (in dollars per share) | $ 0.60 | $ 0.60 | $ 0.60 | $ 0.48 | $ 0.48 | $ 0.48 | |||||||
Length of repurchase program | 24 months | 12 months | |||||||||||
Common stock, dividends, per share, cash paid (in dollars per share) | $ 0.60 | $ 0.48 | $ 0.48 | $ 0.60 | $ 0.48 | ||||||||
Common stock repurchase program, authorized amount | $ 1,000,000,000.0 | $ 500,000,000 | |||||||||||
Treasury stock, shares, acquired (in shares) | 1,300,000.0 | 2,100,000.0 | 1,800,000.0 | ||||||||||
Treasury stock, value, acquired, cost method | $ 137,500,000 | $ 275,000,000 | $ 500,000,000 | $ 225,000,000 | |||||||||
Subsequent Event | |||||||||||||
Subsequent Event [Line Items] | |||||||||||||
Common stock, dividends, per share, cash paid (in dollars per share) | $ 0.60 | ||||||||||||
Treasury stock, shares, acquired (in shares) | 1,500,000.0 | ||||||||||||
Treasury stock, value, acquired, cost method | $ 162,500,000 |
Fair Value Measurements and Derivative Instruments (Details) - Fair Value, Measurements, Nonrecurring - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
|||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Level 1 | |||||||||||||
Assets: | |||||||||||||
Cash and cash equivalents | [1],[2] | $ 108,998 | $ 120,112 | ||||||||||
Total Assets | [2] | 108,998 | 120,112 | ||||||||||
Liabilities: | |||||||||||||
Long-term debt (including current portion of long-term debt) | [2],[3] | 0 | 0 | ||||||||||
Total Liabilities | [2] | 0 | 0 | ||||||||||
Level 2 | |||||||||||||
Assets: | |||||||||||||
Cash and cash equivalents | [1],[4] | 0 | 0 | ||||||||||
Total Assets | [4] | 0 | 0 | ||||||||||
Liabilities: | |||||||||||||
Long-term debt (including current portion of long-term debt) | [3],[4] | 8,964,142 | 8,038,092 | ||||||||||
Total Liabilities | [4] | 8,964,142 | 8,038,092 | ||||||||||
Level 3 | |||||||||||||
Assets: | |||||||||||||
Cash and cash equivalents | [1],[5] | 0 | 0 | ||||||||||
Total Assets | [5] | 0 | 0 | ||||||||||
Liabilities: | |||||||||||||
Long-term debt (including current portion of long-term debt) | [3],[5] | 0 | 0 | ||||||||||
Total Liabilities | [5] | 0 | 0 | ||||||||||
Total Carrying Amount | |||||||||||||
Assets: | |||||||||||||
Cash and cash equivalents | [1] | 108,998 | 120,112 | ||||||||||
Total Assets | 108,998 | 120,112 | |||||||||||
Liabilities: | |||||||||||||
Long-term debt (including current portion of long-term debt) | [3] | 8,474,818 | 7,506,312 | ||||||||||
Total Liabilities | 8,474,818 | 7,506,312 | |||||||||||
Total Fair Value | |||||||||||||
Assets: | |||||||||||||
Cash and cash equivalents | [1] | 108,998 | 120,112 | ||||||||||
Total Assets | 108,998 | 120,112 | |||||||||||
Liabilities: | |||||||||||||
Long-term debt (including current portion of long-term debt) | [3] | 8,964,142 | 8,038,092 | ||||||||||
Total Liabilities | $ 8,964,142 | $ 8,038,092 | |||||||||||
|
Fair Value Measurements and Derivative Instruments - Recurring (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
|||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Assets: | |||||||||||||||
Derivative financial instruments | $ 205,562 | $ 215,634 | |||||||||||||
Liabilities: | |||||||||||||||
Derivative financial instruments | 12,122 | 11,210 | |||||||||||||
Fair Value, Measurements, Recurring | Level 1 | |||||||||||||||
Assets: | |||||||||||||||
Derivative financial instruments | [1],[2] | 0 | 0 | ||||||||||||
Investments | [2],[3] | 0 | 3,340 | ||||||||||||
Total Assets | [2] | 0 | 3,340 | ||||||||||||
Liabilities: | |||||||||||||||
Derivative financial instruments | [2],[4] | 0 | 0 | ||||||||||||
Total Liabilities | [2] | 0 | 0 | ||||||||||||
Fair Value, Measurements, Recurring | Level 2 | |||||||||||||||
Assets: | |||||||||||||||
Derivative financial instruments | [1],[5] | 296,646 | 320,385 | ||||||||||||
Investments | [3],[5] | 0 | 0 | ||||||||||||
Total Assets | [5] | 296,646 | 320,385 | ||||||||||||
Liabilities: | |||||||||||||||
Derivative financial instruments | [4],[5] | 103,206 | 115,961 | ||||||||||||
Total Liabilities | [5] | 103,206 | 115,961 | ||||||||||||
Fair Value, Measurements, Recurring | Level 3 | |||||||||||||||
Assets: | |||||||||||||||
Derivative financial instruments | [1],[6] | 0 | 0 | ||||||||||||
Investments | [3],[6] | 0 | 0 | ||||||||||||
Total Assets | [6] | 0 | 0 | ||||||||||||
Liabilities: | |||||||||||||||
Derivative financial instruments | [4],[6] | 0 | 0 | ||||||||||||
Total Liabilities | [6] | 0 | 0 | ||||||||||||
Total | Fair Value, Measurements, Recurring | |||||||||||||||
Assets: | |||||||||||||||
Derivative financial instruments | [1] | 296,646 | 320,385 | ||||||||||||
Investments | [3] | 0 | 3,340 | ||||||||||||
Total Assets | 296,646 | 323,725 | |||||||||||||
Liabilities: | |||||||||||||||
Derivative financial instruments | [4] | 103,206 | 115,961 | ||||||||||||
Total Liabilities | $ 103,206 | $ 115,961 | |||||||||||||
|
Fair Value Measurements and Derivative Instruments - Equity Method Investments (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
|||||
---|---|---|---|---|---|---|---|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Debt facility and other receivables due from Skysea Holding | $ 277,635 | $ 314,323 | |||||
Fair Value, Measurements, Nonrecurring | Total Carrying Amount | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Equity-method investment- SkySea Holding | [1] | 0 | |||||
Debt facility and other receivables due from Skysea Holding | [2] | 64,667 | |||||
Total | 64,667 | ||||||
Fair Value, Measurements, Nonrecurring | Total Fair Value | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Equity-method investment- SkySea Holding | [1] | 0 | |||||
Debt facility and other receivables due from Skysea Holding | [2] | 64,667 | |||||
Total | 64,667 | ||||||
Fair Value, Measurements, Nonrecurring | Total Fair Value | Level 3 | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Equity-method investment- SkySea Holding | [1] | 0 | |||||
Debt facility and other receivables due from Skysea Holding | [2] | 64,667 | |||||
Total | 64,667 | ||||||
Fair Value, Measurements, Nonrecurring | Total Impairment | |||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||||
Equity-method investment- SkySea Holding | [1] | 509 | |||||
Debt facility and other receivables due from Skysea Holding | [2] | 22,834 | |||||
Total | $ 23,343 | ||||||
|
Fair Value Measurements and Derivative Instruments - Offsetting of Derivative Instruments (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Offsetting of Financial Assets under Master Netting Agreements [Abstract] | ||
Gross Amount of Derivative Assets Presented in the Consolidated Balance Sheet | $ 296,646 | $ 320,385 |
Gross Amount of Eligible Offsetting Recognized Derivative Liabilities | (91,084) | (104,751) |
Cash Collateral Received | 0 | 0 |
Net Amount of Derivative Assets | 205,562 | 215,634 |
Offsetting of Financial Liabilities under Master Netting Agreements [Abstract] | ||
Gross Amount of Derivative Liabilities Presented in the Consolidated Balance Sheet | (103,206) | (115,961) |
Gross Amount of Eligible Offsetting Recognized Derivative Assets | 91,084 | 104,751 |
Cash Collateral Pledged | 0 | 0 |
Net Amount of Derivative Liabilities | $ (12,122) | $ (11,210) |
Fair Value Measurements and Derivative Instruments - Fuel Price Risk (Details) - Fuel Swap Agreements $ in Millions |
Jun. 30, 2018
USD ($)
T
|
Dec. 31, 2017
USD ($)
T
|
---|---|---|
Derivative Instruments | ||
Estimated unrealized net loss associated with cash flow hedges pertaining to fuel swap agreements expected to be reclassified to earnings from accumulated other comprehensive income loss | $ | $ 53.0 | $ (23.7) |
2018 | ||
Derivative Instruments | ||
Fuel swap agreements (metric tons) | 342,900 | 673,700 |
Percentage of projected requirements | 50.00% | 50.00% |
2019 | ||
Derivative Instruments | ||
Fuel swap agreements (metric tons) | 668,500 | 668,500 |
Percentage of projected requirements | 47.00% | 46.00% |
2020 | ||
Derivative Instruments | ||
Fuel swap agreements (metric tons) | 531,200 | 531,200 |
Percentage of projected requirements | 36.00% | 36.00% |
2021 | ||
Derivative Instruments | ||
Fuel swap agreements (metric tons) | 224,900 | 224,900 |
Percentage of projected requirements | 14.00% | 14.00% |
2022 | ||
Derivative Instruments | ||
Fuel swap agreements (metric tons) | 0 | 0 |
Percentage of projected requirements | 0.00% | 0.00% |
Fair Value Measurements and Derivative Instruments - Balance Sheet (Details) - USD ($) $ in Thousands |
Jun. 30, 2018 |
Dec. 31, 2017 |
|||
---|---|---|---|---|---|
Asset Derivatives | |||||
Asset Derivatives | $ 296,646 | $ 320,385 | |||
Liability Derivatives | |||||
Liability Derivatives | 103,206 | 115,961 | |||
Designated as Hedging Instrument | |||||
Asset Derivatives | |||||
Asset Derivatives | [1] | 285,726 | 298,963 | ||
Liability Derivatives | |||||
Liability Derivatives | [1] | 94,778 | 105,033 | ||
Notional Disclosures | |||||
Carrying Amount of the Hedged Assets/(Liabilities) | 730,462 | 749,155 | |||
Cumulative amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets/(Liabilities) | (36,648) | (34,813) | |||
Not Designated as Hedging Instrument | |||||
Asset Derivatives | |||||
Asset Derivatives | 10,920 | 21,422 | |||
Liability Derivatives | |||||
Liability Derivatives | 8,428 | 10,928 | |||
Interest rate swaps | Designated as Hedging Instrument | Other assets | |||||
Asset Derivatives | |||||
Asset Derivatives | [1] | 49,418 | 7,330 | ||
Interest rate swaps | Designated as Hedging Instrument | Other long-term liabilities | |||||
Liability Derivatives | |||||
Liability Derivatives | [1] | 51,917 | 46,509 | ||
Foreign currency forward contracts | Designated as Hedging Instrument | Other assets | |||||
Asset Derivatives | |||||
Asset Derivatives | [1] | 72,830 | 158,879 | ||
Foreign currency forward contracts | Designated as Hedging Instrument | Derivative financial instruments | |||||
Asset Derivatives | |||||
Asset Derivatives | [1] | 21,921 | 68,352 | ||
Liability Derivatives | |||||
Liability Derivatives | [1] | 26,677 | 0 | ||
Foreign currency forward contracts | Designated as Hedging Instrument | Other long-term liabilities | |||||
Liability Derivatives | |||||
Liability Derivatives | [1] | 4,502 | 6,625 | ||
Foreign currency forward contracts | Not Designated as Hedging Instrument | Other assets | |||||
Asset Derivatives | |||||
Asset Derivatives | 734 | 2,793 | |||
Foreign currency forward contracts | Not Designated as Hedging Instrument | Derivative financial instruments | |||||
Asset Derivatives | |||||
Asset Derivatives | 1,930 | 9,945 | |||
Liability Derivatives | |||||
Liability Derivatives | 0 | 2,933 | |||
Foreign currency forward contracts | Not Designated as Hedging Instrument | Other long-term liabilities | |||||
Liability Derivatives | |||||
Liability Derivatives | 0 | 1,139 | |||
Fuel swaps | Designated as Hedging Instrument | Other assets | |||||
Asset Derivatives | |||||
Asset Derivatives | [1] | 79,191 | 51,265 | ||
Fuel swaps | Designated as Hedging Instrument | Derivative financial instruments | |||||
Asset Derivatives | |||||
Asset Derivatives | [1] | 62,366 | 13,137 | ||
Liability Derivatives | |||||
Liability Derivatives | [1] | 9,098 | 38,488 | ||
Fuel swaps | Designated as Hedging Instrument | Other long-term liabilities | |||||
Liability Derivatives | |||||
Liability Derivatives | [1] | 2,584 | 13,411 | ||
Fuel swaps | Not Designated as Hedging Instrument | Other assets | |||||
Asset Derivatives | |||||
Asset Derivatives | 0 | 798 | |||
Fuel swaps | Not Designated as Hedging Instrument | Derivative financial instruments | |||||
Asset Derivatives | |||||
Asset Derivatives | 8,256 | 7,886 | |||
Liability Derivatives | |||||
Liability Derivatives | 8,428 | 6,043 | |||
Fuel swaps | Not Designated as Hedging Instrument | Other long-term liabilities | |||||
Liability Derivatives | |||||
Liability Derivatives | $ 0 | $ 813 | |||
|
Fair Value Measurements and Derivative Instruments - Balance Sheet Hedging Instruments (Details) - Foreign currency debt - USD ($) $ in Thousands |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2018 |
Dec. 31, 2017 |
|
Derivative Instruments | ||
Carrying value of non-derivative instrument designated as hedging instrument | $ 298,854 | $ 295,323 |
Current portion of long-term debt | ||
Derivative Instruments | ||
Carrying value of non-derivative instrument designated as hedging instrument | 79,575 | 70,097 |
Long-term debt | ||
Derivative Instruments | ||
Carrying value of non-derivative instrument designated as hedging instrument | $ 219,279 | $ 225,226 |
Fair Value Measurements and Derivative Instruments - Income Statement Hedging Instruments (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Fuel | $ 172,309 | $ 170,748 | $ 332,650 | $ 348,162 |
Depreciation and amortization | 253,376 | 234,937 | 493,606 | 470,686 |
Interest Income (Expense) | (68,766) | (70,821) | (128,911) | (144,886) |
Other income (expense) | 33,855 | (2,709) | 9,755 | (5,320) |
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | (37,562) | 21,236 | (29,750) | 34,988 |
Fuel swaps | Other income (expense) | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | 213 | (20) | 183 | (80) |
Fuel swaps | Fuel cost | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | (881) | 0 | 1,326 | 0 |
Foreign currency forward contracts | Other income (expense) | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | (36,894) | 21,256 | (31,259) | 35,068 |
Fair Value Hedging | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Amount of Gain (Loss) Recognized in Income on Hedged Item | 3,374 | (4,311) | 16,556 | (1,854) |
Amount of Gain (Loss) Recognized in Income on Derivative | (5,310) | 6,220 | (17,880) | 5,862 |
Fair Value Hedging | Interest Contracts | Interest expense, net of interest capitalized | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Amount of Gain (Loss) Recognized in Income on Hedged Item | 3,374 | 16,556 | ||
Amount of Gain (Loss) Recognized in Income on Derivative | (5,310) | 869 | (17,880) | 2,042 |
Fair Value Hedging | Interest Contracts | Other income (expense) | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Amount of Gain (Loss) Recognized in Income on Hedged Item | (4,311) | (1,854) | ||
Amount of Gain (Loss) Recognized in Income on Derivative | 5,351 | 3,820 | ||
Fair Value Hedging | Interest rate swaps | Interest expense, net of interest capitalized | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Amount of Gain (Loss) Recognized in Income on Hedged Item | 3,374 | 0 | 16,556 | 0 |
Amount of Gain (Loss) Recognized in Income on Derivative | (5,310) | 869 | (17,880) | 2,042 |
Fair Value Hedging | Interest rate swaps | Other income (expense) | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Amount of Gain (Loss) Recognized in Income on Hedged Item | 0 | (4,311) | 0 | (1,854) |
Amount of Gain (Loss) Recognized in Income on Derivative | 0 | 5,351 | 0 | 3,820 |
Cash flow hedge | Interest Contracts | Interest expense, net of interest capitalized | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income (Effective Portion) | (2,138) | (7,863) | (8,976) | (16,720) |
Cash flow hedge | Fuel swaps | Other income (expense) | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income (Effective Portion) | (133) | 2,498 | 192 | 4,775 |
Cash flow hedge | Fuel swaps | Fuel cost | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income (Effective Portion) | 2,043 | (41,835) | (3,089) | (81,763) |
Cash flow hedge | Foreign exchange contracts | Depreciation and amortization expenses | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income (Effective Portion) | (3,156) | (3,312) | (6,468) | (6,624) |
Cash flow hedge | Foreign currency forward contracts | Other income (expense) | ||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | ||||
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income (Effective Portion) | $ 14,601 | $ (4,105) | $ 14,643 | $ (7,675) |
Fair Value Measurements and Derivative Instruments - Designated Cash Flow Hedges (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Dec. 31, 2017 |
|
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Other income (expense) | $ 33,855 | $ (2,709) | $ 9,755 | $ (5,320) | |
Depreciation and amortization | 253,376 | 234,937 | 493,606 | 470,686 | |
Fuel | 172,309 | 170,748 | 332,650 | 348,162 | |
Net income | 466,295 | 369,526 | 684,948 | 584,252 | |
Derivative Instruments, Gain (Loss) Recognized in Income, Ineffective Portion and Amount Excluded from Effectiveness Testing, Net [Abstract] | |||||
Net inception fair value at January 1, 2018 | $ (11,335) | ||||
Amount of gain recognized in income on derivatives for the period ended June 30, 2018 | 1,488 | ||||
Amount of loss remaining to be amortized in accumulated other comprehensive loss, as of June 30, 2018 | 2,205 | ||||
Fair value at June 30, 2018 | (12,052) | (12,052) | |||
Cash flow hedge | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) on Derivative (Effective Portion) | (57,684) | 74,336 | 69,932 | 43,408 | |
Cash flow hedge | Interest rate swaps | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) on Derivative (Effective Portion) | 8,867 | (19,060) | 46,058 | (21,549) | |
Cash flow hedge | Foreign currency forward contracts | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) on Derivative (Effective Portion) | (193,329) | 97,521 | (97,963) | 99,650 | |
Cash flow hedge | Foreign currency forward contracts | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) on Derivative (Effective Portion) | 0 | 0 | 0 | 0 | |
Cash flow hedge | Foreign currency collar options | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) on Derivative (Effective Portion) | 0 | 0 | 0 | 0 | |
Cash flow hedge | Fuel swaps | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) on Derivative (Effective Portion) | 0 | 0 | 0 | 0 | |
Cash flow hedge | Fuel Swap | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Income (Loss) on Derivative (Effective Portion) | 126,778 | (4,125) | 121,837 | (34,693) | |
Reclassification out of Accumulated Other Comprehensive Income [Member] | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Net income | 10,845 | (54,910) | (4,412) | (108,564) | |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Changes related to cash flow derivative hedges | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Net income | 11,217 | (54,617) | (3,698) | (108,007) | |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Changes related to cash flow derivative hedges | Interest rate swaps | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Interest expense, net of interest capitalized | (2,138) | (7,863) | (8,976) | (16,720) | |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Changes related to cash flow derivative hedges | Foreign currency forward contracts | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Depreciation and amortization | (3,156) | (2,710) | (6,468) | (5,420) | |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Changes related to cash flow derivative hedges | Foreign currency forward contracts | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Other income (expense) | 14,601 | (4,105) | 14,643 | (7,675) | |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Changes related to cash flow derivative hedges | Foreign currency collar options | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Depreciation and amortization | 0 | (602) | 0 | (1,204) | |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Changes related to cash flow derivative hedges | Fuel swaps | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Other income (expense) | (133) | 2,498 | 192 | 4,775 | |
Fuel | 2,043 | (41,835) | (3,089) | (81,763) | |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Changes related to cash flow derivative hedges | Fuel Swap | |||||
Effect of derivative instruments involved in hedging on the consolidated financial statements | |||||
Fuel | $ 2,043 | $ (41,835) | $ (3,089) | $ (81,763) |
Fair Value Measurements and Derivative Instruments - Non-Derivative Net Investment (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Foreign currency debt | ||||
Net investment hedge | ||||
Amount of Gain (Loss) Recognized in Other Comprehensive Income (Loss) | $ 15,853 | $ 21,888 | $ 7,609 | $ 26,257 |
Fair Value Measurements and Derivative Instruments - Derivatives Not Designated as Hedging Instruments (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Derivative Instruments | ||||
Amount of gain (loss) recognized in income on derivatives | $ (37,562) | $ 21,236 | $ (29,750) | $ 34,988 |
Foreign currency forward contracts | Other income (expense) | ||||
Derivative Instruments | ||||
Amount of gain (loss) recognized in income on derivatives | (36,894) | 21,256 | (31,259) | 35,068 |
Fuel swaps | Other income (expense) | ||||
Derivative Instruments | ||||
Amount of gain (loss) recognized in income on derivatives | 213 | (20) | 183 | (80) |
Fuel swaps | Fuel cost | ||||
Derivative Instruments | ||||
Amount of gain (loss) recognized in income on derivatives | $ (881) | $ 0 | $ 1,326 | $ 0 |
Fair Value Measurements and Derivative Instruments - Credit Features (Details) |
Jun. 30, 2018
derivative
|
---|---|
Fair Value Disclosures [Abstract] | |
Number of derivatives matured | 5 |
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