UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
Pursuant To Section 13 or 15(d) of The Securities Exchange Act of 1934
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| Item 1.01 | Entry into a Material Definitive Agreement. |
On December 18, 2019, we entered into a credit agreement for the financing of the third Icon-class ship for Royal Caribbean International, which is scheduled for delivery in the second quarter of 2025. The agreement makes available to Royal Caribbean Cruises Ltd. an unsecured US dollar-denominated term loan, the substantial majority of which is to be guaranteed 95% by Finnvera plc (“Finnvera”), the official export credit agency of Finland. Euler Hermes (“Hermes”), the official export credit agency of Germany, has also agreed to provide a 95% guarantee of a smaller portion of the financing. The maximum amount of the facility is equal to the US dollar equivalent of 80% of the vessel purchase price plus 100% of the guarantee premiums payable to Finnvera and Hermes.
The loan, once funded, will amortize semi-annually and will mature twelve years following the delivery of the ship. Approximately 60% of the loan will accrue interest at a fixed rate of 3.29%. Approximately 30% of the loan will accrue interest at a floating rate of LIBOR plus 0.85%. At our election, the remainder of the loan will accrue interest at a fixed rate of 4.34% or at a floating rate of LIBOR plus 0.85%. The credit agreement contains customary events of default and prepayment events for, among other things, non-payment, breach of covenants, default on certain other indebtedness, certain large judgments and a change of control of the Company.
Certain of the lenders participating in the facility, and affiliates of those lenders, provide credit and other financial services to us from time to time for which they have received, and will in the future receive, customary fees.
The foregoing description of the provisions of the credit agreement is summary in nature and is qualified in its entirety by reference to the full and complete terms of the credit agreement, a copy of which is filed herewith as Exhibit 10.1 and incorporated herein by reference.
| Item 2.03 | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant |
The disclosure required by this item is included in Item 1.01 of this Current Report on Form 8-K and is incorporated herein by reference.
| Item 9.01 | Financial Statements and Exhibits |
(d) Exhibits
| 10.1 | Icon 3 Hull No. 1402 Credit Agreement, dated as of December 18, 2019, between Royal Caribbean Cruises Ltd., as the Borrower, KfW IPEX-Bank GmbH, as Facility Agent, CIRR Agent, Documentation Agent, Hermes Agent, Initial Mandated Lead Arranger and Sole Bookrunner, and the Lenders and Residual Risk Guarantors from time to time party thereto. | |
| 104 | Cover Page Interactive Data File (the cover page XBRL tags are embedded in the Inline XBRL document). |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| ROYAL CARIBBEAN CRUISES LTD. | |||
| Date: | December 20, 2019 | By: | /s/ Bradley H. Stein |
| Name: | Bradley H. Stein | ||
| Senior Vice President, General Counsel & Secretary | |||