Please wait
 
Amendment
 
and
 
Restatement
 
Deed
 
re
 
Secured
 
Loan
 
Agreement
 
dated
 
7
 
January
2016
Dated
 
July 2023
(1)
Aster
 
Shipping
 
Company
 
Inc.
Aerik
 
Shipping
 
Company
 
Inc.
(as Borrowers)
(2)
Diana
 
Shipping
 
Inc.
(as Guarantor)
(3)
Diana
 
Shipping Services
 
S.A.
(as Other Security
 
Party)
(4)
The
 
Export-Import
 
Bank
 
of
 
China
(as Lenders)
(5)
The
 
Export-Import
 
Bank
 
of
 
China
(as Arranger)
(6)
The
 
Export-Import
 
Bank
 
of
 
China
(as Agent)
(7)
The
 
Export-Import
 
Bank
 
of
 
China
(as Security Agent)
exhibit452p2i0
LONLIVE\107669195
.3
Contents
Page
1
Definitions and Interpretation
 
................................
 
................................
 
...........
 
2
2
Conditions ................................................................
 
................................
 
.......
 
2
3
Representations ................................................................
 
.............................. 3
4
Amendment and restatement of Loan Agreement............................................ 3
5
Release of Outgoing Borrower................................
 
................................
 
.........
 
3
6
Continuing obligations
 
................................
 
................................
 
..................... 3
7
Confirmations and Undertakings
 
................................
 
................................
 
......
 
3
8
Partial Invalidity, Notices, Counterparts, Governing Law and Enforcement
 
......
 
4
Schedule 1
 
The Lenders
 
................................
 
................................
 
................................
 
....
 
5
Schedule 2
 
Conditions ................................................................
 
................................
 
.......
 
6
Schedule 3
 
Amended and Restated Loan Agreement
 
................................
 
........................ 8
LONLIVE\107669195.3
 
Amendment
 
and
 
Restatement
 
Deed
Dated
 
July 2023
Between:
(1)
Aster Shipping Company Inc.
and
Aerik Shipping Company Inc.
each a company
incorporated
 
under
 
the
 
law
 
of
 
the
 
Republic
 
of
 
the
 
Marshall
 
Islands,
 
with
 
registered
address
 
at
 
Trust
 
Company
 
Complex,
 
Ajeltake
 
Road,
 
Ajeltake
 
Island,
 
Majuro,
MH96960, Marshall
 
Islands (the
 
"
Borrowers
") and
Houk
 
Shipping
 
Company Inc.
,
a company
 
incorporated under
 
the law
 
of the
 
Republic of
 
the Marshall
 
Islands, with
registered
 
address
 
at
 
Trust
 
Company
 
Complex,
 
Ajeltake
 
Road,
 
Ajeltake
 
Island,
Majuro, MH96960 (the "
Outgoing Borrower"
); and
(2)
Diana
 
Shipping
 
Inc.
, a
 
company incorporated
 
under the
 
law of
 
the Republic
 
of the
Marshall
 
Islands,
 
with
 
registered
 
address
 
at
 
Trust
 
Company
 
Complex,
 
Ajeltake
Road,
Ajeltake Island, Majuro, MH96960, Marshall Islands (the "
Guarantor
"); and
(3)
Diana
 
Shipping Services
 
S.A.
, a
 
company incorporated
 
under the
 
law of
 
Panama,
with
 
registered
 
office
 
at
 
Edificio
 
Universal,
 
Piso
 
12,
 
Avenida
 
Federico
 
Boyd,
Panama,
Panama (the "
Other Security Party
"); and
(4)
The
 
financial
 
institutions
 
listed
 
in
 
Schedule
 
1,
 
each
 
acting
 
through
 
its
 
office
 
at
 
the
address indicated against its name in Schedule 1 (together
 
the "
Lenders
" and each
 
a
"
Lender
"); and
(5)
The
 
Export-Import Bank
 
of
 
China
, acting
 
as arranger
 
through its
 
office at
 
No. 30,
Fu Xing
 
Men Nei
 
Street, Xicheng
 
District, Beijing
 
10003, China
 
(in that
 
capacity the
"
Arranger
"); and
(6)
The
 
Export-Import Bank
 
of
 
China
, acting
 
as agent
 
through its
 
office at
 
No. 30,
 
Fu
Xing
 
Men
 
Nei
 
Street,
 
Xicheng
 
District,
 
Beijing
 
10003,
 
China
 
(in
 
that
 
capacity
 
the
"
Agent
"); and
(7)
The Export-Import
 
Bank of China
, acting as security agent through its office at
 
No.
30, Fu
 
Xing Men
 
Nei Street,
 
Xicheng District,
 
Beijing 10003,
 
China (in
 
that capacity
the "
Security Agent
").
Background
(A)
This
 
Deed
 
is
 
supplemental to
 
and
 
amends
 
and
 
restates
 
a
 
secured
 
loan
 
agreement
dated
 
7
 
January
 
2016
 
(the
 
"
Loan
 
Agreement
")
 
made
 
between
 
the
 
Borrowers,
 
the
Lenders, the Arranger,
 
the Agent and the Security Agent
 
on the terms and subject to
the conditions of which each of the Lenders agreed to advance to the Borrowers
 
on a
joint
 
and
 
several
 
basis
 
its
 
respective
 
Commitment
 
of
 
an
 
aggregate
 
amount
 
not
exceeding, as of the date of this Deed, $58,440,000.
(B)
The
 
parties
 
to
 
the
 
Loan
 
Agreement
 
have
 
agreed
 
to
 
amend
 
and
 
restate
 
the
 
Loan
Agreement in the
 
form attached to this
 
Deed at Schedule 3
 
(
Amended and Restated
Loan
 
Agreement
)
 
and
 
the
 
Finance
 
Parties
 
have
 
agreed
 
to
 
release
 
the
 
Outgoing
Borrower from its obligations under the Loan Agreement.
(C)
It is
 
intended that this
 
document takes effect
 
as a
 
deed notwithstanding the
 
fact that
a party may only execute this document under hand.
IT IS AGREED
as follows:
1
Definitions and Interpretation
1.1
Definitions
In this Deed:
"
Effective Date
" means 21 July 2023.
"
Finance
 
Parties
"
 
means
 
the
 
Arranger,
 
the
 
Agent,
 
the
 
Security
 
Agent
 
and
 
the
Lenders.
"
Mortgage Addenda
" means the mortgage addenda in respect of
 
the Vessels, to
 
be
entered into by the Borrowers in favour of the Security Agent.
"
Security Parties
" means any
 
party to this
 
Deed (other than
 
any Finance Party
 
and
the Outgoing Borrower).
1.2
Construction
1.2.1
Capitalised terms defined in the Loan Agreement have the same meaning in
this Deed unless expressly defined in this Deed.
1.2.2
The
 
provisions of
 
clause 1.2
 
of
 
the
 
Loan Agreement
 
apply to
 
this
 
Deed as
though
 
they
 
were
 
set
 
out
 
in
 
full
 
in
 
this
 
Deed
 
except
 
that
 
references
 
to
 
the
Loan Agreement will be construed as references to this Deed.
1.2.3
References
 
to
 
a
 
Clause,
 
a
 
paragraph
 
or
 
a
 
Schedule
 
are
 
to
 
a
 
Clause,
paragraph or Schedule of this Deed unless otherwise specified.
1.3
Finance Document
The Agent
 
and the
 
Borrowers hereby designate
 
this Deed as
 
a
Finance Document.
1.4
Joint
 
and
 
several
 
obligations
All
 
obligations,
 
representations,
 
warranties,
covenants and
 
undertakings of
 
the
 
Borrowers under
 
or pursuant
 
to
 
this Deed
 
shall,
unless otherwise
 
expressly provided,
 
be entered
 
into, made
 
or given
 
by them
 
jointly
and severally.
2
Conditions
2.1
The Borrowers shall
 
deliver or cause
 
to be delivered
 
to or to
 
the order of the
 
Agent, no
later
 
than
 
five
 
Business Days
 
from
 
the
 
Effective
 
Date,
 
all
 
the
 
documents
 
and
 
other
evidence listed in Schedule 2 (
Conditions
).
2.2
All documents and evidence delivered to the Agent pursuant to Clause
 
2.1 shall:
2.2.1
be in form and substance acceptable to the Agent;
2.2.2
if
 
required
 
by
 
the
 
Agent,
 
be
 
certified,
 
notarised,
 
legalised
 
or
 
attested
 
in
 
a
manner acceptable to the Agent.
3
Representations
3.1
Each
 
of
 
the
 
representations
 
contained
 
in
 
clause
 
11
 
(
Representations
)
 
of
 
the
 
Loan
Agreement
 
shall
 
be
 
deemed
 
repeated
 
by
 
the
 
Borrowers
 
and
 
the
 
Guarantor
 
at
 
the
date
 
of
 
this
 
Deed
 
and
 
at
 
the
 
Effective
 
Date,
 
by
 
reference
 
to
 
the
 
facts
 
and
circumstances
 
then
 
pertaining,
 
as
 
if
 
references
 
to
 
the
 
Finance
 
Documents
 
include
this Deed.
3.2
Any representation made
 
by any
 
Security Party in
 
any of
 
the Security
 
Documents to
which it is a party
 
shall be deemed repeated by that
 
Security Party at the date of
 
this
Deed
 
and
 
at
 
the
 
Effective
 
Date,
 
by
 
reference
 
to
 
the
 
facts
 
and
 
circumstances
 
then
pertaining.
4
Amendment and restatement of Loan Agreement
4.1
With
 
effect
 
from
 
the
 
Effective
 
Date,
 
the
 
Loan
 
Agreement
 
shall
 
be
 
amended
 
and
restated in the form set out in Schedule 3 (
Amended and Restated Loan Agreement
).
5
Release of Outgoing Borrower
Without prejudice to the obligations
 
of the Borrowers or the
 
Guarantor under, or to the
validity of, the
 
Loan Agreement and
 
without prejudice
 
to the obligations
 
of the Security
Parties under, or to the validity of, the Security Documents all
 
of which shall remain in
full force
 
and effect
 
in accordance
 
with Clause
 
7, (
Confirmations and Undertakings
),
the
 
Agent on
 
behalf of
 
all the
 
Finance Parties,
 
hereby releases
 
and
 
discharges the
Outgoing
 
Borrower
 
from
 
all
 
obligations,
 
liabilities,
 
claims
 
and
 
demands
 
whatsoever
under the Loan Agreement with effect from the date of this Deed.
6
Continuing obligations
6.1
Subject to the provisions of this Deed:
6.1.1
the
 
Loan
 
Agreement
 
and
 
all
 
other
 
Finance
 
Documents
 
will
 
remain
 
in
 
full
force and effect;
6.1.2
on
 
and
 
from
 
the
 
Effective
 
Date,
 
the
 
Loan
 
Agreement
 
shall
 
be
 
read
 
and
construed
 
as
 
amended
 
and
 
restated
 
by
 
this
 
Deed
 
and
 
references
 
to
 
the
Loan
 
Agreement
 
in
 
each
 
of
 
the
 
Finance
 
Documents
 
will
 
be
 
read
 
and
construed as references to the Loan Agreement as
 
amended and restated in
this Deed;
 
and
6.1.3
nothing in this Deed
 
shall constitute or
 
be construed as
 
a waiver or
 
release of
any
 
right
 
or
 
remedy
 
of
 
the
 
Finance
 
Parties
 
under
 
the
 
Finance
 
Documents
nor
 
otherwise
 
prejudice
 
any
 
right
 
or
 
remedy
 
of
 
a
 
Finance
 
Party
 
under
 
the
Loan Agreement or any other Finance Document.
6.2
The definition of
 
any term defined
 
in any of
 
the Security Documents
 
shall, to
 
the extent
necessary,
 
be
 
modified
 
to
 
reflect
 
the
 
amendment
 
and
 
restatement
 
of
 
the
 
Loan
Agreement made in this Deed.
7
Confirmations and Undertakings
7.1
Each Security Party confirms that on and after
 
the Effective Date, all of
 
its respective
obligations under or pursuant to each of the Security Documents to which it is a party
remain in
 
full force
 
and effect,
 
despite the
 
amendment and
 
restatement of
 
the Loan
Agreement made in
 
this Deed, as
 
if all references
 
in any of
 
the Security Documents
 
to
the
 
Loan
 
Agreement
 
are
 
references
 
to
 
the
 
Loan
 
Agreement
 
as
 
amended
 
and
restated in this Deed.
7.2
The
 
Guarantor
 
also
 
confirms
 
that
 
its
 
Guarantee
 
will
 
extend
 
to
 
each
 
Borrower's
obligations under the Loan Agreement (as amended and restated in
 
this Deed).
7.3
If, and
 
to the
 
extent that, the
 
guarantee, undertaking or
 
indemnity provided under
 
its
Guarantee is not, for any reason, enforceable
 
on or after the Effective Date in relation
to
 
each
 
Borrower's
 
obligations
 
under
 
the
 
Finance
 
Documents
 
(as
 
amended
 
and
restated
 
by
 
this
 
Deed),
 
the
 
Guarantor
 
hereby
 
guarantees
 
to,
 
undertakes
 
with
 
and
indemnifies
 
each
 
Finance
 
Party
 
on
 
the
 
terms
 
of
 
those
 
clauses
 
in
 
relation
 
to
 
those
obligations on and after the Effective Date.
8
Partial Invalidity, Notices, Counterparts, Governing Law and Enforcement
The provisions of clauses 19 (
Partial Invalidity
), 18 (
Notices
), 22.5 (
Counterparts
) and
23 (
Law and
 
Jurisdiction
) of the
 
Loan Agreement
 
shall apply to
 
this Deed as
 
if they are
set out in full
 
and as if (a)
 
references to each
 
Party are references
 
to each party to
 
this
Deed and (b) references to the Loan Agreement are references
 
to this Deed.
In witness
of which the parties
 
to this Deed
 
have executed this Deed
 
as a deed the
 
day and
year first before written.
 
 
 
 
 
 
Schedule
 
1
The Lenders
Lenders
Name
Lending office
The Export-Import Bank of China
No.
 
30,
 
Fu
 
Xing
 
Men
 
Nei
 
Street,
 
Xicheng
District, Beijing 10003, China
Schedule
 
2
Conditions
1
Corporate documents
(a)
Constitutional
 
documents
Copies
 
of
 
the
 
constitutional
 
documents
 
of
each of
 
the Borrowers
 
and the
 
Guarantor together
 
with such
 
other evidence
as the Agent
 
may reasonably
 
require that
 
Borrower or
 
the Guarantor
 
is duly
incorporated in
 
its country
 
of incorporation
 
and remains
 
in existence
 
with
power to
 
enter into,
 
and perform
 
its obligations
 
under,
 
this Deed
 
and any
document to
 
be executed
 
by that
 
Borrower or
 
the
 
Guarantor pursuant
 
to
this Deed.
(b)
Certificates of good standing
A certificate of good standing in respect
 
of
each
 
of
 
the
 
Borrowers
 
and
 
the
 
Guarantor
 
(if
 
such
 
a
 
certificate
 
can
 
be
obtained).
(c)
Board resolutions
A copy of a resolution
 
of the board of directors
 
of each
of the Borrowers and
 
a copy of a
 
resolution of the executive
 
committee of
the Guarantor:
(i)
approving the terms
 
of, and the
 
transactions contemplated
 
by, this
Deed
 
and
 
any
 
document
 
to
 
be
 
executed
 
by
 
that
 
Borrower
 
or
Guarantor (as applicable)
 
pursuant to
 
this Deed and
 
resolving that
it execute this Deed and any such document; and
(ii)
authorising
 
a
 
specified
 
person
 
or
 
persons
 
to
 
execute
 
this
 
Deed
and any
 
such document
 
(including all
 
documents and
 
notices to
be
 
signed
 
and/or
 
dispatched
 
under
 
any
 
such
 
document)
 
on
 
its
behalf.
(d)
Specimen
 
signatures
A
 
specimen
 
of
 
the
 
signature
 
of
 
each
 
person
authorised by the resolutions referred to in (c).
(e)
Shareholder resolutions
A copy of a resolution signed by
 
all the holders
of
 
the
 
issued
 
shares
 
in
 
each
 
of
 
the
 
Borrowers,
 
approving
 
the
 
terms
 
of,
and the transactions contemplated by,
 
this Deed and any
 
document to be
executed by that Borrower pursuant to this Deed.
(f)
Officer's certificates
An original certificate of a duly authorised officer
 
of
each of the Borrowers and the Guarantor:
(i)
certifying that
 
each copy
 
document relating
 
to
 
it specified
 
in this
Schedule 2 is correct, complete and in full force and
 
effect;
(ii)
setting out
 
the names
 
of the
 
directors, officers
 
and shareholders
of that
 
Borrower or the
 
names of the
 
directors and officers
 
of the
Guarantor
 
(as
 
applicable)
 
and
 
the
 
proportion
 
of
 
shares
 
held
 
by
each shareholder of that Borrower; and
(iii)
confirming
 
that,
 
subject
 
only
 
to
 
the
 
documents
 
provided
 
to
 
the
Agent pursuant to this Part 1 of this Schedule 2, none of the
equivalent
 
documents
 
delivered
 
to
 
the
 
Agent
 
pursuant
 
to
 
clause
 
3.1
 
of
 
the
 
Loan
 
Agreement
 
have
 
been
 
amended
 
or
modified in
 
any way since
 
the date
 
of their
 
delivery to the
 
Agent,
or
 
certifying
 
copies,
 
as
 
true,
 
complete,
 
accurate
 
and
 
neither
amended
 
nor
 
revoked,
 
of
 
any
 
which
 
have
 
been
 
amended
 
or
modified.
(g)
Evidence of registration
Where such registration is required or permitted
under the laws
 
of the relevant jurisdiction,
 
evidence that the names
 
of the
directors,
 
officers
 
and
 
shareholders
 
of
 
each
 
of
 
the
 
Borrowers
 
and
 
the
directors
 
and
 
officers
 
of
 
the
 
Guarantor
 
are
 
duly
 
registered
 
in
 
the
companies registry
 
or other
 
registry in
 
the country of
 
incorporation of that
Borrower or Guarantor (as applicable).
(h)
Powers
 
of
 
attorney
The original
 
notarially attested
 
and
 
legalised power
of
 
attorney of
 
each of
 
the Borrowers
 
and the
 
Guarantor under
 
which this
Deed and any document to be executed by that Borrower or Guarantor
 
(as
applicable) pursuant
 
to this
 
Deed are
 
to be
 
executed by
 
that Borrower
 
or
Guarantor (as applicable).
2
Security and related documents
(a)
Mortgage Addenda
the Mortgage
 
Addenda in
 
respect of
 
the Vessels, duly
executed.
(b)
Evidence of
 
registration
Certificates of ownership
 
and encumbrance (or
equivalent)
 
issued
 
by
 
the
 
Registrar
 
of
 
Ships
 
of
 
the
 
Marshall
 
Islands
 
flag
confirming that
 
the
 
Mortgage
 
Addenda have
 
been
 
registered
 
against the
Vessels
 
and
 
that
 
there
 
are
 
no
 
further
 
Encumbrances
 
registered
 
against
the Vessels.
3
Legal opinions
The following legal opinions:
(a)
a legal
 
opinion of
 
Stephenson Harwood
 
LLP,
 
legal advisers
 
to the
 
Agent
as to
 
English law substantially
 
in the
 
form distributed to
 
the Lender
s
prior
to signing this Deed;
(b)
a legal opinion of Hill Dickinson International as to Marshall Islands
 
law.
4
Other documents and evidence
(a)
Process
 
agent
Evidence
 
that
 
any
 
process
 
agent
 
appointed
 
pursuant
 
to
Clause 8 has accepted its appointment.
(b)
Other
 
Authorisations
A
 
copy
 
of
 
any
 
other
 
Authorisation
 
or
 
other
document,
 
opinion
 
or
 
assurance
 
which
 
the
 
Agent
 
considers
 
to
 
be
necessary
 
or
 
desirable
 
(if
 
it
 
has
 
notified
 
the
 
Borrower
 
accordingly)
 
in
connection
 
with
 
the
 
entry
 
into
 
and
 
performance
 
of
 
the
 
transactions
contemplated
 
by
 
this
 
Deed
 
or
 
for
 
the
 
validity
 
and
 
enforceability
 
of
 
this
Deed and any document to be executed pursuant to this Deed.
Schedule 3
Amended and Restated Loan Agreement
 
US$58,440,000
 
Secured
 
Loan
 
Agreement
 
dated
 
7
 
January
 
2016
 
as
 
amended
 
and
restated by a deed of amendment and
 
restatement dated
 
_ July 2023
Aster
 
shipping
 
company
 
Inc.
Aerik
 
shipping
 
company
 
Inc.
(as Borrowers)
-
and -
The
 
Export-Import
 
Bank
 
of
 
China
(as Lenders)
-
and -
The
 
Export-Import
 
Bank
 
of
 
China
(as Arrangers)
-
and -
The
 
Export-Import
 
Bank
 
of
 
China
(as Agent)
-
and -
The
 
Export-Import
 
Bank
 
of
 
China
(as Security Agent)
LONLIVE\107610866.5
exhibit452p2i0
Contents
Page
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
Schedule 1
 
The Lenders and the Arrangers
 
................................
 
................................
 
.....
 
61
Part 1 The Lenders and the Commitments
 
................................
 
....................
 
61
Part 2 The Arrangers
 
................................
 
................................
 
.....................
 
62
Schedule 2
 
Conditions Precedent and Subsequent
 
................................
 
.......................... 63
LONLIVE\107610866.5
Part 1 Conditions precedent
 
................................
 
................................
 
..........
 
63
Part 2 Conditions subsequent
 
................................
 
................................
 
........
 
68
Schedule 3
 
Form of Drawdown Notice
 
................................
 
................................
 
.............
 
69
Schedule 4
 
Form of Transfer Certificate
 
................................
 
................................
 
...........
 
71
Schedule 5
 
Form of Compliance Certificate ................................................................
 
.....
 
74
LONLIVE\107610866.5
3
 
Loan
 
Agreement
 
dated
 
7
 
January
 
2016
 
as
 
amended
 
and
 
restated
 
by
 
a
 
deed
 
of
amendment and restatement dated
 
July 2023
Between:
(1)
Aster Shipping Company
 
Inc.
and
Aerik Shipping Company
 
Inc.
each a
 
company
incorporated under
 
the
 
laws of
 
the Marshall
 
Islands whose
 
registered
 
address is
 
at
Trust
 
Company
 
Complex,
 
Ajeltake
 
Road,
 
Ajeltake
 
Island,
 
Majuro,
 
MH96960,
Marshall
 
Islands
 
(together
 
the
 
"
Borrowers
"
 
and
 
each
 
a
 
"
Borrower
")
 
jointly
 
and
severally; and
(2)
the
 
banks
 
listed
 
in
 
Schedule
 
2,
 
Part
 
1
 
(
The
 
Lenders
 
and
 
the
 
Commitments
),
 
each
acting
 
as
 
lender
 
through
 
its
 
office
 
at
 
the
 
address
 
indicated
 
against
 
its
 
name
 
in
Schedule 2,
Part I (together the "
Lenders
" and each a "
Lender
"); and
(3)
the
 
banks
 
listed
 
in
 
Schedule
 
2,
 
Part
 
2
 
(
The
 
Arrangers
),
 
each
 
acting
 
as
 
arranger
through
 
its
 
office
 
at
 
the
 
address
 
indicated
 
against
 
its
 
name
 
in
 
Schedule
 
2,
 
Part
 
2
(together
 
the "
Arrangers
" and each an "
Arranger
"); and
(4)
The Export-Import
 
Bank Of
 
China
, acting as
 
agent through its
 
office at No.
 
30, Fu
Xing
 
Men
 
Nei
 
Street,
 
Xicheng
 
District,
 
Beijing
 
100031,
 
The
 
People's
 
Republic
 
of
China (in that capacity the "
Agent
"); and
(5)
The Export-Import Bank Of
 
China
, acting as security agent through its office at No.
30, Fu Xing Men
 
Nei Street, Xicheng District, Beijing 100031,
 
The People's Republic
of China (in that capacity the "
Security Agent
").
Whereas:
(A)
Each Borrower
 
has agreed
 
to purchase
 
the relevant
 
Vessel
 
from the
 
Builder on
 
the
terms of
 
the relevant
 
Building Contract
 
and intends
 
to register
 
that Vessel
 
under an
Approved Flag.
(B)
Each of
 
the Lenders
 
has agreed to
 
advance to the
 
Borrowers on
 
a joint
 
and several
basis
 
its
 
Commitment
 
(aggregating,
 
with
 
all
 
the
 
other
 
Commitments
 
up
 
to
 
the
Maximum Loan Amount)
 
in two (2) Tranches to assist
 
the Borrowers to
 
finance part of
the acquisition cost of the Vessels.
It is agreed
as follows:
1
Definitions and Interpretation
1.1
In this Agreement:
"
Account Holder
" means DNB Bank ASA acting through its branch at 8th Floor, The
Walbrook
 
Building, 25
 
Walbrook,
 
London
 
EC4N
 
8AF
 
or
 
any
 
other
 
bank
 
or
 
financial
institution which at any time, with the Security Agent's prior written consent, holds the
Earnings Account.
"
Administration
" has the meaning given to it in paragraph 1.1.3 of the
 
ISM Code.
"
Annex
 
VI
"
 
means
 
Annex
 
VI
 
(Regulations
 
for
 
the
 
Prevention
 
of
 
Air
 
Pollution
 
from
Ships) to the International Convention for the Prevention
 
of Pollution from Ships 1973
(as modified in 1978 and 1997).
LONLIVE\107610866.5
1
"
Approved
 
Brokers
"
 
means
 
together,
 
H.
 
Clarkson
 
and
 
Company
 
Ltd
 
of
 
London,
England,
 
Arrow
 
Research
 
Ltd.
 
of
 
London,
 
England,
 
Astrup
 
Fearnley
 
A/S
 
of
 
Oslo,
Norway,
 
R.S.
 
Platou
 
Shipbrokers
 
of
 
Oslo,
 
Norway,
 
Braemar
 
Seascope
 
of
 
London,
England,
 
Galbraiths
 
Limited
 
of
 
London,
 
England,
 
Simpson
 
Spence
 
&
 
Young
 
of
London, England,
 
VesselsValue,
 
Maersk Brokers
 
K/S and
 
E.A. Gibson
 
Shipbrokers
London and
 
any other
 
independent firm
 
of shipbrokers
 
nominated by
 
the Borrowers
and approved by the Agent and "
Approved Broker
" means any one of them.
"
Approved Flag
" means, in respect of each Vessel, the flag of the Marshall Islands.
"
Assignments
"
 
means
 
the
 
first
 
priority
 
deeds
 
of
 
assignment
 
from
 
the
 
Borrowers
referred to in Clauses 10.1.2 and 10.1.7 (
Security Documents
).
"
Availability
 
Termination
 
Date
" means 12
 
March 2017 or
 
such later date
 
as all the
Lenders may in their discretion agree.
"
Break
 
Costs
"
 
means
 
all
 
sums
 
payable
 
by
 
the
 
Borrowers
 
from
 
time
 
to
 
time
 
under
Clause 8.3 (
Break Costs
).
"
Builder
"
 
means
 
Jiangnan
 
Shipyard
 
(Group)
 
Co.,
 
Ltd.,
 
a
 
company
 
incorporated
under
 
the
 
laws
 
of
 
the
 
People's
 
Republic
 
of
 
China
 
with
 
its
 
registered
 
office
 
at
 
988,
Changxing
 
Jiangnan
 
Road,
 
Changxing
 
District,
 
Chongming
 
County,
 
Shanghai
201913, the
 
People’s Republic of China.
"
Building Contracts
" means the
 
two contracts each
 
dated 17 May 2013
 
on the terms
and
 
subject
 
to
 
the
 
conditions
 
of
 
which
 
the
 
Builder
 
has
 
agreed
 
to
 
construct
 
the
Vessels for, and deliver the Vessel to, the Borrowers and
 
"
Building Contract
" means
any one of them.
"
Business Day
" means a day (other than a Saturday or Sunday) on which banks are
open for
 
general business in
 
New York,
 
London, Athens
 
and Beijing
 
and (in
 
relation
to the fixing of an interest rate) which is a US Government Securities
 
Business
 
Day.
"
Charter
" means
 
in respect
 
of a
 
Vessel
 
any bareboat
 
charter,
 
time
 
charter or
 
other
contract
 
of
 
employment, with
 
a
 
period
 
of
 
duration of
 
more
 
than
 
twelve
 
(12)
 
months
(or
 
which
 
is
 
capable
 
of
 
exceeding
 
twelve
 
(12)
 
months
 
duration
 
(inclusive
 
of
 
any
extension options)),
 
in respect
 
of that
 
Vessel
 
entered or
 
to be
 
entered into
 
between
the relevant Borrower (as owner) and a charterer and "
Charters
" means all of them.
''
CME
 
Term
 
SOFR
''
 
means
 
the
 
Term
 
SOFR
 
reference
 
rate
 
administered
 
by
 
CME
Group Benchmark
 
Administration Limited (or
 
any other
 
person which
 
takes over
 
the
administration
 
of
 
that
 
rate)
 
for
 
the
 
relevant
 
period
 
published
 
(before
 
any correction,
recalculation
 
or
 
republication
 
by
 
the
 
administrator)
 
by
 
CME
 
Group
 
Benchmark
Administration Limited
 
(or any
 
other person
 
which takes
 
over the
 
publication of
 
that
rate).
"
Code
" means the US Internal Revenue Code of 1986.
"
Commitment
"
 
means,
 
in
 
relation
 
to
 
a
 
Lender,
 
the
 
amount
 
of
 
the
 
Loan
 
which
 
that
Lender
 
agrees
 
to
 
advance
 
to
 
the
 
Borrowers
 
as
 
its
 
several
 
liability
 
as
 
indicated
against the name
 
of that Lender
 
in Schedule 2
 
(
The Lenders and
 
the Commitments
)
and/or,
 
where the context
 
permits, the amount
 
of the Loan
 
advanced by that
 
Lender
and remaining outstanding and "
Commitments
" means more than one of them.
"
Compliance
 
Certificate
"
 
means
 
a
 
certificate
 
substantially
 
in
 
the
 
form
 
set
 
out
 
in
Schedule 6 (
Form of Compliance Certificate
).
"
Credit Adjustment Spread
" means 0.15% per annum.
"
Currency of
 
Account
" means, in
 
relation to any
 
payment to be
 
made to a
 
Finance
Party under a
 
Finance Document,
 
the currency in
 
which that payment
 
is required
 
to be
made by the terms of that Finance Document.
"
Default
" means an Event of Default
 
or any event or circumstance which would (with
the
 
expiry
 
of
 
a
 
grace
 
period,
 
the
 
giving
 
of
 
notice,
 
the
 
making
 
of
 
any
 
determination
under
 
the
 
Finance
 
Documents
 
or
 
any
 
combination
 
of
 
any
 
of
 
the
 
foregoing)
 
be
 
an
Event of Default.
"
Delivery Date
" means the date of
 
actual delivery of a Vessel
 
to a Borrower under a
Building Contract.
"
Diana
"
 
means
 
Diana
 
Shipping
 
Services
 
S.A.,
 
a
 
company
 
incorporated
 
under
 
the
laws
 
of
 
the
 
Republic of
 
Panama
 
with
 
its registered
 
office
 
at
 
Edificio Universal,
 
Piso
12,
 
Avenida
 
Federico
 
Boyd,
 
Panama,
 
Republic
 
of
 
Panama,
 
having
 
its
 
established
office in Greece at Pendelis 16, 175 64 Palaio Faliro, Athens, Greece pursuant to the
provisions of Greek Law 27/1975.
"
DOC
"
 
means,
 
in
 
relation
 
to
 
the
 
ISM
 
Company,
 
a
 
valid
 
Document
 
of
 
Compliance
issued for
 
the ISM
 
Company by the
 
Administration under paragraph
 
13.2 of the
 
ISM
Code.
"
Dollars
", "
$
" and
 
"
USD
" each
 
means available
 
and freely
 
transferable and
 
convertible
funds in the lawful currency of the United States of America.
"
Drawdown Date
" means the date on which the relevant Tranche
 
is advanced under
Clause 4 (
Advance
).
"
Drawdown
 
Notice
" means
 
a notice
 
substantially in
 
the form
 
set out
 
in Schedule
 
5
(
Form of Drawdown Notice
).
"
Earnings
" means (i) all hires, freights, pool income and other sums payable to or for
the
 
account
 
of
 
a
 
Borrower
 
in
 
respect
 
of
 
a
 
Vessel
 
including
 
(without
 
limitation)
 
all
remuneration
 
for
 
salvage
 
and
 
towage
 
services,
 
demurrage
 
and
 
detention
 
moneys,
contributions in general
 
average, compensation in
 
respect of any
 
requisition for hire,
and damages and other
 
payments (whether awarded by
 
any court or arbitral
 
tribunal
or by agreement
 
or otherwise) for breach,
 
termination or variation
 
of any contract for
the operation, employment or
 
use of a Vessel
 
and (ii) to the
 
extent not included in (i)
above all rights, title, interest and benefits of any Charter.
"
Earnings
 
Accounts
"
 
means the
 
bank accounts
 
to
 
be opened
 
in the
 
names of
 
the
Borrowers with
 
the Account
 
Holder and
 
designated "Aster
 
Shipping Company
 
Inc.
 
-
Earnings
 
Account"
 
and
 
"Aerik
 
Shipping
 
Company
 
Inc.
 
-
 
Earnings
 
Account"
respectively, and "
Earnings Account
" means any one of them.
"
Earnings
 
Account
 
Charges
"
 
means
 
the
 
deeds
 
of
 
charge
 
referred
 
to
 
in
 
Clause
10.1.4
 
(
Security
 
Documents
)
 
and
 
"
Earnings
 
Account
 
Charge
"
 
means
 
any
 
one
 
of
them.
"
Encumbrance
"
 
means
 
a
 
mortgage,
 
charge,
 
assignment,
 
pledge,
 
lien,
 
or
 
other
security
 
interest
 
securing
 
any
 
obligation
 
of
 
any
 
person
 
or
 
any
 
other
 
agreement
 
or
arrangement having a similar effect.
"
Environmental Laws
" means all
 
local, state, provincial,
 
federal, state local,
 
foreign
and
 
international
 
laws,
 
regulations,
 
treaties
 
and
 
conventions
 
(including
 
any
amendments
 
and/or
 
protocols
 
thereto)
 
for
 
the
 
time
 
being
 
in
 
force
 
pertaining
 
to
 
the
pollution
 
or
 
protection
 
of
 
human
 
health
 
or
 
the
 
environment
 
(including
 
ambient
 
air,
surface water,
 
ground water,
 
land surface or
 
subsurface strata and
 
all or any
 
part of
navigable
 
waters,
 
waters
 
of
 
the
 
contiguous
 
zone,
 
ocean
 
waters
 
and
 
international
waters
 
(howsoever
 
called)),
 
including
 
laws,
 
regulations,
 
treaties
 
and
 
conventions
(including any amendments and/or protocols thereto) for the time being
 
in force.
"
Event of
 
Default
" means any of the events or
 
circumstances set out in Clause 13.1
(
Events of Default
).
"
Facility
 
Period
"
 
means
 
the
 
period
 
beginning
 
on
 
the
 
date
 
of
 
this
 
Agreement
 
and
ending on the date when the whole of the
 
Indebtedness has been paid in full and the
Security Parties
 
have ceased
 
to be
 
under any
 
further actual
 
or contingent
 
liability to
the Finance Parties under or in connection with the Finance Documents.
"
Fair
 
Market
 
Value
" means
 
the market
 
value of
 
a Vessel
 
calculated in
 
accordance
with Clause 10.13 (
Fair Market Value determination
).
"
FATCA
" means:
(a)
sections 1471 to 1474 of the Code or any associated regulations;
(b)
any
 
treaty,
 
law
 
or
 
regulation
 
of
 
any
 
other
 
jurisdiction,
 
or
 
relating
 
to
 
an
intergovernmental
 
agreement
 
between
 
the
 
US
 
and
 
any
 
other
 
jurisdiction,
which (in either
 
case) facilitates the
 
implementation of any
 
law or regulation
referred to in paragraph (a) above; or
(c)
any
 
agreement
 
pursuant
 
to
 
the
 
implementation
 
of
 
any
 
treaty,
 
law
 
or
regulation
 
referred
 
to
 
in
 
paragraphs
 
(a)
 
or
 
(b)
 
above
 
with
 
the
 
US
 
Internal
Revenue
 
Service,
 
the
 
US
 
government
 
or
 
any
 
governmental
 
or
 
taxation
authority in any other jurisdiction.
"
FATCA
 
Application Date
" means:
(a)
in relation
 
to a
 
"withholdable payment" described
 
in section
 
1473(1)(A)(i) of
the Code (which
 
relates to payments
 
of interest and
 
certain other payments
from sources within the US), 1 July 2014; or
(b)
in
 
relation
 
to
 
a
 
"passthru
 
payment"
 
described
 
in
 
section
 
1471(d)(7)
 
of
 
the
Code
 
not
 
falling
 
within
 
(a),
 
the
 
first
 
date
 
from
 
which
 
such
 
payment
 
may
become subject to a deduction or withholding required by
 
FATCA.
"
FATCA
 
Deduction
"
 
means
 
a
 
deduction
 
or
 
withholding
 
from
 
a
 
payment
 
under
 
a
Finance Document required by FATCA.
"
FATCA
 
Exempt Party
" means a Party that is entitled to receive
 
payments free from
any FATCA
 
Deduction.
"
Final
 
Maturity
 
Date
" means
 
the earlier
 
of (a)
 
the date
 
falling 180
 
months after
 
the
Drawdown Date of the relevant Tranche and (b) 12 March 2032.
"
Finance Documents
" means
 
this Agreement,
 
the Security
 
Documents and
 
any other
document
 
designated
 
as
 
such
 
by
 
the
 
Agent
 
and
 
the
 
Borrowers
 
and
 
"
Finance
Document
" means any one of them.
"
Finance
 
Parties
"
 
means
 
the
 
Agent,
 
the
 
Arrangers,
 
the
 
Security
 
Agent
 
and
 
the
Lenders and "
Finance Party
" means any one of them.
"
Financial
 
Indebtedness
"
 
means
 
any
 
obligation
 
for
 
the
 
payment
 
or
 
repayment
 
of
money, whether present or future, actual or contingent, in respect of:
(a)
moneys borrowed or raised and debit balances at banks;
(b)
any acceptance or documentary credit facilities;
(c)
any bond, note, debenture, loan stock or similar debt instrument;
(d)
any finance leases and hire purchase contracts;
(e)
receivables sold or discounted (other than on a non-recourse
 
basis);
(f)
swaps, forward exchange contracts, futures and other derivatives;
(g)
any
 
other
 
transaction (including
 
without
 
limitation forward
 
sale
 
or
 
purchase
agreements) having the
 
commercial effect of a
 
borrowing or raising
 
of money
or of any of (b) to (f) above; and
(h)
guarantees in respect of indebtedness of any person falling
 
within any of (a)
to (g) above.
"
GAAP
"
 
means
 
generally
 
accepted
 
accounting
 
principles
 
in
 
the
 
United
 
States
 
of
America.
"
Guarantee
"
 
means
 
the
 
guarantee
 
and
 
indemnity
 
referred
 
to
 
in
 
Clause
 
10.1.3
(
Security Documents
).
"
Guarantor
" means
 
Diana Shipping
 
Inc., a
 
company incorporated under
 
the laws
 
of
the
 
Republic
 
of
 
the
 
Marshall
 
Islands
 
with
 
its
 
registered
 
address
 
at
 
Trust
 
Company
Complex, Ajeltake Road,
 
Ajeltake Island, Majuro, Marshall
 
Islands MH 96960
 
and/or
(where the context permits) any other person who shall at any time
 
during the Facility
Period give to the Lenders or
 
to the Security Agent on their behalf a
 
guarantee and/or
indemnity for the repayment of all or part of the Indebtedness.
"
Group
" means
 
the Guarantor
 
and its
 
Subsidiaries from
 
time to
 
time (including,
 
but
not
 
limited
 
to,
 
the
 
Borrowers)
 
and
 
"
member
 
of
 
the
 
Group
"
 
shall
 
be
 
construed
accordingly.
"
IAPPC
"
 
means
 
a
 
valid
 
international air
 
pollution
 
prevention
 
certificate
 
for
 
a
 
Vessel
issued under Annex VI.
"
Indebtedness
" means
 
the aggregate
 
from time
 
to time
 
of: the
 
amount of
 
the Loan
outstanding; all accrued and unpaid interest on the Loan; and all other
 
sums of any
nature (together with
 
all accrued and
 
unpaid interest on
 
any of
 
those sums) payable
to any of the Finance Parties under all or any of the Finance Documents.
"
Insurances
"
 
means
 
all
 
policies
 
and
 
contracts of
 
insurance
 
(including
 
all
 
entries
 
in
protection and indemnity or war risks associations) which are from time to
 
time taken
out or entered into in respect of or in connection with a Vessel or her increased value
or her Earnings and (where the context
 
permits) all benefits under such
 
contracts and
policies, including all claims of any nature and returns of premium.
"
Interpolated
 
CME
 
Term
 
SOFR
"
 
means
 
the
 
rate
 
(rounded to
 
the
 
same
 
number
 
of
decimal
 
places
 
as
 
CME
 
Term
 
SOFR)
 
which
 
results
 
from
 
interpolating
 
on
 
a
 
linear
basis between:
(a)
either:
(i)
the
 
applicable CME
 
Term
 
SOFR (as
 
of the
 
Quotation Day)
 
for the
longest
 
period
 
(for
 
which
 
CME
 
Term
 
SOFR
 
is
 
available)
 
which
 
is
less than the Interest Period of the relevant Tranche; or
(ii)
if no
 
such CME
 
Term
 
SOFR is
 
available for
 
a period
 
which is
 
less
than the
 
Interest Period of
 
the relevant
 
Tranche, SOFR
 
for the
 
day
which
 
is two
 
US Government
 
Securities Business
 
Days before
 
the
Quotation Day; and
(b)
the
 
applicable CME
 
Term
 
SOFR (as
 
of the
 
Quotation Day)
 
for the
 
shortest
period (for which
 
CME Term
 
SOFR is available)
 
which exceeds the
 
Interest
Period of the relevant Tranche.
"
Interest Payment Date
" means each date for the payment of interest in accordance
with Clause 7.6 (
Accrual and payment of interest
).
"
Interest
 
Period
" means
 
each period
 
for the
 
determination and
 
payment of
 
interest
selected by
 
the Borrowers
 
or agreed
 
or selected
 
by the
 
Agent pursuant
 
to Clause
 
6
(
Interest
).
"
ISM
 
Code
"
 
means
 
the
 
International
 
Management
 
Code
 
for
 
the
 
Safe
 
Operation
 
of
Ships and for Pollution Prevention.
"
ISM
 
Company
" means,
 
at any
 
given time,
 
the company
 
responsible for
 
a Vessel's
compliance with the ISM Code under paragraph 1.1.2 of the ISM Code.
"
ISPS Code
" means the International Ship and Port Facility Security Code.
"
ISPS Company
" means, at any
 
given time, the company
 
responsible for a Vessel's
compliance with the ISPS Code.
"
ISSC
" means a
 
valid international ship security
 
certificate for a Vessel
 
issued under
the ISPS Code.
"
LIBOR
" means:
(a)
the applicable Screen Rate; or
(b)
(if no Screen Rate is available
 
for any Interest Period) the arithmetic
 
mean of
the rates (rounded upwards to four decimal places) as supplied to the
 
Agent
at its request by leading banks in the London interbank
 
market,
at 11.00 a.m. two (2) Business
 
Days before the
 
first day of the
 
relevant Interest Period
for the offering
 
of deposits in
 
Dollars in an
 
amount comparable
 
to the relevant
 
Tranche
and
 
for
 
a period
 
comparable to
 
the
 
relevant Interest
 
Period and,
 
if
 
any such
 
rate is
below zero, LIBOR will be deemed to be zero.
"
Loan
" means
 
the aggregate
 
amount of
 
the
 
Tranches
 
advanced or
 
to
 
be advanced
by
 
the
 
Lenders
 
to
 
the
 
Borrowers
 
under
 
Clause
 
4
 
(
Advance
)
 
or,
 
where
 
the
 
context
permits, the amount advanced and for the time being outstanding.
"
Majority
 
Lenders
"
 
means
 
a
 
Lender
 
or
 
Lenders
 
whose
 
Commitments
 
aggregate
more than eighty per cent (80%) of the aggregate of all the
 
Commitments.
"
Management
 
Agreements
"
 
means
 
the
 
agreements
 
for
 
the
 
commercial
 
and/or
technical
 
management
 
of
 
the
 
Vessels
 
entered
 
or
 
to
 
be
 
entered
 
into
 
between
 
the
Borrowers respectively
 
and the
 
Managers and
 
"
Management Agreement
" means
 
any
one of them.
"
Managers
" means Diana
 
or such other commercial
 
and/or technical managers
 
of the
Vessels as nominated by the Borrowers and approved by the Agent.
"
Managers' Undertakings
" means the
 
letters of
 
undertaking in
 
respect of
 
the Vessels
referred
 
to
 
in
 
Clause
 
10.1.7
 
(
Security
 
Documents
)
 
and
 
"
Managers'
 
Undertaking
"
means any one of them.
"
Margin
" means two point three per cent (2.3%) per annum.
"
Market
 
Disruption
 
Rate
"
 
means
 
the
 
percentage
 
rate
 
per
 
annum
 
which
 
is
 
the
aggregate of the Reference Rate and the Credit Adjustment Spread.
"
Maximum Tranche Amount
" means:
(a)
in respect
 
of Tranche A,
 
an amount not
 
exceeding the
 
lesser of
 
(i) twenty
 
nine
million and two
 
hundred and twenty
 
thousand Dollars ($29,220,000)
 
and (ii)
seventy per cent (70%) of
 
the Fair Market Value
 
of Vessel
 
A on the basis
 
of
the valuations
 
to be
 
obtained by
 
the Agent
 
pursuant to
 
Clause 3.1
 
(
Conditions
precedent
); and
(b)
in respect
 
of Tranche B,
 
an amount not
 
exceeding the
 
lesser of
 
(i) twenty
 
nine
million and two
 
hundred and twenty
 
thousand Dollars ($29,220,000)
 
and (ii)
seventy per cent (70%) of
 
the Fair Market Value
 
of Vessel
 
B on the basis
 
of
the valuations
 
to be
 
obtained by
 
the Agent
 
pursuant to
 
Clause 3.1
 
(
Conditions
precedent
).
"
Maximum Loan Amount
" means an aggregate amount not exceeding $58,440,000.
"
Mortgages
"
 
means
 
the
 
preferred
 
or
 
statutory
 
(as
 
the
 
context
 
shall
 
require)
mortgages referred to in Clause 10.1.1 (
Security Documents
) and "
Mortgage
" means
any one of them.
"
Negative
 
Share
 
Pledges
"
 
means
 
the
 
negative
 
pledges
 
of
 
shares
 
referred
 
to
 
in
Clause 10.1.5
 
(
Security Documents
) and
 
"
Negative Share
 
Pledge
" means
 
any one
of them.
"
Original
 
Financial
 
Statements
"
 
means
 
the
 
audited
 
consolidated
 
financial
statements
 
of
 
the
 
Borrowers
 
and
 
the
 
Guarantor
 
for
 
the
 
financial
 
year
 
ended
 
31
December 2014.
"
Palios Family
" means, together, each of the following:
(a)
Mr Simeon Palios;
(b)
all the lineal descendants in direct line of Mr Palios;
(c)
a husband or wife or widower or widow of any of the above persons;
(d)
the estates, trusts or
 
legal representatives of
 
which any of the
 
above persons
are the beneficiaries; and
(e)
each
 
company
 
legally
 
or
 
beneficially
 
owned
 
or
 
(as
 
the
 
case
 
may
 
be)
controlled by
 
one or
 
more of
 
the persons
 
or entities
 
which would
 
fall within
paragraphs
(a)
to (d) of this definition,
and each one of the above shall be referred to as "
a member of the
 
Palios Family
";
"
Party
" means a party to this Agreement.
"
Permitted Encumbrance
" means
 
(a) any
 
Encumbrance which
 
has been
 
disclosed
in writing to,
 
and approved in
 
writing by,
 
the Agent on
 
the date of
 
this Agreement, or
(b)
 
any
 
Encumbrance
 
in
 
favour
 
of
 
the
 
Security
 
Agent
 
pursuant
 
to
 
the
 
Finance
Documents,
 
or
 
(c)
 
any
 
lien
 
on
 
a
 
Vessel
 
for
 
master's,
 
officer's
 
or
 
crew's
 
wages
outstanding in
 
the
 
ordinary course
 
of trading,
 
or
 
(d)
 
any lien
 
for
 
salvage, or
 
(e)
 
any
ship
 
repairer's
 
or
 
outfitter's possessory
 
lien
 
on
 
a
 
Vessel
 
for
 
a
 
sum
 
not
 
(except
 
with
the prior written consent
 
of the Agent) exceeding
 
two million Dollars ($2,000,000), or
(f) any other liens incurred in the ordinary course of business by operation of law and
securing
 
Borrowers' overdue
 
obligations of
 
no longer
 
than
 
thirty
 
(30)
 
days
 
from
 
the
date of their occurrence
 
or (g) Encumbrances arising by operation of law in respect
 
of
taxes which are not overdue for payment in
 
respect of taxes being contested in good
faith by appropriate steps and, in each case, in respect of which
 
appropriate reserves
have been made.
"
Pledgor
"
 
means
 
the
 
Guarantor
 
in
 
its
 
capacity
 
as
 
pledgor
 
and
 
shareholder
 
of
 
the
Borrowers.
"
Prepositioning
 
Date
"
 
means
 
the
 
date
 
which
 
is
 
three
 
Business
 
Days
 
before
 
the
Delivery Date.
"
Proportionate
 
Share
"
 
means,
 
at
 
any
 
time,
 
the
 
proportion
 
which
 
a
 
Lender's
Commitment (whether or not advanced)
 
then bears to the aggregate Commitments
 
of
all the Lenders (whether or not advanced).
"
Quotation
 
Day
" means,
 
in relation
 
to any
 
period for
 
which an
 
interest rate
 
is to
 
be
determined two US Government Securities Business Days before the first day of that
period, unless market
 
practice differs in
 
the relevant syndicated
 
loan market, in
 
which
case the
 
Quotation Day
 
will be
 
determined by
 
the Agent
 
in accordance
 
with that
 
market
practice
 
(and
 
if
 
quotations
 
would
 
normally
 
be
 
given
 
on
 
more
 
than
 
one
 
day,
 
the
Quotation Day will be the last of those days).
"
Rate Switch Date
" means 21 July 2023. "
Reference
Rate
" means, in relation to any Tranche:
(a)
the
 
applicable
 
CME
 
Term
 
SOFR as
 
of
 
the
 
Quotation
 
Day
 
and for
 
a
 
period
equal in length to the Interest Period of that Tranche; or
(b)
as otherwise determined pursuant to Clauses 7.9.1 or 7.9.2,
and if, in either case, that rate is less than zero, the Reference Rate shall be deemed
to be zero.
"
Relevant
 
Documents
" means
 
the Finance
 
Documents, the
 
Building Contracts, the
Charters,
 
the
 
Management
 
Agreements
 
and
 
the
 
Account
 
Holder's
 
confirmation
specified in Part 1 of Schedule 3 (
Conditions precedent
).
"
Relevant Market
" means
 
the market
 
for overnight
 
cash borrowing
 
collateralised by
US Government securities.
"
Repayment
 
Date
"
 
means
 
the
 
date
 
for
 
payment
 
of
 
any
 
Repayment
 
Instalment
 
in
accordance with Clause 5.1 (
Repayment of Tranches
).
"
Repayment
 
Instalment
"
 
means
 
any
 
instalment
 
of
 
the
 
Loan
 
to
 
be
 
repaid
 
by
 
the
Borrowers under Clause 5.1 (
Repayment of Tranches
).
"
Requisition
 
Compensation
"
 
means
 
all
 
compensation
 
or
 
other
 
money
 
which
 
may
from time to time be payable to a Borrower as a result of a Vessel being
 
requisitioned
for title or in any other way compulsorily acquired (other than by way of requisition for
hire).
"
Screen
 
Rate
"
 
means,
 
in
 
relation
 
to
 
LIBOR,
 
the
 
London
 
interbank
 
offered
 
rate
administered
 
by
 
ICE
 
Benchmark Administration
 
Limited
 
(or
 
any
 
other
 
person
 
which
takes
 
over
 
the
 
administration
 
of
 
that
 
rate)
 
for
 
the
 
relevant
 
currency
 
and
 
period
displayed on pages LIBOR01 or LIBOR02 of the Reuters screen (or any replacement
Reuters
 
page
 
which
 
displays
 
that
 
rate)
 
or
 
on
 
the
 
appropriate
 
page
 
of
 
such
 
other
information service which publishes that
 
rate from time to
 
time in place of
 
Reuters. If
such page or the service ceases to be available, the Agent may specify
 
another page
or
 
service displaying
 
the
 
appropriate rate
 
after
 
consultation
 
with the
 
Borrowers and
the Lenders.
"
Security Documents
" means the
 
Mortgages, the Assignments,
 
the Guarantee, the
Earnings
 
Account
 
Charges,
 
the
 
Negative
 
Share
 
Pledges,
 
the
 
Managers
Undertakings
 
and
 
any
 
other
 
agreement
 
or
 
document
 
which
 
may
 
at
 
any
 
time
 
be
executed
 
by
 
any
 
person
 
as
 
security
 
for
 
the
 
payment
 
of
 
all
 
or
 
any
 
part
 
of
 
the
Indebtedness
 
and "
Security Document
" means any one of them.
"
Security Parties
" means the
 
Borrowers, the Guarantor,
 
the Pledgor,
 
the Managers
and any other person who may at any time during the Facility Period
 
be liable for,
 
or
provide security for,
 
all or any part of the Indebtedness, and "
Security Party
" means
any one of them.
"
SMC
"
 
means
 
a
 
valid
 
safety
 
management
 
certificate
 
issued
 
for
 
a
 
Vessel
 
by
 
or
 
on
behalf of the Administration under paragraph 13.7 of the ISM Code.
"
SMS
"
 
means
 
a
 
safety
 
management
 
system
 
for
 
a
 
Vessel
 
developed
 
and
implemented in accordance with the ISM Code.
"
SOFR
"
 
means
 
the
 
secured
 
overnight
 
financing
 
rate
 
(SOFR)
 
administered
 
by
 
the
Federal
 
Reserve
 
Bank
 
of
 
New
 
York
 
(or
 
any
 
other
 
person
 
which
 
takes
 
over
 
the
administration
 
of
 
that
 
rate)
 
published
 
(before
 
any
 
correction,
 
recalculation
 
or
republication by the administrator) by the Federal Reserve Bank of New
 
York
 
(or any
other person which takes over the publication of that rate).
"
Subsidiaries
" means any
 
company or entity
 
directly or indirectly
 
controlled by such
person, and
 
for this
 
purpose "control"
 
means either
 
the ownership
 
of more
 
than fifty
per cent (50%)
 
of the voting share
 
capital (or equivalent rights
 
of ownership) of such
company
 
or
 
entity
 
or
 
the
 
power
 
to
 
direct
 
its
 
policies
 
and
 
management,
 
whether
 
by
contract or otherwise and "
Subsidiary
" means any one of them.
"
Tax
"
 
means
 
any
 
tax,
 
levy,
 
impost, duty
 
or
 
other
 
charge
 
or
 
withholding of
 
a
 
similar
nature (including any penalty or interest payable in connection with any failure
 
to pay
or any delay in paying any of the same).
"
Total Loss
" means:
(a)
an
 
actual,
 
constructive,
 
arranged,
 
agreed
 
or
 
compromised
 
total
 
loss
 
of
 
a
Vessel; or
(b)
the
 
requisition
 
for
 
title
 
or
 
compulsory
 
acquisition
 
of
 
a
 
Vessel
 
by
 
any
government
 
or
 
other
 
competent
 
authority
 
(other
 
than
 
by
 
way
 
of
 
requisition
for hire); or
(c)
the
 
capture,
 
seizure,
 
arrest,
 
detention,
 
hijacking,
 
theft,
 
condemnation
 
as
prize,
 
confiscation
 
or
 
forfeiture
 
of
 
a
 
Vessel
 
(not
 
falling
 
within
 
(b)
 
above),
unless
 
that
 
Vessel
 
is
 
released
 
and
 
returned
 
to
 
the
 
possession
 
of
 
the
relevant
 
Borrower within
 
thirty
 
(30)
 
days
 
after
 
the
 
capture,
 
seizure,
 
arrest,
detention, hijacking, theft, condemnation
 
as prize, confiscation
 
or forfeiture in
question.
"
Tranches
" means Tranche A and Tranche B and "
Tranche
" means any one of them.
"
Tranche
 
A
"
 
means
 
an
 
amount
 
of
 
the
 
Loan
 
advanced
 
or
 
to
 
be
 
advanced
 
by
 
the
Lenders
 
to
 
the
 
Borrowers
 
in
 
respect
 
of
 
Vessel
 
A
 
not
 
exceeding
 
the
 
relevant
Maximum
 
Tranche
 
Amount
 
or,
 
where
 
the
 
context
 
permits,
 
the
 
amount
 
thereof
advanced and for
 
the time being outstanding.
"
Tranche
 
B
"
 
means
 
an
 
amount
 
of
 
the
 
Loan
 
advanced
 
or
 
to
 
be
 
advanced
 
by
 
the
Lenders
 
to
 
the
 
Borrowers
 
in
 
respect
 
of
 
Vessel
 
B
 
not
 
exceeding
 
the
 
relevant
Maximum
 
Tranche
 
Amount
 
or,
 
where
 
the
 
context
 
permits,
 
the
 
amount
 
thereof
advanced and for
 
the time being outstanding.
"
Transfer
 
Certificate
"
 
means
 
a
 
certificate
 
substantially
 
in
 
the
 
form
 
set
 
out
 
in
Schedule 6 (
Form of Transfer Certificate
) or any
 
other form agreed
 
between the
 
Agent
and the Borrowers.
"
Transfer Date
" means, in relation to any Transfer Certificate, the later of:
(a)
the proposed Transfer Date specified in the Transfer Certificate; and
(b)
the
 
date
 
on
 
which
 
the
 
Agent
 
executes
 
the
 
Transfer
Certificate. "
Trust Property
" means:
(a)
all
 
benefits
 
derived
 
by
 
the
 
Security
 
Agent
 
from
 
Clause
 
10
 
(
Security
 
and
Application of Moneys
); and
(b)
all
 
benefits
 
arising
 
under
 
(including,
 
without
 
limitation,
 
all
 
proceeds
 
of
 
the
enforcement of) each of the Security Documents,
with the exception of any
 
benefits arising solely for the
 
benefit of the Security Agent.
"
US
" means the United States of America.
"
US Tax Obligor
" means:
(a)
a Borrower which is resident for tax purposes in the US;
 
or
(b)
a
 
Security
 
Party
 
some
 
or
 
all
 
of
 
whose
 
payments
 
under
 
the
 
Finance
Documents
 
are
 
from
 
sources
 
within
 
the
 
US
 
for
 
US
 
federal
 
income
 
tax
purposes.
"
Vessels
" means Vessel A and Vessel B and "
Vessel
" means any one of them.
"
Vessel
 
A
" means
 
the 208,500
 
dwt bulk
 
carrier and
 
everything now
 
or in
 
the future
belonging to her
 
on board and
 
ashore, currently
 
under construction
 
by the Builder
 
with
the Builder's hull number H2548 for Aster Shipping Company Inc. on the terms of the
relevant Building Contract and,
 
on delivery to that Borrower, intended to
 
be registered
under an Approved Flag in the ownership of that Borrower.
"
Vessel
 
B
" means
 
the 208,500
 
dwt bulk
 
carrier and
 
everything now
 
or in
 
the future
belonging to her
 
on board and
 
ashore, currently
 
under construction
 
by the Builder
 
with
the Builder's hull number H2549 for Aerik Shipping Company Inc. on the terms of the
relevant Building Contract and,
 
on delivery to that Borrower, intended to
 
be registered
under an Approved Flag in the ownership of that Borrower.
"
US Government Securities Business Day
" means a day other than:
(a)
a Saturday or Sunday; and
(b)
a
 
day
 
on
 
which
 
the
 
Securities
 
Industry
 
and
 
Financial
 
Markets
 
Association
(or
 
any
 
successor
 
organisation)
 
recommends
 
that
 
the
 
fixed
 
income
departments
 
of
 
its
 
members
 
be
 
closed
 
for
 
the
 
entire
 
day
 
for
 
purposes
 
of
trading in US Government securities.
1.2
In this Agreement:
1.2.1
words denoting the plural number include the singular and vice
 
versa;
1.2.2
words
 
denoting
 
persons include
 
corporations, partnerships,
 
associations of
persons
 
(whether
 
incorporated
 
or
 
not)
 
or
 
governmental
 
or
 
quasi-
governmental bodies or authorities and vice versa;
1.2.3
references
 
to
 
Recitals,
 
Clauses
 
and
 
Schedules
 
are
 
references
 
to
 
recitals,
clauses and schedules to or of this Agreement;
1.2.4
references to this Agreement include the Recitals and the
 
Schedules;
1.2.5
the headings
 
and contents
 
page(s) are
 
for the
 
purpose
 
of reference
 
only, have
no legal or other
 
significance, and shall
 
be ignored in
 
the interpretation of
 
this
Agreement;
1.2.6
references to any document (including,
 
without limitation, to all or
 
any of the
Relevant Documents) are, unless the context otherwise requires, references
to that document as amended,
 
supplemented, novated or replaced
 
from time
to time;
1.2.7
a
 
Lender's "
cost
 
of
 
funds
"
 
in relation
 
to
 
its
 
participation in
 
a
 
Tranche
 
is
 
a
reference to
 
the average
 
cost (determined
 
either on
 
an actual
 
or a
 
notional
basis)
 
which
 
that
 
Lender
 
would
 
incur
 
if
 
it
 
were
 
to
 
fund,
 
from
 
whatever
source(s) it
 
may reasonably
 
select,
 
an amount
 
equal
 
to
 
the
 
amount of
 
that
participation in that Tranche for
 
a period equal in
 
length to the Interest Period
of that Tranche;
1.2.8
references
 
to
 
"
indebtedness
"
 
include
 
any
 
obligation
 
(whether
 
incurred
 
as
principal
 
or
 
as
 
surety)
 
for
 
the
 
payment
 
or
 
repayment
 
of
 
money,
 
whether
present or future, actual or contingent;
1.2.9
references
 
to
 
statutes
 
or
 
provisions
 
of
 
statutes
 
are
 
references
 
to
 
those
statutes, or those
 
provisions, as from time
 
to time amended,
 
replaced or re-
enacted;
1.2.10
references
 
to
 
any
 
Finance
 
Party
 
include
 
its
 
successors,
 
transferees
 
and
assignees; and
1.2.11
a time of day (unless otherwise specified) is a reference to London
 
time.
1.3
Offer letter
This
 
Agreement
 
supersedes
 
the
 
terms
 
and
 
conditions
 
contained
 
in
 
any
correspondence relating to the subject matter of
 
this Agreement exchanged between
any Finance Party and the Borrowers or
 
their representatives prior to the
 
date of this
Agreement.
2
The Loan and its Purpose
2.1
Amount
Subject to
 
the terms
 
of this
 
Agreement, the
 
Lenders agree
 
to make
 
available to
 
the
Borrowers a
 
term loan
 
comprising all
 
the Tranches
 
and not
 
exceeding in
 
aggregate
the Maximum Loan Amount.
2.2
Finance Parties' obligations
The
 
obligations
 
of
 
each
 
Finance
 
Party
 
under
 
the
 
Finance
 
Documents
 
are
 
several.
Failure by
 
a
 
Finance Party
 
to
 
perform its
 
obligations under
 
the
 
Finance Documents
does
 
not
 
affect
 
the
 
obligations
 
of
 
any
 
other
 
party
 
to
 
the
 
Finance
 
Documents.
 
No
Finance Party is responsible for
 
the obligations of any other
 
Finance Party under the
Finance Documents.
2.3
Purpose
The Borrowers shall apply the Loan for the purposes referred
 
to in Recital (B).
2.4
Monitoring
No Finance Party
 
is bound to
 
monitor or verify
 
the application
 
of any amount
 
borrowed
under this Agreement.
3
Conditions of Utilisation
3.1
Conditions precedent
The Borrowers are
 
not entitled to
 
have any Tranche
 
advanced unless the Agent
 
has
received
 
all
 
of
 
the
 
documents
 
and
 
other
 
evidence
 
listed
 
in
 
Part
 
1
 
of
 
Schedule
 
3
(
Conditions precedent
), save that
 
references in Section
 
2 of that
 
Part 1 to
 
"the Vessel"
or to any person or document relating
 
to a Vessel
 
shall be deemed to relate solely to
any Vessel
 
specified in the relevant
 
Drawdown Notice or to
 
any person or document
relating to that Vessel respectively.
3.2
Further conditions precedent
The
 
Lenders
 
will
 
only
 
be
 
obliged
 
to
 
advance
 
a
 
Tranche
 
if
 
on
 
the
 
date
 
of
 
the
Drawdown Notice and on the proposed Drawdown Date:
3.2.1
no Default has occurred or would result from the advance of
 
that Tranche;
3.2.2
the
 
representations
 
made
 
by
 
the
 
Borrowers
 
under
 
Clause
 
11
(
Representations
) are true in all material respects; and
3.2.3
no event or series of events has occurred which, in the opinion of the Agent,
is likely to have a materially adverse effect on the business, assets, financial
condition or credit worthiness of a Security Party.
3.3
Tranche limit
The
 
Lenders
 
will
 
only
 
be
 
obliged
 
to
 
advance
 
a
 
Tranche
 
if
 
that
 
Tranche
 
will
 
not
exceed
 
the
 
relevant
 
Maximum
 
Tranche
 
Amount
 
nor
 
increase
 
the
 
Loan
 
to
 
a
 
sum
 
in
excess of the Maximum Loan Amount Tranche Amount for the relevant Vessel.
3.4
Conditions subsequent
The Borrowers undertake to deliver or to cause to be delivered to the Agent on, or as
soon as practicable after,
 
the relevant Drawdown Date or on such
 
other later date as
the
 
Agent may
 
agree in
 
its
 
discretion, the
 
additional documents
 
and other
 
evidence
listed in Part 2 of Schedule 3 (
Conditions subsequent
), save that references in that
Part
 
2
 
to
 
"the
 
Vessel"
 
or
 
to
 
any
 
person
 
or
 
document
 
relating
 
to
 
a
 
Vessel
 
shall
 
be
deemed to
 
relate solely
 
to any
 
Vessel
 
specified in
 
the relevant
 
Drawdown Notice
 
or
to any person or document relating to that Vessel respectively.
3.5
No waiver
If the
 
Lenders in
 
their sole
 
discretion agree
 
to advance
 
a Tranche
 
to the
 
Borrowers
before
 
all
 
of
 
the
 
documents
 
and
 
evidence
 
required
 
by
 
Clause
 
3.1
 
(
Conditions
precedent
)
 
have
 
been
 
delivered
 
to
 
or
 
to
 
the
 
order
 
of
 
the
 
Agent,
 
the
 
Borrowers
undertake to deliver all outstanding documents and evidence to or
 
to the order of the
Agent no
 
later than
 
the date
 
specified by
 
the Agent
 
(acting on
 
the instructions
 
of all
the Lenders).
The advance of a Tranche under this Clause 3.5 shall not be taken as a waiver of
 
the
Lenders'
 
right
 
to
 
require
 
production
 
of
 
all
 
the
 
documents
 
and
 
evidence
 
required
 
by
Clause 3.1 (
Conditions precedent
).
3.6
Form and content
All documents and evidence delivered to the Agent under this Clause
 
3 shall:
3.6.1
be in form and substance acceptable to the Agent; and
3.6.2
if
 
required
 
by
 
the
 
Agent,
 
be
 
certified,
 
notarised,
 
legalised
 
or
 
attested
 
in
 
a
manner acceptable to the Agent.
4
Advance
4.1
Drawdown Request
The
 
Borrowers
 
may
 
request
 
a
 
Tranche
 
to
 
be
 
advanced
 
in
 
one
 
amount
 
on
 
any
Business Day
 
prior to
 
the relevant
 
Availability Termination
 
Date by
 
delivering to
 
the
Agent
 
a
 
duly
 
completed
 
original
 
Drawdown
 
Notice
 
not
 
fewer
 
than
 
six
 
(6)
 
Business
Days before the
 
proposed Drawdown Date and
 
any undrawn part
 
of a Tranche
 
shall
be cancelled and shall not
 
be available for borrowing by the
 
Borrowers on the earlier
of
 
(a)
 
the
 
relevant
 
Drawdown
 
Date,
 
once
 
the
 
Tranche
 
has
 
been
 
advanced
 
and
 
(b)
the relevant Availability Termination Date. Any such
 
Drawdown Notice
 
shall be signed
by authorised signatories
 
of the Borrowers and, once delivered, is irrevocable.
4.2
Lenders' participation
Subject
 
to
 
Clauses
 
2
 
(
The
 
Loan
 
and
 
its
 
Purpose
)
,
3
 
(
Conditions
 
of
 
Utilisation
)
 
and
4.3
 
(
Prepositioning
 
of
 
funds
),
 
the
 
Agent
 
shall
 
promptly
 
notify
 
each
 
Lender
 
of
 
the
receipt
 
of
 
a
 
Drawdown
 
Notice,
 
following
 
which
 
each
 
Lender
 
shall
 
advance
 
its
Proportionate Share
 
of the
 
relevant Tranche
 
to the
 
Borrowers through
 
the Agent
 
on
the relevant
 
Drawdown Date.
4.3
Prepositioning of funds
The Agent shall,
 
subject to the
 
Agent being satisfied
 
that it will
 
receive by no
 
later than
the
 
Delivery Date
 
all
 
of
 
the
 
documents
 
and evidence
 
listed
 
in
 
Part
 
1 of
 
Schedule 4
(
Conditions precedent
) (unless waived pursuant to this Agreement), at the
 
request of
the Borrower and
 
in accordance with the
 
terms of the
 
relevant Building Contract and
on terms and conditions reasonably acceptable to all the Lenders,
 
preposition on the
 
 
 
 
 
 
Prepositioning Date
 
such part
 
of the
 
Loan as
 
is to
 
be used
 
to finance
 
the amount
 
of
the
 
instalment
 
of
 
the
 
contract
 
price
 
payable
 
on
 
the
 
Delivery
 
Date
 
of
 
the
 
relevant
Vessel
 
under the relevant Building Contract to the Builder
 
as has been received by it
from the Lenders.
The prepositioning
 
of such
 
funds shall
 
constitute an
 
advance of
 
the Loan
 
under this
Clause 4 (
Advance
).
5
Repayment
5.1
Repayment of Tranches
The
 
Borrowers
 
agree
 
to
 
repay
 
each
 
Tranche
 
to
 
the
 
Agent
 
for
 
the
 
account
 
of
 
the
Lenders by 60 quarterly instalments, each in the relevant amount
 
set out below:
Tranche A
$487,000.00
Tranche B
$487,000.00
The first instalment shall
 
fall due on
 
whichever of 21 January,
 
21 April, 21 July
 
or 21
October that next falls not less than six
 
weeks after the Drawdown Date in respect of
that Tranche and subsequent instalments shall fall due on each 21 January,
 
21 April,
21 July or 21 October thereafter. The final instalment shall fall due on the earlier of:
5.1.1
whichever of 21 January,
 
21 April, 21 July or
 
21 October that next falls
 
after
the 59th instalment; and
5.1.2
the Final Maturity Date in respect of that Tranche.
5.2
Reduction of Repayment Instalments
If the aggregate amount advanced to the Borrowers under a
 
Tranche is less than
$29,220,000, the
 
amount
 
of
 
each Repayment
 
Instalment in
 
respect of
 
that
 
Tranche
shall be reduced pro rata to the amount actually advanced.
5.3
Reborrowing
The Borrowers may not reborrow any part of the Loan which is
 
repaid or prepaid.
6
Prepayment
6.1
Illegality
If it becomes unlawful in any jurisdiction for a Lender to perform any
 
of its obligations
as contemplated by this Agreement or to fund or maintain its
 
Commitment:
6.1.1
that Lender shall promptly notify the Agent of that event;
6.1.2
upon the
 
Agent notifying
 
the Borrowers,
 
such Lender's
 
Commitment (to
 
the
extent not already advanced) will be immediately cancelled;
 
and
6.1.3
the
 
Borrowers
 
shall
 
repay
 
a
 
sum
 
equal
 
to
 
such
 
Lender's
 
Commitment
 
in
respect of each
 
Tranche (to
 
the extent already advanced)
 
on the last
 
day of
its current Interest
 
Period or,
 
if earlier,
 
the date specified
 
by that
 
Lender in
the notice delivered to
 
the Agent and
 
notified by the Agent
 
to the Borrowers
(being no
 
earlier than
 
the last
 
day of
 
any applicable
 
grace period
 
permitted
by law) and the remaining Repayment
 
Instalments in respect of that Tranche
shall be reduced pro rata.
6.2
Voluntary prepayment of Tranches
The Borrowers
 
may prepay
 
the whole
 
or any
 
part of
 
a Tranche
 
(but, if
 
in part,
 
being
an amount
 
that reduces
 
that
 
Tranche
 
by an
 
amount which
 
is an
 
integral multiple
 
of
the amount of
 
a quarterly instalment in
 
respect of that
 
Tranche pursuant to
 
Clause 5
(
Repayment
)) subject as follows:
6.2.1
they
 
give
 
the
 
Agent
 
not
 
less
 
than
 
fifteen
 
(15)
 
Business
 
Days'
 
prior
 
written
notice;
6.2.2
no prepayment may be
 
made until after the
 
relevant Availability Termination
Date; and
6.2.3
any prepayment under this Clause 6.2 shall be
 
applied in prepayment of the
remaining
 
Repayment
 
Instalments
 
in
 
respect
 
of
 
the
 
relevant
 
Tranche
 
in
inverse order of maturity.
6.3
Mandatory prepayment on sale or Total Loss
If
 
a
 
Vessel
 
is
 
sold
 
by
 
a
 
Borrower
 
or
 
becomes
 
a
 
Total
 
Loss,
 
the
 
Borrowers
 
shall,
simultaneously with any
 
such sale or
 
on the earlier
 
of the date
 
falling one hundred
 
and
twenty (120)
 
days after
 
any such
 
Total
 
Loss and
 
the date
 
on which
 
the proceeds
 
of
any such Total
 
Loss are realised,
 
prepay the whole
 
of the
 
outstanding Indebtedness
in respect of the Tranche for the Vessel in question.
6.4
Restrictions
Any notice of
 
prepayment given under this
 
Clause 6 shall be
 
irrevocable and, unless
a contrary indication appears
 
in this Agreement, shall specify
 
the date or dates
 
upon
which the relevant prepayment is to be made and the amount of
 
that
 
prepayment.
Any prepayment
 
under this
 
Agreement shall be
 
made together
 
with accrued interest
on the amount prepaid and, subject to any Break Costs without premium
 
or penalty.
If the Agent
 
receives a notice
 
under this Clause 6
 
it shall promptly
 
forward a copy
 
of
that notice to the Borrowers or the Lenders, as appropriate.
7A
 
Rate Switch
7A.1
Switch to CME Term SOFR Rate
Subject to Clause 7A.2 (
Delayed switch
), on and
from the Rate Switch Date:
7A.1.1
 
use of
 
the Reference
 
Rate will
 
replace the
 
use of
 
LIBOR for
 
the calculation
of interest; and
7A.1.2 Clause 7.5.2 shall apply to each Tranche or Unpaid Sum.
8A.2
Delayed switch
If the Rate Switch Date falls
 
before the last day of an Interest
 
Period
for a Tranche:
7A.2.1
 
Clause 7.5.1 shall
 
continue to apply
 
to that Tranche
 
for that Interest
 
Period;
and
7A.2.2
 
on and from the first day
 
of the next Interest Period (if any)
 
for that Tranche,
Clause 7.5.2 shall apply to that Tranche.
7
Interest
7.1
Interest Periods
The
 
period
 
during
 
which
 
each
 
Tranche
 
shall
 
be
 
outstanding
 
under
 
this
 
Agreement
shall be divided into
 
consecutive Interest
 
Periods of three
 
(3) months' duration
 
or such
other
 
duration
 
as
 
may
 
be
 
agreed
 
between
 
the
 
Borrowers
 
and
 
the
 
Lenders
 
not
later
 
than
11.00
 
a.m. on
 
the third
 
Business Day
 
before the
 
beginning of
 
the Interest
 
Period in
question.
7.2
Beginning and end of Interest Periods
Each Interest Period shall start on the
 
Drawdown Date of the relevant Tranche or (if a
Tranche is already made) on the last day of the preceding Interest Period and end on
whichever
 
of
 
21
 
January,
 
21
 
April,
 
21
 
July
 
or
 
21
 
October
 
that
 
next
 
falls
 
after
 
the
Drawdown Date of that Tranche or the last day of the preceding Interest Period in the
relevant calendar month which shall be a Repayment Date,
 
except that, if there is no
numerically corresponding date
 
in that calendar
 
month, the
 
Interest Period shall
 
end
on the last Business Day in that month.
7.3
Interest Periods to meet Repayment Dates
If
 
an
 
Interest
 
Period
 
will
 
expire
 
after
 
the
 
next
 
Repayment
 
Date
 
in
 
respect
 
of
 
the
relevant Tranche, there
 
shall be a
 
separate Interest Period for
 
a part of that
 
Tranche
equal
 
to
 
the
 
Repayment
 
Instalment
 
due
 
on
 
that
 
next
 
Repayment
 
Date
 
and
 
that
separate Interest Period shall expire on that next Repayment Date.
7.4
Non-Business Days
If an Interest Period
 
would otherwise end on a
 
day which is not a
 
Business Day,
 
that
Interest Period
 
will instead
 
end on
 
the next
 
Business Day
 
in that
 
calendar month
 
(if
there is one) or the preceding Business Day (if there is not).
7.5
Interest rate
7.5.1
During
 
each Interest
 
Period starting
 
prior
 
to
 
the
 
Rate
 
Switch
 
Date,
 
interest
shall
 
accrue
 
on
 
the
 
Loan
 
at
 
the
 
rate
 
determined
 
by
 
the
 
Agent
 
to
 
be
 
the
aggregate of (a) the Margin and (b) LIBOR.
7.5.2
On
 
or
 
after
 
the
 
Rate
 
Switch
 
Date
 
(and
 
subject
 
to
 
Clause
 
7A.2
 
(
Delayed
switch
)), the
 
rate of
 
interest on
 
each Tranche for
 
each relevant
 
Interest Period
is the percentage rate per annum which is the aggregate of the
 
applicable:
(a)
Margin; and
(b)
Reference Rate; and
(c)
Credit Adjustment Spread.
7.6
Accrual and payment of interest
Interest shall
 
accrue from
 
day to
 
day,
 
shall be
 
calculated on
 
the basis
 
of a
 
360 day
year and
 
the actual
 
number of
 
days elapsed
 
(or,
 
in any
 
circumstance where
 
market
practice differs,
 
in accordance
 
with the
 
prevailing market
 
practice) and
 
shall be
 
paid
by the Borrowers to
 
the Agent for the
 
account of the Lenders on
 
the last day of
 
each
Interest Period and, if
 
the Interest Period is
 
longer than three (3) months,
 
on the dates
falling at three (3) monthly intervals after the first day of that
 
Interest Period.
7.7
Default interest
If (a) a Borrower fails to pay any amount payable by it
 
under a Finance Document on
its due date or (b)
 
an Event of Default has occurred
 
and is continuing and notice has
been given
 
to the
 
Borrowers, interest
 
shall accrue
 
on the
 
overdue amount
 
or on
 
the
amount
 
of
 
the
 
Loan
 
respectively
 
from
 
the
 
due
 
date
 
or
 
the
 
date
 
of
 
the
 
notice
respectively up to the date
 
of actual payment (both before and
 
after judgment) or the
date of
 
remedy of the
 
Event of Default
 
to the
 
Agent's full satisfaction
 
at a rate
 
which
is
 
two
 
per
 
cent
 
(2%)
 
higher
 
than
 
the
 
rate
 
which
 
would
 
have
 
been
 
payable
 
if
 
the
overdue
 
amount
 
had,
 
during
 
the
 
period
 
of
 
non-payment
 
or
 
Event
 
of
 
Default,
constituted
 
the
 
Loan
 
in
 
the
 
currency
 
of
 
the
 
overdue amount
 
for
 
successive
 
Interest
Periods, each selected by the Agent (acting reasonably). Any interest accruing under
this
 
Clause
 
7.7
 
shall
 
be
 
immediately
 
payable
 
by
 
that
 
Borrower
 
on
 
demand
 
by
 
the
Agent. If
 
unpaid, any
 
such interest
 
will be
 
compounded with
 
the overdue
 
amount at
the
 
end
 
of
 
each
 
Interest
 
Period
 
applicable
 
to
 
that
 
overdue
 
amount
 
but
 
will
 
remain
immediately due and payable.
7.8
Changes to calculation of Interest prior to Rate Switch
 
Date
If prior to the Rate Switch Date, either:
7.8.1
the
 
applicable
 
Screen
 
Rate
 
is
 
not
 
available
 
for
 
any
 
Interest
 
Period
 
and
 
no
rates are quoted to the Agent to determine LIBOR for that Interest Period;
 
or
7.8.2
a Lender or
 
Lenders inform the Agent
 
by written notice that
 
its cost of funds
for
 
any
 
Interest
 
Period
 
would
 
be
 
in
 
excess
 
of
 
LIBOR
 
and
 
that
 
notice
 
is
received by the
 
Agent no later
 
than close of
 
business in London
 
on the
 
day
LIBOR is determined for that Interest Period,
then Clause
 
7.10 (
Cost of funds
) shall
 
apply to the
 
relevant Tranche
 
for the
 
relevant
Interest Period.
7.9
Changes to calculation of Interest on or after Rate Switch
 
Date
On or after the Rate Switch Date:
7.9.1
if no
 
CME Term
 
SOFR is
 
available for the
 
Interest Period of
 
a Tranche,
 
the
applicable Reference Rate
 
shall be
 
the Interpolated CME
 
Term
 
SOFR for a
period equal in length to the Interest Period of that Tranche;
7.9.2
if no
 
CME Term
 
SOFR is available
 
for the
 
Interest Period of
 
a Tranche
 
and
it is not possible to calculate the Interpolated CME Term SOFR, then Clause
7.10
 
(
Cost
 
of
 
funds
)
 
shall
 
apply
 
to
 
that
 
Tranche
 
for
 
the
 
relevant
 
Interest
Period;
7.9.3
if before
 
close of
 
business in
 
London on
 
the Quotation
 
Day for
 
the relevant
Interest Period,
 
the Agent
 
receives notifications
 
from a
 
Lender or
 
Lenders that
its cost of funds relating
 
to its participation in
 
a Tranche exceeds
 
the Market
Disruption Rate in relation to
 
that Tranche, then Clause 7.10
 
(
Cost of funds
)
shall apply to the relevant Tranche for the relevant Interest Period.
7.10
Cost of funds
If this Clause 7.10 applies for any Interest Period,
 
then:
7.10.1
the
 
Agent
 
shall
 
give
 
notice
 
to
 
the
 
Lenders
 
and
 
the
 
Borrowers
 
of
 
the
occurrence of such event; and
7.10.2
the
 
rate
 
of
 
interest
 
on
 
the
 
relevant
 
Lender's
 
Commitment
 
for
 
that
 
Interest
Period shall be the rate per annum which is the sum of:
(a)
the Margin; and
(b)
the rate notified to the Agent by that Lender as soon as practicable,
and in any
 
event before interest
 
is due to
 
be paid in
 
respect of that
Interest Period, to be
 
that which expresses as a
 
percentage rate per
annum
 
that
 
Lender's
 
cost
 
of
 
funds
 
relating
 
its
 
Commitment
 
in
 
the
relevant Tranche.
7.10.3
If
 
this
 
Clause 7.10
 
(Cost of
 
funds)
 
applies and
 
the
 
Agent
 
or
 
the
 
Borrowers
so require,
 
the Agent
 
and the
 
Borrowers shall
 
enter into
 
negotiations (for
 
a
period of not more than
 
thirty days) with a view
 
to agreeing a substitute basis
for determining the rate of interest.
7.10.4
Any substitute
 
or alternative
 
basis agreed
 
pursuant to
 
Clause 7.10.3
 
above
shall, with the prior consent of all the Lenders and the Borrowers, be binding
on all Parties.
7.11
Changes to reference rates
7.11.1
If
 
a
 
Published
 
Rate
 
Replacement
 
Event
 
has
 
occurred
 
in
 
relation
 
to
 
any
Published Rate, any amendment or waiver which relates
 
to:
(a)
providing for the
 
use of a
 
Replacement Reference Rate
 
in place
 
of
that Published Rate; and
(b)
any or all of the following:
(i)
aligning any provision of any Finance Document to the use
of that Replacement Reference Rate;
(ii)
enabling that
 
Replacement Reference Rate
 
to be
 
used for
the calculation of
 
interest under this
 
Agreement (including,
without
 
limitation,
 
any
 
consequential
 
changes
 
required
 
to
enable
 
that
 
Replacement
 
Reference
 
Rate
 
to
 
be
 
used
 
for
the purposes of this Agreement);
(iii)
implementing
 
market
 
conventions
 
applicable
 
to
 
that
Replacement Reference Rate;
(iv)
providing
 
for
 
appropriate
 
fallback
 
(and
 
market
 
disruption)
provisions for that Replacement Reference Rate;
 
or
(v)
adjusting
 
the
 
pricing
 
to
 
reduce
 
or
 
eliminate,
 
to
 
the
 
extent
reasonably practicable,
 
any transfer
 
of economic
 
value from
one
 
Party
 
to
 
another
 
as
 
a
 
result
 
of
 
the
 
application of
 
that
Replacement
 
Reference
 
Rate
 
(and
 
if
 
any
 
adjustment
 
or
method
 
for
 
calculating
 
any
 
adjustment
 
has
 
been
 
formally
designated,
 
nominated
 
or
 
recommended
 
by
 
the
 
Relevant
Nominating
 
Body,
 
the
 
adjustment
 
shall
 
be
 
determined
 
on
the
 
basis
 
of
 
that
 
designation,
 
nomination
 
or
recommendation),
may be made
 
with the consent of
 
the Agent (acting on
 
the instructions of the
Majority Lenders) and the Borrowers.
7.11.2
In this Clause 7.11:
"
Published Rate
" means SOFR or the Term SOFR for any Quoted Tenor.
"
Published
 
Rate
 
Replacement
 
Event
" means,
 
in relation
 
to
 
a Published
Rate:
(a)
the
 
methodology,
 
formula
 
or
 
other
 
means
 
of
 
determining
 
that
Published Rate
 
has, in
 
the opinion
 
of the
 
Majority Lenders,
 
materially
changed; or
(b)
(i)
either
(A)
the
 
administrator
 
of
 
that
 
Published
 
Rate
 
or
 
its
supervisor
 
publicly
 
announces
 
that
 
such
administrator is insolvent; or
(B)
information
 
is
 
published
 
in
 
any
 
order,
 
decree,
notice,
 
petition or
 
filing, however
 
described, of
 
or
filed
 
with
 
a
 
court,
 
tribunal,
 
exchange,
 
regulatory
authority
 
or
 
similar
 
administrative,
 
regulatory
 
or
judicial
 
body
 
which
 
reasonably
 
confirms
 
that
 
the
administrator of that Published Rate is
 
insolvent,
provided
 
that,
 
in
 
each
 
case,
 
at
 
that
 
time,
 
there
 
is
 
no
successor
 
administrator
 
to
 
continue
 
to
 
provide
 
that
Published Rate;
(ii)
the administrator
 
of that
 
Published Rate
 
publicly announces
that
 
it
 
has
 
ceased
 
or
 
will
 
cease
 
to
 
provide
 
that
 
Published
Rate permanently
 
or indefinitely
 
and, at
 
that time,
 
there is
no
 
successor
 
administrator
 
to
 
continue
 
to
 
provide
 
that
Published Rate;
(iii)
the
 
supervisor of
 
the
 
administrator of
 
that
 
Published Rate
publicly announces
 
that such
 
Published Rate
 
has been
 
or
will be permanently or indefinitely discontinued;
 
or
(iv)
the
 
administrator
 
of
 
that
 
Published
 
Rate
 
or
 
its
 
supervisor
announces
 
that
 
that
 
Published
 
Rate
 
may
 
no
 
longer
 
be
used; or
(c)
the administrator
 
of that
 
Published Rate
 
(or the
 
administrator of
 
an
interest rate
 
which is a
 
constituent element of
 
that Published
 
Rate)
determines
 
that
 
that
 
Published
 
Rate
 
should
 
be
 
calculated
 
in
accordance
 
with
 
its
 
reduced
 
submissions
 
or
 
other
 
contingency
 
or
fallback policies or arrangements and either:
(i)
the
 
circumstance(s)
 
or
 
event(s)
 
leading
 
to
 
such
determination
 
are
 
not
 
(in
 
the
 
opinion
 
of
 
the
 
Majority
Lenders) temporary; or
(ii)
that
 
Published
 
Rate
 
is
 
calculated
 
in
 
accordance
 
with
 
any
such policy or
 
arrangement for a
 
period of no
 
less than 15
Business Days; or
(b) the administrator of
 
that Published
 
Rate
 
(or
 
the
 
administrator
of
 
an
 
interest
 
rate
 
which
 
is
 
a
 
constituent
 
element
 
of
 
that
Published
 
Rate)
 
determines
 
that
 
that
 
Published
 
Rate
should
 
be
 
calculated
 
in
 
accordance
 
with
 
its
 
reduced
submissions
 
or
 
other
 
contingency
 
or
 
fallback
 
policies
 
or
arrangements and either:
(d)
in
 
the
 
opinion
 
of
 
the
 
Majority
 
Lenders,
 
that
 
Published
 
Rate
 
is
otherwise
 
no
 
longer
 
appropriate
 
for
 
the
 
purposes
 
of
 
calculating
interest under this Agreement.
"
Quoted Tenor
" means, in relation to Term
 
SOFR, any period for which that
rate is customarily
 
displayed on the
 
relevant page or
 
screen of an
 
information
service.
"
Relevant Nominating Body
" means any applicable central bank, regulator
or
 
other
 
supervisory authority
 
or
 
a
 
group of
 
them,
 
or
 
any working
 
group or
committee sponsored
 
or chaired
 
by,
 
or constituted
 
at the
 
request of,
 
any of
them or the Financial Stability Board.
"
Replacement Reference Rate
" means a reference rate which
 
is:
(a)
formally
 
designated,
 
nominated
 
or
 
recommended
 
as
 
the
 
replacement
for a Published Rate by:
(i)
the administrator of
 
that Published Rate
 
(provided that the
market
 
or
 
economic
 
reality
 
that
 
such
 
reference
 
rate
measures is the same
 
as that measured by
 
that Published
Rate); or
(ii)
any Relevant Nominating Body,
and
 
if
 
replacements
 
have,
 
at
 
the
 
relevant
 
time,
 
been
 
formally
designated, nominated
 
or recommended
 
under both
 
paragraphs, the
"
Replacement
 
Reference
 
Rate
"
 
will
 
be
 
the
 
replacement
 
under
paragraph (ii) above;
(b)
in the
 
opinion of the
 
Majority Lenders and
 
the Borrowers, generally
accepted
 
in
 
the
 
international
 
or
 
any
 
relevant
 
domestic
 
syndicated
loan markets as the appropriate successor to a Published
 
Rate;
 
or
(c)
in
 
the
 
opinion
 
of
 
the
 
Majority
 
Lenders
 
and
 
the
 
Borrowers,
 
an
appropriate successor to a Published Rate.
7.12
Determinations conclusive
The Agent shall promptly
 
notify the Borrowers
 
of the determination
 
of a rate of
 
interest
under this Clause
 
7 and each
 
such determination shall (save
 
in the case
 
of manifest
error) be final and conclusive.
8
Indemnities
8.1
Transaction expenses
The Borrowers
 
will, promptly
 
on the
 
Agent's written
 
demand, pay
 
the
 
Agent (for
 
the
account of the Finance Parties) the amount of all costs and expenses (including legal
fees
 
and Value
 
Added
 
Tax
 
or
 
any similar
 
or replacement
 
tax
 
if
 
applicable) incurred
by the Finance Parties or any of them in connection with:
8.1.1
the negotiation, preparation,
 
printing, execution, syndication and
 
distribution
of
 
information
 
under
 
this
 
Agreement
 
and
 
registration
 
of
 
the
 
Finance
Documents (whether
 
or not
 
any Finance
 
Document is
 
actually
 
executed or
registered and whether or not all or any part of the Loan is
 
advanced);
8.1.2
any
 
amendment,
 
addendum
 
or
 
supplement
 
to
 
any
 
Finance
 
Document
(whether
 
or
 
not
 
completed)
 
(other
 
than
 
any
 
amendment,
 
addendum
 
or
supplement
 
to
 
any
 
Finance
 
Document
 
made
 
pursuant
 
to
 
Clause
 
14
(
Assignment and Sub-Participation
));
8.1.3
any other document which
 
may at any time
 
be required by a
 
Finance Party to
give effect
 
to any
 
Finance Document or
 
which a Finance
 
Party is entitled
 
to
call for
 
or obtain under
 
any Finance Document
 
(including, without limitation,
any
 
valuation
 
of
 
the
 
Vessels
 
obtained
 
in
 
accordance
 
with
 
this
 
Agreement
and any insurance report); and
8.1.4
any discharge, release or reassignment of any of the Security
 
Documents.
8.2
Funding costs
The Borrowers shall indemnify
 
each Finance Party,
 
by payment to the
 
Agent (for the
account
 
of
 
that
 
Finance Party)
 
promptly
 
on
 
the
 
Agent's
 
written
 
demand,
 
against
 
all
losses
 
and
 
costs
 
incurred
 
or
 
sustained
 
by
 
that
 
Finance
 
Party
 
if,
 
for
 
any
 
reason,
 
a
Tranche
 
is
 
not
 
advanced to
 
the
 
Borrowers after
 
the
 
relevant
 
Drawdown Notice
 
has
been given
 
to the
 
Agent, or
 
is advanced
 
on a
 
date other
 
than that
 
requested in
 
the
Drawdown
 
Notice
 
(unless,
 
in
 
either
 
case,
 
as
 
a
 
result
 
of
 
any
 
default
 
by
 
a
 
Finance
Party).
8.3
Break Costs
The Borrowers shall
 
pay to the
 
Agent (for
 
the account of
 
each Lender)
 
promptly on the
Agent's written
 
demand the
 
amount of
 
all costs,
 
losses, premiums
 
or penalties
 
incurred
or to
 
be incurred
 
by that
 
Lender as
 
a result
 
of its
 
receiving any
 
prepayment of
 
all or
any part of the
 
Loan (whether pursuant to
 
Clause 6 (
Prepayment
) or otherwise) on
 
a
day other
 
than the
 
last day
 
of an
 
Interest Period
 
for the
 
Loan or
 
relevant part
 
of the
Loan, or
 
any other payment
 
under or in
 
relation to the
 
Finance Documents on
 
a day
other
 
than
 
the
 
due
 
date
 
for
 
payment
 
of
 
the
 
sum
 
in
 
question,
 
including
 
(without
limitation) any losses or costs incurred or to be incurred in liquidating or re-employing
deposits from third parties acquired to effect or maintain all or any part of
 
the
 
Loan.
8.4
Currency indemnity
In the
 
event of a
 
Finance Party receiving
 
or recovering any
 
amount payable under
 
a
Finance
 
Document
 
in
 
a
 
currency
 
other
 
than
 
the
 
Currency
 
of
 
Account,
 
and
 
if
 
the
amount
 
received
 
or
 
recovered
 
is
 
insufficient
 
when
 
converted
 
into
 
the
 
Currency
 
of
Account at
 
the date
 
of receipt
 
to satisfy
 
in full
 
the amount
 
due, the
 
Borrowers shall,
promptly
 
on
 
the
 
Agent's
 
written
 
demand,
 
pay
 
to
 
the
 
Agent
 
for
 
the
 
account
 
of
 
the
relevant
 
Finance
 
Party
 
such
 
further
 
amount
 
in
 
the
 
Currency
 
of
 
Account
 
as
 
is
sufficient to satisfy
 
in full the amount
 
due and that further
 
amount shall be due to
 
the
Agent
 
on
 
behalf
 
of
 
the
 
relevant
 
Finance
 
Party
 
as
 
a
 
separate
 
debt
 
under
 
this
Agreement.
8.5
Increased costs (subject to Clause 8.6 (
Exceptions to increased costs
))
If, by reason
 
of the introduction of
 
any law,
 
or any change
 
in any law,
 
or any change
in the
 
interpretation or
 
administration of
 
any law,
 
or compliance
 
with any
 
request or
requirement from any central bank
 
or any fiscal, monetary or
 
other authority occurring
after
 
the
 
date
 
of
 
this
 
Agreement
 
(including
 
the
 
implementation
 
or
 
application
 
of
 
or
compliance
 
with
 
the
 
Basel
 
II
 
Accord
 
or
 
any
 
other
 
Basel
 
II
 
Regulation
 
or
 
Basel
 
III
(whether such
 
implementation, application
 
or compliance
 
is by
 
any central
 
bank or
 
any
fiscal,
 
monetary
 
or
 
other
 
authority,
 
a
 
Finance
 
Party
 
or
 
the
 
holding
 
company
 
of
 
a
Finance Party)):
8.5.1
a
 
Finance
 
Party
 
(or
 
the
 
holding
 
company
 
of
 
a
 
Finance
 
Party)
 
shall
 
be
subject
 
to
 
any
 
Tax
 
with
 
respect
 
to
 
payment
 
of
 
all
 
or
 
any
 
part
 
of
 
the
Indebtedness (other than Tax on overall net income); or
8.5.2
the basis of Taxation
 
of payments to a Finance
 
Party in respect of all or
 
any
part of the Indebtedness shall be changed; or
8.5.3
any reserve requirements
 
shall be
 
imposed, modified or
 
deemed applicable
against
 
assets held
 
by or
 
deposits in
 
or for
 
the
 
account of
 
or loans
 
by any
branch of a Finance Party; or
8.5.4
the
 
manner
 
in
 
which
 
a
 
Finance
 
Party
 
allocates
 
capital
 
resources
 
to
 
its
obligations
 
under
 
this
 
Agreement
 
or
 
any
 
ratio
 
(whether
 
cash,
 
capital
adequacy,
 
liquidity
 
or
 
otherwise)
 
which
 
a
 
Finance
 
Party
 
is
 
required
 
or
requested to maintain shall be affected; or
8.5.5
there
 
is
 
imposed
 
on
 
a
 
Finance
 
Party
 
(or
 
on
 
the
 
holding
 
company
 
of
 
a
Finance
 
Party)
 
any
 
other
 
condition
 
in
 
relation
 
to
 
the
 
Indebtedness
 
or
 
the
Finance Documents;
and the result of any of the above shall be to increase the cost
 
to a Finance Party (or
to the
 
holding company
 
of a
 
Finance Party)
 
of that
 
Finance Party
 
making or
 
maintaining
its
 
Commitment,
 
or
 
to
 
cause
 
a
 
Finance
 
Party
 
to
 
suffer
 
(in
 
its
 
opinion)
 
a
 
material
reduction in the rate of return on its overall capital below the level which it reasonably
anticipated at
 
the date
 
of this
 
Agreement and
 
which it
 
would have
 
been able
 
to achieve
but
 
for
 
its
 
entering
 
into this
 
Agreement,
 
and/or
 
performing
 
its
 
obligations under
 
this
Agreement,
 
or
 
to
 
cause
 
a
 
reduction
 
in
 
any
 
amount
 
due
 
and
 
payable
 
to
 
a
 
Finance
Party under
 
any of
 
the Finance
 
Documents, then,
 
subject to
 
Clause 8.6
 
(
Exceptions
to
 
increased
 
costs
),
 
the
 
Finance
 
Party
 
affected
 
shall
 
notify
 
the
 
Agent
 
and
 
the
Borrowers shall from time to time pay to the Agent on demand for the
 
account of that
Finance
 
Party
 
the
 
amount
 
which
 
shall
 
compensate
 
that
 
Finance
 
Party
 
(or
 
the
relevant
 
holding
 
company)
 
for
 
such
 
additional
 
cost
 
or
 
reduced
 
return
 
or
 
reduced
amount. A
 
certificate signed by
 
an authorised signatory of
 
that Finance Party
 
setting
out the amount
 
of that payment
 
and the
 
basis of its
 
calculation shall be
 
submitted to
the
 
Borrowers
 
and
 
shall
 
be
 
conclusive
 
evidence
 
of
 
such
 
amount
 
save
 
for
 
manifest
error or on any question of law.
For the purposes of this Clause 8.5:
"
Basel II Accord
" means
 
the "International
 
Convergence of
 
Capital Measurement
 
and
Capital
 
Standards,
 
a
 
Revised
 
Framework"
 
published
 
by
 
the
 
Basel
 
Committee
 
on
Banking Supervision in June 2004 in the form existing on the date
 
of this
 
Agreement;
"
Basel
 
II
 
Approach
" means,
 
in relation
 
to a
 
Finance Party,
 
either the
 
Standardised
Approach
 
or
 
the
 
relevant
 
Internal
 
Ratings
 
Based
 
Approach
 
(each
 
as
 
defined
 
in
 
the
Basel II
 
Accord) adopted
 
by that
 
Finance Party
 
(or its
 
holding company)
 
for the
 
purpose
of implementing or complying with the Basel II Accord;
"
Basel
 
II
 
Regulation
"
 
means
 
(a)
 
any
 
law
 
or
 
regulation
 
implementing
 
the
 
Basel
 
II
Accord or (b) any Basel II Approach adopted by a Finance Party;
"
Basel
 
III
" means
 
(a) the
 
agreements on
 
capital requirements,
 
a leverage
 
ratio and
liquidity
 
standards
 
contained
 
in
 
"Basel
 
III:
 
A
 
global
 
regulatory
 
framework
 
for
 
more
resilient banks
 
and banking
 
systems", "Basel
 
III: International
 
framework for
 
liquidity
risk measurement,
 
standards and monitoring"
 
and "Guidance for
 
national authorities
operating
 
the
 
countercyclical
 
capital
 
buffer"
 
published
 
by
 
the
 
Basel
 
Committee
 
on
Banking
 
Supervision
 
in
 
December
 
2010,
 
each
 
as
 
amended,
 
supplemented
 
or
restated,
(b) the rules for global systemically important banks contained
 
in "Global systemically
important
 
banks:
 
assessment
 
methodology
 
and
 
the
 
additional
 
loss
 
absorbency
requirement – Rules text" published by the Basel Committee on Banking Supervision
in
 
November
 
2011,
 
as
 
amended,
 
supplemented
 
or
 
restated
 
and
 
(c)
 
any
 
further
guidance
 
or
 
standards
 
published
 
by
 
the
 
Basel
 
Committee
 
on
 
Banking
 
Supervision
relating to "Basel III"; and
"
holding
 
company
" means,
 
in respect
 
of a
 
Finance Party,
 
the company
 
or entity
 
(if
any) within the consolidated supervision of which that Finance Party
 
is included.
8.6
Exceptions to increased costs
Clause
 
8.5
 
(
Increased
 
costs
)
 
does
 
not
 
apply
 
to
 
the
 
extent
 
any
 
additional
 
cost
 
or
reduced return referred to in that Clause is:
8.6.1
compensated for by a payment made under Clause 8.10 (
Taxes
); or
8.6.2
compensated for by a payment made under Clause 17.3 (
Grossing-up
); or
8.6.3
attributable to a FATCA
 
Deduction required to be made by a Party;
 
or
8.6.4
attributable to the wilful breach by the relevant
 
Finance Party (or the holding
company of that Finance Party) of any law or regulation.
8.7
Events of Default
The Borrowers
 
shall indemnify
 
each Finance Party
 
from time
 
to time,
 
by payment to
the
 
Agent
 
(for
 
the
 
account
 
of
 
that
 
Finance
 
Party)
 
promptly
 
on
 
the
 
Agent's
 
written
demand,
 
against all
 
losses,
 
costs, expenses
 
and
 
liabilities incurred
 
or
 
sustained by
that Finance Party as a consequence of any Event of Default.
8.8
Enforcement costs
The
 
Borrowers
 
shall
 
pay
 
to
 
the
 
Agent
 
(for
 
the
 
account
 
of
 
each
 
Finance
 
Party)
promptly
 
on
 
the
 
Agent's
 
written
 
demand
 
the
 
amount
 
of
 
all
 
costs
 
and
 
expenses
(including
 
legal
 
fees)
 
incurred
 
by
 
that
 
Finance
 
Party
 
in
 
connection
 
with
 
the
enforcement
 
of,
 
or
 
the
 
preservation
 
of
 
any
 
rights
 
under,
 
any
 
Finance
 
Document
including
 
(without
 
limitation)
 
any
 
losses,
 
costs
 
and
 
expenses
 
which
 
that
 
Finance
Party
 
may
 
from
 
time
 
to
 
time
 
sustain,
 
incur
 
or
 
become
 
liable
 
for
 
by
 
reason
 
of
 
that
Finance Party
 
being mortgagee
 
of a
 
Vessel
 
and/or a
 
lender to
 
the Borrowers,
 
or by
reason
 
of
 
that
 
Finance
 
Party
 
being
 
deemed
 
by
 
any
 
court
 
or
 
authority
 
to
 
be
 
an
operator
 
or
 
controller,
 
or
 
in
 
any
 
way
 
concerned
 
in
 
the
 
operation
 
or
 
control,
 
of
 
a
Vessel.
8.9
Other costs
The
 
Borrowers
 
shall
 
pay
 
to
 
the
 
Agent
 
(for
 
the
 
account
 
of
 
each
 
Finance
 
Party)
promptly on
 
the Agent's
 
written demand
 
the amount
 
of all
 
sums which
 
that Finance
Party may pay or
 
become actually
 
or contingently
 
liable for
 
on account
 
of a
 
Borrower in
connection
 
with
 
a
 
Vessel
 
(whether
 
alone
 
or
 
jointly
 
or
 
jointly
 
and
 
severally
 
with
 
any
other person) including (without limitation) all sums
 
which that Finance Party
 
may pay
or guarantees which it may
 
give in respect of the
 
Insurances, any expenses incurred
by that Finance
 
Party in
 
connection with the
 
maintenance or
 
repair of
 
a Vessel
 
or in
discharging
 
any
 
lien,
 
bond
 
or
 
other
 
claim
 
relating
 
in
 
any
 
way
 
to
 
a
 
Vessel,
 
and
 
any
sums which
 
that Finance
 
Party may
 
pay or
 
guarantees which
 
it may
 
give to
 
procure
the release of a Vessel from arrest or detention.
8.10
Taxes
The Borrowers shall pay all Taxes
 
to which all or any part of the Indebtedness or any
Finance Document may
 
be at
 
any time subject
 
(other than Tax
 
on a
 
Finance Party's
overall net income and FATCA
 
Deductions required to be made by a Party) and shall
indemnify the
 
Finance Parties,
 
by payment
 
to the
 
Agent (for
 
the account
 
of the
 
Finance
Parties) promptly
 
on the
 
Agent's written
 
demand, against
 
all liabilities,
 
costs, claims
and expenses resulting from any omission to pay or delay in paying
 
any such Taxes.
8.11
Mitigation
If
 
circumstances arise
 
which would,
 
or would
 
upon the
 
giving of
 
notice, result
 
in an
increased
 
payment
 
required
 
to
 
be
 
made
 
by
 
the
 
Borrowers
 
under
 
Clause
 
8.5
(
Increased
 
costs
 
(subject
 
to
 
Clause
 
8.6
 
(Exceptions
 
to
 
increased
 
costs)
)
 
or
 
Clause
17.3 (
Grossing-
 
up
) then, without in
 
any way limiting the
 
obligations of the Borrowers
under
 
either
 
of
 
these
 
clauses,
 
the
 
relevant
 
Finance
 
Party
 
shall
 
use
 
reasonable
endeavours to transfer
 
its obligations, liabilities and
 
rights under this
 
Agreement and
the
 
other
 
Finance
 
Documents
 
to
 
another
 
of
 
its
 
offices
 
not
 
affected
 
by
 
the
circumstances which gave rise to such increased payment.
9
Fees
9.1
Commitment fee
The Borrowers shall pay to the
 
Agent (for the account of the Lenders
 
in proportion to
their
 
Commitments) a
 
non-refundable fee
 
computed at
 
the
 
rate
 
of
 
0.2% per
 
annum
on the
 
undrawn Commitment from time
 
to time
 
from the date
 
of this Agreement
 
until
the last Availability Termination
 
Date. The accrued commitment fee is payable on the
last day of
 
each successive
 
period of
 
three (3)
 
months from
 
the date of
 
this Agreement
and on the last Availability Termination Date.
9.2
Arrangement fee
The
 
Borrowers
 
shall
 
pay
 
to
 
the
 
Agent
 
(for
 
its
 
own
 
account)
 
a
 
non-refundable
arrangement fee in the amount of $378,674.50 on the date of
 
this Agreement.
10
Security and Application of Moneys
10.1
Security Documents
As
 
security
 
for
 
the
 
payment
 
of
 
the
 
Indebtedness,
 
the
 
Borrowers
 
shall
 
execute
 
and
deliver to
 
the Security
 
Agent or
 
cause to
 
be executed
 
and delivered
 
to the
 
Security
Agent
 
the
 
following
 
documents
 
in
 
such
 
forms
 
and
 
containing
 
such
 
terms
 
and
conditions as the Security Agent shall require:
10.1.1
first preferred cross-collaterised mortgages over the
 
Vessels;
10.1.2
first priority deeds
 
of assignment of
 
the Insurances, Earnings
 
and Requisition
Compensation of the Vessels;
10.1.3
a guarantee and indemnity from the Guarantor;
10.1.4
first priority
 
deeds of
 
charge over
 
the Earnings
 
Accounts and
 
all amounts
 
from
time to time standing to the credit of the Earnings
 
Accounts;
10.1.5
first
 
priority
 
negative
 
pledges
 
in
 
respect
 
of
 
all
 
the
 
issued
 
shares
 
of
 
the
Borrowers from the Pledgor;
10.1.6
letters
 
of
 
undertaking
 
and
 
subordination
 
(including
 
an
 
assignment
 
of
Insurances) in respect of the Vessels from the Managers; and
10.1.7
first priority deeds of assignment of any Charter.
10.2
Earnings Accounts
The Borrowers shall maintain
 
the Earnings Accounts with
 
the Account Holder for
 
the
duration of
 
the Facility
 
Period free
 
of Encumbrances
 
and rights
 
of set
 
off other
 
than
those created by or under the Finance Documents.
10.3
Earnings
The Borrowers shall procure that all Earnings and any Requisition Compensation are
credited to the relevant Earnings Account.
10.4
Application of Earnings Accounts
The
 
Borrowers
 
shall
 
procure
 
that
 
there
 
is
 
transferred
 
from
 
the
 
relevant
 
Earnings
Account to the Agent:
10.4.1
on
 
each
 
Repayment
 
Date
 
in
 
respect
 
of
 
a
 
Tranche,
 
the
 
amount
 
of
 
the
Repayment Instalment then due; and
10.4.2
on each
 
Interest Payment
 
Date in
 
respect of
 
the relevant
 
Tranche, the
 
amount
of interest then due,
and the
 
Borrowers irrevocably
 
authorise the
 
Agent to
 
instruct the
 
Account Holder
 
to
make those transfers.
10.5
Borrowers' obligations not affected
If for
 
any reason the
 
amount standing to
 
the credit
 
of the
 
relevant Earnings
 
Account
is insufficient
 
to pay
 
any Repayment
 
Instalment or
 
to make
 
any payment
 
of interest
when
 
due,
 
the
 
Borrowers'
 
obligation
 
to
 
pay
 
that
 
Repayment
 
Instalment
 
or
 
to
 
make
that payment of interest shall not be affected.
10.6
Withdrawals
Unless
 
and
 
until
 
a
 
Default
 
occurs
 
and
 
the
 
Agent
 
shall
 
direct
 
to
 
the
 
contrary,
 
the
Borrowers
 
may
 
withdraw
 
sums
 
remaining
 
to
 
the
 
credit
 
of
 
the
 
Earnings
 
Account
provided however that Clause 12.2.1 is complied with
 
at any relevant time during the
Facility Period.
10.7
Access to information
The
 
Borrowers
 
agree
 
that
 
the
 
Security
 
Agent
 
(and
 
its
 
nominees)
 
may
 
from
 
time
 
to
time during the
 
Facility Period
 
review the records
 
held by the
 
Account Holder (whether
in written
 
or electronic
 
form) in
 
relation to
 
the Accounts,
 
and irrevocably
 
waives any
right of confidentiality which may exist in relation to those
 
records.
10.8
Statements
Without
 
prejudice
 
to
 
the
 
rights
 
of
 
the
 
Security
 
Agent
 
under
 
Clause
 
9.7
 
(
Access
 
to
information
),
 
the
 
Borrowers
 
will
 
procure
 
that
 
the
 
Account
 
Holder
 
provides
 
to
 
the
Security
 
Agent,
 
no
 
less
 
frequently
 
than
 
once
 
every
 
six
 
calendar
 
months
 
during
 
the
Facility
 
Period
 
(unless
 
any
 
Event
 
of
 
Default
 
is
 
continuing,
 
in
 
which
 
case
 
it
 
shall
 
be
once
every calendar month), written statements of account showing all entries made to the
credit and
 
debit of
 
each of
 
the Accounts
 
during the
 
immediately preceding
 
six calendar
months or (where an Event of Default is continuing) the preceding
 
calendar
 
month.
10.9
Application after acceleration
From and after the
 
giving of notice to
 
the Borrowers by the
 
Agent under Clause 13.2
(
Acceleration
), the
 
Borrowers shall
 
procure that
 
all sums
 
from time
 
to time
 
standing
to
 
the
 
credit
 
of
 
any
 
of
 
the
 
Earnings
 
Accounts
 
are
 
immediately
 
transferred
 
to
 
the
Security Agent for application in accordance with Clause 10.9 (
Application of moneys
by
 
Security
 
Agent
)
 
and
 
the
 
Borrowers
 
irrevocably
 
authorise
 
the
 
Security
 
Agent
 
to
instruct the Account Holder to make those transfers.
10.10
Application of moneys by Security Agent
The
 
Borrowers and
 
the
 
Finance
 
Parties
 
irrevocably authorise
 
the
 
Security
 
Agent to
apply all moneys which it receives and is entitled to receive:
10.10.1
pursuant to a sale or
 
other disposition of a
 
Vessel or any right, title or interest
in a Vessel; or
10.10.2
by
 
way
 
of
 
payment
 
of
 
any
 
sum
 
in
 
respect
 
of
 
the
 
Insurances,
 
Earnings
 
or
Requisition Compensation; or
10.10.3
by way of transfer of any sum from any of the Earnings Accounts; or
10.10.4
otherwise under or in connection with any Security Document,
in or towards satisfaction of the Indebtedness in the following
 
order:
10.10.5
first, any unpaid fees,
 
costs, expenses and default
 
interest due to the
 
Agent
and
 
the
 
Security
 
Agent
 
under
 
all
 
or
 
any
 
of
 
the
 
Finance
 
Documents,
 
such
application to be apportioned between the Agent and the Security Agent pro
rata to the aggregate amount of such items due to each of
 
them;
10.10.6
second, any
 
unpaid fees,
 
costs, expenses
 
(including any
 
sums paid
 
by the
Lenders
 
under
 
Clause
 
15.12
 
(
Indemnity
))
 
of
 
the
 
Lenders
 
due
 
under
 
this
Agreement,
 
such
 
application
 
to
 
be
 
apportioned
 
between
 
the
 
Lenders
 
pro
rata to the aggregate amount of such items due to each of
 
them;
10.10.7
third, any
 
accrued but
 
unpaid default
 
interest due
 
to the
 
Lenders under
 
this
Agreement,
 
such
 
application
 
to
 
be
 
apportioned
 
between
 
the
 
Lenders
 
pro
rata to the aggregate amount of such default interest due to each
 
of them;
10.10.8
fourth, any
 
other accrued
 
but unpaid
 
interest due
 
to the
 
Lenders under
 
this
Agreement,
 
such
 
application
 
to
 
be
 
apportioned
 
between
 
the
 
Lenders
 
pro
rata to the aggregate amount of such interest due to each of
 
them;
10.10.9
fifth,
 
any
 
principal
 
of
 
the
 
Loan
 
due
 
and
 
payable
 
but
 
unpaid
 
under
 
this
Agreement,
 
such
 
application
 
to
 
be
 
apportioned
 
between
 
the
 
Lenders
 
pro
rata to each Lender's Proportionate Share; and
10.10.10
sixth,
 
any
 
other
 
sum
 
due
 
and
 
payable
 
to
 
any
 
Finance
 
Party
 
but
 
unpaid
under
 
all
 
or
 
any
 
of
 
the
 
Finance
 
Documents,
 
such
 
application
 
to
 
be
apportioned
 
between the
 
Finance Parties
 
pro
 
rata
 
to
 
the
 
aggregate amount
of any such sum due to each of them;
PROVIDED THAT
 
the
 
balance (if
 
any)
 
of the
 
moneys received
 
shall be
 
paid
 
to
 
the
Security
 
Parties
 
from
 
whom
 
or
 
from
 
whose
 
assets
 
those
 
sums
 
were
 
received
 
or
recovered or to any other person entitled to them.
10.11
Retention on account
Moneys
 
to
 
be
 
applied
 
by
 
the
 
Security
 
Agent
 
under
 
Clause
 
10.9
 
(
Application
 
of
moneys by Security Agent
) shall be applied
 
as soon as
 
practicable after the relevant
moneys
 
are
 
received
 
by
 
it,
 
or
 
otherwise
 
become
 
available
 
to
 
it,
 
save
 
that
 
(without
prejudice
 
to
 
any
 
other
 
provisions
 
contained
 
in
 
any
 
of
 
the
 
Security
 
Documents)
 
the
Security
 
Agent
 
or
 
any
 
receiver
 
or
 
administrator
 
may
 
retain
 
any
 
such
 
moneys
 
by
crediting them to
 
a suspense account for so long and in such manner as the Security
Agent or
 
such receiver or
 
administrator may
 
from time to
 
time determine with
 
a view to
preserving the rights
 
of the
 
Finance Parties
 
or any
 
of them
 
to prove
 
for the
 
whole of
the Indebtedness (or
 
any relevant part)
 
against the Borrowers
 
or any
 
of them or
 
any
other person
 
liable.
10.12
Additional security
If at any time
 
during the Facility Period the
 
aggregate of the Fair Market
 
Value of
 
the
Vessels and the value of any additional security (such value to be the face amount of
the
 
deposit
 
(in
 
the
 
case
 
of
 
cash),
 
determined
 
conclusively
 
by
 
appropriate
 
advisers
appointed by the Agent (in the
 
case of other charged assets), and
 
determined by the
Agent in its
 
discretion (in all other
 
cases)) for the time
 
being provided to the
 
Security
Agent
 
under
 
this
 
Clause
 
10.12
 
is
 
less
 
than
 
one
 
hundred
 
and
 
twenty
 
five
 
per
 
cent
(125%)
 
of
 
the
 
amount
 
of
 
the
 
Loan
 
then
 
outstanding, the
 
Borrowers
 
shall,
 
upon
 
the
Agent's written request, at the Borrowers' option:
10.12.1
pay to
 
the Security Agent
 
or to
 
its nominee a
 
cash deposit in
 
the amount of
the shortfall to be held in the Earnings Accounts and secured in
 
favour of the
Security Agent
 
as additional
 
security for
 
the payment
 
of the
 
Indebtedness; or
10.12.2
give
 
to
 
the
 
Security
 
Agent
 
other
 
additional
 
security
 
in
 
amount
 
and
 
form
acceptable to the Security Agent in its discretion;
 
or
10.12.3
prepay the Loan in the amount of the shortfall.
Clauses
 
5.3
 
(
Reborrowing
),
 
6.2.3
 
(
Voluntary
 
prepayment
 
of
 
Tranches
)
 
and
 
6.4
(
Restrictions
)
 
shall
 
apply,
mutatis
 
mutandis
,
 
to
 
any
 
prepayment
 
made
 
under
 
this
Clause 9.12 and the value of any
 
additional security provided shall be determined as
stated above.
10.13
Fair Market Value determination
10.13.1
For
 
the
 
purposes
 
of
 
Clause
 
10.12
 
(
Additional
 
Security
),
 
the
 
Fair
 
Market
Value
 
of each
 
Vessel
 
shall be
 
determined by
 
one valuation,
 
or (if
 
a breach
of
 
Clause
 
10.12 (
Additional Security
)
 
or
 
an
 
Event
 
of
 
Default
 
has
 
occurred)
by the
 
average of two
 
(2) valuations, each
 
such valuation to
 
be obtained by
one
 
(1),
 
or
 
two
 
(2)
 
(as
 
the
 
case
 
may
 
be)
 
Approved
 
Brokers
 
nominated
 
by
the Borrowers
 
approved by
 
the Lenders
 
and appointed
 
by,
 
and reporting to
the
 
Agent,
 
each
 
such
 
valuation
 
to
 
be
 
addressed
 
to
 
the
 
Agent
 
and
 
made
on the
basis of
 
a charter-free
 
sale for
 
prompt delivery
 
for cash
 
at arm's
 
length, on
normal commercial terms
 
as between a
 
willing buyer and
 
a willing seller.
 
The
Fair
 
Market
 
Value
 
of
 
the
 
Vessels
 
for
 
the
 
purposes
 
of
 
determining
 
the
relevant
 
percentage
 
referred
 
to
 
in
 
Clause
 
10.12
 
(
Additional
 
Security
)
 
shall
be
 
tested
 
no
 
later
 
than
 
the
 
date
 
of
 
each
 
Drawdown
 
Notice
 
in
 
accordance
with the
 
provisions of Clause
 
10.13.2 and
 
on the
 
31
st
of December of
 
each
calendar year
 
during the
 
Facility Period
 
or,
 
at the
 
Agent's discretion
 
(acting
reasonably),
 
at
 
any
 
other
 
time
 
during
 
the
 
Facility
 
Period,
 
each
 
valuation
obtained by
 
the Agent
 
pursuant to
 
this Clause
 
10.12 shall
 
be (a)
 
dated not
earlier than thirty
 
(30) days prior
 
to the date
 
the valuations are
 
provided and
(b) at
 
the cost of
 
the Borrowers and
 
the Fair Market
 
Value
 
of a Vessel
 
shall
be determined
 
by one
 
(1) valuation in
 
accordance to
 
the terms and
 
conditions
of this clause, subject to
 
the Lender's right to request
 
a second valuation for
each Vessel if the first one is not in line with market level.
10.13.2
For
 
the
 
purposes
 
of
 
Clause
 
3.1
 
(
Conditions
 
precedent
),
 
the
 
Fair
 
Market
Value
 
of a
 
Vessel
 
shall be
 
determined by
 
the average
 
of two
 
(2) valuations
in accordance with the valuation method and on the terms and conditions as
set out in Clause 10.13.1.
11
Representations
11.1
Representations
The Borrowers make the representations and warranties set out in this Clause 11.1
 
to
each Finance Party on the date of this Agreement.
11.1.1
Status
Each Security Party (which is not an individual) is a corporation,
 
duly
incorporated
 
and
 
validly
 
existing
 
under
 
the
 
law
 
of
 
its
 
jurisdiction
 
of
incorporation and has the
 
power to own
 
its assets and carry
 
on its business
as it is being conducted.
11.1.2
Binding
 
obligations
The
 
obligations
 
expressed
 
to
 
be
 
assumed
 
by
 
each
Security Party
 
in each
 
Finance Document
 
to which
 
it is
 
a party
 
are legal,
 
valid,
binding and enforceable obligations.
11.1.3
Non-conflict
 
with
 
other
 
obligations
The
 
entry
 
into
 
and
 
performance
 
by
each
 
Security
 
Party
 
of, and
 
the
 
transactions contemplated
 
by,
 
the
 
Finance
Documents do not conflict with:
(a)
any law or regulation applicable to that Security Party;
(b)
the constitutional documents of that Security Party; or
(c)
any document
 
binding on that
 
Security Party or
 
any of
 
its assets,
and in borrowing the Loan, the Borrowers are acting for their own
 
account.
11.1.4
Power
 
and
 
authority
Each
 
Security
 
Party
 
has
 
the
 
power
 
to
 
enter
 
into,
perform and deliver, and has taken all necessary action to authorise its entry
into,
 
performance
 
and
 
delivery
 
of,
 
the
 
Finance
 
Documents
 
to
 
which
 
it
 
is
 
a
party and the transactions contemplated by those Finance
 
Documents.
11.1.5
Validity
 
and
 
admissibility
 
in
 
evidence
All
 
consents,
 
licences,
 
approvals,
authorisations, filings and registrations required or
 
desirable:
(a)
to enable
 
each Security
 
Party lawfully
 
to enter
 
into, exercise
 
its rights
and comply with its
 
obligations in the Finance
 
Documents to which
 
it
is a
 
party or
 
to enable
 
each Finance Party
 
to enforce
 
and exercise
all its rights under the Finance Documents; and
(b)
to
 
make
 
the
 
Finance
 
Documents
 
to
 
which
 
any
 
Security
 
Party
 
is
 
a
party admissible in evidence in its jurisdiction of
 
incorporation,
have
 
been
 
obtained
 
or
 
effected
 
and
 
are
 
in
 
full
 
force
 
and
 
effect,
 
with
 
the
exception
 
only
 
of
 
the
 
registrations
 
referred
 
to
 
in
 
Part
 
2
 
of
 
Schedule
 
3
(
Conditions subsequent
).
11.1.6
Governing
 
law
 
and
 
enforcement
The
 
choice
 
of
 
a
 
particular
 
law
 
as
 
the
governing law
 
of any
 
Finance Document
 
expressed to
 
be governed
 
by that
law will
 
be recognised and
 
enforced in
 
the jurisdiction
 
of incorporation
 
of each
relevant
 
Security
 
Party,
 
and
 
any
 
judgment
 
obtained
 
in
 
the
 
jurisdiction
submitted
 
to
 
in
 
any
 
Finance
 
Document
 
will
 
be
 
recognised
 
and
 
enforced
 
in
the jurisdiction of incorporation of each relevant Security Party.
11.1.7
Deduction
 
of
 
Tax
No
 
Security
 
Party
 
is
 
required
 
under
 
the
 
law
 
of
 
its
jurisdiction of
 
incorporation to make
 
any deduction for
 
or on
 
account of
 
Tax
from any payment it may make under any Finance Document.
11.1.8
No
 
filing
 
or
 
stamp
 
taxes
Under
 
the
 
law
 
of
 
jurisdiction
 
of
 
incorporation
 
of
each relevant Security Party it is not necessary that the
 
Finance Documents
be
 
filed,
 
recorded
 
or
 
enrolled
 
with
 
any
 
court
 
or
 
other
 
authority
 
in
 
that
jurisdiction
 
or
 
that
 
any
 
stamp,
 
registration
 
or
 
similar
 
tax
 
be
 
paid
 
on
 
or
 
in
relation to
 
the Finance
 
Documents or
 
the transactions
 
contemplated by
 
the
Finance Documents.
11.1.9
No default
No Event of
 
Default is continuing
 
or might be
 
expected to result
from the advance of a Tranche.
11.1.10
No
 
misleading
 
information
Any
 
factual
 
information
 
provided
 
by
 
any
Security
 
Party
 
to
 
any
 
Finance
 
Party
 
was
 
true
 
and
 
accurate
 
in
 
all
 
material
respects as at the date it was provided.
11.1.11
Pari
 
passu
 
ranking
The payment
 
obligations of
 
each Security
 
Party under
the Finance Documents to
 
which it is a party rank
 
at least pari passu with the
claims
 
of
 
all
 
its
 
other
 
unsecured
 
and
 
unsubordinated
 
creditors,
 
except
 
for
obligations mandatorily preferred by law applying to companies
 
generally.
11.1.12
No
 
proceedings
 
pending
 
or
 
threatened
No
 
litigation,
 
arbitration
 
or
administrative
 
proceedings
 
of
 
or
 
before
 
any
 
court,
 
arbitral
 
body
 
or
 
agency
have
 
been started
 
or (to
 
the
 
best
 
of the
 
Borrowers' knowledge
 
threatened)
which,
 
if
 
adversely
 
determined,
 
might
 
reasonably
 
be
 
expected
 
to
 
have
 
a
materially adverse effect on
 
the business, assets,
 
financial condition or credit
worthiness of any Security Party.
11.1.13
Disclosure of
 
material facts
The Borrowers are
 
not aware of
 
any material
facts
 
or
 
circumstances
 
which
 
have
 
not
 
been
 
disclosed
 
to
 
the
 
Agent
 
and
which might,
 
if
 
disclosed, have
 
adversely affected
 
the
 
decision of
 
a person
considering whether or not to make loan facilities of the nature
 
contemplated
by this Agreement available to the Borrowers.
11.1.14
Completeness
 
of
 
Relevant
 
Documents
The
 
copies
 
of
 
any
 
Relevant
Documents
 
provided
 
or
 
to
 
be
 
provided
 
by
 
the
 
Borrowers
 
to
 
the
 
Agent
 
in
accordance with Clause 3
 
(
Conditions of Utilisation
) are, or
 
will be, true
 
and
accurate
 
copies
 
of
 
the
 
originals
 
and
 
represent,
 
or
 
will
 
represent,
 
the
 
full
agreement between
 
the parties
 
to those
 
Relevant Documents
 
in relation
 
to
the
 
subject
 
matter
 
of
 
those
 
Relevant
 
Documents
 
and
 
there
 
are
 
no
commissions, rebates, premiums
 
or other payments
 
due or to become
 
due in
connection with the
 
subject matter of
 
those Relevant Documents
 
other than
in the ordinary course of business or as disclosed to, and approved
 
in
 
writing
by, the Agent.
11.1.15
Environmental
 
compliance
The
 
Borrowers
 
comply
 
with
 
all
 
applicable
Environmental
 
Laws,
 
all
 
required
 
governmental
 
approvals
 
and
 
all
requirements relating to the establishment of financial
 
responsibility.
11.2
Repetition
Each
 
representation
 
and
 
warranty
 
in
 
Clause
 
11.1
 
(
Representations
)
 
is
deemed
 
to
 
be
 
repeated
 
by
 
the
 
Borrowers
 
by
 
reference
 
to
 
the
 
facts
 
and
circumstances then
 
existing on
 
the date
 
of each
 
Drawdown Notice
 
and the
 
first day
of each Interest Period.
12
Undertakings and Covenants
The undertakings and covenants in
 
this Clause 12 remain
 
in force for the duration
 
of
the Facility Period.
12.1
Information undertakings
12.1.1
Financial statements
The Borrowers shall procure that the
 
Guarantor shall
supply to the Agent as soon as the same become available, but in any event
within
 
one
 
hundred
 
and
 
eighty
 
(180)
 
days
 
after
 
the
 
end
 
of
 
each
 
of
 
the
Guarantor's
 
financial
 
years,
 
the
 
Group's
 
annual
 
audited
 
consolidated
financial
 
statements
 
for
 
that
 
financial
 
year,
 
in
 
each
 
case
 
together
 
with
 
a
Compliance
 
Certificate,
 
signed
 
by
 
the
 
Chief
 
Finance
 
Officer
 
of
 
the
Guarantor,
 
setting out (in
 
reasonable detail) computations
 
as to
 
compliance
with
 
Clause
 
12.1
 
(
Financial
 
covenants
)
 
and
 
Clause
 
10.12
 
(
Additional
Security
) as
 
at the
 
date as
 
at which
 
those financial
 
statements were
 
drawn
up.
12.1.2
Requirements as to financial
 
statements
Each set of financial statements
delivered by the Guarantor under Clause 12.1.1 (
Financial statements
):
(a)
shall be certified by
 
a director of
 
the Guarantor as fairly
 
representing
its
 
financial
 
condition
 
as
 
at
 
the
 
date
 
as
 
at
 
which
 
those
 
financial
statements were drawn up; and
(b)
shall
 
be
 
prepared
 
using
 
GAAP,
 
accounting
 
practices and
 
financial
reference periods consistent with
 
those applied in the preparation
 
of
the
 
Original
 
Financial
 
Statements
 
unless,
 
in
 
relation
 
to
 
any
 
set
 
of
financial statements, the Guarantor notifies
 
the Agent that there has
been
 
a
 
change
 
in
 
GAAP,
 
the
 
accounting
 
practices
 
or
 
reference
periods and the Guarantor's auditors deliver to the Agent:
(i)
a
 
description
 
of
 
any
 
change
 
necessary for
 
those
 
financial
statements to
 
reflect the
 
GAAP,
 
accounting practices
 
and
reference
 
periods
 
upon
 
which
 
the
 
Original
 
Financial
Statements were prepared; and
(ii)
sufficient
 
information,
 
in
 
form
 
and
 
substance
 
as
 
may
 
be
reasonably
 
required
 
by
 
the
 
Agent,
 
to
 
enable the
 
Agent
 
to
make
 
an
 
accurate
 
comparison
 
between
 
the
 
financial
position
 
indicated
 
in
 
those
 
financial
 
statements
 
and
 
that
indicated in the Original Financial Statements.
12.1.3
Interim
 
financial
 
statements
The
 
Borrowers
 
shall
 
procure
 
that
 
the
Guarantor shall supply to the Agent as
 
soon as the same become available,
but in
 
any event within
 
ninety (90) days
 
after the end
 
of each quarter during
each of the
 
Guarantor's financial years,
 
the Group's consolidated
 
unaudited
quarterly financial
 
statements for
 
that quarter,
 
in each
 
case together
 
with a
Compliance
 
Certificate,
 
signed
 
by
 
the
 
Chief
 
Financial
 
Officer
 
of
 
the
Guarantor,
 
setting out (in
 
reasonable detail) computations
 
as to
 
compliance
with
 
Clause
 
12.2
 
(
Financial
 
covenants
)
 
and
 
Clause
 
10.12
 
(
Additional
Security
) as
 
at the
 
date as
 
at which
 
those financial
 
statements were
 
drawn
up.
12.1.4
Information:
 
miscellaneous
The
 
Borrowers
 
shall,
 
and
 
shall
 
procure
 
that
the Guarantor shall supply to the Agent:
(a)
all
 
documents
 
dispatched
 
by
 
a
 
Borrower
 
or
 
the
 
Guarantor
 
to
 
its
shareholders (or any
 
class of them)
 
or its creditors
 
generally at the
same time as they are dispatched;
(b)
promptly
 
upon
 
becoming
 
aware
 
of
 
them,
 
details
 
of
 
any
 
material
litigation,
 
arbitration
 
or
 
administrative
 
proceedings
 
which
 
are
current, threatened
 
or pending
 
against any
 
Security Party, and
 
which
might, if
 
adversely determined, have
 
a materially adverse
 
effect on
the business, assets, financial
 
condition or credit worthiness
 
of that
Security Party; and
(c)
promptly,
 
such further information
 
regarding the financial
 
condition,
business
 
and
 
operations
 
of
 
any
 
Security
 
Party
 
as
 
the
 
Agent
 
may
reasonably request and which can be provided to the Agent without
breaching
 
any
 
rules
 
of
 
confidentiality
 
including,
 
without
 
limitation,
cash flow analyses and details of the operating costs of any
 
Vessel.
12.1.5
Notification of default
(a)
The Borrowers shall
 
notify the Agent
 
of any Default (and
 
the steps,
if any,
 
being taken to
 
remedy it)
 
promptly upon becoming
 
aware of
its occurrence.
(b)
Promptly upon
 
a request by
 
the Agent,
 
each Borrower shall
 
supply
to
 
the
 
Agent
 
a
 
certificate
 
signed
 
by
 
two
 
of
 
its
 
directors
 
or
 
senior
officers
 
on its
 
behalf certifying
 
that no
 
Default is
 
continuing (or
 
if a
Default
 
is
 
continuing,
 
specifying
 
the
 
Default
 
and
 
the
 
steps,
 
if
 
any,
being taken to remedy it).
12.1.6
"Know your customer" checks
If:
(a)
the
 
introduction
 
of
 
or
 
any
 
change
 
in
 
(or
 
in
 
the
 
interpretation,
administration
 
or
 
application
 
of)
 
any
 
law
 
or
 
regulation
 
made
 
after
the date of this Agreement;
(b)
any
 
change
 
in
 
the
 
status
 
of
 
a
 
Borrower
 
after
 
the
 
date
 
of
 
this
Agreement; or
(c)
a proposed
 
assignment or
 
transfer by
 
a Lender
 
of
 
any of
 
its rights
and obligations under this Agreement to a party that is not a Lender
prior to such assignment or transfer,
obliges the Agent
 
or any Lender
 
(or, in the case of
 
(c) above, any prospective
new
 
Lender)
 
to
 
comply
 
with
 
"know
 
your
 
customer"
 
or
 
similar
 
identification
procedures in circumstances where the necessary information is not already
available to it, the Borrowers shall promptly upon the request of the Agent or
any Lender supply,
 
or procure the
 
supply of, such
 
documentation and other
evidence as
 
is reasonably
 
requested by
 
the Agent
 
(for itself
 
or on
 
behalf of
any Lender)
 
(or,
 
in the
 
case of
 
(c) above,
 
on behalf of
 
any prospective new
Lender)
 
in
 
order for
 
the Agent
 
or that
 
Lender (or,
 
in the
 
case of
 
(c)
 
above,
any prospective
 
new Lender)
 
to carry
 
out and
 
be satisfied
 
it has
 
complied with
all
 
necessary
 
"know
 
your
 
customer"
 
or
 
other
 
similar
 
checks
 
under
 
all
applicable
 
laws
 
and
 
regulations
 
pursuant
 
to
 
the
 
transactions
 
contemplated
in the Finance Documents. Notwithstanding the above, the Agent shall be at
liberty
 
at
 
all
 
times
 
during
 
the
 
Facility
 
Period
 
to
 
request
 
the
 
Borrowers
 
to
provide
 
the
 
Agent
 
with
 
any
 
documentation
 
and
 
other
 
evidence
 
as
 
is
reasonably requested
 
by the
 
Agent (for
 
itself or
 
on behalf
 
of any
 
Lender) in
order
 
for
 
the
 
Agent
 
or
 
that
 
Lender
 
to
 
be
 
satisfied
 
it
 
has
 
complied
 
with
 
all
"know your
 
customer" or
 
other similar
 
checks under
 
all applicable
 
laws and
regulations
 
pursuant
 
to
 
the
 
transactions
 
contemplated
 
in
 
the
 
Finance
Documents.
12.2
Financial covenants
12.2.1
Each Borrower
 
shall, from
 
the relevant
 
Drawdown Date
 
and throughout
 
the
Facility Period, maintain
 
in its Earnings
 
Account a credit
 
balance of not
 
less
than two hundred thousand Dollars ($200,000) for its Vessel.
12.2.2
The Borrowers
 
shall procure
 
that the
 
Guarantor shall
 
(A) maintain
 
from the
first
 
Drawdown
 
Date
 
and
 
throughout
 
the
 
Facility
 
Period
 
Cash
 
of
 
not
 
less
than
 
five
 
hundred
 
thousand
 
Dollars
 
($500,000)
 
for
 
each
 
Fleet
 
Vessel
and
 
(B)
maintain the following
 
financial ratios on
 
a consolidated basis
 
throughout the
Facility Period:
(a)
Adjusted
 
Net
 
Worth
 
shall
 
not
 
be
 
less
 
than
 
one
 
hundred
 
and
 
fifty
million Dollars ($150,000,000); and
(b)
Adjusted Net
 
Worth shall
 
exceed twenty
 
five per
 
cent (25%)
 
of the
Total
 
Assets.
For the purposes of this Clause 12.2:
"
Accounting
 
Information
"
 
means
 
the
 
quarterly
 
consolidated
 
financial
 
statements
and/or the annual
 
consolidated financial statements to
 
be provided by
 
the Guarantor
to the Agent in accordance with Clauses 12.1.1 and 12.1.3.
"
Accounting
 
Period
"
 
means
 
each
 
consecutive
 
period
 
of
 
approximately
 
three
months
 
falling
 
during
 
the
 
Facility
 
Period
 
(ending
 
on
 
the
 
last
 
day
 
in
 
March,
 
June,
September and December of each
 
year) for which quarterly
 
Accounting Information is
required to be delivered pursuant to Clause 12.1.3.
"
Adjusted
 
Net
 
Worth
"
 
means,
 
in
 
respect
 
of
 
an
 
Accounting
 
Period,
 
the
 
amount
 
of
Total
 
Assets less Debt.
"
Cash
" means
 
cash in
 
hand or
 
in bank
 
accounts which
 
is not
 
subject to
 
any charge
back
 
or
 
other
 
Encumbrance
 
(save
 
for
 
Encumbrances
 
in
 
favour
 
of
 
the
 
Finance
Parties) and to which a Borrower or the Guarantor or any other member of the Group
(as the context requires) has free, immediate and direct access.
"
Debt
" means,
 
in respect
 
of an
 
Accounting Period,
 
in relation
 
to any
 
member of
 
the
Group (the "
debtor
"):
(a)
any Financial Indebtedness of the debtor;
(b)
liability
 
of
 
any
 
credit
 
to
 
the
 
debtor
 
from
 
a
 
supplier
 
of
 
goods
 
or
 
services
 
or
under any
 
instalment
 
purchase
 
or
 
payment
 
plan
 
or
 
other similar
 
arrangement;
(c)
contingent
 
liabilities
 
of
 
the
 
debtor
 
(including
 
without
 
limitation
 
any
 
taxes
 
or
other payments under dispute) which have been or,
 
under GAAP,
 
should be
recorded in the notes to the Accounting Information;
(d)
any deferred tax of the debtor; and
(e)
liability under a guarantee, indemnity or similar obligation entered into by the
debtor in respect
 
of a liability
 
of another person
 
who is not
 
a member of
 
the
Group which would fall
 
within (a) to
 
(d) above if the
 
references to the debtor
referred to the other person.
"
Fleet Vessels
" means
 
any vessel
 
directly or
 
indirectly owned
 
by the
 
Group, excluding
however
 
any
 
vessels
 
which
 
are
 
at
 
any
 
given
 
time
 
during
 
the
 
Facility
 
Period
 
under
construction and not yet delivered to the relevant Subsidiary.
"
Total
 
Assets
"
 
means,
 
in
 
respect
 
of
 
an
 
Accounting
 
Period,
 
the
 
total
 
assets
 
of
 
the
Group
 
determined
 
on
 
a
 
consolidated
 
basis
 
as
 
shown
 
in
 
the
 
then
 
most
 
recent
Accounting
 
Information
 
Provided
 
that,
 
for
 
the
 
purposes
 
of
 
determining
compliance
 
with
 
the
covenants set forth
 
in Clause 12.2.2
 
the value of
 
attributable to the
 
Fleet Vessels shall
be
 
equal
 
to
 
the
 
aggregate
 
Fair
 
Market
 
Value
 
of such
 
Fleet
 
Vessels
 
rather
 
than
 
the
value
 
of
 
such
 
Fleet
 
Vessels
 
as
 
stated
 
in
 
the
 
then
 
most
 
recent
 
Accounting
Information.
12.2.3
General undertakings
12.2.4
Authorisations
The Borrowers shall promptly:
(a)
obtain,
 
comply with
 
and do
 
all
 
that
 
is
 
necessary to
 
maintain in
 
full
force and effect; and
(b)
supply certified copies to the Agent of,
any
 
consent,
 
licence,
 
approval
 
or
 
authorisation
 
required
 
under
 
any
 
law
 
or
regulation to enable each
 
Security Party to perform
 
its obligations under the
Finance Documents to which
 
it is a
 
party and to
 
ensure the legality,
 
validity,
enforceability or
 
admissibility in
 
evidence in
 
the
 
jurisdiction of
 
incorporation
of each relevant Security Party of any Finance Document.
12.2.5
Compliance
 
with
 
laws
Each Borrower
 
shall comply
 
in all
 
respects with
 
all
laws to which
 
it may be subject,
 
if failure so to
 
comply would materially
 
impair
its ability to perform its obligations under the Finance
 
Documents.
12.2.6
Conduct
 
of
 
business
Each
 
Borrower
 
shall
 
carry
 
on
 
and
 
conduct
 
its
business
 
in
 
a
 
proper
 
and
 
efficient
 
manner,
 
file
 
all
 
requisite
 
tax
 
returns
 
and
pay
 
all
 
tax
 
which
 
becomes
 
due
 
and
 
payable
 
(except
 
where
 
contested
 
in
good faith).
12.2.7
Evidence
 
of
 
good
 
standing
The
 
Borrowers
 
will
 
from
 
time
 
to
 
time
 
if
requested
 
by
 
the
 
Agent
 
provide
 
the
 
Agent
 
with
 
evidence
 
in
 
form
 
and
substance satisfactory
 
to the Agent
 
that the Security
 
Parties and
 
all corporate
shareholders of any
 
Security Party (other
 
than the Guarantor)
 
remain in good
standing.
12.2.8
Negative
 
pledge
 
and
 
no
 
disposals
No
 
Borrower
 
shall
 
without
 
the
 
prior
written consent
 
of the
 
Agent create
 
nor permit
 
to subsist
 
any Encumbrance
or other third
 
party rights (other than
 
a Permitted Encumbrance) over
 
any of
its present or future assets or
 
undertaking nor dispose of any
 
of those assets
or of all or part of that undertaking.
12.2.9
Merger
No
 
Borrower
 
nor
 
the
 
Guarantor
 
shall
 
without
 
the
 
prior
 
written
consent
 
of
 
the
 
Agent
 
enter
 
into
 
any
 
amalgamation,
 
demerger,
 
merger
 
or
corporate reconstruction.
12.2.10
Change
 
of
 
business
 
or
 
corporate
 
structure
No
 
Borrower
 
nor
 
the
Guarantor
 
shall
 
without
 
the
 
prior
 
written
 
consent of
 
the
 
Lenders make
 
any
substantial change to (a) the general nature
 
of its business from that carried
on
 
at
 
the
 
date
 
of
 
this
 
Agreement
 
or
 
(b)
 
the
 
corporate
 
structure
 
of
 
the
Borrowers as at the date of this Agreement.
12.2.11
No
 
other
 
business
No Borrower
 
shall
 
without
 
the
 
prior
 
written
 
consent of
the
 
Agent
 
engage
 
in
 
any
 
business
 
other
 
than
 
the
 
ownership,
 
operation,
chartering and management of its Vessel.
12.2.12
No
 
borrowings
No
 
Borrower
 
shall
 
without
 
the
 
prior
 
written
 
consent
 
of
 
the
Agent borrow any money (except for the Loan and normal trade credit in the
ordinary course of business) nor incur any obligations under
 
leases.
12.2.13
Subordination of shareholder
 
loans
The Borrowers shall procure that any
shareholder
 
loans
 
and/or
 
inter
 
company
 
borrowings
 
or
 
other
 
indebtedness
permitted
 
by
 
the
 
terms
 
of
 
this
 
Agreement
 
are
 
fully
 
subordinated
 
to
 
the
Indebtedness on terms acceptable to the Agent.
12.2.14
No
 
substantial
 
liabilities
Except
 
in
 
the
 
ordinary
 
course
 
of
 
business,
 
no
Borrower shall without
 
the prior written
 
consent of the
 
Agent incur any
 
liability
to any third party which is in the Agent's opinion of a substantial
 
nature.
12.2.15
No
 
loans
 
or
 
other
 
financial
 
commitments
No Borrower
 
shall without
 
the
prior written consent
 
of the
 
Agent make
 
any loan
 
nor enter
 
into any
 
guarantee
or indemnity or otherwise voluntarily
 
assume any actual or contingent
 
liability
in
 
respect
 
of
 
any
 
obligation
 
of
 
any
 
other
 
person
 
except
 
for
 
loans
 
made
 
or
guarantees or
 
indemnities from
 
time to
 
time required
 
by any
 
protection and
indemnity
 
or
 
war
 
risks
 
association
 
in
 
the
 
ordinary
 
course
 
of
 
business
 
in
connection with the chartering, operation or repair of its
 
Vessel.
12.2.16
No dividends
 
or reduction of
 
share capital
No Borrower shall without the
prior written consent
 
of the Agent
 
(A) pay or
 
declare any dividends
 
or make
any
 
other
 
distributions
 
to
 
shareholders
 
provided
 
however
 
that
 
a
 
Borrower
may
 
pay
 
or
 
declare
 
dividends
 
or
 
make
 
distributions
 
to
 
the
 
Guarantor
 
if
 
no
Event of Default has occurred and is
 
continuing at the time of such payment
or declaration
 
or distribution or
 
would occur as
 
a result
 
thereof or
(B) issue any new shares or (C)
 
reduce its share capital as at
 
the date of this
Agreement.
12.2.17
Inspection
 
of
 
records
Each
 
Borrower
 
will
 
permit
 
the
 
inspection
 
of
 
its
financial records and
 
accounts from
 
time to
 
time by the
 
Agent or
 
its nominee.
12.2.18
Transactions
 
with
 
affiliated
 
companies
No
 
Borrower
 
shall
 
without
 
the
prior
 
written
 
consent
 
of
 
the
 
Agent,
 
enter
 
into
 
any
 
transactions
 
(except
 
on
arm's length terms) with any affiliated companies.
12.2.19
No
 
change
 
in
 
Relevant
 
Documents
The
 
Borrowers
 
shall
 
procure
 
that,
without the
 
prior written
 
consent of
 
the Agent,
 
there shall
 
be no
 
termination
of,
 
alteration
 
to,
 
or
 
waiver
 
of
 
any
 
material,
 
in
 
the
 
Agent's
 
opinion,
 
term
 
of,
any of the Relevant Documents which are not Finance
 
Documents.
12.2.20
No
 
change
 
in
 
ownership
 
and
 
control
Each Borrower
 
undertakes that
 
its
ownership
 
shall
 
remain
 
at
 
all
 
times
 
a
 
wholly
 
owned
 
direct
 
or
 
indirect
Subsidiary of
 
the Guarantor
 
throughout the
 
Facility Period
 
and shall
 
not permit
any change thereof without the prior written consent of the
 
Agent.
12.2.21
Ownership of
 
the Guarantor
The Borrowers shall procure that, at all times
during the
 
Facility Period:
 
(a) the
 
shares of
 
the Guarantor
 
are listed
 
on the
New
 
York
 
Stock
 
Exchange or
 
any
 
other
 
stock
 
exchange
 
acceptable to
 
the
Lender;
 
and
 
(b)
 
the
 
Palios
 
Family
 
(either
 
directly
 
or
 
indirectly
 
through
companies legally
 
and beneficially
 
owned) shall own
 
at least 12.5
 
per cent. of
the common stock in the Guarantor; and (c) the Palios Family (either directly
or indirectly through
 
companies legally and
 
beneficially owned) shall
 
control
at least
 
25 per
 
cent. of
 
the maximum
 
number of
 
votes that
 
might be
 
cast in
respect
 
of
 
any
 
matter
 
submitted
 
to
 
the
 
vote
 
of
 
the
 
shareholders
 
of
 
the
Guarantor; and
 
(d) Semiramis
 
Paliou shall
 
hold the
 
Chief Executive
 
Officer
position in the Guarantor and active role in the decision making in respect of
the Guarantor.
12.2.22
No
 
Subsidiaries
No Borrower
 
shall without
 
the prior
 
written consent
 
of the
Agent form or acquire any Subsidiaries.
12.3
Vessel undertakings
12.3.1
No sale
 
of Vessel
No Borrower shall sell or otherwise dispose
 
of its Vessel
or any shares
 
in its
 
Vessel nor agree
 
to do
 
so without
 
the prior
 
written consent
of the Agent.
12.3.2
No chartering
 
after Event
 
of Default
Following the occurrence and during
the
 
continuation of
 
an
 
Event
 
of
 
Default
 
no
 
Borrower shall
 
without
 
the
 
prior
written consent of the Agent let its Vessel
 
on charter or renew or extend any
charter or other contract of employment of its Vessel (nor agree to do
 
so).
12.3.3
No
 
change
 
in
 
management
Each Borrower
 
shall procure
 
that, without
 
the
prior
 
written
 
consent
 
of
 
the
 
Lenders,
 
there
 
shall
 
be
 
no
 
termination
 
of,
alteration
 
to,
 
or
 
waiver
 
of
 
any material,
 
in
 
the
 
Agent's
 
opinion, term
 
of,
 
the
Management
 
Agreement
 
in
 
respect
 
of
 
its
 
Vessel
 
and
 
no
 
Borrower
 
shall
without
 
the
 
prior
 
written consent
 
of
 
the
 
Agent permit
 
the
 
Managers to
 
sub-
contract or
 
delegate the
 
commercial or
 
technical management
 
of its
 
Vessel
to any third party.
12.3.4
Registration
 
of
 
Vessel
Each
 
Borrower
 
undertakes
 
to
 
maintain
 
the
registration
 
of
 
its
 
Vessel
 
under
 
an
 
Approved
 
Flag
 
for
 
the
 
duration
 
of
 
the
Facility Period and
 
not to change
 
its Vessel's
 
flag without the
 
Lenders' prior
written consent (such consent not to be unreasonably
 
withheld).
12.3.5
Evidence
 
of
 
current
 
COFR
Each
 
Borrower
 
will,
 
if
 
and
 
for
 
so
 
long
 
as
 
its
Vessel
 
trades
 
in
 
the
 
United
 
States
 
of
 
America
 
and
 
Exclusive
 
Economic
Zone
 
(as
 
defined
 
in
 
the
 
United
 
States
 
Oil
 
Pollution
 
Act
 
1990),
 
obtain
 
and
retain a
 
valid Certificate
 
of Financial
 
Responsibility for
 
its Vessel
 
under that
Act, will
 
provide the
 
Agent with
 
evidence of
 
that Certificate,
 
and will
 
comply
strictly with the requirements of that Act.
12.3.6
ISM Code compliance
Each Borrower will:
(a)
procure that its Vessel remains for the
 
duration of the Facility
 
Period
subject to a SMS;
(b)
maintain
 
a
 
valid
 
and
 
current
 
SMC
 
for
 
its
 
Vessel
 
throughout
 
the
Facility Period and provide a copy to the Agent;
(c)
procure that
 
the ISM
 
Company maintains
 
a valid
 
and current
 
DOC
throughout the Facility Period and provide a copy to the Agent;
 
and
(d)
immediately notify
 
the
 
Agent in
 
writing of
 
any actual
 
or threatened
withdrawal, suspension,
 
cancellation or
 
modification of
 
the SMC
 
of
its Vessel or of the DOC of the ISM Company.
12.3.7
ISPS Code compliance
Each Borrower will:
(a)
for the duration of
 
the Facility Period comply
 
with the ISPS Code
 
in
relation
 
to
 
its
 
Vessel
 
and
 
procure
 
that
 
its
 
Vessel
 
and
 
the
 
ISPS
Company comply with the ISPS Code;
(b)
maintain
 
a
 
valid
 
and
 
current
 
ISSC
 
for
 
its
 
Vessel
 
throughout
 
the
Facility Period and provide a copy to the Agent; and
(c)
immediately notify
 
the
 
Agent in
 
writing of
 
any actual
 
or threatened
withdrawal, suspension, cancellation
 
or modification of
 
the ISSC of
its Vessel.
12.3.8
Annex VI compliance
Each Borrower will:
(a)
for the
 
duration of
 
the Facility
 
Period comply
 
with Annex
 
VI in
 
relation
to
 
its
 
Vessel
 
and
 
procure
 
that
 
its
 
Vessel's
 
master
 
and
 
crew
 
are
familiar with, and that its Vessel complies with, Annex VI;
(b)
maintain
 
a
 
valid
 
and
 
current
 
IAPPC
 
for
 
its
 
Vessel
 
throughout
 
the
Facility Period and provide a copy to the Agent; and
(c)
immediately notify
 
the
 
Agent in
 
writing of
 
any actual
 
or threatened
withdrawal,
 
suspension,
 
cancellation
 
or
 
modification
 
of
 
the
 
IAPPC
of its Vessel.
12.3.9
Class
Each Vessel
 
shall be
 
classed with a
 
classification society acceptable
to
 
the
 
Lenders
 
and,
 
commencing
 
from
 
the
 
relevant
 
Delivery
 
Date
 
shall
 
be
classed on a dual basis with China Classification Society (CCS)
 
and:
(a)
in the case of Vessel A and Vessel B, Bureau Veritas; or
with
 
the
 
highest
 
class
 
without
 
any
 
material
 
overdue
 
recommendations
 
or
adverse notations and no
 
Borrower shall without the
 
prior written consent of
the Lenders change the class of its Vessel.
12.3.10
Environmental
 
Laws
All
 
Environmental
 
Laws
 
applicable to
 
a
 
Vessel
 
shall
be complied
 
with in
 
all material respects
 
and all material
 
consents, licenses
and
 
approvals
 
required
 
under
 
such
 
Environmental
 
Laws
 
shall
 
be
 
obtained
and complied with in all material respects.
12.3.11
Assignment
 
of
 
Charter
Each Borrower
 
undertakes, immediately
 
upon the
execution
 
of
 
any
 
Charter,
 
to
 
execute
 
and
 
deliver
 
to
 
the
 
Security
 
Agent
 
a
specific assignment of that Charter in form and substance satisfactory to the
Security Agent together
 
with (i)
 
all other documents
 
required by it,
 
including
without limitation
 
all notices
 
of assignment
 
and evidence
 
that those
 
notices
will be
 
duly acknowledged
 
by the
 
recipients and
 
(ii) the
 
documents referred
to
 
in
 
paragraphs
 
2(vii),
 
3
 
and
 
4(b)
 
of
 
Schedule
 
3,
 
Part
 
1,
 
and
 
such
 
other
documents as the Security Agent may reasonably require.
13
Events of Default
13.1
Events of Default
Each of the events or circumstances set out in this Clause 13.1 is an
 
Event of Default.
13.1.1
Non-payment
The
 
Borrowers
 
do
 
not
 
pay
 
on
 
the
 
due
 
date
 
any
 
amount
payable
 
by
 
them
 
under
 
a
 
Finance
 
Document
 
at
 
the
 
place
 
at
 
and
 
in
 
the
currency in which it is expressed to be payable.
13.1.2
Other
 
obligations
A Security
 
Party or
 
any other
 
person (except
 
a Finance
Party)
 
does
 
not
 
comply
 
with
 
any
 
provision
 
of
 
any
 
of
 
the
 
Relevant
Documents to
 
which that
 
Security Party
 
or person
 
is a
 
party (other
 
than as
referred to
 
in Clause 13.1.1 (
Non-payment
)).
No Event of Default under this Clause 13.1.2 will occur if:
(a)
the failure to comply is
 
capable of remedy and
 
does not relate either
to
 
the
 
Insurances
 
or
 
to
 
compliance
 
with
 
Clause
 
10.12
 
(
Additional
security
) and
 
is remedied within
 
ten (10) Business
 
Days of the
 
Agent
giving notice to the
 
Borrowers or the Borrowers becoming
 
aware of
the failure to comply; or
(b)
the
 
failure
 
to
 
comply
 
relates
 
to
 
a
 
Charter
 
and,
 
if
 
it
 
is
 
capable
 
of
remedy
 
is
 
remedied
 
within
 
seven
 
(7)
 
Business
 
Days
 
of
 
the
Borrowers becoming aware of such failure to comply.
13.1.3
Misrepresentation
Any
 
representation,
 
warranty
 
or
 
statement
 
made
 
or
deemed to be repeated by a Security Party in any Finance Document or any
other
 
document
 
delivered
 
by
 
or
 
on
 
behalf
 
of
 
a
 
Security
 
Party
 
under
 
or
 
in
connection with
 
any Finance
 
Document is
 
or proves
 
to have
 
been incorrect
or misleading in any material respect when made or deemed to be
 
repeated.
13.1.4
Cross default
(a)
Any
 
Financial
 
Indebtedness
 
of
 
any
 
Security
 
Party
 
or
 
any
 
other
member of the Group is not paid when due; or
(b)
any
 
Financial
 
Indebtedness
 
of
 
any
 
Security
 
Party
 
or
 
any
 
other
member
 
of
 
the
 
Group
 
becomes
 
(whether
 
by
 
declaration
 
or
automatically
 
in
 
accordance
 
with
 
the
 
relevant
 
agreement
 
or
instrument constituting the same) due and payable prior
 
to the date
when it would otherwise have become due (unless as a result of
 
the
exercise by the
 
relevant Security Party
 
or any other
 
member of the
Group of a voluntary right of prepayment); or
(c)
any creditor of any Security
 
Party or any other
 
member of the Group
becomes
 
entitled
 
to
 
declare
 
any
 
such
 
Financial Indebtedness
 
due
and payable or
 
any facility or commitment available
 
to any Security
Party
 
or
 
other
 
member
 
of
 
the
 
Group
 
relating
 
to
 
Financial
Indebtedness
 
is
 
withdrawn,
 
suspended
 
or
 
cancelled
 
by
 
reason
 
of
any
 
default
 
(however
 
described)
 
of
 
the
 
person
 
concerned
 
unless
the relevant
 
Security Party or any
 
other member of the
 
Group shall
have satisfied
the Agent
 
that such
 
withdrawal, suspension
 
or cancellation
 
will not
affect
 
or
 
prejudice
 
in
 
any
 
way
 
the
 
ability
 
of
 
the
 
relevant
 
Security
Party or of
 
the relevant member
 
of the Group
 
to pay its
 
debts as they
fall
 
due
 
and
 
fund
 
its
 
commitments
 
or
 
any
 
guarantee
 
given
 
by
 
any
Security Party; or
(d)
any
 
other
 
member
 
of
 
the
 
Group
 
in
 
respect
 
of
 
the
 
Financial
Indebtedness is not honoured when due and called
 
upon
provided
 
that
 
the
 
amount
 
or
 
aggregate
 
amount
 
at
 
any
 
one
 
time,
 
of
 
all
Financial
 
Indebtedness
 
of
 
any
 
Security
 
Party
 
or
 
any
 
other
 
member
 
of
 
the
Group
 
in relation
 
to
 
which any
 
of the
 
foregoing events
 
shall have
 
occurred
and
 
be
 
continuing,
 
is
 
equal
 
to
 
or
 
greater
 
than
 
fifteen
 
million
 
Dollars
($15,000,000)
 
or
 
its
 
equivalent
 
in
 
the
 
currency
 
which
 
the
 
same
 
is
denominated or payable.
For the avoidance of doubt, for the purpose of this
 
Clause 13.1.4 references
to Financial Indebtedness shall exclude the Indebtedness.
13.1.5
Insolvency
(a)
A Security Party is unable or admits
 
inability to pay its debts as they
fall due,
 
suspends
 
making payments
 
on any
 
of its
 
debts or, by
 
reason
of actual
 
or anticipated
 
financial difficulties,
 
commences negotiations
with one
 
or more
 
of its
 
creditors with
 
a view to
 
rescheduling any of
its indebtedness.
(b)
The
 
value
 
of
 
the
 
assets
 
of
 
the
 
Guarantor
 
is
 
less
 
than
 
its
 
liabilities
(taking into account contingent and prospective liabilities other than
commitments
 
in respect
 
of
 
vessels under
 
construction and
 
not yet
delivered to that Security Party).
(c)
A moratorium
 
is declared
 
in respect
 
of any
 
indebtedness
 
of a
 
Security
Party.
13.1.6
Insolvency proceedings
Any corporate action, legal proceedings or other
procedure or step is taken for:
(a)
the
 
suspension
 
of
 
payments,
 
a
 
moratorium
 
of
 
any
 
indebtedness,
winding-up,
 
dissolution,
 
administration,
 
bankruptcy
 
or
reorganisation
 
(by
 
way
 
of
 
voluntary
 
arrangement,
 
scheme
 
of
arrangement or otherwise) of a Security Party;
(b)
a
 
composition,
 
compromise,
 
assignment
 
or
 
arrangement
 
with
 
any
creditor of a Security Party;
(c)
the
 
appointment
 
of
 
a
 
liquidator,
 
receiver,
 
administrative
 
receiver,
administrator,
 
compulsory
 
manager,
 
or
 
trustee
 
or
 
other
 
similar
officer in respect of any Security Party or any of its assets;
 
or
(d)
enforcement
 
of
 
any
 
Encumbrance
 
over
 
any
 
assets
 
of
 
a
 
Security
Party,
or any analogous procedure or step is taken in any jurisdiction.
13.1.7
Creditors'
 
process
Any
 
expropriation,
 
attachment,
 
sequestration,
 
distress
or
 
execution
 
affects
 
any
 
asset
 
or
 
assets
 
of
 
a
 
Security
 
Party
 
and
 
is
 
not
discharged within seven (7) days.
13.1.8
Change
 
in
 
ownership
 
of
 
a
 
Borrower
 
or
 
the
 
Guarantor
(a) There
 
is any
change in
 
the ownership
 
of a
 
Borrower from that
 
advised at
 
the date
 
of this
Agreement
 
or
 
(b)
 
the
 
Palios
 
Family
 
(either
 
directly
 
or
 
indirectly
 
through
companies legally
 
and beneficially owned)
 
ceases to
 
own at
 
least 12.5%
 
of
the common
 
stock in
 
the Guarantor;
 
or (c)
 
the Palios
 
Family (either
 
directly
or
 
indirectly
 
through
 
companies
 
legally
 
and
 
beneficially
 
owned)
 
ceases
 
to
control at
 
least 25%
 
of the
 
maximum number
 
of votes
 
that might
 
be cast
 
in
respect
 
of
 
any
 
matter
 
submitted
 
to
 
the
 
vote
 
of
 
the
 
shareholders
 
of
 
the
Guarantor.
13.1.9
Repudiation
 
etc
A
 
Security
 
Party
 
or
 
any
 
other
 
person
 
(except
 
a
 
Finance
Party) repudiates
 
any of
 
the Relevant
 
Documents to
 
which that
 
Security Party
or person is a party or evidences an intention to do so.
No Event of Default under this
 
Clause 13.1.9 will occur if the
 
repudiation is in
relation to
 
a Charter
 
and such
 
repudiation is
 
beyond the
 
control of
 
the relevant
Borrower and,
 
if it
 
is capable
 
of remedy, is
 
remedied within
 
seven (7)
 
Business
Days of the Borrowers becoming aware of such repudiation.
13.1.10
Impossibility or
 
illegality
Any event occurs which would, or would with
 
the
passage of
 
time, render
 
performance of
 
any of
 
the Relevant
 
Documents by
a
 
Security
 
Party
 
or
 
any
 
other
 
party
 
to
 
any
 
such
 
document
 
impossible,
unlawful or unenforceable by a Finance Party or a Security
 
Party.
No Event of Default under
 
this Clause 13.1.11 will occur if the
 
impossibility or
illegality
 
is
 
in
 
relation
 
to
 
a
 
Charter
 
or
 
a
 
Management
 
Agreement
 
and
 
such
impossibility or
 
illegality is
 
beyond the
 
control of
 
the relevant
 
Borrower and,
if it is capable of
 
remedy, is
 
remedied within seven (7) Business Days of
 
the
Borrowers becoming aware of such impossibility or illegality.
13.1.11
Conditions
 
subsequent
Any
 
of
 
the
 
conditions
 
referred
 
to
 
in
 
Clause
 
3.4
(
Conditions subsequent
) is
 
not satisfied
 
within the
 
time reasonably
 
required
by the Agent.
13.1.12
Revocation
 
or
 
modification
 
of
 
authorisation
Any
 
consent,
 
licence,
approval,
 
authorisation,
 
filing,
 
registration
 
or
 
other
 
requirement
 
of
 
any
governmental, judicial
 
or other public
 
body or authority
 
which is
 
now, or which
at
 
any
 
time
 
during
 
the
 
Facility
 
Period
 
becomes,
 
necessary
 
to
 
enable
 
a
Security Party
 
or any
 
other person
 
(except a
 
Finance Party)
 
to comply
 
with
any of
 
its obligations under
 
any of the
 
Relevant Documents is
 
not obtained,
is
 
revoked,
 
suspended,
 
withdrawn
 
or
 
withheld,
 
or
 
is
 
modified
 
in
 
a
 
manner
which
 
the
 
Agent
 
considers
 
is,
 
or
 
may
 
be,
 
prejudicial
 
to
 
the
 
interests
 
of
 
a
Finance Party, or ceases to remain in full force and effect.
No Event of
 
Default under this
 
Clause 13.1.12 will occur
 
if the revocation or
modification of authorisation is in relation to a Charter or a Management
Agreement and
 
such revocation
 
or modification
 
of authorisation
 
is beyond
 
the
control of
 
the relevant
 
Borrower and,
 
if it
 
is capable
 
of remedy,
 
is remedied
within seven
 
(7)
 
Business Days
 
of
 
the
 
Borrowers becoming
 
aware
 
of
 
such
revocation or modification of authorisation.
13.1.13
Curtailment
 
of
 
business
 
A Security
 
Party ceases,
 
or threatens
 
to cease,
to carry
 
on all
 
or a
 
substantial part
 
of its
 
business or, as
 
a result
 
of intervention
by or under the authority
 
of any government, the
 
business of a Security
 
Party
is wholly or partially curtailed or suspended, or all or a substantial part of the
assets or undertaking
 
of a
 
Security Party is
 
seized, nationalised,
 
expropriated
or compulsorily acquired.
13.1.14
Reduction
 
of
 
capital
A Security
 
Party reduces
 
its
 
authorised or
 
issued or
subscribed capital.
13.1.15
Loss
 
of
 
Vessel
A Vessel
 
suffers a
 
Total
 
Loss or
 
is otherwise
 
destroyed or
abandoned,
 
or
 
a
 
similar event
 
occurs
 
in
 
relation
 
to
 
any
 
other
 
vessel
 
which
may from time to time be mortgaged to the Security Agent
 
as security for the
payment
 
of
 
all
 
or
 
any
 
part
 
of
 
the
 
Indebtedness,
 
except
 
that
 
a
 
Total
 
Loss
(which
 
term
 
shall for
 
the
 
purposes of
 
the
 
remainder of
 
this
 
Clause 13.1.12
include an event
 
similar to a
 
Total
 
Loss in relation to
 
any other vessel) shall
not be an Event of Default if:
(a)
that
 
Vessel
 
or
 
other
 
vessel
 
is
 
insured
 
in
 
accordance
 
with
 
the
Security
 
Documents
 
and
 
a
 
claim
 
for
 
Total
 
Loss
 
is
 
available
 
under
the terms of the
 
relevant insurances; and
(b)
no insurer
 
has refused
 
to meet
 
or has
 
disputed the
 
claim for
 
Total
Loss
 
and
 
it
 
is
 
not
 
apparent
 
to
 
the
 
Agent
 
in
 
its
 
discretion
 
that
 
any
such refusal or dispute is likely to occur; and
(c)
payment
 
of
 
all
 
insurance
 
proceeds
 
in
 
respect
 
of
 
the
 
Total
 
Loss
 
is
made in
 
full to
 
the Security
 
Agent within
 
one hundred
 
and twenty
(120) days of the
 
occurrence of the casualty giving
 
rise to the Total
Loss
 
in
 
question
 
or
 
such
 
longer
 
period
 
as
 
the
 
Agent
 
may
 
in
 
its
discretion agree.
13.1.16
Challenge
 
to
 
registration
The
 
registration
 
of
 
a
 
Vessel
 
or
 
a
 
Mortgage
 
is
contested or
 
becomes void
 
or voidable
 
or liable
 
to cancellation
 
or termination,
or the validity or priority of a Mortgage is contested.
13.1.17
War
The
 
country
 
of
 
registration
 
of
 
a
 
Vessel
 
becomes
 
involved
 
in
 
war
(whether or not declared)
 
or civil war or
 
is occupied by any
 
other power and
the Agent
 
in its
 
discretion considers
 
that, as
 
a result,
 
the security
 
conferred
by any of the Security Documents is materially prejudiced.
13.1.18
Notice of
 
termination
The Guarantor
 
gives notice
 
to the
 
Security Agent to
determine its obligations under the Guarantee.
13.1.19
Material
 
adverse
 
change
Any
 
event
 
or
 
series
 
of
 
events
 
occurs
 
which,
 
in
the opinion
 
of the
 
Agent, is
 
likely to
 
have a
 
materially adverse
 
effect on
 
the
business, assets, financial condition or credit worthiness of a Security
 
Party.
13.1.20
Arrest
A Vessel
 
is arrested or
 
detained or seized
 
by any
 
person other than
any
 
government
 
or
 
persons
 
acting
 
on
 
behalf
 
of
 
any
 
government
 
and
 
not
released
 
and
 
returned
 
to
 
the
 
possession
 
of
 
the
 
relevant
 
Borrower
 
within
fifteen (15)
 
Business Days
 
after the
 
arrest or
 
detention or
 
seizure in
 
question.
13.2
Acceleration
If an
 
Event of Default
 
is continuing the
 
Agent may by
 
notice to the
 
Borrowers cancel
any part of the Maximum Loan Amount not then advanced and:
13.2.1
declare that the
 
Loan, together with
 
accrued interest, and
 
all other amounts
accrued or
 
outstanding under
 
the Finance
 
Documents are
 
immediately due
and
 
payable,
 
whereupon they
 
shall become
 
immediately due
 
and
 
payable;
and/or
13.2.2
declare that the Loan is payable on demand, whereupon it shall immediately
become payable on demand by the Agent.
14
Assignment and Sub-Participation
14.1
Lenders' rights
A Lender
 
may (A)
 
without the
 
Borrowers' prior
 
written consent
 
and so
 
long as
 
such
assignment does not
 
result in
 
any additional cost
 
to the Borrowers,
 
assign any of
 
its
rights
 
under
 
this
 
Agreement
 
to
 
any
 
of
 
its
 
branches,
 
wholly
 
owned
 
subsidiaries
 
and
affiliates or (B) subject to the Borrowers' prior written consent
 
(such consent not to be
unreasonably withheld
 
or delayed),
 
assign any
 
of its
 
rights under
 
this Agreement
 
or
transfer by novation
 
any of its
 
rights and
 
obligations under
 
this Agreement
 
to any other
bank or financial institution or, in each case (for the purpose of a securitisation of that
Lender's rights
 
or obligations
 
under the
 
Finance Documents
 
or a
 
similar transaction
of broadly equivalent economic effect) to any special purpose vehicle, and may grant
sub-participations in all or any part of its Commitment.
14.2
Borrowers' co-operation
The Borrowers will co-operate fully with a Lender in
 
connection with any assignment,
transfer or sub-participation by that Lender; will execute and procure the execution of
such
 
documents
 
as
 
that
 
Lender
 
may
 
require
 
in
 
that
 
connection;
 
and
 
irrevocably
authorise any Finance Party to disclose to any proposed assignee, transferee
 
or sub-
participant (whether before
 
or after any
 
assignment, transfer or
 
sub-participation and
whether
 
or
 
not
 
any
 
assignment,
 
transfer
 
or
 
sub-participation
 
shall
 
take
 
place)
 
all
information relating
 
to the
 
Security Parties,
 
the Loan, the
 
Relevant Documents
 
and the
Vessels
 
which
 
any
 
Finance
 
Party
 
may
 
in
 
its
 
discretion
 
consider
 
necessary
 
or
desirable,
 
subject
 
to
 
the
 
execution
 
by
 
the
 
recipients
 
of
 
such
 
information
 
of
 
a
confidentiality undertaking substantially in the recommended form of
 
the Loan Market
Association
 
at the relevant time.
14.3
Rights of assignee
Any
 
assignee
 
of
 
a
 
Lender
 
shall
 
(unless
 
limited
 
by
 
the
 
express
 
terms
 
of
 
the
assignment)
 
take
 
the
 
full
 
benefit
 
of
 
every
 
provision
 
of
 
the
 
Finance
 
Documents
benefitting
 
that
 
Lender
 
PROVIDED
 
THAT
 
an
 
assignment
 
will
 
only
 
be
 
effective
 
on
notification by the Agent to that
 
Lender and the assignee that the
 
Agent is satisfied it
has complied with
all necessary "Know your customer" or other similar checks under
 
all applicable laws
and regulations in relation to the assignment to the assignee.
14.4
Transfer Certificates
If a
 
Lender wishes
 
to transfer
 
any of
 
its rights
 
and obligations
 
under or
 
pursuant to
this
 
Agreement,
 
it
 
may
 
do
 
so
 
by
 
delivering
 
to
 
the
 
Agent
 
a
 
duly
 
completed Transfer
Certificate, in which event on the Transfer Date:
14.4.1
to the extent that that
 
Lender seeks to transfer its rights
 
and obligations, the
Borrowers (on the
 
one hand) and
 
that Lender (on
 
the other) shall
 
be released
from further obligations towards the other;
14.4.2
the
 
Borrowers
 
(on
 
the
 
one
 
hand)
 
and
 
the
 
transferee
 
(on
 
the
 
other)
 
shall
assume obligations towards the other identical to those released pursuant to
Clause 14.4.1 ; and
14.4.3
the Agent, each of the Lenders and the transferee shall have
 
the same
 
rights
and obligations between
 
themselves as they
 
would have had
 
if the transferee
had been an original party to this Agreement as a Lender with the rights and
obligations transferred to it as a result of the transfer
PROVIDED THAT the Agent shall only be obliged to execute a Transfer Certificate once:
(a)
it is satisfied
 
it has complied
 
with all necessary
 
"know your customer"
 
or other
similar
 
checks
 
under
 
all
 
applicable
 
laws
 
and
 
regulations
 
in
 
relation
 
to
 
the
transfer to the transferee; and
(b)
the transferee has paid to the Agent for its own
 
account a transfer fee of two
thousand Dollars ($2,000).
The Agent
 
shall, as
 
soon as
 
reasonably practicable
 
after it
 
has executed
 
a Transfer
Certificate, send to the Borrowers a copy of that Transfer Certificate.
14.5
Finance Documents
Unless
 
otherwise
 
expressly
 
provided
 
in
 
any
 
Finance
 
Document
 
or
 
otherwise
expressly
 
agreed
 
between
 
a
 
Lender
 
and
 
any
 
proposed
 
transferee
 
and
 
notified
 
by
that
 
Lender
 
to
 
the
 
Agent
 
on
 
or
 
before
 
the
 
relevant
 
Transfer
 
Date,
 
there
 
shall
automatically be assigned to the transferee with
 
any transfer of a Lender's rights and
obligations
 
under
 
or
 
pursuant
 
to
 
this
 
Agreement
 
the
 
rights
 
of
 
that
 
Lender
 
under
 
or
pursuant to
 
the Finance
 
Documents (other
 
than this
 
Agreement) which
 
relate to
 
the
portion
 
of
 
that
 
Lender's
 
rights
 
and
 
obligations
 
transferred
 
by
 
the
 
relevant
 
Transfer
Certificate.
14.6
No assignment or transfer by the Borrowers
No
 
Borrower may
 
assign
 
any
 
of
 
its
 
rights
 
or
 
transfer
 
any
 
of
 
its
 
rights
 
or
 
obligations
under the Finance Documents.
14.7
Securitisation
A Lender
 
may disclose
 
the size
 
and term
 
of the
 
Loan and
 
the
 
name of
 
each of
 
the
Security Parties to any investor or potential investor in a securitisation
 
(or similar
transaction of
 
broadly equivalent
 
economic effect) of
 
that Lender's
 
rights or
 
obligations
under the Finance Documents.
15
The Agent, the Security Agent and the Lenders
15.1
Appointment
15.1.1
Each Lender appoints the
 
Agent to act as
 
its agent under and
 
in connection
with
 
the
 
Finance Documents
 
and
 
each
 
Lender and
 
the
 
Agent
 
appoints the
Security
 
Agent
 
to
 
act
 
as
 
its
 
security
 
agent
 
for
 
the
 
purpose
 
of
 
the
 
Security
Documents.
15.1.2
Each
 
Lender
 
authorises
 
the
 
Agent
 
and
 
each
 
Lender
 
and
 
the
 
Agent
authorises the Security Agent to
 
exercise the rights, powers, authorities and
discretions specifically given to the Agent or the Security Agent (as the
 
case
may
 
be)
 
under or
 
in
 
connection with
 
the
 
Finance Documents
 
together
 
with
any other incidental rights, powers, authorities and discretions.
15.1.3
Except where the context otherwise requires or where
 
expressly provided to
the contrary, references
 
in this
 
Clause 15
 
to the
 
"
Agent
" shall
 
mean the
 
Agent
and the Security Agent individually and collectively.
15.2
Authority
Each
 
of
 
the
 
other
 
Finance
 
Parties
 
irrevocably
 
authorises
 
the
 
Agent
 
(subject
 
to
Clauses 15.4 (
Limitations on authority
) and 15.18 (
Instructions
)):
15.2.1
to execute on
 
its behalf any
 
Finance Document (other than
 
this Agreement)
and
 
any
 
variation
 
or
 
amendment
 
of
 
any
 
Finance
 
Document
 
(including
 
this
Agreement);
15.2.2
to collect, receive, release or pay any money on its behalf;
15.2.3
acting on the instructions from time to time of the Majority Lenders to give or
withhold
 
any
 
waivers,
 
consents
 
or
 
approvals
 
under
 
or
 
pursuant
 
to
 
any
Finance Document; and
15.2.4
acting
 
on
 
the
 
unanimous
 
instructions
 
from
 
time
 
to
 
time
 
of
 
the
 
Lenders
 
to
exercise,
 
or
 
refrain
 
from
 
exercising,
 
any
 
rights,
 
powers,
 
authorities
 
or
discretions
 
(including,
 
without
 
limitation,
 
determining
 
matters
 
to
 
be
acceptable
 
to
 
or
 
agreed
 
by
 
the
 
Agent)
 
under
 
or
 
pursuant
 
to
 
any
 
Finance
Document.
The Agent shall have no duties or responsibilities as agent or
 
as security agent other
than
 
those
 
expressly
 
conferred
 
on
 
it
 
by
 
the
 
Finance
 
Documents
 
and
 
shall
 
not
 
be
obliged to act on any instructions from the Lenders or the Majority Lenders if to do so
would,
 
in
 
the
 
opinion
 
of
 
the
 
Agent,
 
be
 
contrary
 
to
 
any
 
provision
 
of
 
the
 
Finance
Documents
 
or
 
to
 
any
 
law,
 
or
 
would
 
expose
 
the
 
Agent
 
to
 
any
 
actual
 
or
 
potential
liability to any third party.
15.3
Trust
The
 
Security
 
Agent
 
agrees
 
and
 
declares,
 
and
 
each
 
of
 
the
 
other
 
Finance
 
Parties
acknowledges, that, subject to the terms and conditions of this Clause
 
15.3, the
Security
 
Agent holds
 
the
 
Trust
 
Property on
 
trust
 
for
 
the
 
Finance Parties
 
absolutely.
Each
 
of
 
the
 
other
 
Finance
 
Parties
 
agrees
 
that
 
the
 
obligations,
 
rights
 
and
 
benefits
vested
 
in
 
the
 
Security
 
Agent
 
shall
 
be
 
performed
 
and
 
exercised
 
in
 
accordance
 
with
this Clause 15.3.
 
The Security Agent shall
 
have the benefit
 
of all of
 
the provisions of
this Agreement
 
benefiting it
 
in its
 
capacity as
 
security agent
 
for the
 
Finance Parties,
and all the powers
 
and discretions conferred on trustees
 
by the Trustee
 
Act 1925 (to
the extent not inconsistent with this Agreement). In addition:
15.3.1
the Security Agent and any attorney, agent or delegate of the Security Agent
may indemnify itself or himself out of the Trust
 
Property against all liabilities,
costs, fees,
 
damages, charges,
 
losses and
 
expenses sustained
 
or incurred
by it or him in relation to
 
the taking or holding of any of
 
the Trust Property or
in
 
connection
 
with
 
the
 
exercise
 
or
 
purported
 
exercise
 
of
 
the
 
rights,
 
trusts,
powers
 
and
 
discretions
 
vested
 
in
 
the
 
Security
 
Agent
 
or
 
any
 
other
 
such
person
 
by or
 
pursuant to
 
the
 
Security Documents
 
or in
 
respect of
 
anything
else
 
done
 
or
 
omitted
 
to
 
be
 
done
 
in
 
any
 
way
 
relating
 
to
 
the
 
Security
Documents;
15.3.2
the
 
other
 
Finance
 
Parties
 
acknowledge
 
that
 
the
 
Security
 
Agent
 
shall
 
be
under no obligation to insure any property nor to require any other
 
person to
insure any
 
property and shall
 
not be
 
responsible for any
 
loss which may
 
be
suffered
 
by
 
any
 
person
 
as
 
a
 
result
 
of
 
the
 
lack
 
or
 
insufficiency
 
of
 
any
insurance; and
15.3.3
the Finance
 
Parties agree
 
that the
 
perpetuity period
 
applicable to
 
the trusts
declared by this Agreement shall be the period of 125 years from the date of
this Agreement.
The provisions of Part I
 
of the Trustee
 
Act 2000 shall not apply
 
to the Security Agent
or the Trust Property.
15.4
Limitations on authority
Except with the prior written consent of
 
all the Lenders, the Agent shall not
 
be entitled
to:
15.4.1
release or
 
vary any
 
security given
 
for the
 
Borrowers' obligations
 
under this
Agreement; nor
15.4.2
waive the payment
 
of any sum
 
of money
 
payable by any
 
Security Party under
the Finance Documents; nor
15.4.3
reduce the Margin; nor
15.4.4
change the meaning of the expression "
Majority Lenders
"; nor
15.4.5
change the order of
 
application of any
 
moneys set out
 
in this Agreement;
 
nor
15.4.6
exercise, or refrain from
 
exercising, any right,
 
power, authority
 
or discretion,
or
 
give
 
or
 
withhold
 
any
 
consent,
 
the
 
exercise
 
or
 
giving
 
of
 
which
 
is,
 
by
 
the
terms
 
of
 
this
 
Agreement,
 
expressly
 
reserved
 
to
 
the
 
Lenders
 
or
 
dependent
on the instructions of all the Lenders; nor
15.4.7
extend the
 
due date
 
for the
 
payment of
 
any sum
 
of money
 
payable by
 
any
Security Party under any Finance Document; nor
15.4.8
take
 
or
 
refrain
 
from
 
taking
 
any
 
step
 
if
 
the
 
effect
 
of
 
such
 
action
 
or
 
inaction
may
 
lead to
 
the
 
increase of
 
the obligations
 
of a
 
Lender under
 
any Finance
Document; nor
15.4.9
agree
 
to
 
change
 
the
 
currency
 
in
 
which
 
any
 
sum
 
is
 
payable
 
under
 
any
Finance Document (other
 
than in
 
accordance with the
 
terms of
 
the relevant
Finance Document); nor
15.4.10
agree to change this Clause 15.4;
and any
 
amendment or waiver
 
which relates
 
to any
 
of the
 
matters referred to
 
in this
Clause 15.4 shall
 
not be entered
 
into by the
 
Agent until all
 
the Lenders have
 
agreed
its terms.
15.5
Liability
Neither the Agent nor any
 
of its directors, officers,
 
employees or agents shall
 
be liable
to
 
the
 
Lenders
 
for
 
anything
 
done
 
or
 
omitted
 
to
 
be
 
done
 
by
 
the
 
Agent
 
under
 
or
 
in
connection
 
with
 
any
 
of
 
the
 
Relevant
 
Documents
 
unless
 
as
 
a
 
result
 
of
 
the
 
Agent's
gross negligence or wilful misconduct.
15.6
Acknowledgement
Each Lender acknowledges that:
15.6.1
it
 
has
 
not
 
relied
 
on
 
any
 
representation
 
made
 
by
 
the
 
Agent
 
or
 
any
 
of
 
the
Agent's directors,
 
officers, employees
 
or agents
 
or by
 
any other
 
person acting
or
 
purporting
 
to
 
act
 
on
 
behalf
 
of
 
the
 
Agent
 
to
 
induce
 
it
 
to
 
enter
 
into
 
any
Finance Document;
15.6.2
it
 
has
 
made
 
and
 
will
 
continue
 
to
 
make
 
without
 
reliance
 
on
 
the
 
Agent,
 
and
based
 
on
 
such
 
documents and
 
other
 
evidence as
 
it
 
considers
 
appropriate,
its own independent investigation of the
 
financial condition and affairs of
 
the
Security Parties in connection with the making and continuation
 
of the
 
Loan;
15.6.3
it has made its own appraisal of
 
the creditworthiness of the Security Parties;
and
15.6.4
the Agent
 
shall not
 
have any
 
duty or
 
responsibility at
 
any time
 
to provide
 
it
with any credit or other information relating to
 
any Security Party unless that
information
 
is
 
received
 
by
 
the
 
Agent
 
pursuant
 
to
 
the
 
express
 
terms
 
of
 
a
Finance Document.
Each
 
Lender
 
agrees
 
that
 
it
 
will
 
not
 
assert
 
nor
 
seek
 
to
 
assert
 
against
 
any
 
director,
officer,
 
employee
 
or
 
agent
 
of
 
the
 
Agent
 
or
 
against
 
any
 
other
 
person
 
acting
 
or
purporting to
 
act on
 
behalf of
 
the Agent
 
any claim
 
which it
 
might have
 
against them
in respect of any of the matters referred to in this Clause 15.6.
15.7
Limitations on responsibility
The
 
Agent
 
shall
 
have
 
no
 
responsibility
 
to
 
any
 
Security
 
Party
 
or
 
to
 
any
 
Lender
 
on
account of:
15.7.1
the failure
 
of a
 
Lender or
 
of any
 
Security Party
 
to perform
 
any of
 
its obligations
under a Finance Document; nor
15.7.2
the financial condition of any Security Party; nor
15.7.3
the
 
completeness
 
or
 
accuracy
 
of
 
any
 
statements,
 
representations
 
or
warranties made in
 
or pursuant to
 
any Finance Document, or
 
in or pursuant
to
 
any
 
document
 
delivered
 
pursuant
 
to
 
or
 
in
 
connection
 
with
 
any
 
Finance
Document; nor
15.7.4
the
 
negotiation,
 
execution,
 
effectiveness,
 
genuineness,
 
validity,
enforceability,
 
admissibility
 
in
 
evidence
 
or
 
sufficiency
 
of
 
any
 
Finance
Document
 
or
 
of
 
any
 
document
 
executed
 
or
 
delivered
 
pursuant
 
to
 
or
 
in
connection with any Finance Document.
15.8
The Agent's rights
The Agent may:
15.8.1
assume that all
 
representations or warranties made
 
or deemed repeated by
any
 
Security
 
Party
 
in
 
or
 
pursuant
 
to
 
any
 
Finance
 
Document
 
are
 
true
 
and
complete,
 
unless,
 
in
 
its
 
capacity
 
as
 
the
 
Agent,
 
it
 
has
 
acquired
 
actual
knowledge to the contrary;
15.8.2
assume that
 
no Default has
 
occurred unless,
 
in its
 
capacity as the
 
Agent, it
has acquired actual knowledge to the contrary;
15.8.3
rely on any document or notice believed by it to be genuine;
15.8.4
rely as
 
to legal
 
or other
 
professional matters
 
on opinions and
 
statements of
any legal or other professional advisers selected or approved by
 
it;
15.8.5
rely
 
as
 
to
 
any
 
factual
 
matters
 
which
 
might
 
reasonably
 
be
 
expected
 
to
 
be
within the
 
knowledge of
 
any Security
 
Party on
 
a certificate
 
signed by
 
or on
behalf of that Security Party; and
15.8.6
refrain from exercising
 
any right, power, discretion
 
or remedy unless
 
and until
instructed
 
to
 
exercise that
 
right,
 
power,
 
discretion or
 
remedy
 
and
 
as to
 
the
manner of
 
its exercise
 
by the
 
Lenders or
 
the Majority
 
Lenders (as
 
the case
may be)
 
and unless
 
and until
 
the Agent
 
has received from
 
the Lenders
 
any
payment which
 
the Agent
 
may require
 
on account
 
of, or
 
any security
 
which
the Agent
 
may require
 
for,
 
any costs, claims,
 
expenses (including legal
 
and
other
 
professional
 
fees)
 
and
 
liabilities
 
which
 
it
 
considers
 
it
 
may
 
incur
 
or
sustain in complying with those instructions.
15.9
The Agent's duties
The Agent shall:
15.9.1
if
 
requested
 
in
 
writing
 
to
 
do
 
so
 
by
 
a
 
Lender,
 
make
 
enquiry
 
and
 
advise
 
the
Lenders
 
as
 
to
 
the
 
performance
 
or
 
observance
 
of
 
any
 
of
 
the
 
provisions
 
of
any
 
Finance
 
Document by
 
any
 
Security
 
Party
 
or
 
as
 
to
 
the
 
existence
 
of
 
an
Event of Default; and
15.9.2
inform the Lenders
 
promptly of any
 
Event of Default
 
of which the
 
Agent has
actual knowledge.
15.10
No deemed knowledge
The
 
Agent
 
shall
 
not
 
be
 
deemed
 
to
 
have
 
actual
 
knowledge
 
of
 
the
 
falsehood
 
or
incompleteness of any representation
 
or warranty made
 
or deemed repeated by
 
any
Security Party or actual knowledge
 
of the occurrence of
 
any Default unless a Lender
or a Security Party
 
shall have given written notice
 
thereof to the Agent in
 
its capacity
as
 
the
 
Agent.
 
Any
 
information
 
acquired
 
by
 
the
 
Agent
 
other
 
than
 
specifically
 
in
 
its
capacity as the Agent shall not be deemed to be information acquired
 
by the Agent in
its capacity as the Agent.
15.11
Other business
The Agent
 
may,
 
without any
 
liability to
 
account to
 
the Lenders,
 
generally engage
 
in
any kind
 
of banking or
 
trust business with
 
a Security Party
 
or with
 
a Security Party's
subsidiaries or associated companies or with a Lender as if it were
 
not the Agent.
15.12
Indemnity
The
 
Lenders
 
shall,
 
promptly
 
on
 
the
 
Agent's
 
request,
 
reimburse
 
the
 
Agent
 
in
 
their
respective Proportionate Shares, for,
 
and keep the Agent
 
fully indemnified in respect
of
 
all
 
liabilities,
 
damages,
 
costs
 
and
 
claims
 
sustained
 
or
 
incurred
 
by
 
the
 
Agent
 
in
connection
 
with
 
the
 
Finance
 
Documents,
 
or
 
the
 
performance
 
of
 
its
 
duties
 
and
obligations,
 
or
 
the
 
exercise
 
of
 
its
 
rights,
 
powers,
 
discretions
 
or
 
remedies
 
under
 
or
pursuant to any Finance Document, to the extent not paid by the Security Parties
 
and
not arising solely from the Agent's gross negligence or wilful
 
misconduct.
15.13
Employment of agents
In
 
performing
 
its
 
duties
 
and
 
exercising
 
its
 
rights,
 
powers,
 
discretions
 
and
 
remedies
under or
 
pursuant to
 
the Finance
 
Documents, the
 
Agent shall
 
be entitled
 
to employ
and pay agents to
 
do anything which
 
the Agent is empowered
 
to do under or
 
pursuant
to
 
the
 
Finance
 
Documents (including
 
the
 
receipt
 
of
 
money
 
and
 
documents
 
and
 
the
payment of money) and
 
to act or
 
refrain from taking action
 
in reliance on the
 
opinion
of,
 
or
 
advice
 
or
 
information
 
obtained
 
from,
 
any
 
lawyer,
 
banker,
 
broker,
 
accountant,
valuer or any other
 
person believed by
 
the Agent in good
 
faith to be competent
 
to give
such opinion, advice or information.
15.14
Distribution of payments
The
 
Agent
 
(which
 
term
 
shall
 
not
 
for
 
the
 
purposes
 
of
 
this
 
Clause
 
15.14
 
include
 
the
Security Agent)
 
shall pay
 
promptly to
 
the order
 
of each
 
Finance Party
 
every sum
 
of
money
 
received
 
by
 
the
 
Agent
 
pursuant
 
to
 
the
 
Finance Documents
 
for
 
that
 
Finance
Party and until so paid such amount shall be held by the Agent on trust absolutely for
that
 
Finance
 
Party.
 
If
 
the
 
Agent
 
receives
 
a
 
sum
 
of
 
money
 
which
 
is
 
insufficient
 
to
discharge
 
all
 
the
 
amounts then
 
due
 
and
 
payable to
 
every
 
Finance
 
Party under
 
any
one or more of the Finance
 
Documents, the Agent shall
 
apply that sum in accordance
with
 
the
 
order
 
set
 
out
 
in
 
Clauses
 
10.10.5
 
to
 
10.10.10
 
inclusive
 
(
Application
 
of
moneys by Security Agent
).
15.15
Reimbursement
The Agent shall have no liability to pay any sum to a Lender until
 
it has itself received
payment of
 
that sum.
 
If, however, the
 
Agent does
 
pay any
 
sum to
 
a Lender
 
on account
of any amount
 
prospectively due to
 
that Lender pursuant
 
to Clause 15.14 (
Distribution
of payments
) before it has itself received payment of
 
that amount, that Lender will, on
demand
 
by
 
the
 
Agent,
 
refund
 
to
 
the
 
Agent
 
an
 
amount
 
equal
 
to
 
the
 
sum
 
so
 
paid,
together with
 
an amount
 
sufficient to
 
reimburse the
 
Agent for
 
any interest
 
which the
Agent
 
may
 
certify
 
that
 
it
 
has
 
been
 
required
 
to
 
pay
 
on
 
money
 
borrowed to
 
fund
 
the
sum in
 
question during
 
the period
 
beginning on
 
the date
 
of payment
 
and ending
 
on
the date on which the Agent receives reimbursement.
15.16
Redistribution of payments
Unless otherwise agreed between the Lenders and the Agent, if at any time a Lender
receives or recovers by way of
 
set-off, the exercise of any
 
lien or otherwise from any
Security Party, an amount greater than that Lender's Proportionate Share of any sum
due from
 
that Security
 
Party to
 
the Lenders
 
under the
 
Finance Documents
 
(the amount
of the excess being
 
referred to in this
 
Clause 15.16 and in Clause
 
15.17 (
Rescission
of Excess Amount
) as the "
Excess Amount
") then:
15.16.1
that Lender shall promptly notify
 
the Agent (which shall promptly
 
notify each
other Lender);
15.16.2
that Lender
 
shall pay
 
to the
 
Agent an
 
amount equal
 
to the
 
Excess Amount
within ten (10) days of its receipt or recovery of the Excess
 
Amount; and
15.16.3
the
 
Agent
 
shall
 
treat
 
that
 
payment
 
as
 
if
 
it
 
were
 
a
 
payment
 
by
 
the
 
Security
Party in
 
question on account
 
of the sum
 
due from that
 
Security Party to
 
the
Lenders and
 
shall account
 
to the
 
Lenders in
 
respect of
 
the Excess
 
Amount
in
 
accordance
 
with
 
the
 
provisions
 
of
 
Clause
 
15.14
 
(
Distribution
 
of
payments
).
However,
 
if
 
a
 
Lender
 
has
 
commenced
 
any
 
legal
 
proceedings
 
to
 
recover
sums
 
owing
 
to
 
it
 
under
 
the
 
Finance
 
Documents
 
and,
 
as
 
a
 
result
 
of,
 
or
 
in
connection
 
with,
 
those
 
proceedings
 
has
 
received
 
an
 
Excess
 
Amount,
 
the
Agent
 
shall
 
not
 
distribute
 
any
 
of
 
that
 
Excess
 
Amount
 
to
 
any
 
other
 
Lender
which
 
had
 
been
 
notified
 
of
 
the
 
proceedings and
 
had
 
the
 
legal
 
right
 
to,
 
but
did
 
not,
 
join
 
those
 
proceedings
 
or
 
commence
 
and
 
diligently
 
prosecute
separate proceedings to enforce its rights in the same or another
 
court.
15.17
Rescission of Excess Amount
If all or any part of any
 
Excess Amount is rescinded or must otherwise be restored to
any Security
 
Party or
 
to any
 
other third
 
party,
 
the Lenders
 
which have
 
received any
part
 
of
 
that
 
Excess
 
Amount
 
by
 
way
 
of
 
distribution
 
from
 
the
 
Agent
 
pursuant
 
to
 
Clause 15.16 (
Redistribution of payments
) shall repay to the Agent for the account of
the
 
Lender
 
which
 
originally
 
received
 
or
 
recovered
 
the
 
Excess
 
Amount,
 
the
 
amount
which
 
shall
 
be
 
necessary
 
to
 
ensure
 
that
 
the
 
Lenders
 
share
 
rateably
 
in
 
accordance
with
 
their
 
Proportionate
 
Shares
 
in
 
the
 
amount
 
of
 
the
 
receipt
 
or
 
payment
 
retained,
together with
 
interest on
 
that amount
 
at a
 
rate equivalent
 
to that
 
(if any)
 
paid by
 
the
Lender receiving or recovering
 
the Excess Amount
 
to the person
 
to whom that Lender
is liable
to
 
make
 
payment in
 
respect
 
of such
 
amount, and
 
Clause 15.16.3
 
(
Redistribution of
payments
) shall apply only to the retained amount.
15.18
Instructions
Where the Agent is
 
authorised or directed to act
 
or refrain from acting
 
in accordance
with the
 
instructions of
 
the Lenders
 
or of
 
the Majority
 
Lenders (as
 
the case
 
may be)
each of the Lenders
 
shall provide the Agent
 
with instructions within
 
three (3) Business
Days
 
of
 
the
 
Agent's
 
request
 
(which
 
request
 
may
 
be
 
made
 
orally
 
or
 
in
 
writing).
 
If
 
a
Lender
 
does
 
not
 
provide
 
the
 
Agent
 
with
 
instructions
 
within
 
that
 
period,
 
that
 
Lender
shall be
 
bound by
 
the decision
 
of the
 
Agent. Nothing
 
in this
 
Clause 15.18
 
shall limit
the right of
 
the Agent to
 
take, or
 
refrain from taking,
 
any action without
 
obtaining the
instructions of the Lenders
 
or the Majority Lenders (as
 
the case may be)
 
if the Agent
in its
 
discretion considers
 
it necessary
 
or appropriate
 
to take,
 
or refrain
 
from taking,
such action in order to preserve the
 
rights of the Lenders under or
 
in connection with
the Finance Documents. In
 
that event, the
 
Agent will notify the
 
Lenders of the
 
action
taken
 
by
 
it
 
as
 
soon
 
as
 
reasonably
 
practicable,
 
and
 
the
 
Lenders
 
agree
 
to
 
ratify
 
any
action taken by the Agent pursuant to this Clause
 
15.18.
15.19
Payments
All amounts payable
 
to a Lender
 
under this Clause
 
15 shall be
 
paid to such
 
account
at such bank as that Lender may from time to time direct in writing
 
to the Agent.
15.20
"Know your customer" checks
Each Lender
 
shall promptly
 
upon the
 
request
 
of the
 
Agent supply, or
 
procure the
 
supply
of, such documentation and other
 
evidence as is reasonably requested
 
by the Agent
(for itself)
 
in order
 
for the
 
Agent to
 
carry out
 
and be
 
satisfied it
 
has complied with
 
all
necessary
 
"know
 
your
 
customer"
 
or
 
other
 
similar
 
checks
 
under
 
all
 
applicable
 
laws
and
 
regulations
 
pursuant
 
to
 
the
 
transactions
 
contemplated
 
in
 
the
 
Finance
Documents.
15.21
Resignation
Subject
 
to
 
a
 
successor
 
being
 
appointed
 
in
 
accordance
 
with
 
this
 
Clause
 
15.21,
 
the
Agent may
 
resign as
 
agent and/or
 
security agent
 
at any
 
time without
 
assigning any
reason by giving
 
to the Borrowers
 
and the Lenders
 
notice of its
 
intention to do
 
so, in
which event the following shall apply:
15.21.1
the
 
Lenders may
 
within thirty
 
(30) days
 
after the
 
date of
 
the
 
Agent's notice
appoint a successor to act as agent and/or security
 
agent or, if they fail to do
so,
 
the
 
Agent
 
may
 
appoint
 
any
 
other
 
bank
 
or
 
financial
 
institution
 
as
 
its
successor;
15.21.2
the
 
resignation
 
of
 
the
 
Agent
 
shall
 
take
 
effect
 
simultaneously
 
with
 
the
appointment
 
of
 
its
 
successor
 
on
 
written
 
notice
 
of
 
that
 
appointment
 
being
given to the Borrowers and the Lenders;
15.21.3
the Agent shall thereupon be discharged
 
from all further obligations as agent
and/or security agent but shall remain entitled to the benefit
 
of the provisions
of this Clause 15; and
15.21.4
the Agent's successor
 
and each of
 
the other parties
 
to this
 
Agreement shall
have
 
the
 
same
 
rights
 
and
 
obligations
 
amongst
 
themselves
 
as
 
they
 
would
have had if that successor had been a party to this Agreement.
15.22
No fiduciary relationship
Except as provided in
 
Clauses 15.3 (
Trust
) and 15.14 (
Distribution of payments
), the
Agent shall not have any fiduciary
 
relationship with or be deemed
 
to be a trustee of or
for any other person and nothing contained in any Finance Document shall constitute
a partnership between any two or more Lenders or between the Agent
 
and any other
person.
16
Set-Off
A Finance Party
 
may set off any
 
matured obligation due
 
from the Borrowers
 
under any
Finance
 
Document (to
 
the
 
extent beneficially
 
owned
 
by
 
that
 
Finance Party)
 
against
any matured obligation owed by
 
that Finance Party to
 
any Borrower, regardless of the
place of
 
payment, booking
 
branch or
 
currency of
 
either obligation.
 
If the
 
obligations
are
 
in
 
different
 
currencies,
 
that
 
Finance
 
Party
 
may
 
convert
 
either
 
obligation
 
at
 
a
market rate of exchange in its usual course of business
 
for the purpose of the set-off.
17
Payments
17.1
Payments
Each
 
amount
 
payable
 
by
 
a
 
Borrower
 
under
 
a
 
Finance
 
Document
 
shall
 
be
 
paid
 
to
such
 
account
 
at
 
such
 
bank
 
as
 
the
 
Agent
 
may
 
from
 
time
 
to
 
time
 
direct
 
to
 
the
Borrowers in the Currency of Account and in such funds as are customary
 
at the time
for
 
settlement
 
of
 
transactions
 
in
 
the
 
relevant
 
currency
 
in
 
the
 
place
 
of
 
payment.
Payment shall be deemed
 
to have been
 
received by the
 
Agent on the
 
date on which
the Agent receives
 
authenticated advice of receipt,
 
unless that advice
 
is received by
the
 
Agent
 
on
 
a
 
day
 
other
 
than
 
a
 
Business
 
Day
 
or
 
at
 
a
 
time
 
of
 
day
 
(whether
 
on
 
a
Business Day or not) when the Agent in
 
its discretion considers that
 
it is impossible
 
or
impracticable for the Agent to
 
utilise the amount received for
 
value that same day,
 
in
which event
 
the payment in
 
question shall be
 
deemed to have
 
been received by
 
the
Agent on the Business Day next following the date of receipt of advice
 
by the Agent.
17.2
No deductions or withholdings
Each payment
 
(whether of
 
principal or
 
interest or
 
otherwise) to
 
be made
 
by a Borrower
under
 
a
 
Finance
 
Document
 
shall,
 
subject
 
only
 
to
 
Clause
 
17.3
 
(
Grossing-up
),
 
be
made free
 
and clear
 
of and
 
without deduction
 
for or
 
on account
 
of any
 
Taxes
 
(other
than
 
a FATCA
 
Deduction) or
 
other deductions,
 
withholdings, restrictions,
 
conditions
or counterclaims of any nature.
17.3
Grossing-up
If at
 
any time
 
any law
 
requires (or
 
is interpreted
 
to require)
 
a Borrower
 
to make
 
any
deduction
 
or
 
withholding
 
from
 
any
 
payment
 
(other
 
than
 
a
 
FATCA
 
Deduction),
 
or
 
to
change the
 
rate or
 
manner in
 
which any
 
required deduction
 
or withholding
 
is made,
under
 
a
 
Finance
 
Document,
 
the
 
Borrowers
 
will
 
promptly
 
notify
 
the
 
Agent
 
and,
simultaneously with
 
that payment,
 
will pay
 
to the
 
Agent whatever
 
additional amount
(after taking
 
into account
 
any additional
 
Taxes on, or deductions
 
or withholdings
 
from,
or
 
restrictions or
 
conditions on,
 
that additional
 
amount) is
 
necessary to
 
ensure that,
after the
 
deduction or
 
withholding,
 
the relevant
 
Finance
 
Parties receive
 
a net
 
sum equal
to
 
the
 
sum
 
which
 
they
 
would
 
have
 
received
 
had
 
no
 
deduction
 
or
 
withholding
 
been
made.
17.4
Evidence of deductions
If
 
at
 
any
 
time
 
a
 
Borrower
 
is
 
required
 
by
 
law
 
to
 
make
 
any
 
deduction
 
or
 
withholding
from any payment to be
 
made by it under a
 
Finance Document, that Borrower
 
will pay
the
 
amount
 
required
 
to
 
be
 
deducted
 
or
 
withheld to
 
the
 
relevant
 
authority
 
within
 
the
time
 
allowed
 
under
 
the
 
applicable
 
law
 
and
 
will,
 
no
 
later
 
than
 
thirty
 
(30)
 
days
 
after
making that
 
payment, deliver
 
to the
 
Agent an
 
original receipt
 
issued by
 
the relevant
authority,
 
or other evidence
 
acceptable to the
 
Agent, evidencing the
 
payment to that
authority of all amounts required to be deducted or withheld.
17.5
Adjustment of due dates
If any payment or
 
transfer of funds to
 
be made under a
 
Finance Document, other than
a
 
payment
 
of
 
interest
 
on
 
the
 
Loan,
 
shall
 
be
 
due
 
on
 
a
 
day
 
which
 
is
 
not
 
a
 
Business
Day,
 
that payment
 
shall be
 
made on
 
the next
 
succeeding Business
 
Day (unless
 
the
next
 
succeeding Business
 
Day
 
falls
 
in
 
the
 
next
 
calendar
 
month
 
in
 
which
 
event
 
the
payment shall
 
be made
 
on the
 
next preceding
 
Business Day).
 
Any such
 
variation of
time shall be taken into account in computing any interest in
 
respect of that payment.
17.6
Control account
The
 
Agent shall
 
open
 
and maintain
 
on
 
its
 
books
 
a
 
control account
 
in
 
the
 
names of
the
 
Borrowers showing
 
the advance
 
of the
 
Loan and
 
the computation
 
and payment
of interest
 
and all
 
other sums
 
due under this
 
Agreement. The Borrowers'
 
obligations
to repay
 
the Loan
 
and to
 
pay interest
 
and all
 
other sums
 
due under
 
this Agreement
shall
 
be
 
evidenced
 
by
 
the
 
entries
 
from
 
time
 
to
 
time
 
made
 
in
 
the
 
control
 
account
opened and maintained under this Clause 17.6 and those entries will, in
 
the absence
of manifest error, be conclusive and binding.
17.7
Clawback
The
 
Agent
 
shall
 
have
 
no
 
liability
 
to
 
pay
 
any
 
sum
 
to
 
the
 
Borrowers
 
until
 
it
 
has
 
itself
received
 
payment
 
of
 
that
 
sum.
 
If,
 
however,
 
the
 
Agent
 
does
 
pay
 
any
 
sum
 
to
 
the
Borrowers on account of any
 
amount prospectively due to the Borrowers
 
pursuant to
Clause 3
 
(
Advance)
before it
 
has itself
 
received payment
 
of that
 
amount, the
 
Borrowers
will,
 
on
 
demand
 
by
 
the
 
Agent,
 
refund
 
to
 
the
 
Agent
 
an
 
amount
 
equal
 
to
 
the
 
sum
 
so
paid, together with an amount sufficient to reimburse the Agent for any interest which
the Agent may certify that it has been required to pay on money borrowed to fund the
sum in
 
question during
 
the period
 
beginning on
 
the date
 
of payment
 
and ending
 
on
the date on which the Agent receives reimbursement.
17.8
FATCA
 
Deduction and gross-up by a Security
 
Party
(a)
Each
 
Party
 
may
 
make
 
any
 
FATCA
 
Deduction
 
it
 
is
 
required
 
to
 
make
 
by
FATCA
 
and
 
any
 
payment
 
required
 
in
 
connection
 
with
 
that
 
FATCA
Deduction,
 
and
 
no
 
Party
 
shall
 
be
 
required
 
to
 
increase
 
any
 
payment
 
in
respect of which it
 
makes
such
 
a
 
FATCA
 
Deduction
 
or
 
otherwise
 
compensate
 
the
 
recipient
 
of
 
the
payment for that FATCA
 
Deduction.
(b)
Each
 
Party
 
shall
 
promptly,
 
upon
 
becoming
 
aware
 
that
 
it
 
must
 
make
 
a
FATCA
 
Deduction
 
(or
 
that
 
there
 
is
 
any
 
change
 
in
 
the
 
rate
 
or
 
the
 
basis
 
of
such FATCA
 
Deduction), notify the
 
Party to
 
whom it
 
is making the
 
payment
and,
 
in
 
addition,
 
shall
 
notify
 
the
 
Borrowers
 
and
 
the
 
Agent
 
and
 
the
 
Agent
shall notify the other Finance Parties.
18
Notices
18.1
Communications in writing
Any communication to
 
be made
 
under or in
 
connection with this
 
Agreement shall be
made in writing and, unless otherwise stated, may be made by
 
fax or letter.
18.2
Addresses
The address and
 
fax number
 
(and the department
 
or officer, if any, for
 
whose attention
the
 
communication
 
is
 
to
 
be
 
made)
 
of
 
each
 
party
 
to
 
this
 
Agreement
 
for
 
any
communication or document to be made or delivered under or
 
in connection with this
Agreement are:
18.2.1
in the case of the Borrowers:
c/o
 
Diana
 
Shipping
 
Services
S.A. Pendelis 16
175 64 Palaio Faliro
Athens
Greece
 
(fax
 
no:
 
+30
 
210
 
9470101),
 
email:
corpgov@dianashippingservices.com)
marked for the attention of Ms Margarita Veniou;
18.2.2
in the
 
case of
 
each Lender,
 
those appearing
 
opposite its name in
 
Schedule
2, Part 1 (
The Lenders and the Commitments
):
The Export-Import Bank of China
No.30,
 
Fu
 
Xing
 
Men
 
Nei
 
Street,
 
Xicheng
District
 
Beijing 100031,
 
The People's
 
Republic
of China (fax no: +86 10 8357 8428/29)
marked for the attention of: Transportation Finance Department
18.2.3
in
 
the
 
case
 
of
 
each
 
Arranger,
 
those
 
appearing
 
opposite
 
its
 
name
 
in
Schedule 2, Part 2 (
the Arrangers
):
The Export-Import Bank of China
No.30,
 
Fu
 
Xing
 
Men
 
Nei
 
Street,
 
Xicheng
District
 
Beijing 100031,
 
The People's
 
Republic
of China (fax no: +86 10 8357 8428/29)
marked for the attention of: Transportation Finance Department
18.2.4
in the case of the Agent:
The Export-Import Bank of China
No.30,
 
Fu
 
Xing
 
Men
 
Nei
 
Street,
 
Xicheng
District
 
Beijing 100031,
 
The People's
 
Republic
of China (fax no: +86 10 8357 8428/29)
marked for the attention of: Transportation Finance Department
18.2.5
in the
 
case of the
 
Security Agent:
The Export-Import Bank of China
No.30,
 
Fu
 
Xing
 
Men
 
Nei
 
Street,
 
Xicheng
District
 
Beijing 100031,
 
The People's
 
Republic
of China (fax no: +86 10 8357 8428/29)
marked for the attention of: Transportation Finance Department
or any substitute
 
address, fax number,
 
department or officer
 
as any party
 
may notify
to the Agent (or the
 
Agent may notify to the
 
other parties, if a change
 
is made by the
Agent) by not less than five (5) Business Days' notice.
18.3
Delivery
Any communication or document
 
made or delivered by
 
one party to this
 
Agreement to
another under or in connection with this Agreement will only be
 
effective:
18.3.1
if by way of fax, when received in legible form; or
18.3.2
if
 
by
 
way of
 
letter,
 
when
 
it
 
has been
 
left
 
at the
 
relevant address
 
or
 
five
 
(5)
Business
 
Days
 
after
 
being
 
deposited
 
in
 
the
 
post
 
postage
 
prepaid
 
in
 
an
envelope addressed to it at that address;
and,
 
if
 
a
 
particular
 
department
 
or
 
officer
 
is
 
specified
 
as
 
part
 
of
 
its
 
address
 
details
provided under Clause 18.2 (
Addresses
), if addressed to that department or officer.
Any communication or
 
document to be
 
made or delivered
 
to the Agent
 
will be effective
only when actually received by the Agent.
All notices from or to the Borrowers shall be sent through the Agent.
Any
 
communication
 
or
 
document
 
which
 
becomes
 
effective,
 
in
 
accordance
 
with
 
this
Clause 18.3,
 
after 5.00 p.m.
 
in the
 
place of receipt
 
shall be
 
deemed only to
 
become
effective on the following day.
18.4
Notification of address and fax
 
number
Promptly upon receipt of notification of an address, fax number
 
or change of
 
address,
pursuant to Clause 18.2 (
Addresses
) or changing its own address or fax number,
 
the
Agent shall notify the other parties to this Agreement.
18.5
English language
Any notice
 
given under
 
or in
 
connection with
 
this Agreement
 
must be
 
in English.
 
All
other documents provided under or in connection with this Agreement
 
must be:
18.5.1
in English; or
18.5.2
if not in English, and
 
if so required by the
 
Agent, accompanied by a certified
English translation and,
 
in this case,
 
the English translation
 
will prevail unless
the document is a constitutional, statutory or other official
 
document.
19
Partial Invalidity
If, at
 
any time, any
 
provision of a
 
Finance Document is
 
or becomes illegal,
 
invalid or
unenforceable
 
in
 
any
 
respect
 
under
 
any
 
law
 
of
 
any
 
jurisdiction,
 
neither the
 
legality,
validity
 
or
 
enforceability
 
of
 
the
 
remaining
 
provisions
 
nor
 
the
 
legality,
 
validity
 
or
enforceability of such provision under
 
the law of any
 
other jurisdiction will in any
 
way
be affected or impaired.
20
Remedies and Waivers
No failure
 
to exercise, nor
 
any delay in
 
exercising, on the
 
part of
 
any Finance Party,
any
 
right
 
or
 
remedy
 
under
 
a
 
Finance
 
Document
 
shall
 
operate
 
as
 
a
 
waiver
 
of
 
any
such
 
right
 
or
 
remedy
 
or
 
constitute
 
an
 
election
 
to
 
affirm
 
any
 
of
 
the
 
Finance
Documents.
 
No election
 
to affirm
 
any of
 
the
 
Finance Documents
 
on the
 
part of
 
any
Finance Party shall be
 
effective unless it
 
is in writing.
 
No single or
 
partial exercise of
any right
 
or remedy shall
 
prevent any further or other exercise or
 
the exercise of any
other
 
right
 
or
 
remedy.
 
The
 
rights
 
and
 
remedies
 
provided
 
in
 
this
 
Agreement
 
are
cumulative and not exclusive of any rights or remedies provided by law.
21
Joint and several liability
21.1
Nature of liability
The
 
representations,
 
warranties,
 
covenants,
 
obligations
 
and
 
undertakings
 
of
 
the
Borrowers
 
contained
 
in
 
this
 
Agreement
 
shall
 
be
 
joint
 
and
 
several
 
so
 
that
 
each
Borrower shall be jointly and severally liable with all the Borrowers for all of the same
and such
 
liability shall not
 
in any
 
way be
 
discharged, impaired
 
or otherwise
 
affected
by:
21.1.1
any forbearance
 
(whether as
 
to payment
 
or otherwise)
 
or any
 
time or
 
other
indulgence granted to
 
any other Borrower or
 
any other Security
 
Party under
or in connection with any Finance Document;
21.1.2
any
 
amendment,
 
variation,
 
novation
 
or
 
replacement
 
of
 
any
 
other
 
Finance
Document;
21.1.3
any
 
failure
 
of
 
any
 
Finance
 
Document
 
to
 
be
 
legal
 
valid
 
binding
 
and
enforceable in relation to
 
any other Borrower or
 
any other Security Party
 
for
any
 
reason;
21.1.4
the
 
winding-up
 
or
 
dissolution
 
of
 
any
 
other
 
Borrower
 
or
 
any
 
other
 
Security
Party;
21.1.5
the
 
release
 
(whether
 
in
 
whole
 
or
 
in
 
part)
 
of,
 
or
 
the
 
entering
 
into
 
of
 
any
compromise or
 
composition with,
 
any other
 
Borrower or
 
any other
 
Security
Party; or
21.1.6
any other act,
 
omission, thing or circumstance which
 
would or might,
 
but for
this provision, operate to discharge, impair or otherwise affect such
 
liability.
21.2
No rights as surety
Until the Indebtedness has been unconditionally and irrevocably paid and discharged
in full,
 
each Borrower
 
agrees that
 
it shall
 
not, by
 
virtue of
 
any payment
 
made under
this Agreement on account
 
of the Indebtedness or
 
by virtue of any
 
enforcement by a
Finance
 
Party
 
of
 
its
 
rights
 
under
 
this
 
Agreement
 
or
 
by
 
virtue
 
of
 
any
 
relationship
between, or
 
transaction involving,
 
the
 
relevant Borrower
 
and any
 
other Borrower
 
or
any other Security Party:
21.2.1
exercise any
 
rights of subrogation
 
in relation
 
to any rights,
 
security or
 
moneys
held or received or receivable by a Finance Party or any other
 
person; or
21.2.2
exercise
 
any
 
right
 
of
 
contribution
 
from
 
any
 
other
 
Borrower
 
or
 
any
 
other
Security Party under any Finance Document; or
21.2.3
exercise
 
any
 
right
 
of
 
set-off
 
or
 
counterclaim against
 
any
 
other
 
Borrower or
any other Security Party; or
21.2.4
receive,
 
claim
 
or
 
have
 
the
 
benefit
 
of
 
any
 
payment,
 
distribution,
 
security
 
or
indemnity from any other Borrower or any other Security Party;
 
or
21.2.5
unless
 
so
 
directed
 
by
 
the
 
Agent
 
(when
 
the
 
relevant
 
Borrower
 
will
 
prove
 
in
accordance with
 
such directions),
 
claim as
 
a creditor
 
of any
 
other Borrower
or any other Security Party in competition with any Finance
 
Party
and
 
each
 
Borrower
 
shall
 
hold
 
in
 
trust
 
for
 
the
 
Finance
 
Parties
 
and
 
forthwith
 
pay
 
or
transfer (as appropriate)
 
to the Agent
 
any such payment
 
(including an amount
 
equal
to any such
 
set-off), distribution or
 
benefit of such security,
 
indemnity or claim
 
in fact
received by it.
22
Miscellaneous
22.1
No oral variations
No
 
variation
 
or
 
amendment of
 
a
 
Finance
 
Document
 
shall
 
be
 
valid
 
unless
 
in
 
writing
and signed on behalf of all the Finance Parties.
22.2
Further assurance
If any provision
 
of a Finance
 
Document shall be
 
invalid or unenforceable in
 
whole or
in part
 
by reason
 
of any
 
present or
 
future law
 
or any
 
decision of
 
any court,
 
or if
 
the
documents at any time held by or on behalf of the Finance Parties or any of them are
considered
 
by the
 
Lenders for
 
any
 
reason
 
insufficient
 
to
 
carry
 
out
 
the
 
terms
 
of
 
this
Agreement,
 
then
 
from
 
time
 
to
 
time
 
the
 
Borrowers
 
will
 
promptly,
 
on
 
demand
 
by
 
the
Agent, execute or
 
procure the execution of
 
such further documents as
 
in the opinion
of the
 
Lenders are
 
necessary to
 
provide adequate
 
security for
 
the repayment
 
of the
Indebtedness.
22.3
Rescission of payments etc.
Any
 
discharge,
 
release
 
or
 
reassignment
 
by
 
a
 
Finance
 
Party
 
of
 
any
 
of
 
the
 
security
constituted by,
 
or any
 
of the
 
obligations of
 
a
 
Security Party
 
contained in,
 
a Finance
Document shall
 
be (and
 
be deemed
 
always to
 
have been)
 
void if
 
any act
 
(including,
without limitation, any payment) as a result of which such discharge,
 
release or
reassignment
 
was
 
given
 
or
 
made
 
is
 
subsequently
 
wholly
 
or
 
partially
 
rescinded
 
or
avoided by operation of any law.
22.4
Certificates
Any certificate
 
or statement
 
signed by
 
an authorised
 
signatory of
 
the Agent purporting
to
 
show
 
the
 
amount
 
of
 
the
 
Indebtedness
 
(or
 
any
 
part
 
of
 
the
 
Indebtedness)
 
or
 
any
other amount referred to
 
in any Finance Document
 
shall, save for manifest
 
error or on
any question of law, be conclusive evidence as against the Borrowers of that
 
amount.
22.5
Counterparts
This Agreement may be executed
 
in any number of
 
counterparts each of which shall
be original but which shall together constitute the same instrument.
22.6
Contracts (Rights of Third Parties) Act 1999
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.
22.7
Disclosure
Each
 
Borrower
 
irrevocably
 
authorises,
 
and
 
shall
 
procure
 
that
 
each
 
of
 
the
 
other
Security
 
Parties
 
authorises,
 
each
 
Finance
 
Party
 
to
 
disclose
 
from
 
time
 
to
 
time
 
any
information relating to the Security Parties, the Loan, the Commitments, the Earnings
Accounts,
 
the
 
Relevant
 
Documents
 
and
 
the
 
Vessels
 
to
 
(a)
 
any
 
private,
 
public
 
or
internationally recognised authorities,
 
(b) any
 
Finance Party's head
 
office, branches,
affiliates and
 
professional advisors, (c)
 
any other
 
parties to
 
the Finance
 
Documents,
(d) rating
 
agencies or their
 
professional advisors and
 
(e) any
 
person with whom
 
any
Finance
 
Party
 
proposes
 
entering
 
into,
 
or
 
has
 
entered
 
into,
 
contractual
 
relations
 
in
connection with the Loan or any
 
Commitment, provided in each case that the
 
person
to whom
 
such information
 
is to
 
be given
 
has entered
 
in a
 
confidentiality undertaking
substantially in the recommended
 
form of the Loan Market
 
Association at the relevant
time.
23
Law and Jurisdiction
23.1
Governing law
This Agreement and
 
any non-contractual
 
obligations arising
 
from or in
 
connection with
it shall in all respects be governed by and interpreted in accordance
 
with English
 
law.
23.2
Jurisdiction
For
 
the
 
exclusive
 
benefit
 
of
 
the
 
Finance
 
Parties,
 
the
 
parties
 
to
 
this
 
Agreement
irrevocably agree that the
 
courts of England are to have
 
exclusive jurisdiction to settle
any dispute (a) arising from or in
 
connection with this Agreement or
 
(b) relating to any
non-contractual obligations arising from
 
or in connection with this
 
Agreement and that
any proceedings may be brought in those courts.
23.3
Alternative jurisdictions
Nothing
 
contained
 
in
 
this
 
Clause
 
23
 
shall
 
limit
 
the
 
right
 
of
 
the
 
Finance
 
Parties
 
to
commence
 
any proceedings
 
against the
 
Borrowers in
 
any other
 
court of
 
competent
jurisdiction nor shall the commencement of any proceedings against the
 
Borrowers in
one or
 
more jurisdictions
 
preclude the
 
commencement of
 
any proceedings
 
in any
 
other
jurisdiction, whether concurrently or not.
23.4
Waiver of objections
Each Borrower
 
irrevocably waives
 
any objection
 
which it
 
may now
 
or in
 
the future
 
have
to the laying
 
of the venue
 
of any proceedings
 
in any court
 
referred to in
 
this Clause 23,
and
 
any
 
claim
 
that
 
those
 
proceedings
 
have
 
been
 
brought
 
in
 
an
 
inconvenient
 
or
inappropriate
 
forum,
 
and
 
irrevocably
 
agrees
 
that
 
a
 
judgment
 
in
 
any
 
proceedings
commenced
 
in
 
any
 
such
 
court
 
shall
 
be
 
conclusive
 
and
 
binding
 
on
 
it
 
and
 
may
 
be
enforced in the courts of any other jurisdiction.
23.5
Service of process
Without prejudice to any other mode of
 
service allowed under any relevant law,
 
each
Borrower:
23.5.1
irrevocably
 
appoints
 
Hill
 
Dickinson
 
Services
 
(London) Ltd,
 
The
 
Broadgate
Tower,
 
20
 
Primrose
 
Street,
 
London EC2A
 
2EW
 
as
 
its
 
agent
 
for
 
service
 
of
process
 
in
 
relation
 
to
 
any
 
proceedings
 
before
 
the
 
English
 
courts
 
in
connection with this Agreement; and
23.5.2
agrees that failure by
 
a process agent to
 
notify any Borrower of
 
the process
will not invalidate the proceedings concerned.
Schedule 2
The Lenders and the Arrangers
Part 1
The Lenders and the Commitments
The Lenders
 
The Commitments
The Export-Import Bank of China
 
$58,440,000
No.30, Fu Xing Men Nei Street, Xicheng
District
Beijing
 
100031,
 
The
 
People's
 
Republic
 
of
China
(fax no: +86 10 8357 8428/29)
marked
 
for
 
the
 
attention
 
of:
 
Transportation
Finance Department
Part 2
The Arrangers
The Export-Import Bank of China
No.30,
 
Fu
 
Xing
 
Men
 
Nei
 
Street,
 
Xicheng
District
 
Beijing 100031,
 
The People's
 
Republic
of China (fax no: +86 10 8357 8428/29)
marked for the attention of: Transportation Finance Department
Schedule 3
Conditions Precedent and Subsequent
Part 1
Conditions precedent
1
Security Parties
(a)
Constitutional Documents
Copies of the constitutional documents of
 
each
Security Party
 
together with
 
such other
 
evidence
 
as
 
the Agent
 
may reasonably
require
 
that
 
each
 
Security
 
Party
 
is
 
duly
 
incorporated
 
in
 
its
 
country
 
of
incorporation and remains in existence with power to enter into, and perform
its obligations under,
 
the Relevant Documents to
 
which it is
 
or is to
 
become
a party.
(b)
Certificates
 
of
 
good
 
standing
A
certificate of
 
good standing
 
in respect
 
of
each Security Party (if such a certificate can be obtained).
(c)
Board
 
resolutions
A copy
 
of a
 
resolution of
 
the board
 
of directors
 
of each
Security Party (and, in the case
 
of the Guarantor, of the executive committee
of the board of directors of the Guarantor):
(i)
approving the
 
terms of,
 
and the
 
transactions contemplated
 
by,
 
the
Relevant
 
Documents
 
to
 
which
 
it
 
is
 
a
 
party
 
and
 
resolving
 
that
 
it
execute those Relevant Documents; and
(ii)
authorising
 
a
 
specified
 
person
 
or
 
persons
 
to
 
execute
 
those
Relevant Documents
 
(and all
 
documents and
 
notices to
 
be signed
and/or despatched under those documents) on its
 
behalf.
(d)
Specimen
 
signatures
A
 
specimen
 
of
 
the
 
signature
 
of
 
each
 
person
authorised by the resolutions referred to in paragraph (c)
 
above.
(e)
Shareholder
 
resolutions
 
A copy
 
of a
 
resolution signed
 
by all
 
the holders
of
 
the
 
issued
 
shares
 
in
 
each
 
Security
 
Party
 
(other
 
than
 
the
 
Guarantor),
approving the terms
 
of, and the
 
transactions contemplated by,
 
the Relevant
Documents to which that Security Party is a party.
(f)
Officer's
 
certificates
A
 
certificate
 
of
 
a
 
duly
 
authorised
 
officer
 
of
 
each
Security
 
Party certifying
 
that
 
each copy
 
document relating
 
to
 
it
 
specified in
this Part 1 of Schedule 3 is correct, complete and in
 
full force and effect and
setting
 
out
 
the
 
names
 
of
 
the
 
directors,
 
officers
 
and
 
shareholders
 
of
 
that
Security Party and the proportion of shares held by each
 
shareholder.
(g)
Evidence
 
of
 
registration
Evidence
 
that
 
the
 
names
 
of
 
the
 
directors
 
and
officers of the Manager are duly
 
registered in the companies
 
registry or other
registry in the country of incorporation of the Manager.
(h)
Powers of attorney
The power of attorney of
 
each Security Party (notarially
attested
 
and
 
legalised
 
if
 
required)
 
under
 
which
 
any
 
documents
 
are
 
to
 
be
executed or transactions undertaken by that Security Party.
2
Security and related documents
(a)
Vessel documents
(a)
Photocopies, certified
 
as true,
 
accurate and
 
complete by
 
a director
or the secretary of the Borrower, of:
(i)
the Building Contract;
(ii)
such
 
documents
 
as
 
the
 
Agent
 
may
 
reasonably
 
require
 
to
evidence the nomination of or
 
novation in favour of (as
 
the
case
 
may
 
be)
 
the
 
Borrower
 
as
 
purchaser
 
of
 
the
 
Vessel
pursuant to the Building Contract;
(iii)
the builder's certificate and/or bill of sale transferring title in
the
 
Vessel
 
to
 
the
 
Borrower
 
free
 
of
 
all
 
encumbrances,
maritime liens or other debts;
(iv)
the
 
protocol
 
of
 
delivery
 
and
 
acceptance
 
evidencing
 
the
unconditional physical delivery of the Vessel by the Builder
to the Borrower pursuant to the Building
 
Contract;
(v)
the commercial
 
invoice issued
 
by the
 
Builder in
 
respect of
the final contract price of the Vessel;
(vi)
the
 
declaration
 
of
 
warranty
 
issued
 
by
 
the
 
Builder
 
to
 
the
Borrower pursuant to the Building Contract;
(vii)
any
 
charterparty
 
or
 
other
 
contract
 
of
 
employment
 
of
 
the
Vessel
 
which
 
will
 
be
 
in
 
force
 
on
 
the
 
Drawdown
 
Date
including, without limitation, any Charter;
(viii)
the Management Agreement;
(ix)
the
 
Vessel's
 
current
 
Safety
 
Construction,
 
Safety
Equipment,
 
Safety
 
Radio,
 
Oil
 
Pollution
 
Prevention
 
and
Load Line Certificates;
(x)
evidence
 
of
 
the
 
Vessel's
 
current
 
Certificate
 
of
 
Financial
Responsibility
 
issued
 
pursuant
 
to
 
the
 
United
 
States
 
Oil
Pollution Act 1990, if applicable;
(xi)
the Vessel's current SMC;
(xii)
the ISM Company's current DOC;
(xiii)
the Vessel's current ISSC;
(xiv)
the Vessel's current IAPPC;
(xv)
the Vessel's current Tonnage
 
Certificate;
in each case together with all addenda, amendments or supplements.
(b)
Evidence
 
of
 
Borrower's
 
title
Evidence
 
that
 
any
 
prior
 
registration
 
of
 
the
Vessel
 
in
 
the
 
ownership
 
of
 
the
 
Builder
 
and
 
any
 
Encumbrance
 
registered
against that ownership
 
have been cancelled
 
(or confirmation
 
from the
 
Builder
that there
 
was no
 
such prior
 
registration) and
 
evidence that
 
on the
 
Delivery
Date (i) the Vessel will
 
be at least provisionally
 
registered under an Approved
Flag in the ownership
 
of the Borrower and
 
(ii) the Mortgage
 
will be capable
 
of
being registered against the Vessel with first priority.
(c)
Evidence
 
of
 
insurance
Evidence that
 
the Vessel
 
is insured
 
in the
 
manner
required
 
by
 
the
 
Security
 
Documents
 
and
 
that
 
letters
 
of
 
undertaking
 
will
 
be
issued in
 
the manner
 
required by
 
the Security
 
Documents, together with
 
an
opinion on the Insurances by an insurance adviser appointed by
 
the Agent
 
at
the cost of the Borrowers (to be borne directly by the
 
Borrowers).
(d)
Confirmation
 
of
 
class
A
 
Certificate
 
of
 
Confirmation
 
of
 
Class
 
for
 
hull
 
and
machinery
 
confirming
 
that
 
the
 
Vessel
 
is
 
classed
 
with
 
the
 
highest
 
class
applicable to
 
vessels
 
of
 
her
 
type
 
with
 
Bureau
 
Veritas
 
or
 
NKK,
 
as
 
the
 
case
may be, and
 
on a dual
 
basis with China Classification Society
 
or such other
classification
 
society
 
as
 
may
 
be
 
acceptable
 
to
 
the
 
Agent
 
free
 
of
 
material
overdue recommendations or adverse notations, in case affecting
 
class.
(e)
Valuations
Two valuations of the Vessel from Approved Brokers acceptable
to
 
the
 
Agent
 
addressed
 
to
 
the
 
Agent
 
to
 
be
 
issued
 
in
 
accordance
 
with
 
the
requirements of
 
Clause 10.13
(Fair Market
 
Value determination)
certifying the
Fair
 
Market
 
Value
 
of
 
the
 
Vessel
 
in
 
order
 
for
 
the
 
Lenders
 
to
 
assess
compliance
 
with
 
Clause
 
10.12
 
(
Additional
 
security
)
 
and
 
determine
 
the
Maximum
 
Tranche Amount.
(f)
Security Documents
The Mortgage and
 
the Assignments in
 
respect of
 
the
Vessel,
 
the
 
Managers'
 
Undertaking,
 
the
 
Guarantee,
 
the
 
Account
 
Charges,
the Negative
 
Share Pledges,
 
together with
 
all other
 
documents required
 
by
any
 
of
 
them,
 
including,
 
without
 
limitation,
 
all
 
notices
 
of
 
assignment
 
and/or
charge
 
and
 
evidence
 
that
 
those
 
notices
 
will
 
be
 
duly
 
acknowledged
 
by
 
the
recipients.
(g)
Mandates
Such duly signed forms of mandate, and/or other evidence of the
opening of the Earnings Accounts, as the Security Agent may
 
require.
(h)
No
 
disputes
The
 
written
 
confirmation
 
of
 
the
 
Borrower
 
that
 
there
 
is
 
no
dispute under any of the Relevant Documents as between the parties to any
such document.
(i)
Account
 
Holder's
 
confirmation
The
 
written
 
confirmation
 
of
 
the
 
Account
Holder that the Accounts have
 
been opened with the
 
Account Holder and to
its actual knowledge
 
are free from
 
Encumbrances and rights of
 
set off
 
other
than as created by or pursuant to the Security Documents.
(j)
Equity
 
contribution
Evidence of
 
full payment
 
to the
 
Builder of
 
any part
 
of
the contract price of the Vessel under the Building Contract which is payable
on
 
or
 
before the
 
relevant
 
Drawdown Date
 
and
 
which
 
is
 
not
 
being
 
financed
by
 
the
 
Loan, including
 
without
 
limitation that
 
part of
 
the
 
delivery
 
instalment
not being financed by the Loan.
(k)
Cash
 
balance
Written
 
statement of
 
account issued
 
by the
 
Account Holder
and
 
a
 
Compliance
 
Certificate
 
signed
 
by
 
Chief
 
Financial
 
Officer
 
of
 
the
Guarantor,
 
each
 
confirming that
 
the
 
Borrowers
 
are
 
in
 
compliance
 
with
 
the
financial covenant of Clause
 
12.2.1, to be delivered
 
to the Agent on
 
or before
the
 
due
 
date
 
for
 
delivering the
 
Drawdown
 
Request
 
pursuant to
 
Clause 4.1
(
Drawdown Request
).
(l)
Other
 
Relevant
 
Documents
Copies
 
of
 
each
 
of
 
the
 
Relevant
 
Documents,
including the Shareholder Letter,
 
not otherwise comprised in the
 
documents
listed in this Part 1 of Schedule 3.
3
Legal opinions
(a)
If
 
a
 
Security
 
Party
 
is
 
incorporated
 
in
 
a
 
jurisdiction
 
other
 
than
 
England
 
and
Wales
 
or if
 
any Finance Document
 
is governed
 
by the
 
laws of
 
a jurisdiction
other
 
than
 
England
 
and Wales,
 
a
 
legal
 
opinion
 
of
 
the
 
legal
 
advisers to
 
the
Agent in each
 
relevant jurisdiction, substantially
 
in the form or
 
forms provided
to
 
the
 
Agent
 
prior
 
to
 
signing
 
this
 
Agreement
 
or
 
confirmation
 
satisfactory to
the Agent that such an opinion will be given.
4
Other documents and evidence
(a)
Drawdown Notice
A duly completed Drawdown Notice.
(b)
Process agent
Evidence that any
 
process agent referred
 
to in
 
Clause 23.5
(
Service
 
of
 
process
)
 
and
 
any
 
process
 
agent
 
appointed
 
under
 
any
 
other
Finance Document has accepted its appointment.
(c)
Other
 
authorisations
A
 
copy
 
of
 
any
 
other
 
consent,
 
licence,
 
approval,
authorisation
 
or
 
other
 
document,
 
opinion
 
or
 
assurance
 
which
 
the
 
Agent
considers
 
to
 
be
 
necessary
 
or
 
desirable
 
(if
 
it
 
has
 
notified
 
the
 
Borrowers
accordingly)
 
in
 
connection
 
with
 
the
 
entry
 
into
 
and
 
performance
 
of
 
the
transactions
 
contemplated
 
by
 
any
 
of
 
the
 
Relevant
 
Documents
 
or
 
for
 
the
validity and enforceability of any of the Relevant
 
Documents.
(d)
Financial
 
statements
Copies of
 
the Original
 
Financial Statements
 
of each
Borrower and the Guarantor.
(e)
Compliance
 
Certificate
A
 
Compliance
 
Certificate
 
signed
 
by
 
the
 
Chief
Financial
 
Officer
 
of
 
the
 
Guarantor
 
setting
 
out
 
(in
 
reasonable
 
detail)
computations as
 
to compliance
 
with Clause
 
12.2 (
Financial covenants
) and
Clause 10.12 (
Additional Security
) as at the date as at
 
which the Guarantor's
latest financial statements were drawn up, to be delivered to the Agent on or
before
 
the
 
due
 
date
 
for
 
delivering
 
the
 
Drawdown
 
Request
 
pursuant
 
to
Clause 4.1 (
Drawdown Request
).
(f)
Fees
Evidence
 
that
 
the
 
fees,
 
costs
 
and
 
expenses
 
then
 
due
 
from
 
the
Borrowers
 
under
 
Clause
 
8
 
(
Indemnities
)
 
and
 
Clause
 
9
 
(
Fees
)
 
have
 
been
paid or will be paid by the relevant Drawdown Date.
(g)
"Know
 
your
 
customer"
 
documents
Such
 
documentation
 
and
 
other
evidence as
 
is reasonably
 
requested by
 
the Agent
 
in order
 
for the
 
Lenders
to
 
comply
 
with
 
all
 
necessary
 
"know
 
your
 
customer"
 
or
 
similar
 
identification
procedures
 
in
 
relation
 
to
 
the
 
transactions
 
contemplated
 
in
 
the
 
Finance
Documents,
 
including
 
(without
 
limitation)
 
documentation
 
in
 
relation
 
to
 
the
Borrowers, the Guarantor's signatories
 
to the Finance
 
Documents, directors
and the Shareholder.
Part 2
Conditions subsequent
1
Evidence of Borrower's title
Certificate of
 
ownership and encumbrance
 
(or equivalent)
 
issued by
 
the Registrar of
Ships
 
(or
 
equivalent
 
official)
 
of
 
the
 
Approved
 
Flag
 
confirming that
 
(a)
 
the
 
Vessel
 
is
permanently
 
registered
 
under
 
that
 
flag
 
in
 
the
 
ownership
 
of
 
the
 
Borrower,
 
(b)
 
the
Mortgage has
 
been registered
 
with first
 
priority against
 
the Vessel
 
and (c)
 
there are
no further Encumbrances registered against the Vessel.
2
Letters of undertaking
Letters
 
of
 
undertaking
 
in
 
respect
 
of
 
the
 
Insurances
 
as
 
required
 
by
 
the
 
Security
Documents
 
together
 
with
 
copies
 
of
 
the
 
relevant
 
policies
 
or
 
cover
 
notes
 
or
 
entry
certificates duly endorsed with the interest of the Finance Parties.
3
Acknowledgements of notices
Acknowledgements of all notices of
 
assignment and/or charge given pursuant to
 
any
Security Documents received by the Agent pursuant to Part
 
1 of this Schedule 3.
4
Legal opinions
Such of the
 
legal opinions specified
 
in Part 1
 
of this Schedule
 
3 as have
 
not already
been provided to the Agent.
5
Master's receipt
If applicable, the master's receipt for the Mortgage.
Schedule 4
Form of Drawdown Notice
To:
The Export-Import Bank of China
From:
Aster
 
Shipping
 
Company
 
Inc.
Aerik Shipping Company Inc.
[
 
] 2016
Dear Sirs
Drawdown Notice
We refer to the Loan
 
Agreement dated
 
2016
 
made
 
between
 
ourselves
 
and
yourselves (the "
Agreement
").
Words
 
and
 
phrases
 
defined
 
in
 
the
 
Agreement
 
have
 
the
 
same
 
meaning
 
when
 
used
 
in
 
this
Drawdown Notice.
[Pursuant
 
to
 
Clause
 
3.1
 
of
 
the
 
Agreement,
 
we
 
irrevocably
 
request
 
that
 
you
 
advance
 
the
Tranche
 
in
 
respect
 
of
 
the
 
Vessel
 
with
 
hull
 
number
 
[H2548]
 
[H2548]
 
[DY2006]
 
in
 
the
 
sum
 
of
 
[
 
] to us on
 
20
 
,
which is a
 
Business Day, by paying the
 
amount of that
 
Tranche in accordance
 
with the terms
 
of
the Building Contract for hull no. [H2548] [H2549].]
OR*
[Pursuant to
 
Clause 3.3
 
(
Prepositioning of
 
funds
) of the
 
Agreement, we
 
irrevocably request
 
that
you advance the Tranche in respect of the Vessel with hull number [H2548] [H2548] [DY2006]
in the sum
 
of [
 
] to us
 
on
 
20
, which
 
is a
 
Prepositioning Date, by
 
prepositioning such sum
 
in accordance with
 
the terms of
the Building Contract for hull no. [H2548] [H2549].
 
We acknowledge that the prepositioning of
such funds
 
shall constitute
 
an advance
 
of the
 
Vessel
 
Loan under
 
Clause 3
 
(Advance) of
 
the
Agreement.]
We warrant that
 
the representations
 
and warranties
 
contained in Clause
 
10.1 of the
 
Agreement
are true
 
and
 
correct
 
at
 
the date of
 
this Drawdown Notice
 
and
 
will be true and correct
 
on
 
20 , that no Default has occurred and is continuing, and that no Default
 
will result
from the advance of the Tranche requested in this Drawdown Notice.
We
 
select
 
the
 
period
 
of
 
[
 
]
 
months
 
as
 
the
 
first
 
Interest
 
Period.
Yours faithfully
.................................
For and on behalf of
Aster Shipping Company Inc.
Aerik Shipping Company Inc.
*Delete as appropriate
Schedule 5
Form of Transfer Certificate
To:
The
 
Export–Import
 
Bank
 
of
 
China
Transfer Certificate
This
 
transfer
 
certificate
 
relates
 
to
 
a
 
secured
 
loan
 
facility
 
agreement
 
(as
 
from
 
time
 
to
 
time
amended, varied, supplemented or novated the "
Loan
 
Agreement
") dated
 
2016,
on the terms and subject
 
to the conditions of which
 
a secured loan facility
 
of up to $58,440,000
was made
 
available to
 
Aster Shipping
 
Company Inc.
 
and Aerik
 
Shipping Company
 
Inc. on
 
a
joint and several basis by a syndicate of banks on whose behalf you act as agent and security
agent.
1
Terms
 
defined
 
in
 
the
 
Loan
 
Agreement
 
shall,
 
unless
 
otherwise
 
expressly
 
indicated,
have
 
the
 
same
 
meaning
 
when
 
used
 
in
 
this
 
certificate. The
 
terms
 
"
Transferor
"
 
and
"
Transferee
" are defined in the schedule to this certificate.
2
The Transferor:
2.1
confirms
 
that
 
the
 
details
 
in
 
the
 
Schedule
 
under
 
the
 
heading
 
"
Transferor's
Commitment
" accurately summarise its Commitment; and
2.2
requests
 
the
 
Transferee
 
to
 
accept
 
by
 
way
 
of
 
novation
 
the
 
transfer
 
to
 
the
Transferee
 
of
 
the
 
amount
 
of
 
the
 
Transferor's
 
Commitment
 
specified
 
in
 
the
Schedule by counter-signing and delivering this certificate to the Agent at
 
its
address for communications specified in the Loan
 
Agreement.
3
The Transferee requests the Agent to
 
accept this certificate as being delivered to the
Agent pursuant to
 
and for the
 
purposes of clause
 
14.4 of the
 
Loan Agreement so
 
as
to
 
take
 
effect
 
in
 
accordance
 
with
 
the
 
terms
 
of
 
that
 
clause
 
on
 
the
 
Transfer
 
Date
specified in the Schedule.
4
The Agent
 
confirms its
 
acceptance of
 
this certificate
 
for the
 
purposes of
 
clause 14.4
of the Loan Agreement.
5
The Transferee confirms that:
5.1
it
 
has
 
received
 
a
 
copy
 
of
 
the
 
Loan
 
Agreement
 
together
 
with
 
all
 
other
information which it has required in connection with this
 
transaction;
5.2
it has
 
not relied and
 
will not in
 
the future rely
 
on the Transferor
 
or any other
party to
 
the Loan Agreement
 
to check or
 
enquire on
 
its behalf
 
into the legality,
validity,
 
effectiveness,
 
adequacy,
 
accuracy
 
or
 
completeness
 
of
 
any
 
such
information; and
5.3
it has
 
not relied and
 
will not in
 
the future rely
 
on the Transferor
 
or any other
party to the Loan Agreement to keep under review
 
on its behalf the financial
condition, creditworthiness, condition,
 
affairs, status or
 
nature of any
 
Security
Party.
6
Execution
 
of
 
this
 
certificate
 
by
 
the
 
Transferee
 
constitutes
 
its
 
representation
 
and
warranty to the Transferor and to all other parties to the Loan Agreement that it has
the power to become a party to the
 
Loan Agreement as a Lender on the terms
 
of the
Loan Agreement
 
and has
 
taken all
 
steps to
 
authorise execution
 
and delivery
 
of this
certificate.
7
The Transferee
 
undertakes with
 
the Transferor
 
and each
 
of the
 
other parties
 
to
 
the
Loan Agreement
 
that it will
 
perform in accordance
 
with their terms
 
all those obligations
which by the terms of
 
the Loan Agreement will be assumed
 
by it after delivery of this
certificate
 
to
 
the
 
Agent
 
and
 
the
 
satisfaction
 
of
 
any
 
conditions
 
subject
 
to
 
which
 
this
certificate is expressed to take effect.
8
The Transferor
 
makes no
 
representation or
 
warranty and
 
assumes no
 
responsibility
with respect
 
to the
 
legality,
 
validity,
 
effectiveness, adequacy
 
or enforceability
 
of any
Finance
 
Document
 
or
 
any
 
document
 
relating
 
to
 
any
 
Finance
 
Document,
 
and
assumes
 
no responsibility
 
for the
 
financial condition
 
of any
 
Finance Party
 
or
 
for the
performance
 
and
 
observance
 
by
 
any
 
Security
 
Party
 
of
 
any
 
of
 
its
 
obligations
 
under
any Finance
 
Document or any
 
document relating to any
 
Finance Document and
 
any
conditions and warranties implied by law are expressly
 
excluded.
9
The
 
Transferee
 
acknowledges
 
that
 
nothing
 
in
 
this
 
certificate
 
or
 
in
 
the
 
Loan
Agreement shall oblige the Transferor to:
9.1
accept a re-transfer
 
from the Transferee of
 
the whole or
 
any part of
 
the rights,
benefits and/or obligations transferred pursuant to this certificate;
 
or
9.2
support
 
any
 
losses
 
directly
 
or
 
indirectly
 
sustained
 
or
 
incurred
 
by
 
the
Transferee for any
 
reason including, without limitation, the
 
non-performance
by any party to any Finance Document of any obligations under any Finance
Document.
10
The address
 
and fax
 
number of
 
the Transferee
 
for the
 
purposes of
 
clause 18
 
of the
Loan Agreement are set out in the Schedule.
11
This certificate
 
may be
 
executed in
 
any number
 
of counterparts
 
each of
 
which shall
be original but which shall together constitute the same instrument.
12
This certificate and
 
any non-contractual obligations
 
arising out of or
 
in connection with
it shall be governed by and interpreted in accordance with English
 
law.
The Schedule
1
Transferor:
2
Transferee:
3
Transfer Date
 
(not earlier than the
 
fifth Business Day after
 
the date of delivery
 
of the
Transfer Certificate to the Agent):
4
Transferor's Commitment:
5
Amount transferred:
6
Transferee's
 
address
 
and
 
fax
 
number
 
for
 
the
 
purposes
 
of
 
clause
 
18
 
of
 
the
 
Loan
Agreement:
[
name of Transferor
]
 
[
name of Transferee
]
By:
 
By:
Date:
 
Date:
The
 
Export-Import Bank
 
of
 
China
as Agent
By:
Date:
exhibit452p162i0
Schedule 6
Form of Compliance Certificate
To:
The Export – Import Bank of China
From:
Diana Shipping Inc.
Dated:
Dear Sirs
Aster
 
Shipping
 
Company
 
Inc.
and
Aerik
 
Shipping
 
Company
 
Inc.
 
-
 
Loan
 
Agreement
dated [
 
] 2016 (the "Agreement")
We refer to the Agreement. This is
 
a Compliance Certificate. Terms
 
defined in the Agreement
have
 
the
 
same
 
meaning
 
when
 
used
 
in
 
this
 
Compliance
 
Certificate
 
unless
 
given
 
a
 
different
meaning in this Compliance Certificate.
We confirm that:
We
 
maintain
 
Cash
 
of
 
not
 
less
 
than
 
five
 
hundred
 
thousand
 
Dollars
 
($500,000)
 
for
 
each
Fleet Vessel;
Each
 
Borrower
 
maintains
 
in
 
the
 
relevant
 
Earnings
 
Account
 
a
 
credit
 
balance of
 
not
 
less
 
than
two hundred thousand Dollars ($200,000);
The Adjusted Net Worth
 
is not less than
 
one hundred and fifty million Dollars
 
($150,000,000);
and
The Adjusted Net Worth exceeds twenty five per cent (25%) of the Total Assets.
We also confirm that the
 
Borrowers are in compliance with Clause 10.12
 
(
Additional Security
)
[and that no Default is continuing.]
Signed
by
Chief
 
Financial
 
Officer
 
of
Diana
 
Shipping
Inc.
exhibit452p163i0
In witness
of which the parties to this
 
Agreement have executed this Agreement the day and
year first before written.
Signed
by
As duly authorized for and on behalf of
Aster Shipping Company Inc.
signature of witness
exhibit452p164i0 exhibit452p164i0
signature
print name
name address
exhibit452p165i0 exhibit452p165i1
print name of witness
Signed
by
As duly authorized for and on behalf of
Aerik Shipping Company Inc.
signature of witness
exhibit452p164i0 exhibit452p164i0
signature
print name
name address
exhibit452p167i0
print name of witness
Signed
by
As duly authorized for and on behalf of
The Export-Import Bank of China
(as the Lender)
exhibit452p164i0
signature
exhibit452p165i1
Signed
by
As duly authorized for and on behalf of
The Export-Import Bank of China
(as the Arranger)
signature of witness
exhibit452p164i0 exhibit452p164i0
signature
print name
name address
exhibit452p167i0 exhibit452p165i1
print name of witness
Signed
by
As duly authorized for and on behalf of
The Export-Import Bank of China
(as the Agent)
signature of witness
exhibit452p164i0 exhibit452p164i0
signature
print name
name address
exhibit452p165i0
print name of witness
Signed
by
As duly authorized for and on behalf of
The Export-Import Bank of China
(as the Security Agent)
signature
 
Signatures
The Borrowers
Executed
as
 
a
 
deed
 
by
Aster
 
Shipping
 
Company
 
Inc.
acting
 
by
 
its
 
attorney-in-
 
fact/authorised
signatory*
(*delete as applicable)
in the presence of:
 
 
 
 
----------------------------------
signature
print name
signature of witness
print name of witness
address of witness
Executed
as
 
a
 
deed
 
by
Aerik
 
Shipping
 
Company
 
Inc.
acting
 
by
 
its
 
attorney-in-
 
fact/authorised
signatory*
(*delete as applicable)
in the presence of:
 
 
 
 
----------------------------------
signature
print name
signature of witness
print name of witness
address of witness
The Guarantor
Executed
as a deed by
Diana Shipping Inc.
acting by its attorney-in-fact/authorised signatory*
(*delete as applicable)
in the presence of:
 
 
 
 
----------------------------------
signature
print name
signature of witness
print name of witness
address of witness
The Other Obligor
Executed
as
 
a
 
deed
 
by
Diana
 
Shipping
 
Services
 
S.A.
acting
 
by
 
its
 
attorney-in-
 
fact/authorised
signatory*
(*delete as applicable)
in the presence of:
 
 
 
 
----------------------------------
signature
print name
signature of witness
print name of witness
address of witness
The Lenders
Executed
as a
 
deed by
The
 
Export-Import Bank
 
of
 
China
acting by
 
its attorney-in-
 
fact/authorised
signatory*
(*delete as applicable)
in the presence of:
 
 
 
 
----------------------------------
signature
print name
signature of witness
print name of witness
address of witness
The Arranger
Executed
as a
 
deed by
The
 
Export-Import Bank
 
of
 
China
acting by
 
its attorney-in-
 
fact/authorised
signatory*
(*delete as applicable)
in the presence of:
 
 
 
 
----------------------------------
signature
print name
signature of witness
print name of witness
address of witness
The Agent
Executed
as a
 
deed by
The
 
Export-Import Bank
 
of
 
China
acting by
 
its attorney-in-
 
fact/authorised
signatory*
(*delete as applicable)
in the presence of:
 
 
 
 
----------------------------------
signature
print name
signature of witness
print name of witness
address of witness
The Security Agent
Executed
as a
 
deed by
The
 
Export-Import Bank
 
of
 
China
acting by
 
its attorney-in-
 
fact/authorised
signatory*
(*delete as applicable)
in the presence of:
 
 
 
 
----------------------------------
signature
print name
signature of witness
print name of witness
address of witness