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DATED DECEMBER 1999
BETWEEN
BOSS LTD.
STAVANGER SUN LTD.
AS BORROWER
CHRISTIANIA BANK OG KREDITKASSE ASA
AS AGENT AND SECURITY TRUSTEE
AND
OTHERS
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AMENDMENT AGREEMENT
RELATING TO A
JUNIOR FACILITY AGREEMENT
DATED 30 OCTOBER 1997
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CLIFFORD CHANCE
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THIS AGREEMENT is made on December 1999
BETWEEN
(1) BOSS LTD and STAVANGER SUN LTD., both companies duly incorporated in the
Cayman Islands each having its registered office at 3rd Floor, CIBC
Financial Centre, PO Box 1234, George Town, Grand Cayman, Cayman Islands
(the "BORROWERS", and singly a "BORROWER") acting jointly and severally;
(2) CHRISTIANIA BANK OG KREDITKASSE ASA as agent and security trustee for
the Banks (the "AGENT"); and
(3) THE BANKS (as defined in the Original Facility Agreement).
RECITALS
(A) The Banks made a facility available to the Borrowers pursuant to the
Original Facility Agreement (as defined below) on the basis of certain
projections and covenants. The total amount outstanding under the
Original Facility Agreement as at the date hereof is $ .
(B) Due to restricted liquidity and the current earnings of the Vessels, the
Banks have agreed to amend certain provisions of the Original Facility
Agreement.
IT IS AGREED as follows.
1. DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
In this Agreement:
"AMENDED AGREEMENT" means the Original Facility Agreement, as amended by
this Agreement.
"EFFECTIVE DATE" means the date on which the Agent confirms to the Banks
and the Borrower that it has received each of the documents listed in
Schedule 1 (CONDITIONS PRECEDENT) in a form and substance satisfactory
to the Agent.
"ORIGINAL FACILITY AGREEMENT" means the Junior Facility Agreement dated
30 October 1997 between the Borrowers, the Agent, and others.
1.2 INCORPORATION OF DEFINED TERMS
Terms defined in the Original Facility Agreement shall, unless otherwise
defined herein, have the same meaning herein and the principles of
construction set out in the Original Facility Agreement shall have
effect as if set out in this Agreement.
1.3 CLAUSES
In this Agreement any reference to a "Clause" or "Schedule" is, unless
the context otherwise requires, a reference to a Clause or Schedule
hereof. Clause headings are for ease of reference only.
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2. AMENDMENT
2.1 AMENDMENT OF THE ORIGINAL FACILITY AGREEMENT
With effect from the Effective Date the Original Facility Agreement
shall be amended as set out in Schedule 2 (AMENDMENTS TO ORIGINAL
FACILITY AGREEMENT).
2.2 WAIVER
The Finance Parties waive any Event of Default or Potential Event of
Default which has been disclosed by the Borrower in writing to the Agent
prior to the date hereof, PROVIDED THAT nothing herein shall affect the
rights of the Finance Parties in respect of the occurrence of any other
Event of Default or Potential Event of Default which has not been
disclosed by the Borrower in writing prior to the date hereof or which
arises on or after the date hereof.
3. REPRESENTATIONS
The Borrowers make the representations set out in Clause 12 of the
Original Facility Agreement as if each reference therein to "this
Agreement" or "the Documents" includes a reference to (a) this Agreement
and (b) the Amended Agreement.
4. CONTINUITY AND FURTHER ASSURANCE
4.1 CONTINUING OBLIGATIONS
The provisions of the Facility Document shall, save as amended hereby,
continue in full force and effect.
4.2 FURTHER ASSURANCE
Each of the Borrowers shall, at the request of the Agent and at its own
expense, do all such acts and things necessary or desirable to give
effect to the amendments effected or to be effected pursuant to this
Agreement.
5. FEES, COSTS AND EXPENSES
5.1 RESTRUCTURING FEE
The Borrowers shall pay to the Agent, for the account of the Banks, a
restructuring fee in the amount of $10,000.
5.2 TRANSACTION EXPENSES
The Borrowers shall, from time to time on demand of the Agent, reimburse
the Agent and each of the Banks for all costs and expenses (including
legal fees) together with any VAT thereon incurred by it in connection
with the negotiation, preparation and execution of this Agreement, any
other document referred to in this Agreement and the completion of the
transactions herein contemplated.
5.3 PRESERVATION AND ENFORCEMENT OF RIGHTS
The Borrowers shall, from time to time on demand of the Agent, reimburse
the Finance Parties for all costs and expenses (including legal fees) on
a full indemnity basis together with any VAT thereon incurred in or in
connection with the preservation and/or enforcement of any of the rights
of the Banks, the Agent or the Security Trustee under this Agreement and
any other document referred to in this Agreement.
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5.4 STAMP TAXES
The Borrowers shall pay all stamp, registration and other taxes to which
this Agreement, any other document referred to in this Agreement or any
judgment given in connection herewith is or at any time may be subject
and shall, from time to time on demand of the Agent, indemnify the
Banks, the Agent or the Security Trustee against any liabilities, costs,
claims and expenses resulting from any failure to pay or any delay in
paying any such tax.
6. MISCELLANEOUS
6.1 INCORPORATION OF TERMS
The provisions of clause 28 (REMEDIES AND WAIVER), clause 29 (PARTIAL
INVALIDITY), clause 31 (LAW) and clause 32 (JURISDICTION) of the
Original Facility Agreement shall be incorporated into this Agreement as
if set out in full herein and as if references therein to "this
Agreement" or "the Facility Documents" are references to this Agreement.
6.2 COUNTERPARTS
This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument.
AS WITNESS the hands of duly authorised representatives of the parties hereto
the day and year first before written.
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SCHEDULE 1
CONDITIONS PRECEDENT
1. In relation to each Borrower:
(a) a copy, certified as at the date of this Agreement a true and
up-to-date copy by a duly authorised officer of such Borrower,
certifying that, as at the date hereof, there has been no change
to the constitutional documents delivered by such Borrower
pursuant to the Original Facility Agreement;
(b) a copy, certified as at the date of this Agreement a true and
up-to-date copy by an a duly authorised officer of a board
resolution of such Borrower approving the execution, delivery
and performance of this Agreement and the terms and conditions
hereof and authorising a named person or persons to sign this
Agreement and any documents to be delivered by such Borrower
pursuant hereto; and
(c) a certificate of a duly authorised officer of such Borrower
setting out the names and signatures of the persons authorised
to sign, on behalf of such Borrower, this Agreement and any
documents to be delivered by such Borrower pursuant hereto.
2. A copy, certified a true copy by or on behalf of each Borrower, of each
such law, decree, consent, licence, approval, registration or
declaration as is, in the opinion of counsel to the Banks, necessary to
render this Agreement legal, valid, binding and enforceable, to make
this Agreement admissible in evidence in each Borrower's jurisdiction of
incorporation and to enable each Borrower to perform its obligations
hereunder.
3. An opinion of the Banks' Counsel in the jurisdiction of incorporation of
each Borrower and the jurisdiction of the flag of the Vessels
satisfactory in form and substance to the Agent and in substantially the
form distributed to the Banks prior to the signing of this Agreement.
4. Evidence satisfactory to the Banks that the partners in the limited
partnership Stavanger Sun Ltd. have made an additional capital
contribution of a minimum of $1,250,000 which has been paid into Boss
Ltd's Earnings Account, $825,000 (or such other amount as agreed between
the Borrowers and the Banks) of which will be paid into Boss Ltd's
Retention Account and may be released only for application in or towards
the imminent dry docking expenses to be incurred in respect of MT
Stavanger Sun, $175,000 (or such other amount as agreed between the
Borrowers and the Banks) of which will remain in Boss Ltd's Earnings
Account and $250,000 of which will be applied (in such proportions as
the Agent shall require) in part payment of the repayment instalments
due on 30 October 1998, 30 April 1999 and 31 July 1999 under the Senior
Facility Agreement.
5. Evidence satisfactory to the Banks that the partners in the limited
partnership Boss Ltd. have made an additional capital contribution of a
minimum of $1,250,000 which has
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been paid into Boss Ltd's Earnings Account, $650,000 (or such other
amount as agreed between the Borrowers and the Banks) of which will be
paid into Boss Ltd's Retention Account and may be released only for
application in or towards the imminent dry docking expenses to be
incurred in respect of the MT Boss, $350,000 (or such other amount as
agreed between the Borrowers and the Banks) of which will remain in Boss
Ltd's Earnings Account and $250,000 of which will be applied (in such
proportions as the Agent shall require) in part payment of the repayment
instalments due on 30 October 1998, 30 April 1999 and 31 April 1999
under the Senior Facility Agreement.
6. Payment of the restructuring fee pursuant to Clause 5.1 and the Banks'
legal fees pursuant to Clause 5.2.
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SCHEDULE 2
AMENDMENTS TO ORIGINAL FACILITY AGREEMENT
1. The definition of "MARGIN" at clause 1.1 of the Original Facility
Agreement shall be amended to read as follows:
"MARGIN" means:
(i) for any period during which the ratio of the Fair Market Value
of the Vessels to the Loan under the Senior Facility Agreement
is less than 140%, three and one quarter per cent (3 1/4%) per
annum; and
(ii) at any other time, three per cent (3%) per annum.
2. The reference to the various percentages in clause 9.4 (PREPAYMENT FEE)
shall be deleted and replaced as follows:
2.1 in clause 9.4(b) "5.5%" shall be replaced with "6.5%";
2.2 in clause 9.4(c) "4.0%" shall be replaced with "5.0%";
2.3 in clause 9.4(d) "2.5%" shall be replaced with "3.5%"; and
2.4 in clause 9.4(e) "1.0%" shall be replaced with "2.0%".
3. A new clause 8.3 shall be added as follows:
(a) The Excess Cash Amount as defined in Clause 9.7 of the Senior
Facility Agreement shall be applied towards accrued non-paid
interest under this Agreement.
(b) If at any time prior to 31 December 2000, there is insufficient
Excess Cash Amount to pay the total amount of accrued interest
due at the end of that Interest Period, the accrued non-paid
interest at the end of that Interest Period shall roll-up and be
added to and form part of the principal amount of the Advance
for the next Interest Period.
(c) On and from 31 December 2000 there shall be no rolling-up of
interest and each Borrower shall pay interest on the Loan in
accordance with Clause 8.1."
4. A new clause 13.7 shall be added as follows:
"13.7 OTHER INFORMATION
Each Borrower shall provide at such intervals and in such form
as the Agent may from time to time require, reports on its
liquidity and working capital status including any unforeseen
revenue or expenses."
5. The reference at clause 14.1 (FAIR MARKET VALUE OF VESSELS) of the
Original Facility Agreement to the Fair Market Value of the Vessels
being at least 140% of the Loan
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under the Senior Facility Agreement shall be amended such that the
Borrowers shall be obliged to meet the following ratios during the
following periods:
<TABLE>
<CAPTION>
Period Ratio
<S> <C>
From the date of this Agreement to 30 June 2000 100%
From 1 July 2000 to 31 December 2000 110%
Thereafter 140%
</TABLE>
6. Clause 14.2 shall be deleted and replaced with the following:
"FREE CASH BALANCE
The Borrowers shall between them maintain at all times a Free Cash
Balance of an amount in dollars equal to the Minimum Amount".
7. Clause 14.4 shall be deleted and replaced with the following:
"For the purposes of Clause 14.2
"FREE CASH BALANCE" means at any relevant time the aggregate of all
dollar denominated sums standing to the credit of the Borrowers'
respective Earnings Account including any prepaid Earnings, but less any
capital (being the amount of any repayment instalment, together with
interest, due on the next Repayment Date) and operating costs (including
docking costs) as reflected in the Borrowers' latest financial
statements delivered to the Agent pursuant to Clause 13 (INFORMATION
COVENANTS) for the period to which such prepaid Earnings relate.
"EARNINGS" has the meaning given to it in the Assignments of Earnings
and Insurances.
"MINIMUM AMOUNT" means, subject to the proviso below;
(i) when both Vessels are employed under an Existing Time Charter,
$500,000;
(ii) when one Vessel is employed under an Existing Time Charter,
$750,000; and
(iii) when neither Vessel is employed under an Existing Time Charter,
$1,000,000 provided always that until 31 December 2000, the
Minimum Amount shall, in any event, be $500,000.
"EXISTING TIME CHARTER" means any time charter which is continuing in
full force and effect and under which both parties are continuing to
fulfil their obligations as and when they fall due."
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SIGNATURES
THE BORROWERS
BOSS LTD.
By:
STAVANGER SUN LTD.
By:
THE AGENT
CHRISTIANIA BANK OG KREDITKASSE ASA
By:
THE SECURITY TRUSTEE
CHRISTIANIA BANK OG KREDITKASSE ASA
By:
THE BANKS
CHRISTIANIA BANKS OG KREDITKASSE ASA
By:
FOKUS BANK ASA
By:
