-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, EzK+2qfG8dE1QA3lxro8YSSXPiscncdebRCEWOkW8k/F8OgF4T0SYSyuFvSQ8ex4 z2mNrx+IGkRfEjITojhgBQ== 0000950144-07-001914.txt : 20070306 0000950144-07-001914.hdr.sgml : 20070306 20070306171449 ACCESSION NUMBER: 0000950144-07-001914 CONFORMED SUBMISSION TYPE: 20-F PUBLIC DOCUMENT COUNT: 40 CONFORMED PERIOD OF REPORT: 20061231 FILED AS OF DATE: 20070306 DATE AS OF CHANGE: 20070306 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NCL CORP Ltd. CENTRAL INDEX KEY: 0001318742 STANDARD INDUSTRIAL CLASSIFICATION: WATER TRANSPORTATION [4400] IRS NUMBER: 200470163 STATE OF INCORPORATION: D0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 20-F SEC ACT: 1934 Act SEC FILE NUMBER: 333-128780 FILM NUMBER: 07675622 BUSINESS ADDRESS: STREET 1: 7665 CORPORATE CENTER DRIVE CITY: MIAMI STATE: FL ZIP: 33126 BUSINESS PHONE: (305) 436-4000 MAIL ADDRESS: STREET 1: 7665 CORPORATE CENTER DRIVE CITY: MIAMI STATE: FL ZIP: 33126 20-F 1 g05791e20vf.htm NCL CORPORATION, LTD. NCL Corporation, Ltd.
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 20-F
 
ANNUAL REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2006
Commission file number 333-128780
NCL Corporation Ltd.
(Exact name of registrant as specified in its charter)
Bermuda
(Jurisdiction of incorporation or organization)
 
7665 Corporate Center Drive
Miami, Florida 33126
(305) 436-4000
(Address of principal executive offices)
 
Securities registered or to be registered pursuant to Section 12(b) of the Act.
None
Securities registered or to be registered pursuant to Section 12(g) of the Act.
None
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act.
Title of Class
10 5/8% Senior Notes due 2014
Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report: 12,000 shares of common stock
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
o Yes            x No
If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.
o Yes            x No
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.
x Yes            o No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer o           Accelerated filer o           Non-accelerated filer x
Indicate by check mark which financial statement item the registrant has elected to follow:
o Item 17           x Item 18
If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act):
o Yes            x No
 
 

 


 

Table of Contents
             
        Page
Item 1.       3  
Item 2.       3  
Item 3.       3  
Item 4.       13  
Item 4A.       30  
Item 5.       31  
Item 6.       45  
Item 7.       50  
Item 8.       52  
Item 9.       54  
Item 10.       54  
Item 11.       59  
Item 12.       59  
Item 13.       60  
Item 14.       60  
Item 15.       60  
Item 16.       60  
Item 16A.       60  
Item 16B.       60  
Item 16C.       61  
Item 16D.       61  
Item 16E.       61  
Item 17.       62  
Item 18.       62  
Item 19.       62  
Glossary     63  
 EX-4.25 Sixth Supplemental Deed/Norwegian Dawn
 EX-4.26 Third Supplemental Deed/Norwegian Sun
 EX-4.27 Seventh Supplemental Deed/Pride of America
 EX-4.28 Second Supplemental Deed - Nov 13, 2006
 EX-4.29 First Supplemental Deed - Nov. 13, 2006
 EX-4.30 Second Supplemental Deed - April 4, 2006
 EX-4.31 Third Supplemental Deed/Pride of Hawai'i
 EX-4.32 First Supplemental Deed Revolving Loan Facility
 EX-4.33 Syndicate Loan Facility/Hull C33
 EX-4.34 Syndicate Loan Facility/Hull D33
 EX-4.35 Revolving Credit Facility
 EX-4.36 Amendment Agreement
 EX-4.37 Addendum No. 1/Crown Wind Limited
 EX-4.38 Addendum No. 1/Ocean Dream Limited
 EX-4.39 Addendum No. 1/Ocean Voyager Limited
 EX-4.40 Addendum No. 4,5 & 6/Pride of America
 EX-4.41 Addendum 3/Pride of Hawai'i
 EX-4.42 Addendum No. 1/ Norwegian Pearl
 EX-4.43 Shipbuilding Contract for Hull No. C33
 EX-4.44 Shipbuilding Contract for Hull No. D33
 EX-4.45 Side Letter Agreement
 EX-4.46 Office Lease Agreement
 EX-12.1 Section 302 Certification of CEO
 EX-12.2 Section 302 Certification of CFO
 EX-13.1 Section 906 Certification of CEO & CFO
References herein to “Company,” “we,” “our” and “us” refer to NCL Corporation Ltd. and its subsidiaries for periods subsequent to the Reorganization (“Item 7—Major Shareholders and Related Party Transactions”) and Arrasas Limited and its subsidiaries for periods prior to the Reorganization, unless stated otherwise or the context requires otherwise. We refer you to “Item 7—Major Shareholders and Related Party Transactions” for further information on the Reorganization. “NCL” refers to NCL Corporation Ltd. individually and “Norwegian Cruise Line,” “NCL America” and “Orient Lines” refer to the Norwegian Cruise Line, NCL America and Orient Lines brands, respectively. “Star Cruises Limited” refers to our parent company and its subsidiaries. References to the “U.S.” are to the United States of America and “dollars” or “$” are to U.S. dollars.
 

 


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“Forward Looking” Statements
This annual report contains statements that are, or may be deemed to be, “forward-looking” statements, within the meaning of Section 21E of the U.S. Securities Exchange Act of 1934, as amended, or the Exchange Act, and the Private Securities Litigation Reform Act of 1995, or the PSLRA. All statements other than statements of historical facts included in this annual report, including, without limitation, those regarding our business strategy, financial position, results of operations, plans, prospects and objectives of management for future operations (including development plans and objectives relating to our activities), are “forward-looking” statements. Certain statements under “Item 3—Key Information—Risk factors,” “Item 4—Information on the Company,” “Item 5—Operating and Financial Review and Prospects” and elsewhere in this annual report constitute “forward-looking” statements. Some of these statements can be identified by “forward-looking” terms such as “expect,” “anticipate,” “goal,” “project,” “plan,” “believe,” “seek,” “will,” “may,” “forecast,” “estimate,” “intend” and “future” and for similar words. However, these words are not the exclusive means of identifying “forward-looking” statements. These “forward-looking” statements and any other projections contained in this annual report (whether made by us or by any third party) involve known and unknown risks, uncertainties and other factors which may cause our actual results or performance or industry results to differ materially from those expressed or implied by such “forward-looking” statements. These factors include, but are not limited to:
    changes in cruise capacity, as well as capacity changes in the overall vacation industry;
 
    introduction of competing itineraries and other products by other companies;
 
    changes in general economic, business and geo-political conditions;
 
    reduced consumer demand for cruises as a result of any number of reasons, including armed conflict, terrorist attacks, geo-political and economic uncertainties or the unavailability of air service, and the resulting concerns over the safety and security aspects of traveling;
 
    lack of acceptance of new itineraries, products or services by our targeted customers;
 
    our ability to implement brand strategies and our shipbuilding programs, and to continue to expand our business worldwide;
 
    costs of new initiatives, including those involving our inter-island Hawaii cruise operations;
 
    changes in interest rates, fuel costs, or foreign currency rates;
 
    delivery schedules of new ships;
 
    risks associated with operating internationally;
 
    impact of the spread of contagious diseases;
 
    accidents and other incidents affecting the health, safety, security and vacation satisfaction of passengers and causing damage to ships, which could cause the modification of itineraries or cancellation of a cruise or series of cruises;
 
    our ability to attract and retain qualified shipboard crew and maintain good relations with employee unions;

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    changes in other operating costs such as crew, insurance and security costs;
 
    continued availability of attractive port destinations;
 
    the impact of pending or threatened litigation;
 
    the ability to obtain financing on terms that are favorable or consistent with our expectations;
 
    changes involving the tax, environmental, health, safety, security and other regulatory regimes in which we operate;
 
    emergency ship repairs;
 
    the implementation of regulations in the U.S. requiring U.S. citizens to obtain passports for travel to additional foreign destinations; and
 
    weather and natural disasters.
Such “forward-looking” statements are based on current beliefs, assumptions, expectations, estimates and projections of our management regarding our present and future business strategies and the environment in which we will operate in the future. These “forward-looking” statements speak only as of the date of this annual report. We expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any “forward-looking” statement contained herein to reflect any change in our expectations with regard thereto or any change of events, conditions or circumstances on which any such statement was based.
Industry and market data
This annual report includes market share and industry data and forecasts that we obtained from industry publications, third-party surveys and internal company surveys. Industry publications, including those from the Cruise Lines International Association, or CLIA, and surveys and forecasts generally state that the information contained therein has been obtained from sources that we believe are reliable, but there can be no assurance as to the accuracy or completeness of included information. All CLIA information relates to CLIA member lines, which represent 21 of the major North American cruise lines including NCL, which together represented 97% of the North American cruise capacity as of December 31, 2006. We have not independently verified any of the data from third-party sources nor have we ascertained the underlying economic assumptions relied upon therein. We use the most currently available industry and market data to support statements as to our market position. While we are not aware of any misstatements regarding our industry data presented herein, our estimates involve risks and uncertainties and are subject to change based on various factors, including those discussed under “Item 3—Key Information—Risk factors” and “Forward Looking Statements” in this annual report.

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PART I
Item 1. Identity of Directors, Senior Management and Advisers
     Not applicable.
Item 2. Offer Statistics and Expected Timetable
     Not applicable.
Item 3. Key Information
Selected Financial Data
     The selected consolidated financial and operating data presented below are for the years 2002 through 2006 and as of the end of each such year. Our consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the U.S. We refer you to “Item 18— Financial Statements.”
     All prior periods’ financial information presented herein has been adjusted to reflect the retrospective application of the change in our method of accounting for dry-docking costs, as more fully discussed in our consolidated financial statements. We refer you to Note 2. Summary of Significant Accounting Policies and Note 3. Change in Accounting for Dry-docking Costs.
                                         
    Years ended December 31,  
(Dollars in thousands)   2002     2003     2004     2005     2006  
Income statement data
                                       
Revenues:
                                       
Passenger ticket revenues
  $ 896,847     $ 976,124     $ 990,758     $ 1,194,461     $ 1,438,996  
Onboard and other revenues
    281,698       321,909       353,238       435,262       537,313  
 
                             
Total revenues
    1,178,545       1,298,033       1,343,996       1,629,723       1,976,309  
 
                             
 
                                       
Cruise operating expenses:
                                       
Commissions, transportation and other
    242,921       292,453       257,947       328,899       425,648  
Onboard and other
    109,887       112,942       120,250       141,957       186,240  
Payroll and related
    179,045       204,365       243,355       323,621       412,943  
Fuel
    62,681       77,088       78,013       119,412       164,530  
Food
    75,358       79,154       81,448       94,105       102,324  
Ship charter costs
                22,046       28,603       26,226  
Other operating (1)
    160,457       191,384       204,030       211,929       249,471  
 
                             
Total cruise operating expenses
    830,349       957,386       1,007,089       1,248,526       1,567,382  
 
                             
Marketing, general and administrative expenses
    178,704       186,923       204,560       225,240       249,250  
Depreciation and amortization expenses (1)
    83,187       95,765       76,937       85,615       119,097  
Impairment loss (2)
          18,155       14,500             8,000  
 
                             
Total operating expenses
    1,092,240       1,258,229       1,303,086       1,559,381       1,943,729  
 
                             
Operating income
    86,305       39,804       40,910       70,342       32,580  
 
                             
 
                                       
Non-operating (income) expenses:
                                       
Interest income
    (1,748 )     (802 )     (1,434 )     (4,803 )     (3,392 )
Interest expense, net of capitalized interest
    53,396       50,849       48,886       87,006       136,478  
Other expenses (income), net (3)
    1,419       2,165       11,548       (28,096 )     30,393  
 
                             
Total non-operating expenses
    53,067       52,212       59,000       54,107       163,479  
 
                             
Net income (loss)
  $ 33,238     $ (12,408 )   $ (18,090 )   $ 16,235     $ (130,899 )
 
                             

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    As of or for the years ended December 31,  
(Dollars in thousands, except                              
operating data and ratios)   2002     2003     2004     2005     2006  
Balance sheet data
                                       
Assets:
                                       
Cash and cash equivalents
  $ 116,604     $ 199,141     $ 172,424     $ 60,416     $ 63,530  
Property and equipment, net
    2,486,981       2,660,991       2,529,739       3,113,229       3,816,292  
Total assets
    3,340,395       3,593,676       3,464,546       3,984,227       4,629,624  
 
                                       
Liabilities and shareholder’s equity:
                                       
Advance ticket sales
    189,175       188,364       226,081       276,644       314,050  
Other current liabilities (4)
    175,438       529,758       191,225       220,571       298,768  
Current portion of long-term debt
    267,916       476,995       86,198       140,694       154,638  
Long-term debt
    1,316,428       1,019,392       1,604,331       1,965,983       2,405,357  
Other long-term liabilities (4)
    1,302,967       372,589       5,734       2,631       1,744  
Common stock
    12       12       12       12       12  
Total shareholder’s equity
    88,471       1,006,578       1,350,977       1,377,704       1,455,067  
 
                                       
Operating data
                                       
Passengers carried
    819,660       878,067       874,926       981,665       1,153,844  
Passenger cruise days (5)
    6,180,457       6,543,896       6,744,609       7,613,100       8,807,632  
Capacity days (6)
    5,951,273       6,277,888       6,370,096       7,172,040       8,381,445  
Occupancy percentage (7)
    103.9 %     104.2 %     105.9 %     106.1 %     105.1 %
Total number of cruise ships
    11       10       11       12       14  
 
                                       
Other financial data
                                       
Net cash provided by operating activities
    153,777       86,310       153,758       136,828       147,504  
Net cash used in investing activities
    (439,728 )     (275,588 )     (750,710 )     (678,309 )     (756,245 )
Net cash provided by financing activities
    318,733       271,815       570,235       429,473       611,855  
Capital expenditures
    390,857       295,626       748,267       658,795       809,403  
     Note: Certain prior year amounts have been reclassified to conform to the current year presentation.
     (1) In the second quarter of 2006, we retrospectively adjusted for the change in our method of accounting for dry-docking costs from the deferral method to the direct expense method, which resulted in an increase in other operating expenses of approximately $10.8 million, $10.4 million, $19.8 million and $21.5 million for the years ended December 31, 2002, 2003, 2004 and 2005, respectively. The change also resulted in a decrease in depreciation expense of approximately $8.8 million, $11.5 million, $10.5 million and $18.6 million for the years ended December 31, 2002, 2003, 2004 and 2005, respectively.
     (2) In 2003, the impairment loss was recorded as a result of a write-down of $15.0 million relating to the Orient Lines tradename and a write-down of $3.2 million to the carrying value of one of our cruise ships; in 2004, the impairment loss was recorded as a result of a write-down of $14.5 million relating to the carrying value of one of our cruise ships; and in 2006, the impairment loss was recorded as a result of a write-down of $8.0 million relating to the Orient Lines tradename.
     (3) For the years ended December 31, 2002, 2003, 2004, 2005 and 2006 such amount includes foreign currency translation losses of $1.4 million, $2.2 million, $11.5 million, gains of $28.7 million and losses of $38.9 million, respectively, primarily due to fluctuations in the Euro/U.S. dollar exchange rate.
     (4) At December 31, 2002, 2003, 2004 and 2005, we had amounts due to parent of $1.3 billion, $0.7 billion, $1.3 million and $3.1 million, respectively. At December 31, 2006, we did not have an amount due to parent. The amounts due to parent at December 31, 2004 and 2005 were classified as other current liabilities because such amounts were due on demand. The amount

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due to parent at December 31, 2002 was classified as a long-term liability because Star Cruises Limited agreed not to demand repayment of such amount for 12 months from the date of the balance sheet. At December 31, 2003, $366.6 million was classified as a long-term liability because such amount was satisfied through reclassification to equity in the Reorganization and the remaining $374.8 million was classified as a current liability because such amount was repaid in the Reorganization.
(5) Represents the number of passengers carried for the period multiplied by the number of days in their respective cruises.
(6) Represents double occupancy per cabin multiplied by the number of cruise days for the period.
(7) Represents the ratio of Passenger Cruise Days to Capacity Days. A percentage in excess of 100% indicates that three or more passengers occupied some cabins.
Risk factors
The specific risk factors set forth below, as well as the other information contained in this annual report on Form 20-F, are important factors, among others, that could cause our actual results to differ from our expected or historical results. It is not possible to predict or identify all such factors. Consequently, this list should not be considered a complete statement of all potential risks or uncertainties. We refer you to “Item 5—Operating and Financial Review and Prospects” for a note regarding “forward-looking” statements.
Risks relating to our business
An increase in the supply of cruise ships without a corresponding increase in passenger demand could materially and adversely affect our financial condition and results of operations.
Historically, cruise capacity has grown to meet the growth in demand. According to CLIA, North American cruise capacity, in terms of berths, has increased at a compound annual growth rate of approximately 7% from 1981 to 2006. CLIA estimates that, between the end of 2006 and 2010, the CLIA member line fleet will increase by approximately 30 additional ships, which have either been contracted for or are planned, representing approximately 73,600 berths or approximately 30% of total CLIA member line cruise capacity in 2006. In order to profitably utilize this new capacity, the cruise industry will likely need to improve its percentage share of the U.S. population who has cruised at least once, which is approximately 17%, according to CLIA. If there is such an industry-wide increase in capacity without a corresponding increase in public demand, we, as well as the entire cruise industry, could experience reduced occupancy rates or be forced to discount our prices, which could adversely affect our financial condition and results of operations.
We face intense competition.
We face intense competition from other cruise companies in North America where the cruise market is mature and developed. The North American cruise industry is highly concentrated and dominated by three players. As of December 31, 2006, Carnival Corporation and Royal Caribbean Cruises Ltd., each of which may possess greater financial resources than we do, together accounted for approximately 80% of North American cruise passenger capacity in terms of berths while we, as of the same date, operating under all of our brands, accounted for approximately 11% of North American cruise passenger capacity in terms of berths. We also face competition for many itineraries from other cruise operators, such as MSC Cruises and Disney Cruise Line.
In addition, although a federal statute enabled us to introduce three U.S.-flagged ships, operated through a U.S.-incorporated subsidiary, to cruise between and among the Hawaii islands without the need to call at a foreign port, there can be no assurance that other non-U.S. cruise operators will not obtain similar rights

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under a future statute. In the event that other non-U.S. cruise operators were to benefit from similar exemptions, we would face increased competition in the Hawaii islands’ market.
We also face competition from non-cruise vacation alternatives, including beach resorts, golf and tennis resorts, theme parks, land-based casino operations, and other hotels and tourist destinations. In the event we do not compete effectively, our financial condition and results of operations could be adversely affected.
Adverse economic conditions in the North American region or other factors that depress the level of disposable income of consumers or consumer confidence could adversely affect our financial condition and results of operations.
For each of the years ended December 31, 2004, 2005 and 2006 approximately 89%, 90% and 87%, respectively, of our revenues were derived from passengers residing in North America. Past acts of terrorism have had an adverse effect on tourism, travel and the availability of air service and other forms of transportation in North America. The possibility of future terrorist activities and other geo-political uncertainties may have a negative impact on our financial condition and results of operations in the short term. There can be no certainty that North America, and the U.S. in particular, will experience economic growth in the future, nor can there be any assurance that external events similar to those experienced in the past will not recur. Due to our reliance on passengers from the U.S., any such events would likely have an adverse effect on our financial condition and results of operations.
The inter-island cruises that we offer in Hawaii are unique and there are greater uncertainties as to the success of such cruises.
We are the only major cruise operator that offers cruise itineraries from ports in Hawaii that do not require calls at non-U.S. ports. We began offering these itineraries in the summer of 2004, and thus there is little history to indicate the likelihood of success of our future cruise offerings in Hawaii. Although we believe that our ability to offer such cruises will enable us to differentiate our brand and capitalize on the currently growing Hawaii cruise market, we are currently experiencing losses on our Hawaii inter-island operations and we cannot ensure that these cruises will ultimately be successful for us.
We rely on external distribution channels for passenger bookings; major changes in the availability of external distribution channels could undermine our customer base.
In 2006, the vast majority of our passengers on our fleet booked their cruises through independent travel agents and wholesalers. These independent travel agents generally sell and market our cruises on a nonexclusive basis. Although we offer incentives to travel agents for booking our cruises that are comparable to those offered by others in the industry, there can be no guarantee that our competitors will not offer other incentives in the future. Travel agents may face increasing pressure from our competitors, particularly in North America and Europe, to sell and market these competitors’ cruises exclusively. If such exclusive arrangements were introduced, there can be no assurance that we will be able to find alternative distribution channels to ensure that our customer base would not be affected.
We rely on scheduled commercial airline services for passenger connections; increases in the price of or major changes or reduction in commercial airline services could undermine our customer base.
Some of our passengers depend on scheduled commercial airline services to transport them to ports of embarkation for our cruises. Increases in the price of airfare, due to increases in fuel prices or otherwise, would increase the overall vacation cost to our customers and may adversely affect demand for our

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cruises. Changes in commercial airline services as a result of strikes, weather or other events, or the lack of availability due to schedule changes or a high level of airline bookings could adversely affect our ability to deliver passengers to our cruises and increase our cost of sales which would, in turn, have an adverse effect on our financial condition and results of operations.
Increases in fuel prices or other cruise operating costs would have an adverse impact on our financial condition and results of operations.
Fuel costs accounted for 7.7% of our total cruise operating expenses in 2004, 9.6% in 2005 and 10.5% in 2006. Economic and political conditions in certain parts of the world make it difficult to predict the price of fuel in the future. Future increases in the cost of fuel globally would increase the cost of our cruise ship operations. In addition, we could experience increases in other cruise operating costs, such as crew, insurance and security costs, due to market forces and economic or political instability beyond our control. Accordingly, increases in fuel prices or other cruise operating costs could have a material adverse effect on our financial condition and results of operations.
Our revenues are seasonal owing to variations in passenger fare rates and occupancy levels at different times of the year; we may not be able to generate revenues that are sufficient to cover our expenses during certain periods of the year.
The cruise industry in North America, our principal market, is seasonal, with greatest demand generally occurring during the months of June through August. This seasonality in demand has resulted in fluctuations in our revenues and results of operations. The seasonality of our results is increased due to ships being taken out of service for dry-docking, which we typically schedule during non-peak demand periods for such ships. Accordingly, seasonality in demand and dry-docking could adversely affect our ability to generate sufficient revenues to cover expenses and particularly so during certain periods of the year.
Any delays in the delivery of new cruise ships or any mechanical failures on or of our cruise ships may have a material adverse effect on our business, financial condition and results of operations.
Building a ship is subject to risks similar to those encountered in other sophisticated and lengthy projects. Delivery delays can occur as a result of problems with our shipbuilders such as insolvency, labor actions or “force majeure” events that are beyond our control and the control of the shipbuilders. We expect to take delivery of three newbuilds by December 31, 2010, with approximately 10,800 berths, or approximately 41% of our current total berths. We have developed our current business strategy on the assumption that these ships will be delivered on time and that they will perform in the manner indicated by their design specifications. For further discussion on the newbuilds, we refer you to “Item 4—Information on the Company—The fleet—Current new ships on order”. A significant delay in the delivery of these new ships, or a significant performance deficiency or significant mechanical failure on or of a ship, particularly in light of decreasing availability of dry-docking facilities, could have a material adverse effect on our business, financial condition and results of operations.
We are dependent upon the services of key management personnel.
We are dependent upon the collective services of all of the members of our senior management team, including Colin Veitch, our Deputy Chairman, President and Chief Executive Officer. The loss of the services of any such person or several of such persons could have an adverse effect on our business. We refer you to “Item 6—Directors, Senior Management and Employees” for additional information about our management personnel.

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Conducting business internationally and as a reporting company in the U.S. may result in increased costs and risks.
We operate our business internationally and plan to continue to develop our international presence. Operating internationally exposes us to a number of risks. Examples include political risks and risks of increase in duties and taxes as well as changes in laws and policies affecting cruising, vacation or maritime businesses, or governing the operations of foreign-based companies. Because some of our expenses are incurred in foreign currencies, we are exposed to exchange rate risks. We have ship construction contracts that are denominated in Euro and a significant portion of our debt is denominated in Euro. Additional risks include interest rate movements, imposition of trade barriers and restrictions on repatriation of earnings. In addition, because we have only recently become a U.S. reporting company, we are exposed to increased costs and risks associated with complying with increasing and new regulation of corporate governance and disclosure standards, including under the Sarbanes-Oxley Act of 2002 and its requirements under Section 404 relating to internal controls over financial reporting. Furthermore, our operations utilize information technology resources in performing a number of functions, some of which resources may be costly, as a result of which we must update and acquire new information resources over time. The failure to successfully implement or acquire such information resources could expose us to additional risks. If we are unable to address these risks adequately, our financial condition and results of operations could be adversely affected.
Future epidemics and viral outbreaks may have an adverse effect on our financial condition and results of operations.
Public perception about the safety of travel and adverse publicity related to passenger illness may impact demand for cruises and adversely affect our future sales, financial condition and results of operations. If any wide-ranging health scare should occur, our financial condition and results of operations would likely be adversely affected.
The political environment in certain countries where we operate is uncertain and our ability to operate our business as we have in the past may be restricted.
We operate in waters and call at ports throughout the world, including geographic regions that, from time to time, have experienced political and civil unrest and armed hostilities. Historically, adverse international events have affected demand for cruise products generally and have had an adverse effect on us.
Adverse incidents involving cruise ships may have an adverse impact on our financial condition and results of operations.
The operation of cruise ships involves the risk of accidents, mechanical failures and other incidents at sea or while in port that may bring into question passenger safety, may adversely affect future industry performance and may lead to litigation against us. Although we place passenger safety as a high priority in the design and operation of our fleet, we have experienced accidents and other incidents involving our cruise ships. In addition, we offer itineraries in certain parts of the world that may present challenges specific to that region. There can be no assurance that similar events will not occur in the future. It is possible that we could be forced to cancel a cruise or a series of cruises due to these factors, which could have an adverse effect on our sales, financial condition and results of operations. Any such event involving our cruise ships or other passenger cruise ships may adversely affect passengers’ perceptions of safety or result in increased governmental or other regulatory oversight and may therefore affect our results of operations. An adverse judgment or settlement in respect of any of the ongoing claims against us may also lead to negative publicity about us. We refer you to “Item 4—Information on the

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Company— Company operations and cruise infrastructure—Crew and passenger safety” and “Item 8—Financial Information—Legal proceedings” for additional information about our safety provisions and litigation in which we are involved.
Amendments to the collective bargaining agreements for crew members of our fleet could have an adverse impact on our financial condition and results of operations.
Currently, we are a party to six collective bargaining agreements. Three of our collective bargaining agreements are with the Norwegian Seamens Union and are automatically renewable annually. The three remaining collective bargaining agreements are scheduled to expire in 2009. Amendments to such collective bargaining agreements in favor of the union members may increase labor costs and could have an adverse impact on our financial condition and results of operations.
Our U.S.-flagged ships sail in the Hawaii islands under the NCL America brand. Pride of Aloha commenced sailing in the summer of 2004, Pride of America commenced sailing in the summer of 2005 and Pride of Hawai’i commenced sailing in the spring of 2006. Under U.S. law, we are obligated to employ a certain percentage of U.S. crew members onboard these U.S.-flagged ships and comply with U.S. federal labor laws and regulations and Hawaii state laws and regulations. Under current U.S. federal laws, the prescribed minimum wage of a non-officer crew member onboard a U.S.-flagged ship operating in domestic trade is significantly higher than that of an international crew member on foreign-flagged ships engaged in international trade. We incur higher expenses for benefits for the crews on our U.S.-flagged ships. Also, the higher costs of hiring, training and retaining U.S. crews may cause our actual results to differ materially from our expectations and thus have an adverse effect on our financial condition and results of operations.
Unavailability of ports of call may adversely affect our financial condition and results of operations.
We believe that attractive port destinations are a major reason why passengers choose to go on a particular cruise or on a cruise vacation. The availability of ports is affected by a number of factors, including, among others, existing capacity constraints, security concerns, adverse weather conditions and natural disasters, financial limitations on port development, local governmental regulations and local community concerns about port development and other adverse impacts on their communities from additional tourists. Any limitations on the availability of our ports of call could adversely affect our financial condition and results of operations.
We may suffer an uninsured loss, as we are not protected against all risks or lawsuits that we may face.
The operation of ocean-going ships carries an inherent risk of loss caused by adverse weather conditions, marine disaster, including oil spills and other environmental mishaps, fire, mechanical failure, collisions, human error, war, terrorism, piracy, political action in various countries and other circumstances or events. Any such event may result in loss of life or property, loss of revenues or increased costs and could result in significant litigation against us.
We seek to maintain comprehensive insurance coverage at commercially reasonable rates. We believe that our current coverage is adequate to protect against most of the accident-related risks involved in the conduct of our business. We are not protected against all lawsuits brought against us, although certain individual claims may be covered by insurance, depending on their subject matter.
There can be no assurance that all risks are fully insured against, that any particular claim will be fully paid or that we will be able to procure adequate insurance coverage at commercially reasonable rates in the future. We may also be subject to calls, or premiums, in amounts based not only on our own claim

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records, but also the claim records of all other members of the protection and indemnity associations through which we receive indemnity coverage for tort liability. Our payment of these calls could result in significant expenses to us which could reduce our cash flows. If we were to sustain significant losses in the future, our ability to obtain insurance coverage or coverage at commercially reasonable rates could be materially adversely affected.
Our future operating cash flow may not be sufficient to fund future obligations, and we may not be able to obtain additional financing, if necessary, at a cost that is favorable or that meets our expectations.
To fund our capital expenditures and scheduled debt payments, we have relied primarily on cash generated from operations, bank and other borrowings and equity infusions and loans from Star Cruises Limited. Our forecasted cash flow from future operations may be adversely affected by various factors, including, among others, declines in customer demand, increased competition, overcapacity, a deterioration in general economic and business conditions, terrorist attacks, ship accidents and other incidents, adverse publicity and increases in fuel prices, as well as other factors noted under these “Risk factors” that are beyond our control. To the extent that we are required, or choose, to fund future cash requirements, including future shipbuilding commitments, from sources other than cash flow from operations, cash on hand, committed financings and equity infusions or loans from Star Cruises Limited, we will have to secure such financing from banks or through the offering of debt and/or equity securities in the public or private markets. Our access to, and the cost of, financing will depend on, among other things, the maintenance of adequate credit ratings. Any lowering of our credit ratings may have adverse consequences on our ability to access the financial markets and/or on our cost of financings. In addition, interest rates and our ability to obtain financing are dependent on many economic and political factors beyond our control. Accordingly, we cannot be sure that our cash flows from operations and additional financings will be available in accordance with our expectations.
We are highly leveraged with a high level of floating rate debt, and our level of indebtedness could limit cash flow available for our operations and could adversely affect our financial condition, operations, prospects and flexibility.
As of December 31, 2006, we had $2.6 billion of total debt, of which $154.6 million is the current portion of long-term borrowings. As of the same date, we had $1.5 billion in shareholder’s equity. Most of our debt has been incurred to finance ship construction. Our high level of indebtedness may adversely affect our future strategy and operations in a number of ways, including:
    a substantial portion of our cash flow from operations will be required to service debt, thereby reducing the funds available to us for other purposes;
    our ability to obtain additional financing for working capital, capital expenditures and general corporate purposes, including upgrades of our current ships or the construction of new ships, may be limited; and
    our high level of leverage may hinder our ability to withstand competitive pressures or adjust rapidly to changing market conditions.
As of December 31, 2006, approximately 66% of our indebtedness bears interest at rates that fluctuate with prevailing interest rates. As a result, our interest expense under such facilities will increase as short-term interest rates increase. With respect to our debt outstanding as of December 31, 2006, a 1% increase in annual LIBOR and EURIBOR interest rates would increase our annual interest expense in 2007 by approximately $17.4 million. In addition, future financings we may undertake may also provide for rates

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that fluctuate with prevailing interest rates.
Subject to compliance with various financial and other covenants imposed by our credit facilities and the agreements governing our indebtedness, we and our subsidiaries may incur additional indebtedness from time to time, including debt to finance the purchase or completion of new ships. Our incurrence of additional debt could further exacerbate the risks described in this annual report and could result in a material adverse effect on our business, financial condition and results of operations. Our ships and substantially all our other property are pledged as collateral for our debt. We refer you to “Item 5—Operating and Financial Review and Prospects—Liquidity and capital resources.”
Risks relating to the regulatory environment in which we operate
Future changes in applicable tax laws, or our inability to take advantage of favorable tax regimes, may have an adverse impact on our financial condition and results of operations.
As we generally derive revenue from shipboard activity in international waters and not in a particular jurisdiction, our exposure to tax is limited in some instances. Bermuda, the jurisdiction of formation of NCL and certain of our operating subsidiaries, and the Isle of Man, the jurisdiction of incorporation of certain of our operating subsidiaries, impose no tax on our income. We do, however, submit to the tax regimes of the jurisdictions in which we operate and pay taxes as required by those regimes.
The income that we derive from the international operation of ships, as well as certain income that is considered to be incidental to such income (“Shipping Income”), is exempt from U.S. federal income taxes under section 883 of the Internal Revenue Code of 1986, as amended, or the Code, based upon certain assumptions as to shareholdings and other information as of December 31, 2005 and 2006, as more fully described in “Item 4—Information on the Company—Taxation—U.S. federal income taxation.” We believe that substantially all of our income from the international operation of ships is properly categorized as Shipping Income. The U.S.-source portion of our income from the international operation of ships that is not Shipping Income is subject to U.S. taxation. We believe that, if our Shipping Income were not exempt from federal income taxation under section 883 of the Code, that income, as well as any other income from cruise operations of NCL that is not Shipping Income, to the extent derived from U.S. sources, generally would be taxed on a net basis at graduated U.S. federal corporate income tax rates (currently, a maximum of 35%). We also would be subject to a 30% federal branch profits tax under section 884 of the Code, generally on the after tax portion of such income that was from U.S. sources each year to the extent that such income was not properly viewed as reinvested and maintained in our U.S. business. Interest paid or accrued by us also could be subject to a 30% withholding tax and/or branch interest taxes under section 884 of the Code (and to some extent could be treated as U.S.-source interest). If section 883 of the Code had not applied to us in 2005 and 2006, we would have been subject to U.S. corporate income tax only on the portion of our income derived from U.S. sources. Further, a change in our operations could result in a change in the amount of source income subject to U.S. federal income tax. Moreover, the income that we derive from our U.S.-flagged operations under the NCL America brand is subject to tax on a net basis at the graduated U.S. federal corporate income tax rates generally applicable to corporations organized in the U.S. U.S.-source dividends paid by NCL America generally would be subject to a 30% withholding tax. At December 31, 2005 and 2006, our U.S.-flagged operations were not in a U.S. income tax paying position because they had substantial net operating loss carry-forwards.

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The various tax regimes to which we are currently subject result in a relatively low effective tax rate on our world-wide income. These tax regimes, however, are subject to change. Moreover, we may become subject to new tax regimes and may be unable to take advantage of favorable tax provisions afforded by current or future law.
We are subject to complex laws and regulations, including environmental laws and regulations, which could adversely affect our operations; any changes in the current laws and regulations could lead to increased costs or decreased revenues and adversely affect our business prospects, financial condition and results of operations.
Some environmental groups have lobbied for more onerous oversight of cruise ships and have generated negative publicity about the cruise industry and its environmental impact. Increasingly stringent federal, state, local and international laws and regulations on environmental protection and health and safety of workers could affect our operations. The U.S. Environmental Protection Agency, the International Maritime Organization, commonly referred to as the IMO, the Council of the European Union and individual States are considering, as well as implementing, new laws and rules to manage cruise ship waste. In addition, many aspects of the cruise industry are subject to governmental regulation by the U.S. Coast Guard as well as international treaties such as the International Convention for the Safety of Life at Sea, commonly referred to as SOLAS, the International Convention for the Prevention of Pollution from Ships, commonly referred to as MARPOL, and the Standard of Training Certification and Watchkeeping for Seafarers, commonly referred to as STCW, and the recently adopted Manning Convention. In addition, international regulations regarding ballast water and security levels are pending. Compliance with such laws and regulations may entail significant expenses for ship modification and changes in operating procedures.
By virtue of our operations in the U.S., the U.S. Federal Maritime Commission, commonly known as the FMC, requires us to maintain a $15.0 million third party performance guarantee on our behalf in respect of liabilities for non-performance of transportation and other obligations to passengers. The FMC has proposed rules that would significantly increase the amount of our required guarantees and accordingly our cost of compliance. There can be no assurance that such an increase in the amount of our guarantees, if required, would be available to us. For additional discussion of the FMC’s proposed requirements, we refer you to “Item 4—Information on the Company—Regulatory issues.”
New health, safety, security and other regulatory issues could adversely affect our business prospects, financial condition and results of operations.
We are subject to various international, national, state and local health, safety and security laws and regulations. For additional discussion of these requirements, we refer you to “Item 4—Information on the Company—Regulatory issues.” Changes in existing legislation or regulations and the imposition of new requirements could adversely affect our business prospects, financial condition and results of operations.
Implementation of U.S. federal regulations, requiring U.S. citizens to obtain passports for seaborne travel to all foreign destinations, could adversely affect our financial condition and results of operations. Many cruise customers may not currently have passports or may not obtain a People Access Security Card (PASS) card, if and when available. A PASS card system is currently being developed by the State Department and the Department of Homeland Security as a secure credential that verifies the citizenship and identity of U.S. nationals who re-enter the U.S. and it may be a less expensive alternative to a passport.

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Item 4. Information on the Company
History and development of the Company
The Norwegian Cruise Line brand commenced operations in 1966. In February 2000, Star Cruises Limited, a Bermuda company with limited liability, acquired control of and subsequently became the sole owner of the Norwegian Cruise Line’s operations through its subsidiary Arrasas Limited, an Isle of Man company.
In December 2003, the Company was incorporated in Bermuda as a wholly-owned subsidiary of Star Cruises Limited. In connection with our formation, Star Cruises Limited contributed to the Company its 100% ownership interest in Arrasas Limited. Various subsidiaries were reorganized so that the entities owning or operating Bahamas-flagged ships became subsidiaries of NCL International, Ltd., also a Bermuda company, and the entities owning or operating U.S.-flagged ships became subsidiaries of NCL America Holdings, Inc., a Delaware corporation. NCL International, Ltd. and NCL America Holdings, Inc. are wholly-owned by Arrasas Limited. We refer you to “Item 4—Information on the Company—Organizational structure” for a diagram of our organization.
At December 31, 2006, approximately 37% of the shareholding interests in Star Cruises Limited were held by Golden Hope Limited (“GHL”) as trustee of the Golden Hope Unit Trust, a private unit trust held directly and indirectly by GZ Trust Corporation as trustee of a discretionary trust established for the benefit of certain members of our Chairman’s family (the “Lim Family”). In addition, Resorts World Bhd (“RWB”), a Malaysian company listed on Bursa Malaysia Securities Berhad, in which the Lim Family has a substantial indirect beneficial interest, held approximately 36% of the shareholding interests in Star Cruises Limited. Star Cruises Limited’s shares are listed on the Stock Exchange of Hong Kong Limited and quoted on the Central Limit Order Book International of the Singapore Exchange Securities Trading Limited. We refer you to “Item 4—Information on the Company—Business overview” for further information.
The Company’s registered offices are located at Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda. Our principal executive offices are located at 7665 Corporate Center Drive, Miami, Florida 33126, U.S. and the main telephone number at that address is (305) 436-4000. The websites for Norwegian Cruise Line, NCL America and Orient Lines are located at www.ncl.com, www.ncl.com/ncla and www.orientlines.com, respectively. Information contained on our websites is not incorporated by reference into this or any other report filed with or furnished to the U.S. Securities and Exchange Commission (“SEC”). Mark E. Warren, our Executive Vice President and General Counsel, is our agent for service of process at our principal executive offices.
Business overview
We are one of the leading cruise ship operators in the world and are increasing the capacity and modernity of our fleet. We currently operate 14 ships with a total of over 26,600 berths, which represents approximately 11% of the overall cruise capacity in North America in terms of berths. We are in the midst of a fleet renewal program which, by the end of 2010, will add three new ships to our fleet with approximately 10,800 berths. During the same period, certain ships which we currently charter from Star Cruises Limited will be withdrawn from our fleet. We offer a wide variety of itineraries focused on North America, including year-round cruises from New York, the only seven-day inter-island itineraries in Hawaii and a variety of itineraries in Alaska. We also offer numerous mainstream itineraries in the Caribbean, Europe and South America and have the largest cruise operation in Antarctica. We operate under three brands: Norwegian Cruise Line, NCL America (under which we offer our unique Hawaii cruises), and Orient Lines.

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In addition to operating our large, competitive international fleet, we are unique in the industry in being the only major cruise line to operate U.S.-flagged ships, which enables us to offer entirely inter-island Hawaii cruises.
Segment Reporting
We operate under three brand names, Norwegian Cruise Line, NCL America, and Orient Lines. The brands have been aggregated as a single operating segment based on the similarity of their economic characteristics, as well as products and services provided.
Although we sell cruises on an international basis, our passenger ticket revenue is primarily attributed to passengers who made reservations in North America. For the years ended December 31, 2004, 2005 and 2006, revenues attributable to North American passengers were approximately 89%, 90% and 87%, respectively.
Our business strategies
We seek to attract vacationers by pioneering new products and services, exploring new markets and adding modern ships to our fleet. Our objective is to offer vacation products, unique in the cruise industry and which offer better value and more attractive characteristics than the broader, land-based leisure alternatives with which we compete. We have a long tradition of product innovation within the cruise industry: Norwegian Cruise Line is the oldest established consumer brand in Caribbean cruising; we became the first cruise operator to buy a private island in the Bahamas to offer a private beach experience to our passengers; and we were the first to introduce a 2,000-berth megaship into the Caribbean market in 1980. This tradition of innovation has continued in recent years with the launch of “Freestyle Cruising,” the development of “Homeland Cruising,” including the initiation of year-round cruises from New York, and the introduction of one-week and more recently 10 and 11-day inter-island cruises on ocean-going ships in Hawaii through our U.S.-flagged ships, which we believe differentiate us significantly from our major competitors.
“Freestyle Cruising” One of our most significant initiatives has been the introduction of a new style of cruising, called “Freestyle Cruising,” onboard all Norwegian Cruise Line and NCL America ships. Our primary aim has been to eliminate the traditional cruise ship practice of fixed dining schedules, assigned dinner seating, formal dress codes, and cash tipping of service staff. Additionally, we have increased the number of activities and dining facilities available onboard, allowing passengers to organize their onboard experience according to their own schedules and tastes. The key elements of “Freestyle Cruising” include:
    flexible dining policy in our dining rooms; no fixed dining times or pre-assigned seating;
 
    up to 11 dining locations ranging from casual fast-food outlets to à la carte gourmet and specialty ethnic restaurants;
 
    resort-casual dress code acceptable throughout the ship, at all times;
 
    increased service staff for a more personalized vacation experience;
 
    replacement of cash tipping with an automated service charge system;

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    diverse “lifestyle” activities, including cultural and educational onboard programs along with an increased adventure emphasis for shore excursions; and
 
    passenger-friendly disembarkation policies.
Our new ships have been designed and built for “Freestyle Cruising,” which we believe differentiates us significantly from our major competitors. We further believe that “Freestyle Cruising” attracts a passenger base that prefers the less structured, resort-style experience of our cruises.
Hawaii We are one of the pioneers of the Hawaii cruise market and have offered cruises in Hawaii since 1998 and have been the industry leader in Hawaii since 2001. Initially, our cruises were on non-U.S.-flagged ships and were required to call on a foreign port during each cruise to comply with the provisions of the U.S. Jones Act. As a result, since 1998, our Hawaii cruises called on Fanning Island in the Republic of Kiribati, which is the closest foreign port that complies with the Jones Act provisions and is located approximately 900 nautical miles south of the Big Island of Hawaii. We retain the exclusive right to call at Fanning Island through March 2009. Because our Hawaii operations consistently generated revenues and passenger yields that exceeded those of our other itineraries, and because we believe Hawaii is an attractive market for expansion as it offers the potential to generate premium revenues, in February 2003, we sought and received U.S. Congressional permission to operate in the Hawaii inter-island trade. As a result, we are currently the only major ocean-going cruise ship operator capable of offering seven-day itineraries and entirely inter-island cruises in Hawaii which we believe are more attractive to our customers than our competitors’ offerings.
Pursuant to federal law, we were permitted to re-flag an existing non-U.S.-flagged ship in our fleet as a U.S.-flagged ship and complete the construction of two additional U.S.-flagged ships outside the U.S. As a result, three of our ships are able to cruise between and among ports in Hawaii without the need to call at a foreign port. The 2,000-berth Pride of Aloha commenced sailing seven-day inter-island cruises from Honolulu in the summer of 2004. Pride of America, our first newly built U.S.-flagged ship, commenced sailing seven-day inter-island cruises from Honolulu in the summer of 2005. It added 2,140 berths to our fleet and features more private balcony cabins than any other ship in our fleet. Pride of Hawai’i, our third U.S.-flagged ship and also a new purpose-built ship for “Freestyle Cruising,” commenced sailing in the spring of 2006, adding a further 2,460 berths to our fleet. In total, we offer over 6,600 berths on U.S.-flagged ships on weekly inter-island Hawaii cruises.
Fleet renewal We have one of the youngest fleets in the industry. An important element of our strategy since our acquisition by Star Cruises Limited in 2000 has been to make significant investments in the renewal of our fleet. We are in the midst of a fleet renewal program, which, by the end of 2010, will add three new ships to our fleet, for a total of 12 modern ships added to our fleet since 1999. These three ships have approximately 10,800 berths, or approximately 41% of our total berths of our existing fleet as of December 31, 2006. The total cost of these three new ships is currently estimated to be $2.6 billion based on the Euro/U.S. dollar exchange rate on December 31, 2006, of which we had paid $0.2 billion as of December 31, 2006. Renewal of our fleet is expected to enhance our results because:
    new ships are more attractive to passengers;
 
    new ships are larger and have a more profitable mix of cabins, including a higher percentage of cabins with private balconies for which passengers are willing to pay a premium;
 
    our new ships are faster than many of our competitors’ ships, giving us more flexibility in designing new and attractive itineraries;

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    new ships tend to provide greater operating economies of scale; and
 
    our new ships have been designed and built to deliver “Freestyle Cruising.”
In 2004, we transferred ownership of six of our older cruise ships to our parent, Star Cruises Limited. We continue to operate five of these ships under charter agreements with our parent at December 31, 2006. These charter agreements afford us the flexibility to return our older ships to Star Cruises Limited as new, modern ships enter our fleet over time, without relying on the secondary sale market.
“Homeland Cruising” We are one of the industry leaders in offering cruises from a wide variety of North American homeports close to major population centers, thus eliminating the need for vacationers to fly to distant ports to board a ship and reducing the overall cost and duration of a vacation. We branded this initiative as “Homeland Cruising” in response to changing consumer travel patterns in recent years. We are, for example, the only brand operating year-round from Honolulu and New York, the largest population center in the U.S., and we offer Bermuda cruises from three of the main northeastern ports, Boston, New York and Philadelphia.
Brand identity launch
We recently unveiled a new, comprehensive brand identity created expressly to capture and articulate our “Freestyle Cruising”. The marketing plan features national television, radio, print, newspaper, out-of-home and online advertising, along with a redesigned website. This branding effort has also extended to our passengers and travel agents’ correspondence, onboard and in-cabin elements and port signage and terminal décor.
The fleet
As of December 31, 2006, NCL operates a fleet of 14 cruise ships with a total of over 26,600 berths. We are one of the industry leaders in offering cruises from a wide variety of North American homeports close to major population centers on ships specifically designed or re-configured to offer our unique “Freestyle Cruising” product.
Most of our ships are characterized by state-of-the-art passenger amenities including multiple dining choices in up to 11 restaurants on each ship, together with hundreds of standard private balcony cabins on each ship. Private balcony cabins are very popular with passengers and offer the opportunity for potential increased revenues by allowing us to charge a premium. Additionally, Pride of Hawai’i, Norwegian Pearl, Norwegian Jewel, Norwegian Star and Norwegian Dawn each have a “ship within a ship” of luxury garden villas with up to approximately 4,390 square feet. These garden villas contain three separate bedroom areas, spacious living and dining room areas, as well as butler and concierge service. In addition, Pride of Hawai’i, Norwegian Jewel and Norwegian Pearl, each have 10 courtyard villas, with up to approximately 572 square feet, which provide access to an exclusive private courtyard area with a private pool.

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Norwegian Cruise Line’s ships
The table below provides a brief description of the Norwegian Cruise Line’s ships and areas of operations based on 2006 itineraries:
                                 
    Year Built/           Crew   Gross   Primary Areas of
Ship   Rebuilt   Berths   Capacity   Tons   Operation
Norwegian Pearl
  2006     2,400       1,200       93,500     Alaska, Caribbean, Pacific
 
                              Coastal and Panama Canal
Norwegian Jewel
  2005     2,380       1,100       93,500     Caribbean and Europe
Norwegian Dawn
  2002     2,220       1,100       92,300     Bahamas, Bermuda, Caribbean,
Canada and New England
Norwegian Star
  2001     2,240       1,100       91,700     Alaska, Mexico and Pacific Coastal
Norwegian Sun
  2001     1,940       900       78,300     Alaska, Caribbean, Hawaii,
Pacific Coastal and Panama Canal
Norwegian Majesty (1)
  1992/1999     1,460       700       40,900     Bahamas, Bermuda and Caribbean
Norwegian Wind (1)
  1993/1998     1,740       700       50,800     Alaska and Hawaii
Norwegian Dream (1)
  1992/1998     1,740       700       50,800     Caribbean, Europe, Panama Canal
 
                              and South America
Norwegian Spirit
  1998     1,980       1,000       75,300     Alaska, Caribbean, Bahamas,
 
                              Canada and New England
Norwegian Crown (1)

  1988     1,080       550       34,200     Panama Canal, South America and
Bermuda
 
(1)   Chartered from Star Cruises Limited with the anticipation that such ships will be returned to Star Cruises Limited as new modern ships enter our fleet over time.
NCL America’s ships
As of December 31, 2006, NCL America currently operates three ships, with a total of over 6,600 berths. The table below provides a brief description of the NCL America ships:
                                         
                                    Primary
                    Crew   Gross   Areas of
Ship   Year Built   Berths   Capacity   Tons   Operation
Pride of Hawai’i
    2006       2,460       950       93,600     Hawaii
Pride of America
    2005       2,140       950       80,400     Hawaii
Pride of Aloha
    1999       2,000       900       77,100     Hawaii
Orient Lines’ ship
Orient Lines currently operates Marco Polo, with 840 berths. The table below provides a brief description of Marco Polo:

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    Year Built/       Crew       Primary Areas
Ship   Rebuilt   Berths   Capacity   Gross Tons   of Operation
Marco Polo (1)
  1965/1993   840   400   22,100   Mediterranean,
 
                  Scandinavia,
 
                  Antarctica, South
 
                  America and North
 
                  Africa
 
(1)   Chartered from Star Cruises Limited.
Marco Polo is ice-strengthened for cruising in Antarctica. Marco Polo offers destination-oriented cruises in Europe (in the Northern summer), South America, North Africa and Antarctica (in the Southern summer).
Current new ships on order
We currently have three ships on order for our fleet. The planned berth capacity and expected delivery dates of these three ships on order are as follows:
                     
Ship   Expected Delivery Date   Berths   Gross Tons
Norwegian Gem
  Fourth Quarter 2007     2,400       93,500  
New Class
                   
F3 One
  Fourth Quarter 2009     4,200       150,000  
F3 Two
  Second Quarter 2010     4,200       150,000  
We have an option for a third F3 ship with a scheduled delivery in the first quarter of 2011 with an additional 4,200 berths.
Other ships
In 2003, we purchased two U.S.-flagged ships, the United States and the Independence, with a view to potentially expanding our U.S.-flagged operations beyond Hawaii and beyond the three U.S.-flagged ships for which we have received exemptions under federal law. Under current U.S. law, existing U.S.-flagged ships may be upgraded in a foreign shipyard so long as any hull and superstructure work is completed in a domestic U.S. yard. If we decide to upgrade these two ships into modern cruise ships, such work is expected to be performed in a combination of U.S. and European shipyards in a way that is most economically and technically efficient. If they are modernized, the United States and the Independence would be important initiatives in our strategy to build up our NCL America brand. As U.S.-flagged ships, the United States and the Independence would not be restricted in their deployment, but would be subject to a 75% U.S. citizen ownership and control requirement. In addition to a full range of international itineraries, the ships could be used to offer coastwise short cruises from, for example, New York, Boston, San Francisco and various Gulf of Mexico and Atlantic ports and mainland U.S. itineraries where cruise products are not currently available to customers from our non-U.S.-flagged ships or our competitors. Whether to upgrade these ships and the timing of any such upgrades is currently under consideration.
Ship deployment
We offer cruise itineraries ranging from one day to approximately one month and call at approximately 190 destinations worldwide, including destinations in the Caribbean, Bermuda, the Bahamas, Mexico, Alaska, Europe, Hawaii, New England, Central and South America, Scandinavia, North Africa and Antarctica. We have developed, and are continuing to develop, innovative itineraries to position our ships

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in new and niche markets as well as in the mainstream markets throughout the Americas and Europe. We believe this strategy allows us to maintain our status as one of the three major North American cruise operators while diversifying our deployment rather than relying as heavily on the traditional mass market trades in the Caribbean and the Bahamas out of South Florida.
Ports and facilities
We have permits with the Government of Bermuda whereby Norwegian Majesty, Norwegian Crown, Norwegian Spirit and Norwegian Dawn are permitted to call each season in Bermuda from Boston, Charleston, Philadelphia and New York. In addition, we own an uninhabited private island in the Bahamas, Great Stirrup Cay, which we utilize as a port-of-call on some of our itineraries.
We have an agreement for the exclusive right to call at Fanning Island, an island approximately 900 nautical miles south of Hawaii, until April 1, 2009, with an option to extend the agreement for an additional two years. For a number of years, we have operated a round-trip Honolulu-Fanning Island cruise itinerary in Hawaii.
In June 2004, we entered into a contract with the City of New York pursuant to which we receive preferential berths on specific piers at the city’s passenger ship terminal. Furthermore, in September 2006, we entered into a contract with the city of Los Angeles pursuant to which we receive preferential use of a berth at the city’s cruise ship terminal.
We have a concession permit with the U.S. National Park Service (“Park Service”) whereby our ships are permitted to call on Glacier Bay 13 times during each season. These permits have been extended by the Park Service until December 31, 2007. Our expectation is that the current permit will be extended through at least December 31, 2009. The Park Service has not yet established the process by which the permits would be issued for visits to Glacier Bay after December 31, 2009.
To enable Orient Lines to call at a variety of ports, we perform turn-around operations in a number of different ports and have a policy of not designating a homeport for Marco Polo. Marco Polo visited approximately 120 different ports of call in 2006.
Except as discussed above, we do not lease any port facilities and have no other fixed arrangements to call at other ports. At present, we do not intend to acquire any port facilities. We believe that our facilities are adequate for our current needs, and that we are capable of obtaining additional facilities as necessary.
Company revenue management
Cruise pricing and revenue management
Our cruise prices generally include cruise fare and a wide variety of onboard activities and amenities, including meals and entertainment. In some instances, cruise prices include round-trip airfare to and from the port of embarkation. Prices vary depending on the particular cruise itinerary, cabin category selected and the time of year that the voyage takes place. Additional charges are levied for dining in specialty restaurants, certain beverages, gift shop purchases, spa services, shore excursions and other similar purchases.
We base our pricing and revenue management on a strategy that encourages travelers to book early and secure attractive savings. This is accomplished through a revenue management system designed to maximize net revenue per Capacity Day by matching projected availability to anticipated future passenger

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demand. We perform extensive analyses of our databases in order to determine booking history and trends by market segment and distribution channel. In addition, we establish a set of cabin categories throughout each cruise ship and price our cruise fares on the basis of these cabin categories—the better the cabin category, the higher the cruise fare. Typically, the published fares are established months in advance of the departure of a cruise at a level which, under normal circumstances, would provide a high level of occupancy. If the rate at which cabin inventory is sold differs from expectations, we gradually and systematically adjust the number of cabins assigned for different fares for sale as the departure date approaches. Our yield management system is designed to encourage earlier booking of higher category cabins and a more orderly booking of lower category cabins, thereby reducing the need for last minute price cuts to fill ships.
We are further developing a sophisticated revenue management system, typical of other systems used by competitors within the North American cruise market. This system tracks and forecasts demand at multiple price points per cabin category which would allow us to identify changes in demand more quickly and shorten the time to implement pricing decisions.
Onboard and other revenues
Cruise prices typically include cruise accommodation, meals in certain dining facilities and many onboard activities. We earn additional revenues principally from shore excursions, food and beverage sales, gaming, retail sales, and spa services. Onboard and other revenue is an important component of our revenue base. To maximize onboard revenues, we utilize point-of-sale computer hardware and operating systems on our ships to permit “cashless” transactions for many of the products and services that our ships offer. Although we run the casinos onboard all our ships (other than the ships operating in Hawaii, where gambling is prohibited) and onshore excursion sales onboard all our ships, we generally enter into concession contracts for retail shops, spa services, photography and art auctions. These contracts generally entitle us to a fixed percentage of the gross or net sales derived from these concessions. We refer you to “Item 5—Operating and Financial Review and Prospects.”
Seasonality
The seasonality of the North American cruise industry generally results in the greatest demand for cruises during the months of June through August. This predictable seasonality in demand has resulted in fluctuations in our revenues and results of operations. The seasonality of our results is increased due to ships being taken out of service for dry-docking, which we typically schedule during non-peak demand periods for such ships.
Sales and marketing
Travel agent relationships
In 2006, a vast majority of our passengers booked their cruises through independent travel agents who sell our itineraries on a non-exclusive basis. Since almost all of our sales are made through independent travel agents, a major focus of our marketing strategy is motivating and supporting the retail travel agent community. Our marketing is supported by an extensive network of approximately 20,000 independent travel agencies including brick and mortar, internet-based and home-based operators located in North America, South America, Europe, Asia and Australia.
Our call centers are located in Miami, Phoenix, the United Kingdom and Germany with over 650 personnel oriented towards servicing travel agents and direct customer calls. Additionally, we have an outsourced relationship with a firm that manages two additional locations for us in Louisiana and Panama.

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The Phoenix call center supports reservation agents and passenger service functions with the goal of ensuring high quality of service to our travel partners and business continuity in the event of disaster in South Florida (such as a hurricane). In 2006, we continued to expand our “business enhancement unit” in Phoenix. This is a group of personnel who contact travel agents with customers booked or customers who have booked directly to offer them attractively priced upgrades where we have higher category space available that has not yet been sold.
Marketing, brand communications and advertising
Our marketing department has been staffed and organized into core areas to support our new brand launch and increase in consumer marketing, while continuing trade and travel partner marketing. The core areas are: marketing communications, direct marketing and loyalty and website/interactive.
In late 2006, we launched our first major advertising effort, our most significant campaign in more than ten years, including national consumer communications through television, magazine, online and direct mail. Media activity also included commuter rail posters, Times Square, New York city advertising, along with a redesigned website developed with new features and functionality, emphasizing the new brand identity. All media activity was also supported by newly developed fulfillment materials, sales collateral, national sales promotions and product brochures, all in the new brand look and tone of voice.
Sustainable customer loyalty of our past passengers is an important element of our marketing strategy. We believe that attending to our past passengers’ needs and motivations creates a cost-effective means of attracting business, particularly to our new itineraries, because past passengers are familiar with our brands, products and services. Norwegian Cruise Line and Orient Lines each have their own past passenger loyalty programs. Norwegian Cruise Line’s program, which includes NCL America, is known as the Latitudes Club and Orient Lines’ program is known as the Polo Club. Members of these programs receive periodic mailings with informative destination information and cruise promotions that include special pricing, shipboard credits, cabin upgrades and onboard recognition. Avid cruisers can use our co-brand credit card to earn upgrades and discounts. Also, we have established a variety of interactive dialogue opportunities through periodic market research, polling emails and annual contests.
In the past year, we have made significant progress in expanding our marketing reach with our online products and services. Our website, www.ncl.com, serving both our passengers and travel agency partners, has been a major focus of this momentum. In October 2006, we launched our redesigned website that aligns with our new brand look and further promotes our “Freestyle Cruising” program. With an average of approximately 40,000 visitors a day, ncl.com offers our passengers and travel partners comprehensive information on our destinations, onboard products and services, shore excursions, and our ships, including deck and cabin details. We also are in the process of launching a new booking engine that will allow passengers and travel agency partners to shop and purchase any of our worldwide cruise itineraries with a more intuitive and informative online experience.
Company operations and cruise infrastructure
Ship maintenance
In addition to routine maintenance and repairs performed on an ongoing basis and in accordance with applicable requirements, each of our ships is generally taken out of service, approximately every 24 to 60 months, for a period of one or more weeks for maintenance work, repairs and improvements performed in dry-dock. To the extent practical, each ship’s crew, catering and hotel staff remain with the ship during the dry-docking period and assist in performing maintenance and repair work. We lose revenue earning opportunities while ships are dry-docked. Accordingly, dry-docking work is typically performed during

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non-peak demand periods to minimize the adverse effect on revenues that results from ships being out of service. Dry-dockings are typically scheduled in spring or autumn, depending on shipyard availability and the itinerary of the ship.
Information technology
Information technology is essential at all levels of our operations, from our corporate headquarters to our ships. Computer systems and solutions are widely used to support the expanding global information technology requirements for various functions and locations.
We have implemented an integrated computerized reservation system, called “Freestyle Connect,” which is designed to maximize inventory use together with a variety of controls and functions. “Freestyle Connect” supports revenue maximization with sophisticated features providing selling limits and probability of sales information. It includes tools designed to optimize cabin inventory and provide flexible customization capabilities to manage our cruise revenue goals. “Freestyle Connect” interfaces with our air management system, “AirWare,” which manages our air transportation logistics. We use an integrated airline computerized reservation system, or CRS, that is designed to directly access the reservation systems of most major airlines from a single terminal. The system has eliminated the need for multi-CRS systems and provides more efficient reporting of, and control over, airline ticket purchasing when booking a cruise.
Onboard the ships, the Fidelio Cruise Shipboard Property Management System is an integrated cruise management system which facilitates front-office and back-office operations in servicing passengers and crew members. It also provides a “one-card-fits-all” concept, offering passengers the convenience of using their Onboard Access Card for ID gangway transit, cabin entry and purchases and charges onboard.
The Manpower Analysis Planning System, or MAPS, provided by Manpower Software, Ltd., is a crew information and scheduling system. The system enables us to track relevant information for all active crew, retain historic personnel information and provide assistance in the complex task of scheduling crew onboard our ships. In addition, MAPS enables us to automate several processes that were performed manually, including travel requests, tracking required training and creating crew manifest lists.
Suppliers
Our largest purchases are for ship construction and acquisition. Our largest operating purchases are for travel agent services, passenger airfare, fuel and oil, passenger food and beverages, advertising and marketing, and hotel supplies for our ships. Most of the supplies that we require are available from numerous sources at competitive prices. In addition, owing to the large quantities that we purchase, we can obtain favorable prices for many of our supplies. Our purchases are denominated primarily in U.S. dollars and Euro. Payment terms granted by the suppliers are generally customary terms for the cruise industry.
Crew and passenger safety
We place the utmost importance on the safety of our passengers and crew. We conduct an ongoing safety campaign, with the objective of training ship personnel to enhance their awareness of safety practices and policies onboard.
Our fleet is equipped with modern navigational control and fire prevention and control systems. Our ships have continuously been upgraded since the acquisition of NCL Holding ASA (“NCLH”) by Star Cruises Limited in 2000. We have installed high-fog sprinklers in the engine rooms of the cruise ships in

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our fleet, as required by International Maritime Organization, commonly referred to as the IMO, regulation. The navigation centers on our ships are also equipped with voyage data recorders, or VDRs, which are similar in concept to the black boxes used in commercial aircraft. The VDRs permit us to analyze safety incidents.
We have developed the Safety and Environmental Management System or SEMS. This advanced, intranet-based system establishes the policies, procedures, training, qualification, quality, compliance, audit, and self-improvement standards for all employees, both shipboard and shoreside. It also provides real-time reports and information to support decisions, fleet support, and risk management throughout the company. Through this system, our senior managers, as well as ship management, can focus on consistent, high quality operation of the fleet. The SEMS is approved and routinely audited by Det Norske Veritas, an outside consultant.
We screen and train our crew to ensure crew familiarity and proficiency with the safety equipment onboard. Various safety measures have been implemented on all of our ships and additional personnel have been appointed in our ship operations departments. Such safety initiatives include:
    strict alcohol and drug policy, including frequent random tests and a zero tolerance policy for alcohol use by senior officers and watch keepers at all times;
 
    a policy of requiring the presence of at least two officers in the navigation center of every cruise ship while at sea (except under certain low-risk situations);
 
    a comprehensive fleet safety program with six traveling safety officers;
 
    “Navigation Conditions” system involving the presence of additional officers on the bridge when a cruise ship is operating in identified “yellow zones” or “red zones”—specific locations and situations identified as being potentially hazardous or deviating from the normal course of the cruise ship;
 
    procedure checklists;
 
    performance of an internal and external audit at least annually to ensure safety implementation, corrective action following incidents and continuous regular improvements;
 
    standardization and upgrade of equipment on our ships;
 
    installation of automatic identification system, or AIS, in the navigation centers of all of our ships;
 
    psychological profiling of officers;
 
    bridge and crew resource management courses for all bridge officers;
 
    centralized and automated engine control (except on Marco Polo);
 
    additional onboard training in the use of the navigation and safety equipment; and
 
    stringent implementation of additional controls and procedures, which have been published as safety recommendations, following investigation analyses of incidents or accidents in other parts of the cruise industry.

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Insurance
We maintain marine insurance on the hull and machinery of our ships, which are maintained in amounts related to the estimated market value of each ship. The coverage for each of the hull and machinery policies is maintained with syndicates of insurance underwriters from the European and U.S. insurance markets.
In addition to the marine insurance coverage in respect of the hull and machinery of our ships discussed above, we seek to maintain comprehensive insurance coverage at commercially reasonable rates and believe that our current coverage is adequate to protect against most of the accident-related risks involved in the conduct of our business. We carry:
    protection and indemnity insurance (that is, coverage for third party liabilities) on each ship;
 
    war risk insurance, including terrorist risk insurance, on each ship in an amount equal to the total insured hull value, subject to certain coverage limits, deductibles and exclusions. The terms of our marine war risk policies include provisions where underwriters can give seven days notice to the insured that the policies will be cancelled, which is typical for policies in the marine industry;
 
    insurance for cash onboard; and
 
    insurance for our shoreside property and general liability risks.
We believe that all of our insurance coverage, including those noted above, is subject to market-standard limitations, exclusions and deductible levels. We will endeavor to obtain insurance coverage in amounts and at premiums that are commercially acceptable to us.
The Athens Convention relating to the Carriage of Passengers and their Luggage by Sea (1974) and the 1976 Protocol to the Athens Convention are generally applicable to passenger ships. The U.S. has not ratified the Athens Convention. However, with limited exceptions, the 1976 Protocol to the Athens Convention may be contractually enforced with respect to cruises that do not call at a U.S. port. The International Maritime Organization Diplomatic Conference agreed to a new protocol to the Athens Convention on November 1, 2002 (the “2002 Protocol”). The 2002 Protocol, which has not yet been ratified, establishes for the first time a level of compulsory insurance which must be maintained by passenger ship operators with a right of direct action against the insurer. The timing of the ratification of the 2002 Protocol, if achieved at all, is unknown. No assurance can be given that affordable and secure insurance markets will be available to provide the level and type of coverage required under the 2002 Protocol. If the 2002 Protocol is ratified, we expect insurance costs would increase.
Trademarks
We own a number of registered trademarks relating to, among other things, the names “NORWEGIAN CRUISE LINE,” “NCL AMERICA,” “NCL” and the NCL logo, the names of our cruise ships (except where trademark applications for these have been filed and are pending), incentive programs and specialty services rendered onboard our ships. In addition, we own registered trademarks relating to the “FREESTYLE” family of names, including, among others, “FREESTYLE CRUISING,” “FREESTYLE DINING” and “FREESTYLE VACATION”. We believe our NORWEGIAN CRUISE LINE, NCL AMERICA, NCL, FREESTYLE CRUISING, FREESTYLE DINING and FREESTYLE VACATION trademarks and the NCL and NCL AMERICA logos are widely recognized throughout North America and Europe and have considerable value. During the fourth quarter of 2006, we transferred the ORIENT

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LINES tradename and various tradenames and trademarks related to that business to a subsidiary of Star Cruises Limited (we refer you to Item 3. Key Information-Selected Financial Data, footnote 2).
Regulatory issues
Registration of our ships
Eleven of the ships that we currently operate are registered in the Bahamas. Three of our ships, Pride of Hawai’i, Pride of Aloha, and Pride of America, are U.S.-flagged ships. Our ships registered in the Bahamas are inspected at least annually pursuant to Bahamian requirements. Our U.S.-registered ships are subject to laws and regulations of the U.S. federal government and to various U.S. federal regulatory agencies, including but not limited to the U.S. Public Health Service, the FMC and the U.S. Coast Guard. Both our U.S.-flagged and Bahamas-flagged fleets are also subject to the health and safety laws and regulations of the various port states where the ships dock. The U.S. and the Bahamas are members of the IMO and have adopted and put into effect the IMO conventions relating to ocean-going passenger ships.
U.S. law generally requires ships transporting passengers exclusively between and among ports in the U.S. to be built entirely in the U.S, documented under U.S. law, crewed by Americans and owned by entities that are at least 75% owned and controlled by U.S. citizens. We have been granted specific authority to operate in and among the islands of Hawaii under legislation, known as the “Hawaii Cruise Ship Provision,” which was part of the “Consolidated Appropriations Resolution, 2003” enacted in 2003 (Public Law 108-7, Division B, Title II, General Provisions—Department of Commerce, Section 211 (February 20, 2003) (117 Stat. 11,79)). The Hawaii Cruise Ship Provision permitted two partially completed cruise ships (originally contracted for construction in a U.S. shipyard by an unrelated party), Pride of Hawai’i and Pride of America, to be completed in a shipyard outside of the U.S. and documented under the U.S. flag even if the owner does not meet the 75% U.S. ownership requirement, provided that the direct owning entity is organized under the laws of the U.S. and meets certain U.S. citizen officer and director requirements. The Hawaii Cruise Ship Provision also authorizes the re-documentation under the U.S. flag of one additional foreign-built cruise ship for operation between U.S. ports in the islands of Hawaii, Pride of Aloha. The Hawaii Cruise Ship Provision imposes certain requirements, including that any non-warranty work performed on any of the three ships be performed in the U.S., except in case of emergency or lack of availability, and that the ships operate primarily between and among the islands of Hawaii. As a result of this exemption, our U.S.-flagged ships deployed in Hawaii are able to cruise between U.S. ports in Hawaii without the need to call at a foreign port. We refer you to “Item 4—Information on the Company—Our business strategies—Hawaii,” for a discussion of our development of U.S.-flagged ships for cruising in Hawaii.
Health and environment
We believe that our ships currently comply with all requirements of the IMO and the U.S. and Bahamian flags, including but not limited to SOLAS, MARPOL, and STCW. The SOLAS requirements are amended and extended by the IMO from time to time. For example, The International Port and Ship Facility Code, or the ISPS Code, was adopted by the IMO in December 2002. For more information, we refer you to “Item 4— Information on the Company—Regulatory issues—Security and safety”.
Our various ports of call subject our ships to international and U.S. laws and regulations relating to environmental protection, including but not limited to MARPOL. Under such laws and regulations, we are prohibited from, among other things, discharging certain materials, such as petrochemicals and plastics, into the waterways.

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In the U.S., we must meet the U.S. Public Health Service’s requirements, including ratings by inspectors from the Centers for Disease Control and Prevention, or the CDC, and the Food and Drug Administration, or the FDA. We believe we rate at the top of the range of CDC and FDA scores achieved by the major cruise lines. In addition, the cruise industry and the U.S. Public Health Service have agreed on regulations for food, water and hygiene to assist cruise lines in achieving the highest health and sanitation standards on cruise ships.
Pursuant to FMC and U.S. Coast Guard regulations, we have covered our financial responsibility with respect to death or injury to passengers and water pollution by providing required guarantees from our insurers with respect to such potential liabilities. In addition, we are required to obtain certificates from the U.S. Coast Guard relating to our ability to satisfy liabilities in cases of water pollution.
We currently operate under a U.S. Government-approved Environmental Management Plan that is incorporated into the SEMS program. Among the achievements under this system are:
    deployment of environmental officers and environmental engineers on all ships;
 
    a dedicated, full time environmental staff at shoreside;
 
    a comprehensive environmental training and awareness program;
 
    an environmental hotline;
 
    advanced wastewater treatment systems installed or in the process of being installed on 100% of the fleet;
 
    our own patent-pending ballast water management system to prevent discharge of damaging non-indigenous marine species in ballast water;
 
    advanced treatment systems for oily bilge water installed on all ships; and
 
    an innovative bio-sludge disposal and used lube recycling programs.
Permits for Glacier Bay, Alaska and the Antarctic
In connection with certain of our Alaska cruise operations, we rely on concession permits from the U.S. National Park Service to operate our cruise ships in Glacier Bay National Park and Preserve. We also hold an approved initial Environmental Evaluation permit from the U.S. Environmental Protection Agency allowing Marco Polo to operate in the Antarctic. Such permits must be periodically renewed and there can be no assurance that they will continue to be renewed or that regulations relating to the renewal of such permits will remain unchanged in the future.
Security and safety
With effect from July 1, 1998, pursuant to provisions adopted by the IMO, all cruise ships were required to be certified as having safety procedures that comply with the requirements of the International Safety Management Code for the Safe Operation of Ships and for Pollution Prevention, or the ISM Code. We have obtained certificates certifying that our ships are in compliance with the ISM Code. Each such certificate is granted for a five-year period and is subject to periodic verification.

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The ISPS Code provides for measures strengthening maritime security and places new requirements on governments, port authorities and shipping companies in relation to security issues onboard ships and in ports. We have been in compliance with all requirements of the ISPS Code imposed upon us as of the implementation date of July 1, 2004.
In addition to the requirements of the ISPS Code, the U.S. Congress enacted The Maritime Transportation Security Act of 2002, commonly known as the MTSA, which implements a number of security measures at ports in the U.S. including measures that apply to ships registered outside the United States docking at ports in the U.S. The U.S. Coast Guard has recently published its own set of MTSA regulations that require a security plan for every ship entering the territorial waters of the U.S., provide for identification requirements for ships entering such waters and establish various procedures for the identification of crew members onboard such ships. Our fleet is in compliance with the requirements imposed upon it by the MTSA and the U.S. Coast Guard regulations.
Recent amendments to SOLAS required that ships constructed in accordance with pre-SOLAS, 1974 requirements install automatic sprinkler systems by year-end 2005. Failure to comply with the SOLAS requirements with respect to any ship will, among other things, restrict the operations of such ship in the U.S. and many other jurisdictions. At December 31, 2006, we were in compliance with these requirements.
Financial requirements
The FMC requires evidence of financial responsibility for those offering transportation onboard passenger ships operating out of U.S. ports to indemnify passengers in the event of non-performance of the transportation. Proposed regulations would revise the financial requirements with respect to both death/injury and non-performance coverages. We are also required to establish financial responsibility by other jurisdictions to meet liability in the event of non-performance of our obligations to passengers from those jurisdictions.
From time to time, various other regulatory and legislative changes have been or may in the future be proposed that may have an effect on our operations in the U.S. and the cruise industry in general.
Taxation
U.S. federal income taxation — foreign-flagged operations
The following discussion of the application to us of U.S. federal income tax laws is based upon current provisions of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), legislative history, U.S. Treasury regulations, administrative rulings and court decisions. The following description is subject to change and any change could affect the continuing accuracy of this discussion. In particular, the Tax Reform Act of 1986 (the “1986 Act”) significantly changed the U.S. federal income tax treatment of shipping income. In August 2003, the U.S. Internal Revenue Service, or the IRS, issued final regulations (the “Final Regulations”) interpreting section 883 of the Code, as amended by the 1986 Act. The Final Regulations were originally effective for taxable years beginning on or after September 25, 2003. However, pursuant to The American Jobs Creation Act of 2004, the effective date of the Final Regulations was delayed to taxable years of a foreign corporation beginning after September 24, 2004. Therefore, the Final Regulations apply to our year ended December 31, 2005 and subsequent years.
Our foreign-flagged operations derive income from the international operation of ships. Under section 883 of the Code, certain foreign corporations, though engaged in the conduct of a trade or business within the U.S., are exempt from U.S. federal income taxes on (or in respect of) gross income derived from the

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international operation of ships. A foreign corporation will qualify for the section 883 exemption if: (i) the foreign country in which the foreign corporation is organized grants an equivalent exemption for income from the international operation of ships (“Shipping Income”) of sufficiently broad scope to U.S. corporations (“Equivalent Exemption”) and (ii) more than 50% in value of its stock is directly or indirectly owned by individuals who are residents of one or more foreign countries that grant an Equivalent Exemption (“Stock Ownership Test”). In addition, the Final Regulations require a foreign corporation and certain of its direct and indirect shareholders to satisfy detailed substantiation requirements (“Substantiation Requirements”) in order to establish that it meets the Stock Ownership Test.
In applying the Stock Ownership Test, under section 883(c) of the Code, stock of a foreign corporation owned directly or indirectly by a corporation (i) organized in a foreign country which grants an Equivalent Exemption and (ii) whose stock is “primarily and regularly traded on an established securities market” in an Equivalent Exemption jurisdiction or in the U.S., is treated as owned by individuals resident in such foreign country of organization.
We believe that our Shipping Income is exempt from U.S. federal income taxes because (i) Bermuda, NCL’s country of organization (NCL’s non-U.S. subsidiaries are disregarded for federal tax purposes), grants an Equivalent Exemption, and (ii) based upon certain assumptions as to shareholdings and other information, NCL meets the Stock Ownership Test because more than 50% in value of its stock is owned, or is treated as owned, by individuals residing in Equivalent Exemption jurisdictions—i.e., Bermuda and Malaysia.
The Final Regulations list several items of income which are not considered to be incidental to the international operation of ships and, to the extent derived from U.S.-sources, are subject to U.S. federal income taxes. Income items considered non-incidental to the international operation of ships include income from the sale of single-day shore excursions, air and other transportation, and pre- and post-cruise land packages.
We believe that substantially all of our income from the international operation of ships is properly categorized as Shipping Income. The U.S.-source portion of our income from the international operation of ships that is not Shipping Income will be subject to U.S. taxation. We believe that, if our Shipping Income were not exempt from federal income taxation under section 883 of the Code, that income, as well as any other income from cruise operations of NCL that is not Shipping Income, to the extent derived from U.S.-sources, generally would be taxed on a net basis at graduated U.S. federal corporate income tax rates (currently, a maximum of 35%). We also would be subject to a 30% federal branch profits tax under section 884 of the Code, generally on the after tax portion of such income that was from U.S.-sources each year to the extent that such income was not properly viewed as reinvested and maintained in our U.S. business. Interest paid or accrued by us also could be subject to a 30% withholding tax and/or branch interest taxes under section 884 of the Code (and to some extent could be treated as U.S.-source interest). We believe that NCL would not be subject to the 4% gross basis tax under section 887 of the Code on certain U.S.-source transportation income.
Income of NCL derived from U.S.-sources includes 100% of its income, if any, from transportation that begins and ends in the U.S., and 50% of its income from transportation that either begins or ends in the U.S. Income from transportation that neither begins nor ends in the U.S. would not be taxable. There are indications in the legislative history of the transportation income source rules that suggest that a cruise that begins and ends in a U.S. port, but that calls on one or more foreign ports, will derive U.S.-source income only from the first and last legs of such cruise. However, since there are no regulations or other IRS guidance with respect to these rules, the applicability of the transportation income source rules in the aforesaid manner is not free from doubt. If this application of the rules is correct and if section 883 of the

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Code did not apply to NCL at all, NCL would be subject to U.S. taxation on a smaller portion of its income than described above.
U.S. federal income taxation — U.S.-flagged operations
Income derived from our U.S.-flagged operations (under the NCL America brand) generally is subject to U.S. federal income taxation at graduated rates of up to 35%, after an allowance for deductions. U.S.-source dividends paid by NCL America generally would be subject to a 30% withholding tax.
Organizational structure
Our corporate structure is as follows1:
(Chart)
 
1   All subsidiaries are 100% owned by their immediate parent companies.
 
2   NCL Corporation Ltd. is a wholly-owned subsidiary of Star Cruises Limited.
 
3   Ship-holding companies for Bahamas flagged-ships.
 
4   Operates Bahamas flag fleet, including ships under charter agreements with Star Cruises Limited (Norwegian Crown, Norwegian Dream, Norwegian Majesty, Marco Polo and Norwegian Wind) and performs under contract with NCL America Inc. certain marketing, ticket issuance and other services.
 
5   Ship-holding companies for U.S.-flagged ships.
 
6   Operates U.S.-flagged fleet.
Property, plant and equipment
Information about our cruise ships, including their size and primary areas of operation, as well as information regarding our cruise ships under construction, estimated expenditures and financing may be found under “Item 4—Information on the Company—The fleet” and “Item 5—Operating and Financial Review and Prospects—Liquidity and capital resources”.
Our principal executive offices are located at 7665 Corporate Center Drive, Miami, Florida, where we lease the approximately 209,000 square feet facility. We also lease approximately (i) 11,500 square feet of office space in Honolulu, Hawaii for administrative operations of NCL America; (ii) 14,000 square feet of office space in London, England for sales and marketing in the United Kingdom and Ireland; (iii) 6,000

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square feet of office space in Germany for sales and marketing in Europe; and (iv) 42,000 square feet of office space in Phoenix, Arizona for a call center. In addition, we own an uninhabited private island in the Bahamas, Great Stirrup Cay, that we utilize as a port-of-call on some of our itineraries. We believe that our facilities are adequate for our current needs, and that we are capable of obtaining additional facilities as necessary.
Industry
Industry background
We provide cruise vacations primarily in North America, which represents the largest vacation market in the world. According to CLIA, 10.2 million North American passengers took a cruise in 2006.
Estimates of North American-sourced cruise passengers and the number of berths marketed in North America compiled by CLIA from 2002 to 2006 are as follows:
                 
    Cruise Passengers   Berths
    Sourced in   Marketed in
Calendar Year   North America (1)   North America (2)
2002
    7,640,000       197,553  
2003
    8,195,000       215,397  
2004
    9,107,000       220,187  
2005
    9,670,000       227,717  
2006
    10,180,000       246,759  
 
(1)   Based on passengers carried for at least two consecutive nights for the calendar year.
 
(2)   As of the end of the calendar year. These figures include ships that are marketed in North America and elsewhere.
The principal itineraries visited by North American cruise passengers in recent years were the Caribbean, Europe, the Mediterranean and Alaska. In addition, North American cruise passengers visited Mexico, Hawaii, Bermuda, the Panama Canal and other exotic locations, including South America, North Africa, the South Pacific, the Far East and India.
Based on the number of ships that are currently on order worldwide, the net capacity serving North American consumers is expected to increase over the next several years. Projections compiled by CLIA indicated that at the end of 2006 and 2007, CLIA member lines have and will have an aggregate passenger capacity of 246,759 and 320,321 berths, respectively. These figures include ships that are expected to be marketed in North America and elsewhere. CLIA’s estimates of capacity do not include assumptions related to unannounced ship withdrawals due to factors such as the age of ships or changes in the location from where ships’ passengers are predominantly sourced and, accordingly, may indicate a higher percentage growth in North American capacity than will actually occur. Nonetheless, the net capacity serving North American-sourced cruise passengers is expected to increase over the next several years.
Item 4A. Unresolved Staff Comments
None.

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Item 5. Operating and Financial Review and Prospects
Management’s Discussion and Analysis of Financial Condition and Results of Operations
Certain statements under this caption “Item 5—Operating and Financial Review and Prospects—Management’s discussion and analysis of financial condition and results of operations,” and elsewhere in this annual report, constitute “forward-looking” statements within the meaning of Section 21E of the Exchange Act and the PSLRA. Many, but not all of these statements can be found by looking for terms like “expect,” “anticipate,” “goal,” “project,” “plan,” “believe,” “seek,” “will,” “may,” “forecast,” “estimate,” “intend” and “future” and for similar words. “Forward-looking” statements do not guarantee future performance and may involve risks, uncertainties and other factors which could cause our actual results, performance or achievements to differ materially from the future results, performance or achievements expressed or implied in those “forward-looking” statements. Examples of these risks, uncertainties and other factors include, but are not limited to:
    changes in cruise capacity, as well as capacity changes in the overall vacation industry;
 
    introduction of competing itineraries and other products by other companies;
 
    changes in general economic, business, and geo-political conditions;
 
    reduced consumer demand for cruises as a result of any number of reasons, including armed conflict, terrorists attacks, geo-political and economic uncertainties or the unavailability of air service, and the resulting concerns over the safety and security aspects of traveling;
 
    lack of acceptance of new itineraries, products or services by our targeted customers;
 
    our ability to implement brand strategies and our shipbuilding programs, and to continue to expand our business worldwide;
 
    costs of new initiatives, including those involving our inter-island Hawaii cruise operations;
 
    changes in interest rates, fuel costs or foreign currency rates;
 
    delivery schedules of new ships;
 
    risks associated with operating internationally;
 
    impact of the spread of contagious diseases;
 
    accidents and other incidents affecting the health, safety, security and vacation satisfaction of passengers and causing damage to ships, which could cause the modification of itineraries or cancellation of a cruise or series of cruises;
 
    our ability to attract and retain qualified shipboard crew and maintain good relations with employee unions;
 
    changes in other operating costs, such as crew, insurance and security costs;
 
    continued availability of attractive port destinations;

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    the impact of pending or threatened litigation;
 
    the ability to obtain financing on terms that are favorable or consistent with our expectations;
 
    changes involving the tax, environmental, health, safety, security and other regulatory regimes in which we operate;
 
    emergency ship repairs;
 
    the implementation of regulations in the U.S. requiring U.S. citizens to obtain passports for travel to additional foreign destinations; and
 
    weather and natural disasters.
The above examples are not exhaustive and new risks emerge from time to time. We undertake no obligation to publicly update or revise any “forward-looking” statements, whether as a result of new information, future events or otherwise.
Such “forward-looking” statements are based on current beliefs, assumptions, expectations, estimates and projections of our management regarding our present and future business strategies and the environment in which we will operate in the future. These “forward-looking” statements speak only as of the date of this annual report. We expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any “forward-looking” statement contained herein to reflect any change in our expectations with regard thereto or any change of events, conditions or circumstances on which any such statement was based.
All prior periods’ financial information presented herein has been adjusted to reflect the retrospective application of the change in our method of accounting for dry-docking costs, as more fully discussed in our consolidated financial statements. We refer you to Note 2. Summary of Significant Accounting Policies and Note 3. Change in Accounting for Dry-docking Costs.
Terminology and Non-GAAP Financial Measures
Capacity Days represent double occupancy per cabin multiplied by the number of cruise days for the period.
Gross Cruise Costs represent the sum of total cruise operating expenses and marketing, general and administrative expenses.
Gross Yields represent total revenues per Capacity Day.
Net Yields represent total revenues less commissions, transportation and other expenses, and onboard and other expenses per Capacity Day. We utilize Net Yields to manage our business on a day-to-day basis and believe that it is the most relevant measure of our pricing performance and is commonly used in the cruise industry to measure pricing performance. We have not provided a quantitative reconciliation of projected Gross Yields to projected Net Yields due to the significant uncertainty in projecting the costs deducted to arrive at this measure. Accordingly, we do not believe that reconciling information for such projected figures would be meaningful.
Net Cruise Costs represent Gross Cruise Costs excluding commission, transportation and other expenses and onboard and other expenses. In measuring our ability to control costs in a manner that positively

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impacts net income (loss), we believe changes in Net Cruise Costs to be the most relevant indicator of our performance and are commonly used in the cruise industry as a measurement of costs.
Passenger Cruise Days represent the number of passengers carried for the period, multiplied by the number of days in their respective cruises.
Occupancy Percentage, in accordance with cruise industry practice, represents the ratio of Passenger Cruise Days to Capacity Days. A percentage in excess of 100% indicates that three or more passengers occupied some cabins.
Please see a reconciliation of these measures to items in our consolidated financial statements on page 38.
Overview
Revenues from our cruise and cruise-related activities are categorized by us as “passenger ticket revenues” and “onboard and other revenues”. Passenger ticket revenues and onboard revenues vary according to the size of the ship in operation, the length of cruises operated and the markets in which the ship operates. Our revenues are seasonal based on demand for cruises. Historically, demand for cruises has been strongest during the summer months.
Passenger ticket revenues primarily consist of payments for accommodations, meals in certain restaurants on the ship, certain onboard entertainment, and include payments for service charges and air and land transportation to and from the ship, to the extent passengers purchase those items from us. Passenger ticket revenues are generally collected from passengers prior to their departure on the cruise.
Onboard and other revenues consist of revenues primarily from shore excursions, food and beverage sales, gaming, retail sales, and spa services. We record onboard revenues from onboard activities we perform directly or that are performed by independent concessionaires, from which we receive a percentage of their revenues.
Our cruise operating expenses are classified as follows:
    Commissions, transportation and other expenses consist of those amounts directly associated with passenger ticket revenues. These amounts include travel agent commissions, air and other transportation expenses, credit card fees, and certain port expenses.
 
    Onboard and other expenses consist of direct costs that are incurred primarily in connection with onboard and other revenues. These costs are incurred in connection with shore excursions, beverage sales, land packages, and sales of travel protection for vacation packages.
 
    Payroll and related expenses represent the cost of wages and benefits for shipboard employees.
 
    Fuel expenses include fuel costs, the impact of fuel hedges and delivery costs.
 
    Food expenses consist of food costs for passengers and crew, which typically vary according to the number of passengers onboard a particular cruise ship.
 
    Ship charter costs consist of amounts paid for chartering ships.
 
    Other operating expenses consist of costs such as repairs and maintenance including dry-docking costs, ship insurance and other ship expenses.

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We do not allocate payroll and related costs, food costs, or other ship operating costs to passenger ticket costs or to onboard and other cruise costs, since they are incurred to support the total cruise experience.
Critical accounting policies
Our operating and financial review and prospects are based upon our consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles in the U.S. The preparation of these consolidated financial statements requires us to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. We rely on historical experience and on various other assumptions that we believe to be reasonable under the circumstances to make these estimates and judgments. Actual results could differ materially from these estimates. We believe that the following critical accounting policies affect the more significant estimates used in the preparation of our consolidated financial statements. These critical accounting policies, which are presented in detail in the notes to our audited consolidated financial statements, relate to ship accounting, asset impairment and contingencies.
Ship accounting
Ships represent our most significant assets, and we record them at cost less accumulated depreciation. Depreciation of ships is computed on a straight-line basis over the estimated service lives of primarily 30 years after a 15% reduction for the estimated salvage value of the ship. Improvement costs that we believe add value to our ships are capitalized as additions to the ship and depreciated over the improvements’ estimated useful lives. Repairs and maintenance activities are charged to expense as incurred. During the second quarter of 2006, we elected to change our method of accounting for dry-docking costs from the deferral method, under which costs associated with dry-docking a ship are deferred and charged to expense over the period to a ship’s next scheduled dry-docking, to the direct expense method, under which we expense all dry-docking costs as incurred. Accordingly, we have adjusted our previously reported financial information for all periods presented for this change in the method of accounting for dry-docking costs. As a result of the change in the method of accounting for dry-docking costs to the direct expense method, we have classified such costs as other operating expenses in our consolidated statements of operations consistent with our method of expensing repairs and maintenance costs.
We determine the useful life of our ships based primarily on our estimates of the average useful life of the ships’ major component systems, such as cabins, main diesels, main electric, superstructure and hull. In addition, we consider the impact of anticipated changes in the vacation market and technological conditions and historical useful lives of similarly-built ships. Given the large and complex nature of our ships, our accounting estimates related to ships and determinations of ship improvement costs to be capitalized require considerable judgment and are inherently uncertain. Should certain factors or circumstances cause us to revise our estimate of ship service lives or projected residual values, depreciation expense could be materially lower or higher. If circumstances cause us to change our assumptions in making determinations as to whether ship improvements should be capitalized, the amounts we expense each year as repairs and maintenance costs could increase, partially offset by a decrease in depreciation expense. If we reduced our estimated average 30-year ship service life by one year, depreciation expense for the year ended December 31, 2006 would have increased by approximately $2.9 million. In addition, if our ships were estimated to have no residual value, depreciation expense for the same period would have increased by approximately $14.4 million.

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Our estimates for ship accounting, we believe, are reasonable and our methods are consistently applied. We believe that depreciation expense is based on a rational and systematic method to allocate our ships’ costs to the periods that benefit from the ships’ usage.
Asset impairment
We review our long-lived assets, principally ships, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Assets are grouped and evaluated at the lowest level for which there are identifiable cash flows that are largely independent of the cash flows of other groups of assets. We consider historical performance and future estimated results in our evaluation of potential impairment and then compare the carrying amount of the asset to the estimated future cash flows expected to result from the use of the asset. If the carrying amount of the asset exceeds the estimated expected undiscounted future cash flows, we measure the amount of the impairment by comparing the carrying amount of the asset to its fair value. We estimate fair value based on the best information available making whatever estimates, judgments and projections are considered necessary. The estimation of fair value is generally measured by discounting expected future cash flows at discount rates commensurate with the risk involved.
Goodwill and other indefinite-lived assets, principally tradenames, are reviewed for impairment on an annual basis or earlier if there is an event or change in circumstances that would indicate that the carrying value of these assets could not be fully recovered.
We believe our estimates and judgments with respect to our long-lived assets, principally ships, and goodwill and other indefinite-lived intangible assets are reasonable. Nonetheless, if there were a material change in assumptions used in the determination of such fair values or if there is a material change in the conditions or circumstances that influence such assets, we could be required to record a material impairment charge.
Contingencies
Periodically, we assess potential liabilities related to any lawsuits or claims brought against us or any asserted claims, including tax, legal and/or environmental matters. Although it is typically very difficult to determine the timing and ultimate outcome of such actions, we use our best judgment to determine if it is probable that we will incur an expense related to the settlement or final adjudication of such matters and whether a reasonable estimation of such probable loss, if any, can be made. In assessing probable losses, we take into consideration estimates of the amount of insurance recoveries, if any. In accordance with the guidance in SFAS No. 5, “Accounting for Contingencies,” as amended, we accrue a liability when we believe a loss is probable and the amount of loss can be reasonably estimated. Due to the inherent uncertainties related to the eventual outcome of litigation and potential insurance recoveries, although we believe that our estimates and judgments are reasonable, it is possible that certain matters may be resolved for amounts materially different from any estimated provisions or previous disclosures.
Recent accounting pronouncements
In June 2006, the Financial Accounting Standards Board (“FASB”) issued FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes — an interpretation of FASB Statement 109” (“FIN 48”). FIN 48 prescribes a comprehensive model for recognizing, measuring, presenting and disclosing in the financial statements tax positions taken or expected to be taken on a tax return. The provisions of FIN 48 are effective beginning January 1, 2007 with the cumulative effect of the change in accounting principle recorded as an adjustment to the opening balance of accumulated deficit. We do not expect that the adoption of

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FIN 48 will have a material impact on our consolidated financial position and results of operations.
In June 2006, the Emerging Issues Task Force (“EITF”) ratified a consensus on EITF Issue No. 06-3, “How Taxes Collected from Customers and Remitted to Governmental Authorities Should Be Presented in the Income Statement (that is, Gross versus Net Presentation)”. Taxes within the scope of EITF Issue No. 06-3 include any taxes assessed by a governmental authority that are directly imposed on a revenue-producing transaction between a seller and a customer and may include, but are not limited to, sales taxes, use taxes, value-added taxes, and some excise taxes. We have adopted EITF Issue No. 06-3 as our policy is to present these taxes on a gross basis. The amounts included on a gross basis are $53.8 million, $68.7 million and $83.3 million for the years ended December 31, 2004, 2005 and 2006, respectively.
In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” (“SFAS No. 157”). SFAS No. 157 defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. SFAS No. 157 is effective for financial statements issued for our fiscal year beginning in 2008 and interim periods within that year. We are currently assessing the impact of SFAS No. 157 on our consolidated financial position and results of operations.
In September 2006, the FASB issued SFAS No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans, an amendment of FASB Statements No. 87, 88, 106, 132(R)” (“SFAS No. 158”). SFAS No. 158 requires employers to fully recognize in their financial statements the obligations associated with single-employer defined benefit pension plans, retiree healthcare plans, and other postretirement plans. Specifically, it requires a company to recognize on its balance sheet an asset for a plan’s overfunded status or a liability for a plan’s underfunded status, measure a plan’s assets and its obligations that determine its funded status as of the end of the employer’s fiscal year and recognize changes in the funded status of a plan through comprehensive income in the year in which the changes occur. SFAS No. 158 is effective for financial statements issued as of December 31, 2006 and is to be applied prospectively. The adoption of SFAS No. 158 did not have an impact on our consolidated financial statements as our plans are not within the scope of SFAS No. 158.
In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities—Including an amendment of FASB Statement No. 115” (“SFAS No. 159”). It permits all entities to choose to elect, at specified election dates, to measure eligible financial instruments at fair value. An entity shall report unrealized gains and losses on items for which the fair value option has been elected in earnings at each subsequent reporting date, and recognize upfront costs and fees related to those items in earnings as incurred and not deferred. SFAS No. 159 applies to fiscal years beginning after November 15, 2007, with early adoption permitted for an entity that has also elected to apply the provisions of SFAS No. 157. SFAS No. 159 also applies to eligible items existing at November 15, 2007 (or early adoption date). We are currently assessing the impact of SFAS No. 159 on our consolidated financial position and results of operations.

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Results of operations
We reported historical total revenues, total operating expenses, operating income and net (loss) income as shown in the following table (in thousands):
                         
    Years Ended December 31,
    2004   2005   2006
Total revenues
  $ 1,343,996     $ 1,629,723     $ 1,976,309  
 
                       
Total operating expenses
  $ 1,007,089     $ 1,248,526     $ 1,567,382  
 
                       
Operating income
  $ 40,910     $ 70,342     $ 32,580  
 
                       
Net (loss) income
  $ (18,090 )   $ 16,235     $ (130,899 )
 
                       
The following table presents operating data as a percentage of revenues:
                         
    Years Ended December 31,
    2004   2005   2006
Revenues
                       
Passenger ticket revenues
    73.7 %     73.3 %     72.8 %
Onboard and other revenues
    26.3 %     26.7 %     27.2 %
 
                       
Total revenues
    100.0 %     100.0 %     100.0 %
 
                       
Cruise operating expenses
                       
Commissions, transportation and other
    19.2 %     20.2 %     21.5 %
Onboard and other
    8.9 %     8.7 %     9.4 %
Payroll and related
    18.1 %     19.9 %     20.9 %
Fuel
    5.8 %     7.3 %     8.3 %
Food
    6.1 %     5.8 %     5.2 %
Ship charter costs
    1.6 %     1.7 %     1.3 %
Other operating
    15.2 %     13.0 %     12.7 %
 
                       
Total cruise operating expenses
    74.9 %     76.6 %     79.3 %
 
                       
Marketing, general and administrative expenses
    15.2 %     13.8 %     12.6 %
Depreciation and amortization expenses
    5.7 %     5.3 %     6.0 %
Impairment loss
    1.1 %     %     0.4 %
Total operating expenses
    96.9 %     95.7 %     98.3 %
 
                       
Operating income
    3.1 %     4.3 %     1.7 %
 
                       
Non-operating (income) expenses
                       
Interest income
    (0.1 )%     (0.3 )%     (0.1 )%
Interest expense, net of capitalized interest
    3.7 %     5.3 %     6.9 %
Other expenses (income), net
    0.9 %     (1.7 )%     1.5 %
 
                       
Total non-operating expenses
    4.5 %     3.3 %     8.3 %
 
                       
Net (loss) income
    (1.4 )%     1.0 %     (6.6 )%
 
                       
The following table sets forth selected statistical information for the periods presented:
                         
    Years Ended December 31,
    2004   2005   2006
Passengers Carried
    874,926       981,665       1,153,844  
Passenger Cruise Days
    6,744,609       7,613,100       8,807,632  
Capacity Days
    6,370,096       7,172,040       8,381,445  
Occupancy Percentage
    105.9 %     106.1 %     105.1 %

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Gross Yields and Net Yields were calculated as follows (in thousands, except Capacity Days and Yields):
                         
    Years Ended December 31,
    2004   2005   2006
Passenger ticket revenues
  $ 990,758     $ 1,194,461     $ 1,438,996  
Onboard and other revenues
    353,238       435,262       537,313  
 
                       
Total revenues
    1,343,996       1,629,723       1,976,309  
 
                       
Less:
                       
Commissions, transportation and other
    257,947       328,899       425,648  
Onboard and other
    120,250       141,957       186,240  
 
                       
Net revenues
  $ 965,799     $ 1,158,867     $ 1,364,421  
 
                       
 
                       
Capacity Days
    6,370,096       7,172,040       8,381,445  
Gross Yields
  $ 210.99     $ 227.23     $ 235.80  
Net Yields
  $ 151.61     $ 161.58     $ 162.79  
Gross Cruise Costs and Net Cruise Costs were calculated as follows (in thousands, except Capacity Days and per Capacity Day data):
                         
    Years Ended December 31,
    2004   2005   2006
Total cruise operating expenses
  $ 1,007,089     $ 1,248,526     $ 1,567,382  
Marketing, general and administrative expenses
    204,560       225,240       249,250  
 
                       
Gross Cruise Costs
    1,211,649       1,473,766       1,816,632  
 
                       
Less:
                       
Commissions, transportation and other
    257,947       328,899       425,648  
Onboard and other
    120,250       141,957       186,240  
 
                       
Net Cruise Costs
  $ 833,452     $ 1,002,910     $ 1,204,744  
 
                       
 
Capacity Days
    6,370,096       7,172,040       8,381,445  
Gross Cruise Costs per Capacity Day
  $ 190.21     $ 205.49     $ 216.74  
Net Cruise Costs per Capacity Day
  $ 130.84     $ 139.84     $ 143.74  
Outlook
Since the start of what has been characterized as the industry’s “wave period,” we have seen a strong response to our new marketing campaign and an improvement in the pace of bookings following weak bookings during the fourth quarter of 2006. On a capacity adjusted basis, we are significantly ahead of last year in terms of volumes booked for 2007 during the wave period. Demand for the summer programs continues to be solid, particularly for our European deployment, and demand in the Caribbean has shown modest improvement from the weak fourth quarter of 2006. As a result, we have been selectively increasing prices on many sailings and itineraries since the start of the wave period. Because of a large year-over-year increase in our own capacity in inter-island Hawaii cruises, and substantially increased competitive capacity on other Hawaii itineraries, we continue to experience strong downward pricing pressure in this trade. It is clear that the addition of capacity — both ours and our foreign-flag competitors — has outstripped demand in the short term, and we are not achieving the pricing needed to support our higher U.S.-flag operating costs. Based upon these circumstances in Hawaii, and a weaker Caribbean demand than last year, more notably on our older ships, we currently expect Net Yields to be negative for the first half of 2007 compared to the first half of 2006.

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Year ended December 31, 2005 compared to year ended December 31, 2006
Revenues
Net revenues increased 17.7% in 2006 compared to 2005 primarily due to a 16.9% increase in Capacity Days and a 0.7% increase in Net Yields. The increase in Capacity Days was primarily due to the additions of Pride of America, Norwegian Jewel, Pride of Hawai’i and Norwegian Pearl which entered service in June 2005, August 2005, May 2006 and November 2006, respectively, partially offset by the return of Norwegian Sea to Star Cruises Limited upon expiration of the relevant charter agreement in August 2005. The increase in Net Yields in 2006 was primarily due to a slight increase in onboard and other revenues while passenger ticket prices remained relatively unchanged. The increase in net onboard and other revenues was due to the increase in amounts spent per passenger primarily due to revenues related to Polynesian Adventure Tours, Inc., a tour bus operator in Hawaii, which we acquired in November 2004. Although passenger ticket prices for our international-flagged fleet slightly increased, this increase was partially offset by downward pricing pressure related to our inter-island cruises in Hawaii. Gross Yields increased 3.8% compared to the year ended December 31, 2005 primarily due to a higher percentage of passengers purchasing air travel with us and increased travel to Hawaii.
Expenses
Net Cruise Costs increased 20.1% in 2006 compared to 2005 primarily due to the 16.9% increase in capacity mentioned above and a 2.8% increase in Net Cruise Costs per Capacity Day. The increase in Net Cruise Costs was primarily due to increases in both payroll and related expenses and fuel costs. The increase in payroll and related expenses was primarily due to higher crew costs related to the U.S. crew deployed on our inter-island cruises in Hawaii, which expanded to three ships during 2006. Average fuel costs for 2006 increased 22% to $355 per metric ton from $291 per metric ton for 2005. The increase in payroll and related expenses and fuel costs accounted for 3.0 and 2.1 percentage points, respectively, of the increase in Net Cruise Costs. The increase in marketing, general and administrative expenses was primarily attributable to increases in shoreside expenses for our reservation centers. These increases were partially offset by certain operating efficiencies. On a Capacity Day basis, marketing, general and administrative expenses decreased 5.3% primarily due to the benefits of certain economies of scale. In 2006, we incurred an impairment loss of $8.0 million related to the Orient Lines tradename, which was transferred to Star Cruises Limited in the fourth quarter of 2006. Gross Cruise Costs per Capacity Day increased 5.5%.
Depreciation and amortization expense increased 39.1% in 2006 compared to 2005. The increase was primarily due to the additions of Pride of America, Norwegian Jewel, Pride of Hawai’i and Norwegian Pearl which entered service in June 2005, August 2005, May 2006 and November 2006, respectively.
Other Income (Expense)
Interest income decreased from $4.8 million in 2005 compared to $3.4 million in 2006. The decrease was due to lower average cash balances during 2006 compared to 2005. Interest expense, net of capitalized interest, increased from $87.0 million in 2005 to $136.5 million in 2006, primarily as a result of higher interest rates and an increase in average outstanding borrowings primarily related to the acquisition of new ships. Other income decreased from a gain of $28.1 million in 2005 to a loss of $30.4 million in 2006. The decrease was due primarily to foreign exchange translation gains of $28.7 million in 2005 compared to foreign exchange translation losses of $38.9 million in 2006 primarily due to fluctuations in the Euro/U.S. dollar exchange rate, partially offset by approximately $7.3 million in connection with a settlement agreement for claims against the builder of Pride of America for post-delivery costs incurred by us.

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Year ended December 31, 2004 compared to year ended December 31, 2005
Revenues
Net revenues increased 20.0% in 2005 compared to 2004 primarily due to a 12.6% increase in Capacity Days and a 6.6% increase in Net Yields. The increase in Capacity Days was primarily due to the additions of Norwegian Spirit, Pride of America and Norwegian Jewel, which entered service in May 2004, June 2005 and August 2005, respectively, partially offset by the return of Norwegian Sea to Star Cruises Limited upon expiration of the relevant charter agreement in August 2005. The increase in Net Yields was primarily due to higher cruise ticket prices and amounts spent per passenger onboard. Higher cruise ticket prices were primarily attributable to a generally improved pricing environment in 2005. The increase in amounts spent per passenger was primarily due to the acquisition of Polynesian Adventure Tours, Inc. and deployment mix, particularly for Pride of Aloha. Gross Yields increased 7.7% compared to the year ended December 31, 2004 primarily due to the same reasons discussed above for Net Yields.
Expenses
Net Cruise Costs increased 20.3% in 2005 compared to 2004 primarily due to the 12.6% increase in capacity mentioned above and a 6.9% increase in Net Cruise Costs per Capacity Day. The increase in Net Cruise Costs was primarily due to increases in both payroll and related expenses and fuel costs. The increase in payroll and related expenses was primarily due to higher crew costs related to the U.S. crew deployed on our inter-island cruises in Hawaii, which began operations in June 2004 and which expanded to two ships in June 2005. Average fuel costs for 2005 increased 36% to $291 per metric ton from $214 per metric ton for 2004. The increase in payroll and related expenses and fuel costs accounted for 5.3 and 3.4 percentage points, respectively, of the increase in Net Cruise Costs. The increase in marketing, general and administrative expenses was primarily attributable to increases in shoreside expenses for our Honolulu office, marketing costs related to NCL America, the introduction of Pride of America and Norwegian Jewel, in June 2005 and August 2005, respectively, and the addition of Polynesian Adventure Tours, Inc. These increases were partially offset by certain operating efficiencies. On a Capacity Day basis, marketing, general and administrative expenses decreased 2.2% primarily due to the benefits of certain economies of scale. Gross Cruise Costs per Capacity Day increased 8.0%.
Depreciation and amortization expense increased 11.3% in 2005 compared to 2004. The increase was primarily due to the additions of Norwegian Spirit, Pride of America and Norwegian Jewel, which entered service in May 2004, June 2005 and August 2005, respectively. In 2004, depreciation expense for the six ships transferred to Star Cruises Limited was eliminated with the transfer of such ships in April of that year.
Other Income (Expense)
Interest income increased from $1.4 million in 2004 compared to $4.8 million in 2005. The increase was primarily due to higher interest rates during 2005 compared to 2004. Interest expense, net of capitalized interest, increased from $48.9 million in 2004 to $87.0 million in 2005, primarily as a result of higher interest rates and an increase in average outstanding borrowings primarily related to the acquisition of new ships. Other income increased from a loss of $11.5 million in 2004 to a gain of $28.1 million in 2005. The increase was due primarily to foreign exchange translation gains of $28.7 million during 2005 compared to foreign exchange translation losses of $11.5 million in 2004 primarily due to fluctuations in the Euro/U.S. dollar exchange rate.

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Liquidity and capital resources
Net cash provided by operating activities was $153.8 million, $136.8 million and $147.5 million for the years ended December 31, 2004, 2005 and 2006, respectively. The changes in cash provided by operating activities primarily related to timing differences in cash payments relating to operating assets and liabilities.
Net cash used in investing activities was $750.7 million, $678.3 million and $756.2 million for the years ended December 31, 2004, 2005 and 2006, respectively. Capital expenditures were $748.3 million, $658.8 million and $809.4 million for the years ended December 31, 2004, 2005 and 2006, respectively. The capital expenditures were primarily related to the purchase of Norwegian Spirit in 2004, the deliveries of Pride of America and Norwegian Jewel in 2005 and Pride of Hawai’i and Norwegian Pearl in 2006 as well as progress payments for ships under construction in all years.
Cash from financing activities was $570.2 million, $429.5 million and $611.9 million for the years ended December 31, 2004, 2005 and 2006, respectively. In 2004, we issued $250.0 million of senior unsecured notes due 2014 and we drew approximately $260.0 million on committed loan facilities to fund progress payments on ships under construction. In addition, we entered into a $300.0 million term facility and drew $280.0 million on our $500.0 million revolving credit facility. These funds were primarily used to purchase Norwegian Spirit, to repay $425.7 million outstanding on Norwegian Sky and Norwegian Star term loans, and for general corporate purposes. In 2005, we drew on committed loan facilities to fund progress payments on ships under construction and to fund the deliveries of Pride of America and Norwegian Jewel for a total of $485.3 million. We also drew $230.0 million on our $500.0 million revolver and made repayments on our facilities including our revolver of $280.4 million. In 2006, we drew 130.0 million Euro in conjunction with the delivery of Pride of Hawai’i ($157.4 million as of drawdown date). In 2006, we drew $260.0 million on our revolving credit facility for general corporate purposes, including progress payments on ships. We drew 311.2 million Euro ($410.8 million at drawdown date) of a Euro 624.0 million revolving credit facility to fund the delivery of Norwegian Pearl. We also entered into a $610.0 million senior secured revolving credit facility and drew $390.0 million which refinanced two loans secured by Norwegian Dawn and Norwegian Sun. In 2006, we made total payments of $809.6 million in connection with our various facilities and our revolver. We received $208.0 million in capital contributions from Star Cruises Limited including the amount related to the Orient Lines tradename.
In November 2006, our lenders agreed to modify our debt agreements by increasing our maximum permitted total net funded debt-to-capital ratio from 65% to 70%.
Capitalized interest increased from $17.4 million for the year ended December 31, 2004 to $32.2 million for the year ended December 31, 2005 primarily due to a higher level of investment in ships under construction. Capitalized interest decreased to $21.9 million for the year ended December 31, 2006 from $32.2 million for the year ended December 31, 2005 primarily due to a lower level of investment in ships under construction.

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Future capital commitments
The planned berths and expected delivery dates of our ships under construction and on firm order are as follows:
             
    Expected   Approximate
Ship   Delivery Date   Berths
Norwegian Gem
  4th Quarter 2007     2,400  
New Class
           
F3 One
  4th Quarter 2009     4,200  
F3 Two
  2nd Quarter 2010     4,200  
We have an option for a third F3 ship with a scheduled delivery in the first quarter of 2011 with an additional 4,200 berths.
The aggregate cost of the ships under construction and on firm order is approximately $2.6 billion, of which we have paid $0.2 billion based on the Euro/U.S. dollar exchange rate at December 31, 2006. The remaining costs of the ships as of December 31, 2006 are exposed to fluctuations in the Euro/U.S. dollar exchange rate.
We anticipate that capital expenditures will be approximately $0.6 billion, $0.3 billion, and $1.0 billion for the years ending December 31, 2007, 2008, and 2009, respectively, and will principally relate to payments for ships under construction.
Contractual Obligations:
As of December 31, 2006, our contractual obligations, with initial or remaining terms in excess of one year, including interest expense on long-term debt obligations, were as follows (in thousands):
                                         
            Less than 1   1-3   3-5   More than 5
    Total   year   years   years   years
Long-term debt obligations(1)
  $ 3,471,428     $ 311,701     $ 623,378     $ 955,057     $ 1,581,292  
Operating lease obligations(2)
    50,703       5,795       10,375       7,864       26,669  
Ship charter obligations(3)
    47,905       21,005       26,676       224        
Ship purchase obligations(4)
    2,398,455       501,193       1,102,716       794,546        
Port facilities(5)
    93,081       8,158       15,908       16,153       52,862  
Capital lease obligations(6)
    16,429       3,072       5,490       6,486       1,381  
Other(7)
    28,022       14,598       12,686       738        
 
                                       
Total
  $ 6,106,023     $ 865,522     $ 1,797,229     $ 1,781,068     $ 1,662,204  
 
                                       
 
(1)   Assumes LIBOR rate of 5.37% and EURIBOR of 3.85% for all periods and EURO/USD exchange rate of 1.3199.
 
(2)   We are obligated under noncancellable operating leases primarily for offices and motor vehicles.
 
(3)   Ship charter costs are for ships chartered from Star Cruises Limited.
 
(4)   Amounts represent contractual obligations with initial terms in excess of one year, assumes EURO/USD of 1.3199.
 
(5)   Amounts represent future commitments with remaining terms in excess of one year to pay for our usage of a New York City terminal and Fanning Island.
 
(6)   Amounts exclude interest. Capital leases are primarily for buses for Hawaii operations.
 
(7)   Amounts represent future commitments with remaining terms in excess of one year to pay for primarily service and maintenance contracts.

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Certain contracts we enter into include indemnification provisions that obligate us to make payments to the counterparty if certain events occur. The indemnification clauses are often standard contractual terms that are entered into in the normal course of business. There are no stated or notional amounts included in the indemnification clauses and we are not able to estimate the maximum potential amount of future payments, if any, under these indemnification clauses. We have not been required to make any payments under such clauses in the past, and do not believe that, under current circumstances, a request for indemnification is probable.
As a routine part of our business, depending on market conditions, exchange rates, pricing and our strategy for growth, we continuously consider opportunities to enter into contracts for the building of additional ships. We may also consider the sale of ships, potential acquisitions and strategic alliances. If any of these were to occur, they may be financed through the incurrence of additional indebtedness, through cash flows from operations, or through the issuance of debt, equity or equity-related securities.
Funding sources
As of December 31, 2006, our liquidity was $403.5 million consisting of $63.5 million in cash and cash equivalents and $340.0 million available to drawdown under our revolving credit facilities. According to the terms of our $610.0 million revolving credit facility, the availability under the facility will increase by $100.0 million to the full $610.0 million in the event we receive an additional $200.0 million of equity, which we have not received as of February 23, 2007.
We also have specific funding available for Norwegian Gem of approximately $0.4 billion, based on the Euro/U.S. dollar exchange rate at December 31, 2006. We have export credit financing for 80% of the contract amount of each of the two F3 ships scheduled for delivery in 2009 and 2010. These financings cannot exceed approximately $0.9 billion each, based on the Euro/U.S. dollar exchange rate at December 31, 2006.
Our debt agreements contain covenants that require us, among other things, to maintain a minimum level of liquidity, limit our net funded debt-to-capital ratio and restrict our ability to pay dividends. We were in compliance with all covenants as of December 31, 2006. Our ships and substantially all other property are pledged as collateral for our debt.
During 2006, we received $208.0 million in capital contributions from Star Cruises Limited including the amount related to the Orient Lines tradename.
We have commitments of approximately $0.9 billion due during the 12-month period ending December 31, 2007. We believe our cash on hand, expected future operating cash inflows, additional borrowings under existing credit facilities and our ability to issue debt securities or raise additional equity, including capital contributions, will be sufficient to fund operations, debt payment requirements, capital expenditures and maintain compliance with debt covenants under our debt agreements over the next twelve-month period. There can be no assurances that cash flows from operations and additional financing from external sources will be available in accordance with our expectations.
For further information about our long-term debt, we refer you to our consolidated financial statements Note 5. “Long-Term Debt” on
page F-15.

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Financial instruments and other
General
We are exposed to market risk attributable to changes in interest rates, foreign currency exchange rates and fuel prices. We attempt to minimize these risks through a combination of our normal operating and financing activities and through the use of derivative financial instruments. The financial impacts of these hedging instruments are primarily offset by corresponding changes in the underlying exposures being hedged. We achieve this by closely matching the amount, term and conditions of the derivative instrument with the underlying risk being hedged. We do not hold or issue derivative financial instruments for trading or other speculative purposes. Derivative positions are monitored using techniques including market valuations and sensitivity analyses. We refer you to our consolidated financial statements Note 7, “Financial Instruments,” on page F-18 for further detail.
Interest rate risk
From time to time, we consider entering into interest rate swap agreements to modify our exposure to interest rate movements and to manage our interest expense. At December 31, 2006, 34% of our debt was fixed and 66% was floating, and we had no interest rate swap agreements in place. A hypothetical one percentage point increase in interest rates would increase our 2007 interest expense by approximately $17.4 million.
Foreign currency exchange rate risk
At December 31, 2006, we had no foreign currency forward contracts or options outstanding. Our exposure to foreign currency exchange rate risk relates primarily to our ship building contracts and to our Euro-denominated debt. Our ship contracts are denominated in Euro and the associated debt agreements are denominated in either U.S. dollars or Euro with certain conversion options. If denominated in Euro, our principal and interest payments for the debt will be payable in Euro, and will be subject to the exchange rate of the Euro at the time these payments are due. From time to time, we enter into foreign currency forward contracts and/or options contracts for these payments.
We are also exposed to foreign currency exchange rate fluctuations on the U.S. dollar value of our foreign currency denominated forecasted transactions. Our principal net foreign currency exposure relates to the Euro. To manage this exposure, we take advantage of any natural offsets of our foreign currency revenues and expenses and from time to time enter into foreign currency forward contracts and/or option contracts for a portion of the remaining exposure related to these forecasted transactions.
Fuel price risk
Our exposure to market risk for changes in fuel prices relates to the consumption of fuel on our ships. Fuel cost, as a percentage of our total cruise operating expenses, was 7.7% in 2004, 9.6% in 2005 and 10.5% in 2006. From time to time, we use fuel hedging agreements to mitigate the financial impact of fluctuations in fuel prices. As of December 31, 2006, we had fuel swap agreements to pay fixed prices for fuel with an aggregate notional amount of approximately $18.9 million, maturing by June 2007. The estimated fair value of these contracts at December 31, 2006 was an unrealized loss of $1.6 million. We estimate that a hypothetical 10% increase in our weighted-average fuel price for the year ended December 31, 2006 would increase our anticipated 2007 fuel cost by approximately $19.1 million. This increase would be partially offset by an increase in the fair value of our fuel swap agreements of approximately $1.7 million.

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Related party transactions
We refer you to “Item 7—Major Shareholders and Related Party Transactions—Related party transactions” for details of our related party transactions.
Item 6. Directors, Senior Management and Employees
Directors and senior management
The members of our Board of Directors and our executive officers as of March 1, 2007 are:
             
Name   Age   Position with NCL
Tan Sri Lim Kok Thay
    55     Chairman of the Board of Directors
David Colin Sinclair Veitch
    51     Deputy Chairman of the Board of Directors, President and Chief Executive Officer
Senator Robert Graham
    70     Independent Director, Chairman of the Governance Committee
Alberto Ibargüen
    63     Independent Director, Chairman of the Compensation Committee
Walter L. Revell
    72     Independent Director, Chairman of the Audit Committee
Bonnie S. Biumi
    44     Executive Vice President and Chief Financial Officer
William A. Hamlin
    54     Executive Vice President of Fleet Operations
Robert M. Kritzman
    46     Executive Vice President of Hawaii Operations
Andrew Stuart
    43     Executive Vice President of Sales, Marketing and Passenger Services
Mark E. Warren
    55     Executive Vice President and General Counsel
Tan Sri Lim Kok Thay became the Chairman of the Board of Directors of the Company on December 16, 2003. Tan Sri Lim is Chairman, President and Chief Executive of Genting Berhad, a company listed on Bursa Malaysia Securities Berhad. Genting Berhad is an investment holding company and is principally involved, through its subsidiaries and associated companies, in leisure and hospitality; gaming and entertainment businesses; plantations; property development and management; tours and travel-related services; investments; manufacturing and trading in paper and paper-related products; generation and supply of electric power and oil and gas exploration activities. Tan Sri Lim is also Chairman, President and Chief Executive of RWB and Joint Chief Executive of Asiatic Development Berhad, both of which are publicly listed companies in Malaysia and subsidiaries of Genting Berhad; a director of Resorts World Limited, Joondalup Limited, Cove Investments Limited, and GHL acting as trustee of the Golden Hope Unit Trust, which are substantial shareholders of Star Cruises Limited; the Chairman of Genting International PLC, a public company listed on the Singapore Stock Exchange and a subsidiary of Genting Berhad; and Chairman, President and Chief Executive Officer of Star Cruises Limited, where he focuses on long-term policies and new shipbuildings. Tan Sri Lim was involved with Star Cruises Limited since its formation in 1993. Tan Sri Lim was also involved in the development of the Genting Highlands Resort in Malaysia and the overall concept and development of the Burswood Resort in Perth, Australia, the Adelaide casino in South Australia and Foxwoods Casino Resort in Connecticut. Tan Sri Lim graduated with a Bachelor of Science (Civil Engineering) degree from the University of London in 1975 and attended the Program for Management Development at the Harvard Graduate School of Business in 1979.
David Colin Sinclair Veitch became the Deputy Chairman of the Board of Directors of the Company on December 16, 2003. Mr. Veitch is the President and Chief Executive Officer of NCL and is a Director of

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Star Cruises Limited. Before he joined our management in January 2000, Mr. Veitch was the Chief Financial Officer and Senior Vice President of Marketing and Corporate Development of Princess Cruises for approximately eight years, with responsibility at varying times for finance, marketing, international sales, strategic planning and corporate development. In addition, beginning in mid-1998, he was also the executive in charge of Princess Cruises’ sister company, P&O Cruises (Australia). Mr. Veitch graduated with a Master in Business Administration degree from the Harvard Graduate School of Business in 1984 and also holds a Bachelor of Science degree with First Class Honours from the University of London.
Senator Robert Graham became a member of our Board of Directors and Chairman of the Governance Committee in July 2006. Mr. Graham is also a member of our Audit and Compensation Committees. Mr. Graham is a former three-term U.S. Senator and two-term Governor of Florida. A graduate of the University of Florida and Harvard Law School, Senator Graham served in 2006 as Senior Fellow at Harvard University’s John F. Kennedy School of Government, following his retirement from the Senate at the start of 2005. In the U.S. Senate, a distinguished career was capped by his chairmanship of the Senate Select Committee on Intelligence and of the joint House-Senate Intelligence Committee Investigation of the 9/11 terrorist attacks. Senator Graham also serves on the board of directors of the American Institute of Certified Public Accountants (AICPA).
Alberto Ibargüen became a member of our Board of Directors and Chairman of the Compensation Committee in July 2006. Mr. Ibargüen is also a member of our Audit and Governance Committees. Mr. Ibargüen is President and CEO of the Knight Foundation, a private foundation supporting journalism programs in the U.S. and abroad, and social programs in the 26 U.S. communities where John and James Knight published their newspapers. Previously, Mr. Ibargüen was publisher of The Miami Herald and of El Nuevo Herald, capping a newspaper career of over 20 years. He served in the Peace Corps in Venezuela and in Colombia before graduating from the University of Pennsylvania Law School. Mr. Ibargüen is a member of the board of directors of PepsiCo and is on the Advisory Council of the Public Company Accounting Oversight Board. He also is a member of the board of directors of the Council on Foreign Relations, serves as chairman of the board of trustees of the Newseum in Washington D.C., a museum dedicated to free speech and free press, and is a member of the Trustees’ Council of the National Gallery of Art.
Walter L. Revell became a member of our Board of Directors and Chairman of the Audit Committee in June 2005. Mr. Revell is also a member of our Compensation and Governance Committees. Mr. Revell is Chairman of the Board and Chief Executive Officer of Revell Investments International, Inc., a diversified investment, development and management company located in Coral Gables, Florida. Mr. Revell also serves as a Director and Chairman of the Audit Committee of The St. Joe Company, a publicly traded company that is Florida’s largest land owner and real estate developer; as a Director of Rinker Group Limited, a large multinational corporation based in Australia with extensive operations in the U.S.; as a Director of Calpine Corporation, one of the largest electric power producers in North America, and as a Director of International Finance Bank in Miami, Florida. Mr. Revell served as Secretary of Transportation for the State of Florida in the Askew Administration. He served as Chairman and CEO of H.J. Ross Associates, Inc., consulting engineers, planners and scientists, and continues as Senior Advisor to the new parent company, T.Y. Lin International, in San Francisco.
Bonnie S. Biumi is the Executive Vice President and Chief Financial Officer of the Company who joined us in July 2005. Ms. Biumi was the Senior Vice President and Treasurer at Royal Caribbean Cruises Ltd. and worked there since 1999. Prior to that Ms. Biumi was Chief Financial Officer of two separate public companies, an equipment rental company and a telecommunications service provider. Ms. Biumi is a Certified Public Accountant with 11 years experience at Price Waterhouse in Miami. Ms. Biumi graduated with a Bachelor of Science degree with honors in Business Administration from the University of Florida.

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William A. Hamlin is the Executive Vice President of Fleet Operations of the Company. Prior to joining us in June 2004, Mr. Hamlin served as President of the America Region of APL Limited, which is part of the NOL Group based in Oakland, California. He also served as President of North American Operations, and Vice President of Operations for the America Region. Prior to joining APL, Mr. Hamlin held positions with Sea-Land, United States Line and other marine organizations. Mr. Hamlin has over 25 years of marine and logistics experience. Mr. Hamlin attended the University of Maine in Orono.
Robert M. Kritzman is the Executive Vice President of our Hawaii Operations. Mr. Kritzman previously was our Senior Vice President and General Counsel. Prior to joining us in June 1990, Mr. Kritzman was an attorney with the law firm of McDermott, Will & Emery. He obtained a Bachelor of Science degree in Economics and a Juris Doctorate degree from the University of Florida. Mr. Kritzman serves on the boards of the International Council of Cruise Lines and the North West Cruiseship Association. Mr. Kritzman is based in NCL America Inc.’s offices in Honolulu, Hawaii.
Andrew Stuart is the Executive Vice President of Sales, Marketing and Passenger Services of the Company. He previously held the position of Senior Vice President of Marketing and Sales since August 1998 and, prior to that, he was our Senior Vice President of Passenger Services. He joined us in August 1988 in our London office holding various Sales and Marketing positions before relocating to our headquarters in Miami. Mr. Stuart earned a Bachelor of Science degree in Catering Administration from Bournemouth University, United Kingdom.
Mark E. Warren is the Executive Vice President and General Counsel of the Company who joined us in August 2003. Mr. Warren was formerly a partner in the Los Angeles, California and Washington, D.C. offices of the law firm of Gibson, Dunn & Crutcher. Mr. Warren previously served as Senior Vice President and General Counsel of Princess Cruises. He also worked in the federal government, previously serving on both the U.S. Senate and White House staff of Walter F. Mondale. Mr. Warren serves on the Board of Directors of The West of England Protection and Indemnity Association, one of our two Protection and Indemnity clubs. Mr. Warren graduated with a Bachelor of Arts degree with high honors in Political Science and International Studies from Gustavus Adolphus College and a Juris Doctorate degree with honors from the University of Minnesota School of Law.
Sharon Ward is the Secretary of the Company. She is a corporate administrator employed by Coson Corporate Services Limited. Wendell M. Hollis is the Resident Representative of the Company. He is a Partner of Cox Hallett Wilkinson.
Compensation of directors and executive officers
The aggregate cash compensation paid to NCL’s directors and executive officers for the year ended December 31, 2006 was $6.8 million.
Share option scheme for shares of Star Cruises Limited
Share options are granted to certain directors of Star Cruises Limited and employees of Star Cruises Limited under the Star Cruises Limited Employees Share Option Scheme for Executives adopted by Star Cruises Limited on April 16, 1997 prior to the listing of its ordinary shares on The Stock Exchange of Hong Kong Limited (the “Pre-listing Employee Share Option Scheme”) and the share option scheme adopted by Star Cruises Limited on August 23, 2000 (as effected on November 30, 2000 and amended on May 22, 2002) (the “Post-listing Employee Share Option Scheme”) entitling them to subscribe for ordinary shares of Star Cruises Limited.

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The outstanding share options under the Pre-listing Employee Share Option Scheme vest over a period of 10 years following their respective original grant dates and generally became exercisable as to 20% and 30% of the amount granted three years and four years after the grant date, respectively, with the remaining options exercisable annually in equal tranches of 10% over the remaining option period, subject to further terms and conditions set out in the relevant offer letters and provisions of the Pre-listing Employee Share Option Scheme.
Other than the share options granted on August 23, 2004 under the Post-listing Employee Share Option Scheme which, upon valid acceptance, will become exercisable in part or in full for a period of eight years commencing from two years after the date of the offer, the outstanding share options granted under the Post-listing Employee Share Option Scheme vest in seven tranches over a period of ten years from their respective dates of offer and become exercisable as to 30% and 20% of the amount granted commencing from two years and three years, respectively, after the dates of offer, with the remaining options exercisable annually in equal tranches of 10% commencing in each of the following years. All of the outstanding share options under the Post-Listing Share Option Scheme are subject to further terms and conditions set out in the relevant offer letters and provisions of the Post-Listing Employee Share Option Scheme.
On December 28, 2006, Star Cruises Limited completed the issuance of 1,484,084,467 rights shares. As a result of the rights issue, the exercise price and the number of ordinary shares issuable upon exercise in full of the outstanding share options were adjusted accordingly. Subsequent to the rights issue, as of December 31, 2006, outstanding share options granted to NCL’s employees (including directors) under the Pre-listing Employee Share Option Scheme and the Post-listing Employee Share Option Scheme totaled 648,963 at an exercise price of $0.40 per share and 50,988,055 with a weighted-average exercise price of $0.34 per share, respectively, including 2,595,853 and 2,530,958 granted to directors and executive officers, respectively. Such amounts exclude outstanding share options granted to the Chairman, President and Chief Executive Officer of Star Cruises Limited, who also serves as the Chairman of our Board of Directors. At December 31, 2006, he had outstanding share options under the Pre-listing Employee Share Option Scheme and the Post-listing Employee Share Option Scheme of 6,002,906 and 4,218,261, respectively.
Qualified and non-qualified benefit plans
Defined Contribution Plan. We maintain a frozen qualified defined contribution plan (the “Plan”) for our shoreside employees. Effective January 1, 2002, the Plan was amended to cease all future employer contributions. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and is intended to be qualified under section 401(a) of the Code.
401(k) Plan. In addition, we maintain a 401(k) Plan (the “401(k) Plan”). The 401(k) Plan covers substantially all of our shoreside employees. Participants may contribute up to 100% of eligible compensation each pay period, subject to certain limitations. We make matching contributions equal to 100% of the first 3% and 50% of the next 7% of each participant’s contributions, and our matching contributions may not exceed 6.5% of each participant’s compensation. Our matching contributions are vested according to a five-year schedule. The 401(k) Plan is subject to the provisions of ERISA and is intended to be qualified under section 401(a) of the Code.
Supplemental Executive Retirement Plan. We also maintain a Supplemental Executive Retirement Plan (“SERP Plan”), an unfunded defined contribution plan, for certain of our key employees whose benefits are limited under the Plan and the 401(k) Plan. We record an expense for amounts due to the SERP Plan on behalf of each participant that would have been contributed without regard to any limitations imposed by the Code.

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Supplemental Senior Executive Retirement Plan. We maintain a Supplemental Senior Executive Retirement Plan (“SSERP Plan”), an unfunded defined benefit plan, for selected senior executives. We have recorded an accrual at December 31, 2005 and 2006 of approximately $9.7 million and $8.6 million, respectively, with respect to the SSERP Plan in our balance sheet. We record an expense related to the SSERP Plan for such amounts based on the following actuarial assumptions: 5% discount rate and 5% annual increase in compensation.
We recorded expenses related to the above described defined contribution plans and SSERP Plan of approximately $4.5 million, $3.2 million and $1.6 million for the years ended December 31, 2004, 2005 and 2006, respectively. No amounts are required to be or were contributed under the SERP Plan or SSERP Plan by us as of December 31, 2004, 2005 and 2006 as the SERP Plan and SSERP Plans are unfunded.
Board practices
Terms of directors and executive officers
At the time of this annual report, all of our current directors serve until re-elected or their successors are appointed at our annual general meeting. Currently, three committees have been established by our Board of Directors: the Audit Committee, the Compensation Committee and the Governance Committee.
The Audit Committee is responsible for overseeing our accounting, auditing and financial reporting processes, including the appointment of our independent auditor, determination of its compensation and oversight of its work. At the time of this annual report, Mr. Revell serves on and is the chair of our Audit Committee. The Board of Directors has determined that Mr. Revell meets the requirements for being an “audit committee financial expert” as defined by SEC regulations. We believe that the composition and functioning of our Audit Committee at the time of this annual report complies with the applicable requirements of the Sarbanes-Oxley Act of 2002. We believe we have satisfied the audit committee independence requirements under Section 10A of the Exchange Act. At the time of this annual report, Mr. Revell is the chair of, and he, Senator Graham and Mr. Ibargüen serve on, our Audit Committee.
The Compensation Committee of our Board of Directors evaluates our CEO’s and CFO’s performance and, based on such evaluation, recommends to the Board the compensation of our CEO and CFO. The Compensation Committee also reviews and makes recommendations to the Board regarding compensation of our Executive Vice Presidents and our Board Members. The Compensation Committee also administers our incentive compensation plans and equity-based plans (but our Board retains the authority to interpret those plans). At the time of this annual report, Mr. Ibargüen is the chair of, and he, Senator Graham and Mr. Revell serve on, our Compensation Committee.
The Governance Committee is responsible for assisting the Board of Directors in fulfilling its overall responsibilities with respect to identifying qualified individuals to become members of the Board of Directors, determining the composition of the Board of Directors and its committees and establishing and implementing our corporate governance principles. At the time of this annual report, Senator Graham is the chair of, and he, and Messrs. Ibargüen and Revell serve on, our Governance Committee.
Our executive officers have employment agreements with us that provide for benefits upon termination of employment without cause. We have not entered into any service agreement that provides for benefits upon termination of service with any of our directors.

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Employees
The following table shows the divisional allocation of our employees as of December 31, 2004, 2005 and 2006.
                         
    December 31,
    2004   2005   2006
Shipboard (1)
    8,843       10,088       12,145  
Shoreside
    1,605       1,860       2,052  
 
                       
Total
    10,448       11,948       14,197  
 
                       
 
(1)   Does not include crew members that were on leave as of the respective dates.
Share Ownership
Item 7. Major Shareholders and Related Party Transactions
Major shareholder
Star Cruises Limited is the sole beneficial owner of our common shares. Beneficial ownership is determined in accordance with the rules of the SEC, based on factors including voting and investment power with respect to our common shares. We have no common shares subject to options currently exercisable, or exercisable within 60 days of the date of this annual report. Star Cruises Limited has sole voting and sole investment control with respect to the common shares it beneficially owns.
As of December 31, 2006, the principal shareholders of Star Cruises Limited are:
         
    Percentage Ownership in
Shareholder   Star Cruises Limited
GHL (1)
    37.02 %
RWB (2)
    36.01 %
 
(1)   GHL is a company incorporated in the Isle of Man acting as trustee of the Golden Hope Unit Trust, a private unit trust which is held directly and indirectly by GZ Trust Corporation as trustee of a discretionary trust established for the benefit of certain members of the Lim Family.
 
(2)   RWB is a Malaysian company listed on Bursa Malaysia Securities Berhad in which the Lim Family has a substantial indirect beneficial interest.
As a result, an aggregate of approximately 73% of Star Cruises Limited’s outstanding shares is owned by RWB and GHL as trustee of the Golden Hope Unit Trust, directly or indirectly, as of December 31, 2006.
Related party transactions
Transactions in connection with the Reorganization
In April 2004, Star Cruises Limited completed a reorganization transaction (the “Reorganization”) which included the formation of NCL Corporation Ltd. in December 2003.
As part of the Reorganization, $366.6 million of our liabilities that were recorded as amount due to Star Cruises Limited were capitalized as equity. In addition, substantially all of the guarantees and mortgages that had been provided by ship-owning subsidiaries of Arrasas Limited to the lenders of Star Cruises Limited were released, while substantially all of the guarantees provided by Star Cruises Limited to these subsidiaries’ lenders were also released and replaced with guarantees from us.

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In addition, we transferred six of our ships, Norwegian Crown, Norwegian Dream, Norwegian Majesty, Norwegian Sea, Marco Polo and Norwegian Wind, to Star Cruises Limited at their existing net book values of $778.0 million along with their $403.2 million of secured indebtedness. The difference of $374.8 million reduced our intercompany debt owed to Star Cruises Limited by the same amount. After the transfer, we entered into arrangements with Star Cruises Limited to charter-in these six ships from Star Cruises Limited for periods ranging from one to six years to continue operating them under the Norwegian Cruise Line and Orient Lines brands. These charter arrangements are expected to provide us with greater flexibility in removing older ships from our fleet as new ships that are custom designed for “Freestyle Cruising” enter our fleet over time. We believe that our arrangements with Star Cruises Limited are on terms substantially the same as arms-length transactions. When we took delivery of our new ship, Norwegian Jewel, in August 2005, we ended the charter for Norwegian Sea during the same month and returned the ship to Star Cruises Limited.
Contributions from Star Cruises Limited
We have been substantially funded since the inception of Arrasas Limited by inter-company advances from our parent, Star Cruises Limited. In April and September 2001, $47.2 million (inclusive of $1.5 million of interest) and $150.0 million, respectively, were repaid to Star Cruises Limited through the issuance of Arrasas Limited common stock to Star Cruises Limited.
The remaining advances from Star Cruises Limited at December 31, 2002, 2003, 2004 and 2005 of $1.3 billion, $0.7 billion, $1.3 million and $3.1 million, respectively, were non-interest bearing and unsecured. At December 31, 2004 and 2005, such amounts had no fixed repayment terms and, as a result, were classified as a current liability in our consolidated financial statements. Star Cruises Limited agreed not to demand repayment during 2003 of the balance outstanding at December 31, 2002 and, as a result, such amount was classified as a long-term liability in our consolidated financial statements at December 31, 2002. At December 31, 2003, the $366.6 million that was capitalized as equity in connection with the Reorganization was classified as a long-term liability at December 31, 2003. The remaining balance of $374.8 million was classified as a current liability as such amount was satisfied in connection with the Reorganization transaction. At December 31, 2006, we did not have an amount due to parent.
For the years ended December 31, 2004, 2005 and 2006, we recorded legal and other costs in the amounts of $0.2 million, $10.1 million and $0.2 million, respectively, all of which was reimbursed to us by Star Cruises Limited. Such amounts were recorded as capital contributions in the respective years.
In 2006, we transferred the Orient Lines tradename to Star Cruises Limited for $16.0 million and recognized an impairment loss of $8.0 million. The proceeds received from this transfer in excess of the net book value of the Orient Lines tradename have been recorded as a capital contribution from Parent in our consolidated statement of changes in shareholder’s equity for the year ended December 31, 2006. During 2006, we also received a $200.0 million capital contribution from Star Cruises Limited.
Other ship purchases and sales
Norwegian Sky has been reflagged and renamed Pride of Aloha, and began offering inter-island cruises in Hawaii in July, 2004. In order to continue offering the cruises that previously were provided by Norwegian Sky, particularly its Alaska cruise itineraries, we entered into a bareboat charter agreement, in May 2004, with Star Cruises Limited to charter-in the cruise ship Norwegian Spirit, built in 1998. We purchased Norwegian Spirit in July 2004 with funds from the Senior Secured Credit Facility for $307.6 million, which represents the net book value of the ship at the date of the transaction including reimbursement for certain dry-docking costs and other spare parts.

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During 2004, we transferred Norway, and a related $19.7 million insurance receivable to Star Cruises Limited in exchange for a non-interest bearing promissory note in the amount of $46.5 million. The promissory note or a portion of the outstanding balance thereof was payable to us by Star Cruises Limited at the time of disposal of the ship and the recovery of certain amounts from the insurance syndicate which insured the ship in May 2003 at the time there was an incident onboard. The face value of the promissory note represented our carrying value of Norway on April 23, 2004, which estimated the anticipated proceeds from the sale of the ship, and the estimated amount to be recovered from the insurance syndicate. The promissory note, which was settled in January 2006, is classified as a current asset in the accompanying consolidated balance sheets at December 31, 2005.
The amounts payable by us annually to Star Cruises Limited for the chartering of Norwegian Crown, Norwegian Dream, Norwegian Majesty, Marco Polo and Norwegian Wind are set forth under “Item 5—Operating and Financial Review and Prospects—Contractual obligations” above, within the line item “Ship Charter Obligations.”
We refer you to our consolidated financial statements Note 6, “Related Party Disclosures” on page F-17, for a further discussion of our related party transactions.
Item 8. Financial Information
We refer you to Item 18—Financial Statements beginning on page F-2.
Legal proceedings
     Material litigation
  (i)   A proposed class action suit was filed on August 1, 2000 in the U.S. District Court for the Southern District of Texas against us, alleging that we violated the Americans with Disabilities Act of 1990 (“ADA”) in our treatment of physically impaired passengers. The same plaintiffs also filed on the same date a proposed class action suit in a Texas state court alleging that we and a third party violated Texas’ Deceptive Trade Practices and Consumer Protection Act. The state court judge granted our motion for summary judgment and the plaintiff filed an appeal which is currently pending. On June 6, 2005, the U.S. Supreme Court ruled in the Federal matter that the ADA is applicable to foreign flagged cruise ships that operate in U.S. waters to the same extent that it applies to U.S. flagged ships. The U.S. Supreme Court remanded the case to the Fifth Circuit Court of Appeals to determine which claims in the lawsuit remain and the Fifth Circuit remanded the case to the trial court. We have filed a motion for summary judgment in the trial court which is currently pending.
 
  (ii)   A proposed class action suit was filed on December 20, 2000 in a Florida State Court alleging that we discriminated against disabled persons in violation of the ADA and the Florida Trade Act on several of our ships. Discovery has commenced. We believe that we have meritorious defenses to these claims and, accordingly, are defending vigorously this action.
 
  (iii)   A proposed class action suit was filed on May 17, 2001 in the U.S. District Court for the Southern District of New York alleging that during the period from January 1998 through March 2005, we failed to pay unlicensed seafarers overtime wages in accordance with their contracts of employment. The court entered an order certifying the case as a class action. In March 2005, the parties reached a settlement which was

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      subsequently approved by the court. We believe that the ultimate outcome of this matter will not have a material impact on our financial position, results of operations or cash flows.
 
  (iv)   On July 25, 2002, we were served with a complaint in which a former employee alleged that we failed to pay him severance pay/employment benefits following his discharge. The matter was tried before a jury in January 2007 at which time a verdict in favor of plaintiff was returned. Trial counsel is currently evaluating possible appealable issues.
 
  (v)   In May 2003, an explosion in the boiler room onboard Norway resulted in the death of eight crew members and the injury of approximately 20 other crew members. All personal injury claims stemming from this incident are covered by our insurance. The incident is currently under investigation by regulatory authorities and the United States Attorney’s Office for the Southern District of Florida. We are cooperating with the investigation. To date, none of the agencies involved has rendered opinions or conclusions concerning the incident.
 
  (vi)   On or about February 3, 2006, we were served with a class action complaint filed in the United States District Court for the Southern District of New York alleging copyright infringement stemming from performances of certain portions of copyrighted music aboard our ships. We believe that we have meritorious defenses to these claims and, accordingly, are defending vigorously this action.
 
  (vii)   On June 16, 2006, a complaint was filed against us in the Circuit Court of Miami-Dade County, Florida, alleging breach of contract and fraudulent misrepresentation stemming from two 2004 charter sailings of Pride of Aloha. We believe that we have meritorious defenses to these claims and, accordingly, are defending vigorously this action.
 
  (viii)   On July 14, 2006, we were served with a complaint filed in Florida State court on behalf of a former onboard concessionaire alleging breach of contract and unjust enrichment. We believe that we have meritorious defenses to these claims and, accordingly, are defending vigorously this action.
 
  (ix)   On August 24, 2006, we were served with a complaint by the U.S. Equal Employment Opportunity Commission to correct alleged unlawful employment practices on the basis of national origin and religion and to provide relief to seven former employees who were allegedly terminated as a result of same. We believe that we have meritorious defenses to these claims and, accordingly, are defending vigorously this action.
In the normal course of our business, various other claims and lawsuits have been filed or are pending against us. Most of these claims and lawsuits are covered by insurance and, accordingly, the maximum amount of our liability is typically limited to our deductible amount. Nonetheless, the ultimate outcome of these claims and lawsuits that are not covered by insurance cannot be determined at this time. We have evaluated our overall exposure with respect to all of our threatened and pending litigation. To the extent required, we have accrued amounts for all estimable probable losses associated with our deemed exposure. We are currently unable to estimate any other potential contingent losses beyond those accrued, as discovery is not complete nor is adequate information available to estimate such range of

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loss or potential recovery. As discussed above, we intend to vigorously defend our legal position on all claims and, to the extent necessary, seek recovery. At December 31, 2006, we had accrued amounts of approximately $8.9 million for the above pending legal matters.
     Other
Certain contracts we enter into include indemnification provisions that obligate us to make payments to the counterparty if certain events occur. The indemnification clauses are often standard contractual terms that are entered into in the normal course of business. There are no stated or notional amounts included in the indemnification clauses and we are not able to estimate the maximum potential amount of future payments, if any, under these indemnification clauses. We have not been required to make any payments under such clauses in the past, and do not believe that, under current circumstances, a request for indemnification is probable.
Dividends
We intend to retain all currently available funds and as much as necessary of future earnings in order to fund the continued development and growth of our business. The indenture governing our 10 5/8% Senior Notes due 2014 prohibits, among other things, our ability to pay cash dividends to our shareholders above specified levels. In addition, any determination to pay dividends in the future will be at the discretion of our board of directors and will depend upon our results of operations, financial condition, restrictions imposed by applicable law and other factors that our Board of Directors deems relevant.
Significant changes
Except as identified in this annual report, no significant change in our financial condition has occurred since the date of the most recent consolidated audited financial statements contained in this annual report.
Item 9. Offer and Listing Details
Not applicable.
Item 10. Additional Information
General
We are an exempted company incorporated under the laws of Bermuda. We are registered with the Registrar of Companies in Bermuda under registration number 34678. We were incorporated on December 15, 2003 under the name NCL Holdings, Ltd. which was changed to NCL Corporation Ltd. on March 26, 2004. We have a general corporate purpose. We are wholly-owned by our parent, Star Cruises Limited.
Share capital
All of our issued and outstanding common stock are fully paid. Subject to our bye-laws and to any resolution of our shareholders to the contrary, and without prejudice to any special rights previously conferred on the holders of any existing shares or class of shares, our Board of Directors is authorized to issue any of our authorized but unissued shares. There are no limitations on the right of non-Bermudians or non-residents of Bermuda to hold or vote our shares.

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Holders of common shares have no pre-emptive, redemption, conversion or sinking fund rights. Holders of common shares are entitled to one vote per share on all matters submitted to a vote of holders of common shares. Unless a different majority is required by law or by our bye-laws, resolutions to be approved by holders of common shares require approval by a simple majority of votes cast at a meeting at which a quorum is present and in the case of an equality of votes, the resolution will fail.
In the event of our liquidation, dissolution or winding up, the holders of common shares are entitled to share equally and ratably in our surplus assets, if any, remaining after the payment of all of our debts and liabilities. If we are wound up, the liquidator may, with the sanction of a resolution of our shareholders, divide amongst our shareholders all or any part of our assets and determine how such division shall be carried out as between our shareholders or different classes of shareholders.
Dividend rights
Under Bermuda law, a company’s board of directors may declare and pay dividends from time to time unless there are reasonable grounds for believing either that the company is, or after the payment would be, unable to pay its liabilities as they become due or that the realizable value of its assets would thereby be less than the sum of its liabilities and issued share capital (par value) and share premium accounts (share premium being the amount of consideration paid for the subscription of shares in excess of the par value of those shares). Under our bye-laws, each common share is entitled to dividends if and when dividends are declared by our Board of Directors, subject to any preferred dividend right of the holders of any preference shares. There are no restrictions on our ability to transfer funds (other than funds denominated in Bermuda dollars) in and out of Bermuda or to pay dividends to non-Bermuda residents. Our bye-laws provide that our Board of Directors may forfeit any dividend or other monies payable in respect of any shares which remain unclaimed for six years from the date when such monies became due for payment.
Variation of shareholder rights
If at any time we have more than one class of shares, the rights attaching to any class, unless otherwise provided for by the terms of issue of the relevant class, may be varied either: (i) with the consent in writing of the holders of 75% of the issued shares of that class; or (ii) with the sanction of a resolution passed by a majority of the votes cast at a general meeting of the relevant class of shareholders at which a quorum consisting of at least two persons holding or representing the issued shares of the relevant class is present. Our bye-laws specify that the creation or issue of shares ranking equally with existing shares will not, unless expressly provided by the terms of issue of those shares, vary the rights attached to existing shares. In addition, the creation or issue of preferred shares ranking prior to common shares will not be deemed to vary the rights attached to common shares.
Transfer of shares
Our Board of Directors may in its absolute discretion and without assigning any reason refuse to register the transfer of a share that is not fully paid. Our Board of Directors may also refuse to recognize an instrument of transfer of a share unless it is accompanied by the relevant share certificate and such other evidence of the transferor’s right to make the transfer as our Board of Directors shall reasonably require. Subject to these restrictions, a holder of common shares may transfer the title to all or any of his or her or its common shares by completing a form of transfer in the form set out in our bye-laws (or as near thereto as circumstances admit) or in such other form as the Board of Directors may accept. The instrument of transfer must be signed by both the transferor and transferee, although in the case of a fully paid share our Board of Directors may accept the instrument signed only by the transferor.

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Meetings of shareholders
Our bye-laws provide that any resolution required or permitted to be passed by our shareholders must be passed at an annual or special general meeting of our shareholders or by the unanimous written consent of our shareholders, except that the removal of directors and auditors cannot be done by unanimous written consent. Under Bermuda law, a company is required to convene at least one general meeting of shareholders each calendar year. Bermuda law provides that a special general meeting of shareholders may be called by the board of directors of a company and must be called upon the request of shareholders holding not less than 10% of the paid-up capital of the company carrying the right to vote at general meetings. Bermuda law also requires that shareholders be given at least five days’ advance notice of a general meeting, but the accidental omission to give notice to any person does not invalidate the proceedings at a meeting. Our bye-laws provide that our Board of Directors may convene an annual general meeting or a special general meeting. The notice requirement for general meetings is subject to the ability to hold such meetings on shorter notice if such notice is agreed: (i) in the case of an annual general meeting by all of the shareholders entitled to attend and vote at such meeting; or (ii) in the case of a special general meeting by a majority in number of the shareholders entitled to attend and vote at the meeting holding not less than 95% in nominal value of the shares entitled to vote at such meeting. The quorum required for a general meeting of shareholders is two or more shareholders present in person or by proxy and entitled to vote.
Access to books and records and public dissemination of information
Members of the general public have the right to inspect the public documents of a company available at the office of the Registrar of Companies in Bermuda. These documents include the Company’s memorandum of association (which include its objects and powers) and certain alterations to its memorandum of association. The shareholders have the additional right to inspect the bye-laws of the Company, minutes of general meetings of shareholders and the Company’s audited financial statements, which must be presented at the annual general meeting. The register of members of a company is also open to inspection by shareholders without charge and by members of the general public on the payment of a fee. The register of members is required to be open for inspection for not less than two hours in any business day (subject to the ability of a company to close the register of shareholders for not more than thirty days in a year). A company is required to maintain its share register in Bermuda but may, subject to the provisions of the Companies Act 1981, establish a branch register outside Bermuda. A company is required to keep at its registered office a register of directors and officers that is open for inspection for not less than two hours in any business day by members of the public without charge. Bermuda law does not, however, provide a general right for shareholders to inspect or obtain copies of any other corporate records.
Election and removal of directors
Our bye-laws provide that our Board of Directors shall consist of not less than two directors. Our bye-laws do not provide for cumulative voting in the election of directors. Subject to the provisions of our bye-laws, the shareholders by resolution may determine such other minimum or maximum numbers of directors.
Our bye-laws provide that the shareholders entitled to vote for the election of directors may, at any special general meeting called for that purpose, remove a director for any reason, provided that the notice of any such meeting convened for the purpose of removing a director contains a statement of the intention to remove the director and is served on that director at least 14 days before the meeting. The director is entitled to be heard at the meeting on the motion for his or her removal. Any vacancy created by the

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removal of a director at a special general meeting may be filled at the meeting by a resolution of the shareholders, or, in the absence of such election, by the Board of Directors.
Proceedings of the Board of Directors
Our bye-laws provide that our business is to be managed and conducted by our Board of Directors and our Board may exercise all powers of the Company to borrow money and mortgage any of our property and assets. Bermuda law requires that our directors be individuals, but there is no requirement in our bye-laws or Bermuda law that directors hold any of our shares. There is also no requirement in our bye-laws or Bermuda law that our directors must retire at a certain age.
The remuneration of our directors is determined by resolution of the shareholders. Our directors may also be paid all reasonable travel, hotel and other expenses properly incurred by them in attending and returning from meetings of the Board or general meetings of the Company, acting as committee members appointed by the Board or otherwise in connection with our business or their duties as directors. Under Bermuda law, a director shall be deemed not to be acting honestly and in good faith if he fails to disclose at the first opportunity at a meeting of directors or by writing to the directors: (i) his or her interest in any material contract or proposed material contract with the Company or any of its subsidiaries; or (ii) his or her material interest in any person that is a party to a material contract or proposed material contract with the Company.
Indemnification of directors and officers
Our bye-laws indemnify our directors and officers in respect of their actions and omissions, except in respect of their fraud or dishonesty. The indemnification provided in our bye-laws is not exclusive of other indemnification rights to which a director or officer may be entitled, provided these rights do not extend to his or her fraud or dishonesty.
Amendment of memorandum of association and bye-laws
Bermuda law provides that the memorandum of association of a company may be amended by a resolution passed at a general meeting of shareholders of which due notice has been given. Our bye-laws may be amended in the manner provided for in the Companies Act 1981.
Under Bermuda law, the holders of an aggregate of not less than 20% in par value of a company’s issued share capital have the right to apply to the Supreme Court of Bermuda for an annulment of any amendment of the memorandum of association adopted by shareholders at any general meeting, other than an amendment which alters or reduces a company’s share capital as provided in the Companies Act 1981. Where such an application is made, the amendment becomes effective only to the extent that it is confirmed by the Bermuda court. An application for an annulment of an amendment of the memorandum of association must be made within twenty-one days after the date on which the resolution altering the company’s memorandum of association is passed and may be made on behalf of persons entitled to make the application by one or more of their number as they may appoint in writing for the purpose. No application may be made by shareholders voting in favor of the amendment.
Appraisal rights and shareholder suits
Under Bermuda law, in the event of an amalgamation of a Bermuda company with another company or corporation, a shareholder of the Bermuda company who is not satisfied that fair value has been offered for such shareholder’s shares may apply to the Supreme Court of Bermuda within one month of notice of the shareholders’ meeting to appraise the fair value of those shares.

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Class actions and derivative actions are generally not available to shareholders under Bermuda law. The Bermuda courts, however, would ordinarily be expected to permit a shareholder to commence an action in the name of a company to remedy a wrong to the company where the act complained of is alleged to be beyond the corporate power of the company or is illegal or would result in the violation of the company’s memorandum of association or bye-laws. Furthermore, consideration would be given by a Bermuda court to acts that are alleged to constitute a fraud against the minority shareholders or, for instance, where an act requires the approval of a greater percentage of the company’s shareholders than that which actually approved it.
Capitalization of profits and reserves
Pursuant to our bye-laws, our shareholders may, upon the recommendation of our Board of Directors, (i) capitalize any part of the amount of our share premium or other reserve accounts or otherwise available for distribution by applying such sum in paying up unissued shares to be allotted as fully paid bonus shares pro-rata (except in connection with the conversion of shares) to the shareholders; or (ii) capitalize any sum standing to the credit of a reserve account or sums otherwise available for dividend or distribution by paying up in full partly paid or nil paid shares of those shareholders who would have been entitled to such sums if they were distributed by way of dividend or distribution.
Material contracts
On December 24, 2004, we entered into a contract with Meyer Werft Shipyard to build a 2,400-berth ship, Norwegian Pearl, for 389.0 million Euro ($460.7 million at delivery date), including an allowance for buyer’s items. The ship was delivered in the fourth quarter of 2006.
On May 3, 2005, we entered into a contract with Meyer Werft Shipyard to build another 2,400-berth ship, Norwegian Gem, for 391.0 million Euro ($516.1 million as of December 31, 2006), including an allowance for buyer’s items. The ship is anticipated to be delivered in the fourth quarter of 2007.
On October 7, 2005, we entered into a secured revolving credit facility allowing us to borrow up to 80% of the contract price of the two ships including an allowance for buyer’s items upon their respective delivery dates, which was 311.2 million Euro, ($410.8 million as of December 31, 2006) for Norwegian Pearl and up to 312.8 million Euro, ($412.9 million as of December 31, 2006) for Norwegian Gem.
On September 7, 2006, we entered into a contract with Aker Yards S.A. to build a 4,200-berth ship, F3 One, for 735.0 million Euro ($970.1 million as of December 31, 2006), including an allowance for buyer’s items. Pursuant to subsequent modification agreements, the contract price was increased to 742.5 million Euro ($980.0 million as of December 31, 2006). The ship is anticipated to be delivered in the fourth quarter of 2009.
On September 7, 2006, we entered into a contract with Aker Yards S.A. to build a 4,200-berth ship, F3 Two, for 735.0 million Euro ($970.1 million as of December 31, 2006), including an allowance for buyer’s items. Pursuant to subsequent modification agreements, the contract price was increased to 742.5 million Euro ($980.0 million as of December 31, 2006). The ship is anticipated to be delivered in the second quarter of 2010.
On September 7, 2006, we entered into a purchase option agreement with Aker Yards S.A. to build a third 4,200-berth F3 ship for 700 million Euro ($923.9 million as of December 31, 2006). We may exercise the option before or on August 31, 2007. If so exercised, the ship would be scheduled for delivery in the first quarter of 2011.
On September 22, 2006, we signed a loan agreement with BNP Paribas, as agent for BNP Paribas, Calyon, HSBC France and Societe Generale, allowing us to borrow up to 80% of the contract price of F3 One upon its delivery date, or up to 662.9 million Euro ($875.0 million as of December 31, 2006). We expect to make payments due during construction from cash flows from operations and borrowings under our revolving credit facilities.
On September 22, 2006, we signed a loan agreement with BNP Paribas, as agent for BNP Paribas, Calyon, HSBC France and Societe Generale, allowing us to borrow up to 80% of the contract price of F3 Two upon its delivery date, or up to 662.9 million Euro ($875.0 million as of December 31, 2006). We expect to make payments due during construction from cash flows from operations and borrowings under our revolving credit facilities.
Both of the above described financings are term loans, each collateralized by the respective ship and are repayable in 24 semi-annual installments, commencing six months from the relevant ship’s delivery date, through 2021 and 2022. The financing for F3 One is denominated in U.S. dollars bearing a fixed interest rate of 6.05% and the financing for F3 Two is denominated in Euros bearing a fixed interest rate of 4.89%. Under the terms of each loan agreement, we have the ability to cancel the financing up to 60 days prior to the delivery date for the ship.
On November 27, 2006, we entered into a 146-month lease agreement commencing December 1, 2006 with Hines Reit Airport Corporate Center LLC with respect to our Miami corporate headquarters, which lease provides for 208,737 rentable square feet.

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On December 22, 2006, we entered into a $610.0 million senior secured revolving credit facility with DnB NOR Bank ASA, as agent for DnB NOR Bank ASA, Citibank N.A., Commerzbank Aktiengesellschaft, KfW, Norddeutsche Landesbank Girozentrale, and Nordea Bank Norge ASA. The facility refinanced two existing loans collateralized by Norwegian Dawn and Norwegian Sun and provides additional borrowing capacity for general corporate purposes. The facility is available in two tranches of $510 million and $100 million, each having a condition precedent of $200 million in equity being raised by us. The facility has no amortization for the first 36 months, bears interest at LIBOR plus a margin of 150 basis points at December 31, 2006 (which margin is subject to certain adjustments) and matures in 2013. At December 31, 2006, $120.0 million was available under this facility.
Exchange controls
None.
Documents on display
We are subject to the information requirements of the Exchange Act. In accordance with these requirements, we file reports, including annual reports on Form 20-F, and other information with the SEC. These materials, including this annual report, and the exhibits thereto, may be inspected and copied at the SEC’s public reference room at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference rooms. In addition, any filings we make electronically with the SEC will be available to the public over the Internet at the SEC’s website at http://www.sec.gov and are also available on our www.ncl.com website.
Item 11. Quantitative and Qualitative Disclosures About Market Risk
We refer you to “Item 5—Operating and Financial Review and Prospects—Financial instruments and other,” for information about our market risk.
Item 12. Description of Securities Other than Equity Securities
None.

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PART II
Item 13. Defaults, Dividend Arrearages and Delinquencies
None.
Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds
None.
Item 15. Controls and Procedures
We have evaluated, with the participation of our Chief Executive Officer and our Chief Financial Officer, the effectiveness of our disclosure controls and procedures as of December 31, 2006. There are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives. Based upon our evaluation, our Chief Executive Officer and our Chief Financial Officer concluded that our disclosure controls and procedures were effective to provide reasonable assurance that the information required to be disclosed by us in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the applicable rules and forms, and that it is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.
There has been no change in our internal control over financial reporting during 2006 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Item 16. Reserved
Item 16A. Audit Committee Financial Expert
Our Board of Directors has determined that Mr. Walter L. Revell qualifies as an “audit committee financial expert” and is independent within the meaning of the rules, of the New York Stock Exchange (a national securities exchange registered pursuant to Section 6 of the Exchange Act).
One of our Audit Committee members serves on the board of directors of more than three public companies; however, we have determined that such simultaneous service will not impair the ability of such member to effectively serve on the Audit Committee.
Item 16B. Code of Ethics
Our Board of Directors has adopted a code of conduct and ethics as defined in Item 16B of Form 20-F. The code of conduct and ethics is applicable to all of our directors, officers and employees. Our code of conduct and ethics is publicly available on our website at www.ncl.com.

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Item 16C. Principal Accountant Fees and Services
The following table sets forth the fees billed to us by our principal accounting firm, PricewarterhouseCoopers LLP, during the years ended December 31, 2005 and 2006.
                 
    Total Fees
    For the years ended December 31,
    2005   2006
    (in thousands of dollars)
Fees
               
Audit fees
  $ 1,275     $ 873  
Audit related fees
    139       37  
Tax fees
    348       145  
All other fees
          2  
 
               
Total
  $ 1,762     $ 1,057  
 
               
Audit fees in the above table are the aggregate fees billed by PricewaterhouseCoopers LLP in connection with the audit of our annual consolidated financial statements, the review of our quarterly financial statements and other statutory audit reports. The 2005 audit fees were increased by approximately $278,000 from what was reported in our Form 20-F for the year ended December 31, 2005 because these fees were approved after the filing of the 2005 Form 20-F.
Audit-related fees in 2005 were in connection with the audit of our employee benefit plan and due diligence performed on our purchase of Polynesian Adventure Tours, Inc. Audit-related fees in 2006 were in connection with the audit of our employee benefit plan.
Tax fees in 2005 and 2006 were in connection with tax return preparation and tax advice concerning NCL America and for our European offices. The 2005 tax fees were increased by approximately $35,000 from what was reported in our Form 20-F for the year ended December 31, 2005 because these fees were approved after the filing of the 2005 Form 20-F.
All Other Fees for 2006 were for PricewaterhouseCoopers LLP annual on-line subscription related to a research tool.
Audit Committee pre-approval policies and procedures
Our Audit Committee approves all audit, audit-related services, tax services and other services provided by PricewaterhouseCoopers LLP. Any services provided by PricewaterhouseCoopers LLP that are not specifically included within the scope of the audit must be pre-approved by the Audit Committee prior to any engagement.
Item 16D. Exemptions from Listing Standards for Audit Committees
None.
Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers
None.

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PART III
Item 17. Financial Statements
The Registrant has responded to Item 18 in lieu of this Item.
Item 18. Financial Statements
Reference is made to pages F-1 to F-28 of this annual report.
Item 19. Exhibits
A list of exhibits included as part of this annual report is set forth in the Exhibit Index and is hereby incorporated by reference herein. These agreements may contain representations and warranties by the parties. These representations and warranties have been made solely for the benefit of the other party or parties to such agreements and (i) may have been qualified by disclosures made to such other party or parties, (ii) were made only as of the date of such agreements or such other date(s) as may be specified in such agreements and are subject to more recent developments, which may not be fully reflected in our public disclosure, (iii) may reflect the allocation of risk among the parties to such agreements and (iv) may apply materiality standards different from what may be viewed as material to investors. Accordingly, these representations and warranties may not describe our actual state of affairs at the date hereof and should not be relied upon.

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Glossary
Berths. The number of passenger beds on a cruise ship, calculated, in accordance with industry practice, by multiplying the number of passenger cabins by two beds per cabin. Berths do not represent the actual number of passenger beds on a cruise ship. The actual number of beds may be different because it is possible to furnish a cabin on a cruise ship with more or fewer than two beds per cabin.
Charter. The hire of a ship for a specified period of time. The contract for a charter is called a charterparty. A ship is “chartered in” by an end user and “chartered out” by the provider of the vessel.
CLIA. Cruise Lines International Association, a marketing and training organization formed in 1975 to promote cruising. CLIA is composed of 21 of the major North American cruise lines, including NCL, which together represent 97% of the cruise capacity marketed from North America as of December 31, 2006.
Dry-dock. Large basin where all the fresh/sea water is pumped out to allow a ship to dock in order to carry out cleaning and repairs of those parts of a ship which are below the water line.
Gross Tons. Is a unit of enclosed passenger space on a cruise ship, such that gross ton = 100 cubic feet or 2.831 cubic meters.
IMO. International Maritime Organization, a United Nations agency that sets international standards for shipping.
Jones Act. A common name for the coastwise laws in the U.S. including the U.S. Merchant Marine Act of 1920, as amended, with regard to the transportation of merchandise and the Passenger Vessel Services Act with regard to the transportation of passengers.
MARPOL. The International Convention for the Prevention of Pollution from Ships, an international environmental regulation.
SOLAS. The International Convention for the Safety of Life at Sea, an international environmental regulation.
Terminal. A building in a port through which ship passengers arrive and depart.

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SIGNATURE
The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.
         
  NCL Corporation Ltd.
 
 
  By:   /s/ Bonnie S. Biumi    
    Name:   Bonnie S. Biumi   
    Title:   Executive Vice President and Chief Financial Officer   
 
Date: March 5, 2007

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Exhibit    
number   Description of exhibit
 
1.1
  Memorandum of Association of NCL Corporation Ltd.*
 
   
1.2
  Bye-Laws of NCL Corporation Ltd.*
 
   
2.1
  Indenture, dated July 15, 2004, between NCL Corporation Ltd. and JPMorgan Chase Bank, N.A., as Indenture Trustee with respect to $250 million 10 5/8% Senior Notes due 2014*
 
   
4.1
  $626.9 million Syndicated Term Loan, dated as of June 26, 1999, as amended by four supplemental agreements, among Norwegian Star Limited, Norwegian Dawn Limited and a syndicate of international banks and related Guarantee by NCL Corporation Ltd.*+
 
   
4.2
  Fifth Supplemental Deed, dated as of 30 September 2005, to $626.9 million Syndicated Term Loan, among Norwegian Dawn Limited, NCL Corporation Ltd. and a syndicate of international banks.**
 
   
4.3
  $225.0 million Norwegian Sun Loan, dated as of July 9, 2003, as amended, among Norwegian Sun Limited and a syndicate of international banks and related Guarantee by NCL Corporation Ltd.*+
 
   
4.4
  Second Supplemental Deed, dated as of 30 September 2005, to $225.0 million Norwegian Sun Loan, among Norwegian Sun Limited, NCL Corporation Ltd. and a syndicate of international banks.**
 
   
4.5
  Euro 298.0 million Pride of America Loans, dated as of April 4, 2003, among Ship Holding LLC and a syndicate of international banks and related Guarantee by NCL Corporation Ltd.*+
 
   
4.6
  Supplemental Amendments, to Euro 298.0 million Pride of America Loans, among Pride of America Ship Holding, Inc., NCL Corporation Ltd. and a syndicate of international banks.**
 
   
4.7
  $800.0 million Senior Secured Credit Facility, dated as of July 7, 2004, among NCL Corporation Ltd. and a syndicate of international banks.*
 
   
4.8
  Supplemental Deed, dated as of 30 September 2005, to $800.0 million Senior Secured Credit Facility, among Norwegian Star Limited, Norwegian Spirit Ltd., Pride of Aloha, Inc., NCL Corporation Ltd. and a syndicate of international banks.**
 
   
4.9
  Facility Agreement, dated as of 23 September 2005, in connection with Letters of Credit required by the Merchant Services Bankcard Agreement, by and among NCL Corporation Ltd. and a syndicate of international banks.**
 
   
4.10
  Euro 334.1 million Norwegian Jewel Loan, dated as of April 20, 2004, among Norwegian Jewel Limited and a syndicate of international banks and related Guarantee by NCL Corporation Ltd.*+
 
   
4.11
  Supplemental Deed, dated as of 30 September 2005, to Euro 334.1 million Norwegian Jewel Loan, among Norwegian Jewel Limited, NCL Corporation Ltd. and a syndicate of international banks.**
 
   
4.12
  Euro 308.1 million Pride of Hawai’i Loan, dated as of April 20, 2004, as amended, among Pride of Hawaii, Inc. and a syndicate of international banks and related Guarantee by NCL Corporation Ltd.*+

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Exhibit    
number   Description of exhibit
 
4.13
  Second Supplemental Deed, dated as of 30 September 2005, to Euro 308.1 million Pride of Hawai’i Loan, among Pride of Hawaii, Inc., NCL Corporation Ltd. and a syndicate of international banks.**
 
   
4.14
  Merchant Services Bankcard Agreement, dated as of March 26, 2004, among NCL Corporation Ltd., Chase Merchant Services, LLC and JPMorgan Chase Bank.*
 
   
4.15
  Bareboat Charter Agreement, dated April 20, 2004, between Crown Odyssey Limited and NCL (Bahamas) Ltd.*+
 
   
4.16
  Bareboat Charter Agreement, dated April 20, 2004, between Crown Wind Limited and NCL (Bahamas) Ltd.*+
 
   
4.17
  Bareboat Charter Agreement, dated April 20, 2004, between Ocean Dream Limited and NCL (Bahamas) Ltd.*+
 
   
4.18
  Bareboat Charter Agreement, dated April 20, 2004, between Ocean Voyager Limited and NCL (Bahamas) Ltd.*+
 
   
4.19
  Amended and Restated Shipbuilding Contract for Pride of America, dated February 5, 2003, between Ship Holding LLC and Lloyd Werft Bremerhaven GmbH, as amended by addendum No. 1 dated March 7, 2003, addendum No. 2 dated March 14, 2003 and addendum No. 3 dated July 1, 2004.*+
 
   
4.20
  Shipbuilding Contract for Hull No. 667, dated September 15, 2003, between Arrasas Limited and Jos. L. Meyer GmbH, as amended by addendum No. 1 dated March 25, 2004.*+
 
   
4.21
  Shipbuilding Contract for Hull No. 668, dated September 15, 2003, between Arrasas Limited, Pride of Hawai’i, Inc. and Jos. L. Meyer GmbH, as amended by addendum No. 1 dated April 13, 2004.*+
 
   
4.22
  Shipbuilding Contract for Hull No. S669, dated December 24, 2004, between Hull 669 Ltd., NCL Corporation Ltd. and Jos. L. Meyer GmbH.*+
 
   
4.23
  Shipbuilding Contract for Hull No. S670, dated May 3, 2005, between Newbuild Holding, Ltd., NCL Corporation Ltd. and Jos. L. Meyer GmbH.*+
 
   
4.24
  Up to Euro 624.0 million Revolving Loan Facility Agreement, dated October 7, 2005, among NCL Corporation Ltd., and a syndicate of international banks.**
 
   
4.25
  Sixth Supplemental Deed, dated November 13, 2006, to $626.9 million Syndicated Term Loan, dated as of June 26, 1999, as amended, by and among Norwegian Dawn Limited and a syndicate of international banks and a related Guarantee by NCL Corporation Ltd.++
 
   
4.26
  Third Supplemental Deed, dated November 13, 2006, to $225.0 million Norwegian Sun Loan, dated as of July 9, 2003, as amended, by and among Norwegian Sun Limited and a syndicate of international banks and a related Guarantee by NCL Corporation Ltd.++
 
   
4.27
  Seventh Supplemental Deed to Euro 258.0 million Pride of America Loans and Sixth Supplemental Deed to Euro 40.0 million Pride of America Loans, both dated November 13, 2006, to Euro 298.0 million Pride of America Loans, dated as of April 4, 2003, and amended and restated by an agreement dated April 20, 2004, by and among Pride of America Ship Holding, Inc. and a syndicate of international banks and a related Guarantee by NCL Corporation Ltd.++

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Exhibit    
number   Description of exhibit
 
4.28
  Second Supplemental Deed, dated November 13, 2006, to $800.0 million Senior Secured Credit Facility, dated as of July 7, 2004, as amended, by and among NCL Corporation Ltd., Norwegian Star Limited, Norwegian Spirit, Ltd., Pride of Aloha, Inc., and a syndicate of international banks.++
 
   
4.29
  First Supplemental Deed, dated November 13, 2006, to Facility Agreement, dated September 23, 2005, in connection with Letters of Credit required by the Merchant Services Bankcard Agreement, by and among NCL Corporation Ltd. and a syndicate of international banks.++
 
   
4.30
  Second Supplemental Deed, dated April 4, 2006, and Third Supplemental Deed, dated November 13, 2006, to $334.1 million Norwegian Jewel Loan, dated as of April 20, 2004, as amended, by and among Norwegian Jewel Limited and a syndicate of international banks and a related Guarantee by NCL Corporation Ltd.++
 
   
4.31
  Third Supplemental Deed, dated November 13, 2006, to Euro 308.1 million Pride of Hawai’i Loan, dated as of April 20, 2004, as amended, by and among Pride of Hawaii, Inc. and a syndicate of international banks and a related Guarantee by NCL Corporation Ltd.++
 
   
4.32
  First Supplemental Deed, dated November 13, 2006, to up to Euro 624.0 million Revolving Loan Facility Gem/Pearl Agreement, dated October 7, 2005, as amended, by and among NCL Corporation Ltd. and a syndicate of international banks.++
 
   
4.33
  Euro 662.9 million Syndicated Loan Facility, dated September 22, 2006, by and among F3 One, Ltd. and a syndicate of international banks and a related Guarantee by NCL Corporation Ltd., for the construction of Hull C33 at Aker Yards S.A.++
 
   
4.34
  Euro 662.9 million Syndicated Loan Facility, dated September 22, 2006, by and among F3 Two, Ltd. and a syndicate of international banks and a related Guarantee by NCL Corporation Ltd., for the construction of Hull D33 at Aker Yards S.A.++
 
   
4.35
  $610.0 million Revolving Credit Facility, dated December 22, 2006, by and between NCL Corporation Ltd. and a syndicate of international banks for the refinancing of m.v. Norwegian Sun and m.v. Norwegian Dawn vessels (amongst other matters).++
 
   
4.36
  Amendment Agreement, dated September 1, 2006, to Bareboat Charter Agreement, dated April 20, 2004, by and between Crown Odyssey Limited and NCL (Bahamas) Ltd.++
 
   
4.37
  Addendum No. 1, dated November 28, 2006, to Bareboat Charter Agreement, dated April 20, 2004, by and between Crown Wind Limited and NCL (Bahamas) Ltd.++
 
   
4.38
  Addendum No. 1, dated November 28, 2006, to Bareboat Charter Agreement, dated April 20, 2004, by and between Ocean Dream Limited and NCL (Bahamas) Ltd.++
 
   
4.39
  Addendum No. 1, dated November 28, 2006, to Bareboat Charter Agreement, dated April 20, 2004, by and between Ocean Voyager Limited and NCL (Bahamas) Ltd.++
 
   
4.40
  Addendum No. 4, dated April 28, 2005, Addendum No. 5, dated June 7, 2005, and Addendum No. 6, dated June 25, 2005, to Amended and Restated Shipbuilding Contract for Pride of America, dated February 5, 2003, by and between Pride of America Ship Holding, Inc. and Lloyd Werft Bremerhaven GmbH.++
 
   
4.41
  Addendum, dated February 14, 2006, and Addendum No. 3, dated April 19, 2006, to Shipbuilding Contract for Hull No. 668, dated September 15, 2003, by and among, Arrasas Limited, Pride of Hawaii, Inc. and Jos. L. Meyer GmbH.++

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Exhibit    
number   Description of exhibit
 
4.42
  Addendum No. 1, dated February 14, 2006, to Shipbuilding Contract for Hull No. S669, dated December 24, 2004, by and among Norwegian Pearl, Ltd., NCL Corporation Ltd. and Jos. L. Meyer GmbH.
 
   
4.43
  Shipbuilding Contract for Hull No. C33, dated September 7, 2006, by and between F3 One, Ltd. and Aker Yards S.A., and Agreement on a Modification (“AOM”) No. 1, dated September 7, 2006, AOM No. 2, dated September 7, 2006, AOM No. 3, dated September 7, 2006, and AOM No. 4, dated September 7, 2006.++
 
   
4.44
  Shipbuilding Contract for Hull No. D33, dated September 7, 2006, by and between F3 Two, Ltd. and Aker Yards S.A., and AOM No. 1, dated September 7, 2006, AOM No. 2, dated September 7, 2006, AOM No. 3, dated September 7, 2006, and AOM No. 4, dated September 7, 2006.++
 
   
4.45
  Side Letter Agreement, dated as of September 7, 2006, by and between, F3 One, Ltd., F3 Two, Ltd. and Aker Yards S.A.++
 
   
4.46
  Office Lease Agreement, dated November 27, 2006, by and between NCL (Bahamas) Ltd. and Hines Reit Airport Corporate Center LLC and a related Guarantee by NCL Corporation Ltd., and First Amendment, dated November 27, 2006.++
 
   
8.1
  List of subsidiaries of NCL Corporation Ltd.*
 
   
12.1
  Certification under Section 302 of the Sarbanes-Oxley Act of 2002.
 
   
12.2
  Certification under Section 302 of the Sarbanes-Oxley Act of 2002.
 
   
13.1
  Certification under Section 906 of the Sarbanes-Oxley Act of 2002.
 
*   Incorporated herein by reference to our registration statement on Form F-4 (File No. 333-128780).
 
**   Incorporated herein by reference to our annual report for the fiscal year ended December 31, 2005 on Form 20-F filed on March 29, 2006 (File No. 333-128780).
 
+   Confidential treatment has been granted with respect to certain portions of this exhibit. Omitted portions have been filed separately with the SEC.
 
++   Confidential treatment has been requested with respect to certain portions of this exhibit. Omitted portions have been filed separately with the SEC.

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NCL Corporation Ltd.
Index to Consolidated Financial Statements

 
         
    Page(s)
Report of Independent Registered Certified Public Accounting Firm
    F-1  
 
       
Consolidated Financial Statements
       
 
       
Consolidated Statements of Operations for the years ended December 31, 2004, 2005 and 2006
    F-2  
 
       
Consolidated Balance Sheets as of December 31, 2005 and 2006
    F-3  
 
       
Consolidated Statements of Cash Flows for the years ended December 31, 2004, 2005 and 2006
    F-4  
 
       
Consolidated Statements of Changes in Shareholder’s Equity for the years ended December 31, 2004, 2005 and 2006
    F-5  
 
       
Notes to the Consolidated Financial Statements
    F-6 to F-28  

 


Table of Contents

Report of Independent Registered Certified Public Accounting Firm
Board of Directors and Shareholder
NCL Corporation Ltd.
In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of operations, of cash flows and of changes in shareholder’s equity present fairly, in all material respects, the financial position of NCL Corporation Ltd. and its subsidiaries (the “Company”) at December 31, 2006 and 2005, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2006 in conformity with accounting principles generally accepted in the United States of America. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
As discussed in Notes 2 and 3, the Company changed its method of accounting for share-based compensation and dry-docking costs.
Pricewaterhousecoopers LLP
Miami, Florida
February 23, 2007

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Table of Contents

NCL Corporation Ltd.
Consolidated Statements of Operations
(in thousands of dollars)

 
 
                         
    Years Ended December 31,
    2004   2005   2006
    (Note 3)        
Revenues
                       
Passenger ticket revenues
  $ 990,758     $ 1,194,461     $ 1,438,996  
Onboard and other revenues
    353,238       435,262       537,313  
 
                       
Total revenues
    1,343,996       1,629,723       1,976,309  
 
                       
 
                       
Cruise operating expenses
                       
Commissions, transportation and other
    257,947       328,899       425,648  
Onboard and other
    120,250       141,957       186,240  
Payroll and related
    243,355       323,621       412,943  
Fuel
    78,013       119,412       164,530  
Food
    81,448       94,105       102,324  
Ship charter costs
    22,046       28,603       26,226  
Other operating
    204,030       211,929       249,471  
 
                       
Total cruise operating expenses
    1,007,089       1,248,526       1,567,382  
 
                       
Marketing, general and administrative expenses
    204,560       225,240       249,250  
Depreciation and amortization expenses
    76,937       85,615       119,097  
Impairment loss
    14,500             8,000  
 
                       
Total operating expenses
    1,303,086       1,559,381       1,943,729  
 
                       
Operating income
    40,910       70,342       32,580  
 
                       
 
                       
Non-operating (income) expenses
                       
Interest income
    (1,434 )     (4,803 )     (3,392 )
Interest expense, net of capitalized interest
    48,886       87,006       136,478  
Other expenses (income), net
    11,548       (28,096 )     30,393  
 
                       
Total non-operating expenses
    59,000       54,107       163,479  
 
                       
Net (loss) income
  $ (18,090 )   $ 16,235     $ (130,899 )
 
                       
The accompanying notes are an integral part of these consolidated financial statements.

F-2


Table of Contents

NCL Corporation Ltd.
Consolidated Balance Sheets
(in thousands of dollars, except share data)

 
 
                 
    December 31,
    2005   2006
    (Note 3)
Assets
               
Current assets:
               
Cash and cash equivalents
  $ 60,416     $ 63,530  
Restricted cash
    48,034       1,226  
Accounts receivable, net
    11,691       10,244  
Note from Parent
    12,325        
Amount due from Parent
          5,033  
Consumable inventories
    29,460       33,392  
Prepaid expenses and other
    27,203       24,211  
 
               
Total current assets
    189,129       137,636  
 
               
Property and equipment, net
    3,113,229       3,816,292  
Restricted cash
          1,650  
Goodwill
    400,254       400,254  
Tradenames
    218,538       202,538  
Other assets
    63,077       71,254  
 
               
Total assets
  $ 3,984,227     $ 4,629,624  
 
               
 
               
Liabilities and Shareholder’s Equity
               
Current liabilities:
               
Current portion of long-term debt
  $ 140,694     $ 154,638  
Accounts payable
    73,003       116,947  
Accrued expenses and other liabilities
    144,427       181,821  
Amount due to Parent
    3,141        
Advance ticket sales
    276,644       314,050  
 
               
Total current liabilities
    637,909       767,456  
 
               
Long-term debt
    1,965,983       2,405,357  
Other long-term liabilities
    2,631       1,744  
 
               
Total liabilities
    2,606,523       3,174,557  
 
               
 
               
Commitments and contingencies (Note 10)
               
 
               
Shareholder’s equity
               
Common stock, $1.00 par value; 12,000 shares authorized; 12,000 shares issued and outstanding
    12       12  
Additional paid-in capital
    1,501,929       1,711,114  
Unamortized stock option expense
    (593 )      
Accumulated other comprehensive loss
          (1,516 )
Accumulated deficit
    (123,644 )     (254,543 )
 
               
Total shareholder’s equity
    1,377,704       1,455,067  
 
               
Total liabilities and shareholder’s equity
  $ 3,984,227     $ 4,629,624  
 
               
The accompanying notes are an integral part of these consolidated financial statements.

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NCL Corporation Ltd.
Consolidated Statements of Cash Flows
(in thousands of dollars)

 
 
                         
    Years Ended December 31,
    2004   2005   2006
    (Note 3)        
Cash flows from operating activities
                       
Net (loss) income
  $ (18,090 )   $ 16,235     $ (130,899 )
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
                       
Depreciation and amortization expenses
    76,937       85,615       119,097  
Impairment loss
    14,500             8,000  
Loss (gain) on translation of debt
    9,545       (29,418 )     35,122  
Other
    440       3,359       1,347  
Changes in operating assets and liabilities:
                       
(Increase) decrease in accounts receivable
    (951 )     (885 )     1,447  
Increase in consumable inventories
    (349 )     (10,732 )     (3,932 )
Decrease (increase) in prepaid expenses and other assets
    16,711       (1,300 )     (535 )
(Decrease) increase in accounts payable
    (1,640 )     3,128       43,944  
Increase in accrued expenses and other liabilities
    18,938       20,263       36,507  
Increase in advance ticket sales
    37,717       50,563       37,406  
 
                       
Net cash provided by operating activities
    153,758       136,828       147,504  
 
                       
 
                       
Cash flows from investing activities
                       
Capital expenditures
    (748,267 )     (658,795 )     (809,403 )
Decrease (increase) in restricted cash
    2,204       (19,514 )     45,158  
Cash paid for acquisition of business, net of cash received
    (4,647 )            
Proceeds received for transfer of tradename to Parent
                8,000  
 
                       
Net cash used in investing activities
    (750,710 )     (678,309 )     (756,245 )
 
                       
 
                       
Cash flows from financing activities
                       
Principal repayments on long-term debt
    (505,029 )     (280,440 )     (809,740 )
Proceeds from debt
    1,090,153       715,696       1,219,557  
Proceeds from Parent
    32,566       1,868       4,151  
Contribution from Parent
          461       208,000  
Payment of loan arrangement fees
    (47,455 )     (8,112 )     (10,113 )
 
                       
Net cash provided by financing activities
    570,235       429,473       611,855  
 
                       
Net (decrease) increase in cash and cash equivalents
    (26,717 )     (112,008 )     3,114  
Cash and cash equivalents at beginning of period
    199,141       172,424       60,416  
 
                       
Cash and cash equivalents at end of period
  $ 172,424     $ 60,416     $ 63,530  
 
                       
 
                       
Supplemental disclosures (Note 11)
                       
Interest paid (net of amounts capitalized)
  $ 29,633     $ 88,811     $ 133,958  
 
                       
The accompanying notes are an integral part of these consolidated financial statements.

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NCL Corporation Ltd.
Consolidated Statements of Changes in Shareholder’s Equity
For the Years Ended December 31, 2004, 2005 and 2006
(in thousands of dollars)

 
 
                                                 
                            Accumulated    
            Additional   Unamortized   other   (Note 3)
    Common   paid-in   stock option   comprehensive   Accumulated    
    stock   capital   expense   loss   deficit   Total
Balance, December 31, 2003
  $ 12     $ 1,129,123     $ (768 )         $ (121,789 )   $ 1,006,578  
Issuance of stock options
          451       (178 )                 273  
Accretion of stock option expense
                167                   167  
Contribution from Parent (Note 6 )
          362,049                         362,049  
Net loss
                            (18,090 )     (18,090 )
 
                                               
Balance, December 31, 2004
    12       1,491,623       (779 )           (139,879 )     1,350,977  
Issuance of stock options
          94       (38 )                 56  
Accretion of stock option expense
                224                   224  
Adjustments to variable stock options
          64                         64  
Contribution from Parent (Note 6)
          10,148                         10,148  
Net income
                            16,235       16,235  
 
                                               
Balance, December 31, 2005
    12       1,501,929       (593 )           (123,644 )     1,377,704  
Non-cash stock-based compensation
          1,559                         1,559  
Reclassification of unamortized stock option expense
          (593 )     593                    
Contribution from Parent (Note 6)
          208,219                         208,219  
Changes related to cash flow derivative hedges
                      (1,516           (1,516 )
Net loss
                            (130,899 )     (130,899 )
 
                                               
Balance, December 31, 2006
  $ 12     $ 1,711,114     $     $ (1,516     $(254,543 )   $ 1,455,067  
 
                                               
     The number of shares of common stock for the three years remains unchanged at 12.0 shares issued and outstanding.
    Comprehensive (loss) income is as follows (in thousands):
                         
    Years Ended December 31,
    2004   2005   2006
Net (loss) income
  $ (18,090 )   $ 16,235     $ (130,899 )
Changes related to cash flow derivative hedges
                (1,516 )
 
                       
Total comprehensive (loss) income
  $ (18,090 )   $ 16,235     $ (132,415 )
 
                       
                         
    Changes related to cash flow derivative hedges
Accumulated other comprehensive income at beginning of year
  $     $     $  
Current-period change
                (1,516 )
 
                       
Accumulated other comprehensive loss at end of year
  $     $     $ (1,516 )
 
                       
The accompanying notes are an integral part of these consolidated financial statements.

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NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
 
1.   Description of Business and Organization
 
    On December 15, 2003, we were incorporated in Bermuda as a wholly-owned subsidiary of Star Cruises Limited (the “Parent”). In connection with our formation, Star Cruises Limited transferred the stock it held in Arrasas Limited (“Arrasas”) to us. This transaction has been accounted for at historical cost since we and Arrasas are under the common control of Star Cruises Limited. The accompanying consolidated financial statements have been prepared as if we were in existence on January 1, 2003. Accordingly, the consolidated statements of changes in shareholder’s equity has been adjusted to reflect this capital structure for all periods presented.
 
    We operate three cruise brands, Norwegian Cruise Line, NCL America, and Orient Lines. As of December 31, 2006, we operated 14 ships offering cruises in Antarctica, the Caribbean, the Bahamas, Bermuda, Alaska, Mexico, Europe, Hawaii, New England, North Africa and Central and South America and Scandinavia.
 
2.   Summary of Significant Accounting Policies
 
    The following accounting policies have been used consistently in the preparation of the consolidated financial statements:
 
    Basis of Presentation
 
    The consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America. Estimates are required for the preparation of consolidated financial statements in accordance with generally accepted accounting principles. Actual results could differ from those estimates. All significant intercompany accounts and transactions are eliminated in consolidation.
 
    Revenue and Expense Recognition
 
    Deposits received from customers for future voyages are recorded as advance ticket sales until such passenger revenue is earned. Revenues are recognized when the relevant services have been rendered. Passenger ticket revenues and all associated direct costs of a voyage are recognized on a pro rata basis over the period of the voyage.
 
    Cash and Cash Equivalents
 
    Cash and cash equivalents include cash and investments with original maturities of three months or less when purchased.
 
    Restricted Cash
 
    Restricted cash consists of cash collateral in respect of certain agreements, including requirements imposed by our credit card processor (we refer you to Note 10(f)). Restricted cash fluctuates based on the level of advance ticket sales processed. In May 2006, cash collateral requirements imposed by our credit card processors were lifted. These requirements can be reinstated at the credit card processors’ discretion.

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NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
 
      Accounts Receivable
 
    Accounts receivable are shown net of an allowance of $2.0 million and $2.5 million at December 31, 2005 and 2006, respectively.
 
    Foreign Currency
 
    The majority of our transactions are settled in U.S. dollars. Gains or losses resulting from transactions denominated in other currencies are recognized in the consolidated statements of operations at each balance sheet date.
 
    Property and Equipment
 
    Property and equipment are recorded at cost. Major renewals and improvements are capitalized while the cost of repairs and maintenance, including dry-docking costs, are charged to expense as incurred. Gains or losses on the sale of property and equipment are recorded as a component of operating income in the consolidated statements of operations.
 
    Depreciation is computed on the straight-line basis over the estimated useful lives of the assets and after a 15% reduction for the estimated salvage values of ships as follows:
         
    Useful Life
Cruise ships
  30 years
Other property and equipment
  3-20 years
      Leasehold improvements are amortized on a straight-line basis over the shorter of lease term or related asset life.
 
    Long-lived assets are reviewed for impairments, based on estimated future cash flows, whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Assets are grouped and evaluated at the lowest level for which there are identifiable cash flows that are largely independent of the cash flows of other groups of assets. We consider historical performance and future estimated results in our evaluation of potential impairment and then compare the carrying amount of the asset to the estimated future cash flows expected to result from the use of the asset. If the carrying amount of the asset exceeds estimated expected undiscounted future cash flows, we measure the amount of the impairment by comparing the carrying amount of the asset to its fair value. We estimate fair value based on the best information available making whatever estimates, judgments and projections are considered necessary. The estimation of fair value is generally measured by discounting expected future cash flows at discount rates commensurate with the risk involved.
 
    Goodwill and Tradenames
 
    Goodwill represents the excess of cost over the fair value of net assets acquired. We review goodwill and tradenames for impairment annually or whenever events or changes in circumstances indicate that the carrying amount of goodwill and tradenames may not be fully recoverable.
 
    We have concluded that our business has a single reportable and operating segment, with each ship considered to be a component. Each component constitutes a business for which discrete financial information is available and management regularly reviews the operating results and, therefore, each component is considered a reporting unit. Our reporting units have similar economic

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NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
 
      characteristics, including similar margins and similar products and services, therefore, we aggregate all of the reporting units in assessing goodwill.
 
    The impairment review of goodwill is based on the expected future cash flows of the ships. The impairment review considers fair value estimated by our guideline method which utilizes market values of companies with similar operations and the transaction approach whereby we estimate fair value based on a recent sale transaction of a similar company.
 
    In 2006, we transferred the Orient Lines tradename to Star Cruises Limited for $16.0 million and recognized an impairment loss of $8.0 million. The proceeds received from the transfer in excess of the net book value of the Orient Lines tradename have been recorded as a capital contribution from Parent in our consolidated statement of changes in shareholder’s equity for the year ended December 31, 2006.
 
    Consumable Inventories
 
    Consumable inventories mainly consist of provisions and supplies and are carried at the lower of cost determined on a weighted-average basis or net realizable value.
 
    Advertising Costs
 
    Advertising costs incurred that result in tangible assets, including brochures, are treated as prepaid supplies and charged to expense as consumed. Television production costs are recorded as prepaid expenses and expensed when the television advertisement is initially run. Advertising costs of approximately $6.9 million and $3.8 million as of December 31, 2005 and 2006, respectively, are included in prepaid expenses and other. Advertising costs totaled $75.2 million, $79.1 and $76.8 million for the years ended December 31, 2004, 2005 and 2006, respectively.
 
    Dry-docking Expenses
 
    During the second quarter of 2006, we elected to change our method of accounting for dry-docking costs from the deferral method, under which costs associated with dry-docking a ship are deferred and charged to expense over the period to a ship’s next scheduled dry-docking, to the direct expense method, under which we expense all dry-docking costs as incurred. Accordingly, we have adjusted our previously reported financial information for all periods presented for this change in the method of accounting for dry-docking costs. As a result of the change in the method of accounting for dry-docking costs to the direct expense method, we have classified such costs as other operating expenses in our consolidated statements of operations consistent with our method of expensing repairs and maintenance costs. We refer you to Note 3. “Change in Accounting for Dry-docking Costs”.
 
    Income Taxes
 
    Deferred tax assets and liabilities are calculated in accordance with the liability method. Deferred taxes are recorded using the currently enacted tax rates that apply in the periods differences are expected to reverse. Deferred taxes are not discounted. In conjunction with business acquisitions, we record acquired deferred tax assets and liabilities.
 
    We provide a valuation allowance on deferred tax assets when it is more likely than not that such assets will not be realized. With respect to acquired deferred tax assets, future reversals of the

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NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
 
      valuation allowance will first be applied against goodwill and other intangibles before recognition of a benefit in the consolidated statements of operations.
 
    Share-Based Compensation
 
    Effective January 1, 2006, we adopted the provisions of Statement of Financial Accounting Standards (“SFAS”) No. 123 (revised 2004), “Share-Based Payment” (“SFAS 123R”). SFAS 123R requires the measurement and recognition of compensation expense at fair value for all share-based awards over their vesting period. Prior to January 1, 2006, we accounted for share-based compensation plans in accordance with the provisions of APB Opinion No. 25, “Accounting for Stock Issued to Employees” (“APB 25”), and disclosed pro forma information as if we had applied the fair value recognition provisions of SFAS No. 123, “Accounting for Stock-Based Compensation” (“SFAS 123”).
 
    We have adopted SFAS 123R under the modified prospective application transition method. Under this method, the share-based compensation expense recognized beginning January 1, 2006 includes compensation cost for all employee share-based awards granted prior to, but not vested as of December 31, 2005, based on the grant date fair value originally estimated in accordance with the provisions of SFAS 123 over their remaining vesting period. Compensation expense associated with awards granted subsequent to January 1, 2006 will be based on the grant date fair value estimated in accordance with the provisions of SFAS 123R. In addition, SFAS 123R requires us to estimate the amount of expected forfeitures when calculating the compensation expense, instead of accounting for forfeitures as they occurred, which was our previous method. Prior period results are not restated under the modified prospective application method. As of January 1, 2006, the cumulative effect of adopting the expected forfeiture method was not significant.
 
    The following table illustrates the effect on net (loss) income for the years ended December 31, 2004 and 2005 if we had applied the fair value recognition provisions of SFAS 123 to share-based employee compensation (in thousands of dollars):
                 
    2004   2005
Net (loss) income
  $ (18,090 )   $ 16,235  
Add:
               
Total share-based employee compensation expense included in net (loss) income
    440       343  
Deduct:
               
Total share-based employee compensation expense determined under fair value method for all awards
    (2,373 )     (3,524 )
 
               
Pro forma net (loss) income
  $ (20,023 )   $ 13,054  
 
               
      Stock Option Plans
 
    On December 28, 2006, Star Cruises Limited completed the issuance of 1,484,084,467 rights shares. As a result of the rights issue, the exercise price and the number of ordinary shares issuable upon exercise in full of the outstanding share options were adjusted accordingly. At such time, 499 employees received 3,073,108 incremental shares due to the rights offering. This rights offering has been accounted for as a modification under SFAS 123R and has resulted in an incremental expense of $0.3 million as of the modification date, December 28, 2006. The extended binomial options pricing model was used to estimate the incremental fair value, (i.e., the

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NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
 
      difference between the fair value of the modified share options and that of the original share options).
 
    Total compensation expense recognized under SFAS 123R for options issued under the Pre-Listing Employee Share Option Scheme and the Post-Listing Share Option Scheme was $1.6 million for the year ended December 31, 2006, of which approximately $0.8 million has been included within marketing, general and administrative expenses and approximately $0.8 million in payroll and related expenses in our consolidated statements of operations. This amount includes the $0.3 million for the incremental expense due to the modification discussed above.
 
    In January 2000, Star Cruises Limited granted a stock option to an executive to purchase 200,000 shares of Star Cruises Limited’s common stock at $2.275 per share under Star Cruises Limited’s Pre-Listing Employee Share Option Scheme. The option vests over a period through 2009. The number of shares of common stock subject to the stock option was adjusted for the rights offerings. At December 31, 2006, the executive had a stock option to purchase 648,963 shares of Star Cruises Limited’s common stock at a price of $0.40 per share. No further options can be granted under the Pre-Listing Employee Share Option Scheme.
 
    In November 2000, Star Cruises Limited adopted a Post-Listing Employee Share Option Scheme for the employees of Star Cruises Limited and our employees that provides for the granting of stock options in Star Cruises Limited’s common stock. The maximum number of stock options available for issue under the Post-Listing Employee Share Option Scheme and options granted under any other schemes of Star Cruises Limited is 132,733,953. The stock options are exercisable over a ten-year period from the date the stock options are awarded. Fifty percent of the total stock options granted vests as follows: 30% two years from the award date, 20% three years from the award date and an additional 10% annually in the subsequent years until the options are fully vested. The other 50% of the total stock options granted vests pursuant to the same schedule assuming that we achieve certain performance targets, as defined in the Post-Listing Employee Share Option Scheme. Pursuant to the terms of the grant award, the employee is required to sign and return documentation of acceptance of the stock option award along with $1.00 consideration. Generally, options issued under the Post-Listing Employee Share Option Scheme are granted at a price not less than the fair value of the shares on the date of grant.
 
    In August 2004, Star Cruises Limited authorized the additional grant of approximately 7,974,000 share options to our management under the Post-Listing Employee Share Option Scheme. The terms and conditions of this grant are consistent with the previous options granted under the Post-Listing Employee Share Option Scheme with the exception that the options vest two years from the award date.
 
    The Post-Listing Employee Share Option Scheme provides that a former employee must pay in cash to us liquidated damages, as defined, in the Post-Listing Share Option Scheme, if the employee leaves us and engages in any trade, employment, business or activity for six months after leaving us that would be considered in competition with the work done for us. The liquidated damages are equivalent to a percentage of the capital appreciation of the stock option, defined as the difference between the market price of the stock on the date of the exercise of the stock option and the exercise price of the stock option, less the amount of any income taxes paid.
 
    The weighted-average fair value of options granted to employees during each of the years ended December 31, 2004 and 2005 was $0.16. The weighted-average fair value of options granted to employees as of the modification date, December 28, 2006, was $0.11. The fair value of options

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NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
 
      on the grant and modification dates was estimated using an extended binomial options pricing model with the following assumptions:
                         
    Years Ended December 31,
    2004   2005   2006
Dividend yield
                 
Expected stock price volatility
    40.2 %     40.2 %     49.9 %
Risk-free interest rate
    3.4 %     3.4 %     3.7 %
Expected option life
  10 years   10 years   10 years
      Expected volatility was based on historical volatility. The risk-free interest rate was based on the Hong Kong government bond rate with a remaining term equal to the expected option life assumed at the date of grant. The expected option life was calculated based on the contractual term of the option, historical exercise experience and the underlying terms of the respective options.
 
    Upon adoption of SFAS 123R, $0.6 million in unamortized stock option expense related to awards that had been subject to variable accounting under APB 25 was eliminated against additional paid-in capital for the year ended December 31, 2006.
 
    Segment Reporting
 
    We operate under three brand names, Norwegian Cruise Line, NCL America, and Orient Lines. The brands have been aggregated as a single operating segment based on the similarity of their economic characteristics, as well as products and services provided.
 
    Although we sell cruises on an international basis, our passenger ticket revenue is primarily attributed to passengers who made reservations in North America. For the years ended December 31, 2004, 2005 and 2006, revenues attributable to North American passengers were approximately 89%, 90% and 87%, respectively.
 
    Financial Instruments
 
    From time to time, we enter into derivative instruments, primarily forward contracts, swaps and options, to reduce our exposure to fluctuations in foreign currency exchange, interest and fuel rates. The criteria used to determine whether a transaction qualifies for hedge accounting include correlation between fluctuations in the fair value of the hedged item and the fair value of the related derivative instrument and the effectiveness of the hedge. To the extent that an instrument is not effective as a hedge, gains and losses are recognized in the consolidated statements of operations as a gain or loss in other expenses (income), net (we refer you to Note 7).
 
    Recent Accounting Pronouncements
 
    In June 2006, the Financial Accounting Standards Board (“FASB”) issued FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes — an interpretation of FASB Statement 109” (“FIN 48”). FIN 48 prescribes a comprehensive model for recognizing, measuring, presenting and disclosing in the financial statements tax positions taken or expected to be taken on a tax return. The provisions of FIN 48 are effective beginning January 1, 2007 with the cumulative effect of the change in accounting principle recorded as an adjustment to the opening balance of accumulated

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NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
 
      deficit. We do not expect that the adoption of FIN 48 will have a material impact on our consolidated financial position and results of operations.
 
    In June 2006, the Emerging Issues Task Force (“EITF”) ratified a consensus on EITF Issue No. 06-3, “How Taxes Collected from Customers and Remitted to Governmental Authorities Should Be Presented in the Income Statement (that is, Gross versus Net Presentation)”. Taxes within the scope of EITF Issue No. 06-3 include any taxes assessed by a governmental authority that are directly imposed on a revenue-producing transaction between a seller and a customer and may include, but are not limited to, sales taxes, use taxes, value-added taxes, and some excise taxes. We have adopted EITF Issue No. 06-3 as our policy is to present these taxes on a gross basis. The amounts included on a gross basis are $53.8 million, $68.7 million and $83.3 million for the years ended December 31, 2004, 2005 and 2006, respectively.
 
    In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” (“SFAS No. 157”). SFAS No. 157 defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. SFAS No. 157 is effective for financial statements issued for our fiscal year beginning in 2008 and interim periods within that year. We are currently assessing the impact of SFAS No. 157 on our consolidated financial position and results of operations.
 
    In September 2006, the FASB issued SFAS No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans, an amendment of FASB Statements No. 87, 88, 106, 132(R)” (“SFAS No. 158”). SFAS No. 158 requires employers to fully recognize in their financial statements the obligations associated with single-employer defined benefit pension plans, retiree healthcare plans, and other postretirement plans. Specifically, it requires a company to recognize on its balance sheet an asset for a plan’s overfunded status or a liability for a plan’s underfunded status, measure a plan’s assets and its obligations that determine its funded status as of the end of the employer’s fiscal year and recognize changes in the funded status of a plan through comprehensive income in the year in which the changes occur. SFAS No. 158 is effective for financial statements issued as of December 31, 2006 and is to be applied prospectively. The adoption of SFAS No. 158 did not have an impact on our consolidated financial statements as our plans are not within the scope of SFAS No. 158.
 
    In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities—Including an amendment of FASB Statement No. 115” (“SFAS No. 159”). It permits all entities to choose to elect, at specified election dates, to measure eligible financial instruments at fair value. An entity shall report unrealized gains and losses on items for which the fair value option has been elected in earnings at each subsequent reporting date, and recognize upfront costs and fees related to those items in earnings as incurred and not deferred. SFAS No. 159 applies to fiscal years beginning after November 15, 2007, with early adoption permitted for an entity that has also elected to apply the provisions of SFAS No. 157. An entity is prohibited from retrospectively applying SFAS No. 159, unless it chooses early adoption. We are currently assessing the impact of SFAS No. 159 on our consolidated financial position and results of operations.
 
    Reclassifications
 
    Certain prior year balances have been reclassified to conform to the current year’s presentation.

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NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
3.   Change in Accounting for Dry-docking Costs
 
    During the second quarter of 2006, we elected to change our method of accounting for dry-docking costs from the deferral method, under which costs associated with dry-docking a ship are deferred and charged to expense over the period to a ship’s next scheduled dry-docking, to the direct expense method, under which we will expense all dry-docking costs as incurred. We view this as a preferable method since it eliminates the subjectivity and significant amount of time that is needed in determining which costs related to dry-docking activities should be deferred and amortized over a future period. We have adopted this change in accounting policy in accordance with SFAS No. 154, “Accounting Changes and Error Corrections”, which requires that we report changes in accounting policy by retrospectively applying new policies to all prior periods presented, unless it is impractical to determine the prior period impacts. Accordingly, we have adjusted our previously reported financial information for all periods presented for this change in the method of accounting for dry-docking costs. The effects of this change in accounting policy were as follows (in thousands of dollars):
 
    Consolidated Statements of Operations
                                                 
    Year ended   Year ended
    December 31, 2004   December 31, 2005
    Deferral   Direct   Effect   Deferral   Direct   Effect
    Method   Method   of Change   Method   Method   of Change
Other operating expenses (a)
  $ 184,188     $ 204,030     $ 19,842     $ 190,442     $ 211,929     $ 21,487  
Depreciation and amortization expenses (a)
    87,397       76,937       (10,460 )     104,181       85,615       (18,566 )
Net (loss) income
    (8,708 )     (18,090 )     (9,382 )     19,156       16,235       (2,921 )
                         
    Year ended
    December 31, 2006
    Deferral   Direct   Effect
    Method (b)   Method   of Change
Other operating expenses(a)
  $ 230,364     $ 249,471     $ 19,107  
Depreciation and amortization expenses(a)
    140,726       119,097       (21,629 )
Net loss
    (133,421 )     (130,899 )     2,522  

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NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
Consolidated Balance Sheets
                                                 
    December 31, 2005   December 31, 2006
    Deferral   Direct   Effect   Deferral   Direct   Effect
    Method   Method   of Change   Method (b)   Method   of Change
Deferred dry-docking costs current
  $ 14,591     $     $ (14,591 )   $ 15,820   $     $ (15,820 )
Deferred dry-docking costs non-current
    9,273             (9,273 )     7,110           (7,110 )
Accrued expenses and other liabilities
    142,839       144,427       (1,588 )                  
Accumulated deficit
    (98,192 )     (123,644 )     (25,452 )     (231,613 )     (254,543 )     (22,930 )
(a)   As a result of the change in the method of accounting for dry-docking costs to the direct expense method, we have classified such costs as other operating expenses in our consolidated statements of operations consistent with our method of expensing repairs and maintenance costs.
 
(b)   The amounts disclosed under the deferral method as of and for the year ended December 31, 2006 are based on the estimated effect of not changing our method of accounting for dry-docking costs to the direct expense method for this current period. Accordingly, these estimated current period amounts have not been previously reported, but are being disclosed in accordance with the requirements of SFAS No. 154.
 
    In addition, our accumulated deficit increased by $13.2 million at December 31, 2003 from $108.6 million to $121.8 million, as a result of this change in the method of accounting for dry-docking costs.
 
4.   Property and Equipment
 
    Property and equipment at December 31, 2005 and 2006 consists of the following (in thousands of dollars):
                 
    2005   2006
Cruise ships
  $ 2,849,784     $ 3,876,857  
Cruise ships under construction
    461,317       223,945  
Other property and equipment
    84,182       115,813  
 
               
 
    3,395,283       4,216,615  
Less: accumulated depreciation.
    (282,054 )     (400,323 )
 
               
Total
  $ 3,113,229     $ 3,816,292  
 
               
      Depreciation expense for the years ended December 31, 2004, 2005 and 2006 was $76.9 million, $85.6 million and $119.1 million, respectively.
 
    Ships under construction include progress payments for the construction of new ships as well as planning, design, interest, commitment fees and other associated costs.

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NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
 
    Interest costs associated with the construction of the cruise ships are capitalized during the construction period and amounted to $17.4 million, $32.2 million and $21.9 million for the years ended December 31, 2004, 2005 and 2006, respectively.
 
    In September 2006, we entered into a 29.0 million Euro or $36.8 million, based on the Euro/U.S. dollar exchange rate at September 30, 2006, settlement agreement in connection with our pre- and post-ship delivery claims against the builder of Pride of America. Settlement amounts of $7.3 million related to our claims for post-delivery costs incurred by us have been included as other income in our consolidated statements of operations.
 
5.   Long-Term Debt
 
    Long-term debt as of December 31, 2005 and 2006 consists of the following (in thousands of dollars):
                 
    2005   2006
$300.0 million Senior Secured Term Loan, LIBOR + applicable margin (1.50% at December 31, 2005 and 2006), due through 2010
  $ 265,000     $ 230,000  
$500.0 million Senior Secured Revolving Credit Facility, LIBOR + applicable margin (1.50% at December 31, 2005 and 2006), due 2010
    280,000       280,000  
$610.0 million Senior Secured Revolving Credit Facility, LIBOR + applicable margin (1.50% at December 31, 2006), due through 2013
          390,000  
Euro 624.0 million Norwegian Pearl and Norwegian Gem Revolving Credit Facility, EURIBOR + applicable margin (1.2375% at December 31, 2006), due through 2018
          410,753  
$250.0 million 10 5/8% Senior Notes due through 2014
    250,000       250,000  
$626.9 million Syndicated Term Loan, LIBOR + 1.40% , due through 2014
    250,769        
$225.0 million Norwegian Sun Loan, LIBOR + 1.40% , due through 2011
    189,000        
Euro 258.0 million Pride of America Hermes Loan, 5.715%, due through 2017
    292,219       266,808  
Euro 40.0 million Pride of America Commercial Loan, 6.595%, due through 2017
    44,419       40,557  
$334.1 million Norwegian Jewel Loan, 6.1075%, due through 2017
    324,261       297,239  
Euro 308.1 million Pride of Hawai’i Loan, EURIBOR + 0.75%, due through 2018
    200,120       378,209  
Other long-term debt
    10,889       16,429  
 
               
 
    2,106,677       2,559,995  
Less: Current portion
    (140,694 )     (154,638 )
 
               
 
  $ 1,965,983     $ 2,405,357  
 
               
      In October 2005, we entered into a revolving credit facility agreement for up to Euro 624.0 million. The facility can only be drawn for the payments due under Norwegian Pearl and Norwegian Gem shipbuilding contracts. We drew Euro 311.2 million ($410.8 million based on the Euro/U.S. dollar exchange rate at drawdown) for delivery of Norwegian Pearl. After the initial drawdown, the facility converted to a revolving credit facility and can be used for general corporate and working capital purposes. The size of the facility decreases over the life of the loan. The facility matures 12 years following delivery of the relevant ship. The facility bears interest at a rate that varies according to LIBOR or EURIBOR, depending on the denomination of the underlying balance.

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NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
 
      In December 2005, the Euro 258.0 million Pride of America Hermes Loan was converted into U.S. dollars, and the applicable interest rate was converted from a floating LIBOR-based rate to a fixed rate of 5.715%.
 
    In March 2006, we amended the Euro 40.0 million Pride of America Commercial Loan, converting it from a floating-rate loan bearing interest at a rate based on LIBOR plus a margin of 135 basis points to a fixed-rate loan bearing interest at a rate of 6.595%.
 
    In April 2006, we amended the $334.1 million Norwegian Jewel Loan, converting it from a floating-rate loan bearing interest at a rate based on LIBOR plus a margin of 75 basis points to a fixed-rate loan bearing interest at a rate of 6.1075%.
 
    In April 2006, we took delivery of Pride of Hawai’i. The balance due to the shipbuilding yard was paid on delivery from a drawdown of Euro 130.0 million ($157.4 million based on the Euro/U.S. dollar exchange rate at drawdown) under the Euro 308.1 million Pride of Hawai’i Loan. At December 31, 2006, Euro 286.5 million ($378.2 million based on the Euro/U.S, dollar exchange rate) was outstanding.
 
    In September 2006, we obtained export credit financing for 80% of the contract amount of each of the two F3 ships scheduled for delivery in 2009 and 2010. These financings cannot exceed approximately $0.9 billion each, based on the Euro/U.S. dollar exchange rate at December 31, 2006. These financings are term loans each collateralized by the respective ship and are due 12 years from delivery date, through 2021 and 2022, respectively. The financing for the first ship is denominated in U.S. dollars bearing a fixed interest rate of 6.05% and the financing for the second ship is denominated in Euro bearing a fixed interest rate of 4.89%. Under the terms of each loan agreement, we have the ability to cancel the financing up to 60 days prior to the delivery date for the ship.
 
    In December 2006, we entered into a $610.0 million senior secured revolving credit facility. The facility refinanced two existing loans collateralized by Norwegian Dawn and Norwegian Sun and provides additional borrowing capacity for general corporate purposes. The facility is available in two tranches of $510.0 million and $100.0 million. According to the terms of this facility, the availability under the facility will increase by $100.0 million to the full $610.0 million in the event we receive an additional $200.0 million of equity, which we have not received as of February 23, 2007. The facility has no amortization for the first 36 months, bears interest at LIBOR plus a margin of 150 basis points at December 31, 2006 (subject to certain adjustments) and matures in 2013.
 
    At December 31, 2005 and 2006, we had long-term debt denominated in Euro with a balance of $200.1 million and $789.0 million, respectively. As a result of the translation of these borrowings, we recognized a foreign currency translation loss of $9.5 million, gain of $29.4 million and a loss of $35.1 million for the years ended December 31, 2004, 2005 and 2006, respectively. These amounts were recorded as a component of other expenses (income), net, in the consolidated statements of operations.
 
    Our availability under our $500.0 million and $610.0 million senior secured revolving credit facilities at December 31, 2006, was $220.0 million and $120.0 million, respectively.
 
    There are no restrictions in the agreements that limit intercompany borrowings or dividends between our subsidiaries that would impact our ability to meet our cash obligations.

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NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
 
      Costs incurred in connection with the arranging of loan financing have been deferred and are amortized over the life of the loan agreement. The amortization included in interest expense for the years ended December 31, 2004, 2005 and 2006 was $3.9 million, $3.9 million and $5.5 million, respectively.
 
    Our debt agreements contain covenants that require us, among other things, to maintain a minimum level of free liquidity, limit our net funded debt-to-capital ratio, and restrict our ability to pay dividends. We were in compliance with all covenants as of December 31, 2005 and 2006. In November 2006, our lenders agreed to modify our debt agreements by increasing our maximum permitted total net funded debt-to-capital ratio from 65% to 70%. Our ships and substantially all other property are pledged as collateral for our debt.
 
    The following is a schedule of principal repayments of the long-term debt based on the Euro/U.S. dollar exchange rate at December 31, 2006 (in thousands of dollars):
         
2007
  $ 154,638  
2008
    154,309  
2009
    179,313  
2010
    575,058  
2011
    169,560  
    We had an accrued interest liability of $29.8 million and $35.1 million at December 31, 2005 and 2006, respectively.
 
6.   Related Party Disclosures
 
    In April 2004, Star Cruises Limited completed a reorganization transaction (the “Reorganization”) which included the formation of NCL Corporation Ltd. (we refer you to Note 1). In connection with the Reorganization, we transferred six ships at their existing net book values of approximately $778.0 million along with approximately $403.2 million of existing debt associated with these ships. The difference of approximately $374.8 million between the net book value of the ships and the outstanding debt balance was recorded as a reduction of our amount due to Parent on the date of the transaction. In addition, Star Cruises Limited agreed to forgive an additional $366.6 million owed by us to Star Cruises Limited at December 31, 2003. This forgiveness was recorded as additional paid-in capital during the year ended December 31, 2004.
 
    In connection with the Reorganization, substantially all of the guarantees and mortgages that had been provided by our subsidiaries to the lenders of Star Cruises Limited were released and substantially all of the guarantees provided by Star Cruises Limited to our lenders were released. Our lenders were provided guarantees by us in lieu of the previous guarantees provided by Star Cruises Limited.
 
    After the transfer of the six ships to Star Cruises Limited, we entered into charter agreements for the six ships with Star Cruises Limited for periods ranging from one to six years. During such charter periods, we will continue to operate and maintain such ships. We are required to return the ships at the end of the term of the charter agreements in the same condition as when the ships were delivered to us at the commencement of the charter term.
 
    In April 2004, we transferred Norway, and a related $19.7 million insurance receivable to Star Cruises Limited in exchange for a non-interest bearing promissory note in the amount of $46.5 million. The promissory note or a portion of the outstanding balance thereof is payable to us by

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NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
 
    Star Cruises Limited at the time of disposal of the ship and the recovery of certain amounts from the insurance syndicate who insured the ship in May 2003 at the time there was an incident onboard. The face value of the promissory note represented our carrying value of Norway on April 23, 2004, which estimated the anticipated proceeds from the sale of the ship, and the estimated amount to be recovered from the insurance syndicate.
 
    In October 2004, we received insurance proceeds of $19.7 million that reduced the outstanding balance of the promissory note to $26.8 million. Subsequently, management determined the probability of finding a qualified third party buyer was not likely and accordingly, in the fourth quarter of 2004, we recorded an impairment charge in the amount of $14.5 million to reduce the carrying value of the promissory note to the ship’s estimated salvage value, approximately $12.3 million, at December 31, 2004. The promissory note, which was settled in January 2006, is classified as a current asset in the accompanying consolidated balance sheets at December 31, 2005.
 
    In July 2004, we purchased Norwegian Spirit from Star Cruises Limited for $307.6 million. Approximately $4.7 million of the amount originally transferred was accounted for as a reduction of additional paid-in capital for the year ended December 31, 2004. Such amount represented the excess of the amount paid by us to Star Cruises Limited in connection with the purchase of Norwegian Spirit over the net book value of the ship on the books of Star Cruises Limited at the time of the transaction.
 
    Amounts due to Star Cruises Limited at December 31, 2005 of $3.1 million and amounts due from Star Cruises Limited at December 31, 2006 of $5.0 million are non-interest bearing and represent short-term intercompany transactions.
 
    In 2006, we transferred the Orient Lines tradename to Star Cruises Limited for $16.0 million and recognized an impairment loss of $8.0 million. The proceeds received from the transfer in excess of the net book value of the Orient Lines tradename have been recorded as a capital contribution from Parent in our consolidated statement of changes in shareholder’s equity for the year ended December 31, 2006. During 2006, we received $208.0 million in capital contributions from Star Cruises Limited including the amounts related to the Orient Lines tradename.
 
    In addition, for the years ended December 31, 2004, 2005 and 2006, we recorded legal and other costs in the amounts of $0.2 million, $10.1 million and $0.2 million, respectively, all of which was reimbursed to us by Star Cruises Limited. Such amounts were recorded as capital contributions in the respective years.
 
    At December 31, 2006, the Lim Family directly and indirectly controls approximately 73% of Star Cruises Limited, which in turn owns 100% of our equity. As a result of the ownership, the Lim Family has the ability to determine our corporate policies, appoint our directors and officers and control those corporate actions that require shareholder approval.
 
7.   Financial Instruments
 
    Reported fair values are based on a variety of factors and assumptions. Accordingly, the fair values may not represent actual values of the financial instruments that could have been realized as of the balance sheet date or that will be realized in the future and do not include expenses that could be incurred in an actual sale or settlement. Our financial instruments are not held for trading or speculative purposes.
 
    Our exposure under foreign currency contracts, interest rate and fuel hedging agreements is limited to the cost of replacing the contracts in the event of non-performance by the counterparties to the

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NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
 
      contracts. To minimize this risk, we select counterparties with credit risks acceptable to us. Furthermore, foreign currency forward contracts are denominated in primary currencies.
 
    The following are the fair values and methods used to estimate the fair values of our financial instruments:
 
    Cash and Cash Equivalents
 
    The carrying amounts of cash and cash equivalents approximate their fair values due to the short term maturity of these instruments.
 
    Long-Term Debt
 
    As of December 31, 2005 and 2006, the fair value of our long-term debt, including the current portion, was $2,128.5 million and $2,579.2 million, respectively, which was $21.8 million more and $19.2 million more, respectively, than the carrying values. The difference between the fair value and carrying value of our long-term debt is due to our variable rate debt obligations carrying interest rates that are above or below market rates at the measurement dates. The fair value of our long-term debt is estimated based on rates currently available to us for the same or similar terms and remaining maturities.
 
    Market risk associated with our long-term fixed rate debt is the potential increase in fair value resulting from a decrease in interest rates. Market risk associated with our long-term floating rate debt is the potential increase in interest expense from an increase in interest rates.
 
    Fuel Swap Agreements
 
    The fair values of our fuel swap agreements were estimated based on quoted market prices for similar or identical financial instruments to those we hold. Our exposure to market risk for changes in fuel prices relates to the forecasted consumption of fuel on our ships. We use fuel swap agreements to mitigate the impact of fluctuations in fuel prices. As of December 31, 2005, we had fuel swap agreements to pay fixed prices for fuel with an aggregate notional amount of $12.5 million and an unrealized favorable fair value of $0.6 million which matured through June 2006. As of December 31, 2006, we had fuel swap agreements to pay fixed prices for fuel with an aggregate notional amount of $18.9 million and an unrealized unfavorable fair value of $1.6 million maturing through June 2007.
 
8.   Employee Benefits and Stock Option Plans
 
    Employee Stock Option Plans
 
    In November 2000, Star Cruises Limited adopted a “Post-listing Employee Share Option Scheme” (“Share Option Scheme”) for the employees of Star Cruises Limited and our employees that provides for the granting of stock options in Star Cruises Limited’s common stock. The stock options are exercisable over a ten year period from the date the stock options are awarded. Fifty percent of the total stock options granted vests as follows: 30% two years from the award date, 20% three years from the award date and an additional 10% annually in the subsequent years until the options are fully vested. The other 50% of the total stock options granted vests pursuant to the same schedule assuming that we achieve certain performance targets, as defined in the Share Option Scheme. Pursuant to the terms of the grant award, the employee is required to sign and return documentation of acceptance of the stock option award along with U.S. $1.00 consideration.

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NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
 
      In August 2004, Star Cruises Limited authorized the additional grant of approximately 7,974,000 share options to our management under the Post-Listing Employee Share Option Scheme. The terms and conditions are consistent with the previous options granted under the Post-Listing Employee Share Option Scheme with the exception that the options vest two years from the award date.
 
    On December 28, 2006, Star Cruises Limited completed the issuance of 1,484,084,467 rights shares. As a result of the rights issue, the exercise price and the number of ordinary shares issuable upon exercise in full of the outstanding share options have been adjusted accordingly. At such date, 499 employees received 3,073,108 incremental shares due to the rights offering. This rights offering has been accounted for as a modification under SFAS 123R and has resulted in an incremental expense of $0.3 million as of the modification date, December 28, 2006. The extended binomial options pricing model was used to estimate the incremental fair value, (i.e., the difference between the fair value of the modified share options and that of the original share options).
 
    Subsequent to the rights issue, as of December 31, 2006, outstanding share options granted to NCL’s employees (including directors) under the Pre-listing Employee Share Option Scheme and the Post-listing Employee Share Option Scheme totaled 648,963 at an exercise price of $0.40 per share and 50,988,055 with a weighted-average exercise price of $0.34 per share, respectively, including 2,595,853 and 2,530,958 granted to directors and executive officers, respectively.
 
    Pertinent information covering the options granted pursuant to the Share Option Scheme is as follows:
                                     
                            Weighted    
                    Weighted   Average    
                    Average   Remaining    
    Number of   Option   Exercise   Contractual    
    Shares   Price   Price   Life   Date
Outstanding at December 31, 2005
    49,045,982     $ 0.22-$0.41     $ 0.39       6.91     2012-14
Granted
                         
Additional shares due to rights offering
    3,073,108     $ 0.21-$0.36     $ 0.34       5.92     2012-14
Forfeited
    (1,131,035 )   $ 0.21-$0.36     $ 0.35       5.74     2012-14
 
                                   
Outstanding at December 31, 2006
    50,988,055     $ 0.21-$0.36     $ 0.34       5.92     2012-14
 
                                   
Exercisable at
                                   
December 31, 2006
    32,106,506     $ 0.21-$0.36     $ 0.33              

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NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
 
      Significant option groups outstanding at December 31, 2006 and related price and life information is as follows:
                                         
    Options Outstanding   Options Exercisable
                    Weighted        
            Weighted   Average   Exercisable   Weighted
    Outstanding at   Average   Remaining   at   Average
  December 31,   Exercise   Contractual   December 31,   Exercise
Exercise Price   2006   Price   Life   2006   Price
$0.36
    44,311,549     $ 0.36       5.66       25,430,000     $ 0.36  
$0.21
    6,676,506     $ 0.21       7.65       6,676,506     $ 0.21  
 
                                       
 
    50,988,055     $ 0.34       5.92       32,106,506     $ 0.33  
 
                                       
      As of December 31, 2006, there was $2.6 million of total unrecognized compensation cost related to unvested stock options. This cost is expected to be recognized over a weighted-average period of 3.3 years.
 
      The Share Option Scheme provides that a former employee must pay in cash to us liquidated damages, as defined, in the “Share Option Scheme,” if the employee leaves us and engages in any trade, employment, business or activity for six months after leaving us that would be considered in competition with the work done for us. The liquidated damages is equivalent to a percentage of the capital appreciation of the stock option, defined as the difference between the market price of the stock on the date of the exercise of the stock option and the exercise price of the stock option, less the amount of any income taxes paid.
 
    Benefit Plans
 
    We have a frozen defined contribution plan (the “Plan”) for our shoreside employees. Effective January 1, 2002, the Plan was amended to cease future employer contributions. The Plan is subject to the provisions of the Employment Retirement Income Security Act of 1974 (“ERISA”).
 
    In addition, we maintain a 401(k) Plan (the “401(k) Plan”). The 401(k) Plan covers substantially all our shoreside employees. Participants may contribute up to 100% of eligible compensation each pay period, subject to certain limitations. We make matching contributions equal to 100% of the first 3% and 50% of the next 7% of the participant’s contributions and such contributions shall not exceed 6.5% of each participant’s compensation. Our matching contributions are vested according to a five-year schedule.
 
    We maintain an unfunded Supplemental Executive Retirement Plan (“SERP Plan”), a defined contribution plan, for certain of our key employees whose benefits are limited under the Plan and the 401(k) Plan. We record an expense for amounts due to the SERP Plan on behalf of each participant that would have been contributed without regard to any limitations imposed by the U.S. Internal Revenue Code (the “Code”).
 
    Our contributions are reduced by contributions forfeited by those employees who leave the schemes prior to vesting fully in the contributions. Approximately $0.11 million, $0.10 million and $0.13 million of the forfeited contributions were utilized in each of the years ended December 31, 2004, 2005 and 2006, respectively. As of December 31, 2005 and 2006, approximately $0.1 million and $0.04 million, respectively, were available to reduce future contributions.
 
    In addition, we maintain an unfunded Supplemental Senior Executive Retirement Plan (“SSERP Plan”), a defined benefit plan, for selected senior executives. We have recorded an accrual at December 31, 2005 and 2006 of approximately $9.7 million and $8.6 million, respectively, with respect to the SSERP Plan in the accompanying consolidated balance sheets. We record an expense

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NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
 
      related to the SSERP Plan for such amounts based on the following actuarial assumptions: 5% discount rate and 5% annual increase in compensation.
 
    We recorded expenses related to the above described defined contribution plans and SSERP Plan of approximately $4.5 million, $3.2 million and $1.6 million for the years ended December 31, 2004, 2005 and 2006, respectively. No amounts are required to be or were contributed under the SERP or SSERP Plan by us as of December 31, 2004, 2005 and 2006 as the SERP and SSERP Plans are unfunded.
 
9.   Income Taxes
 
    We are incorporated in Bermuda. Our subsidiary, Arrasas Limited, which is incorporated in the Isle of Man, is not subject to income tax in respect of activities undertaken outside the Isle of Man.
 
    Historically, NCL Holdings ASA (“NCLH”) and its subsidiaries were subject to tax in Norway. However, during 2001, Arrasas Limited completed a restructuring of NCLH and its subsidiaries. In connection with the restructuring, Norwegian Cruise Line Limited (“NCLL”), a Bermuda based operating subsidiary, became a directly held subsidiary of Arrasas and accordingly the profits of NCLL are no longer subject to taxation in Norway. NCLH and NCL Cruises Ltd. remain within the Norwegian tax regime and are currently dormant.
 
    Deferred tax assets and liabilities that relate to our Norwegian taxes comprised the following at December 31, 2005 and 2006 (in thousands of dollars):
                 
    2005   2006
Deferred tax assets:
               
Loss carryforwards
  $ 59,510     $ 59,560  
Shares in NCL Cruises Ltd.
    42,020       56,184  
Pension obligation
    544       589  
Others
    572       458  
 
               
 
    102,646       116,791  
Valuation allowance
    (102,646 )     (116,791 )
 
               
Total net deferred taxes
  $     $  
 
               
      Due to recently enacted legislation, taxable losses can be carried forward indefinitely. Total losses available for carry forward related to NCLH as of December 31, 2005 and 2006 are $212.5 million and $212.7 million, respectively.
 
    The valuation allowance for deferred tax is in respect of future tax benefits attributable to NCLH and arising prior to its acquisition by us. If these assets are realized, the benefit will be allocated to reduce goodwill arising on the acquisition of NCLH.

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NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
 
      In addition, we are subject to U.S. federal income taxation with respect to certain income derived from our foreign-flagged operations and the income derived from our U.S. subsidiaries.
 
    Our foreign-flagged operations derive income from the international operation of ships (“Shipping Income”). Under section 883 of the Code, certain foreign corporations, though engaged in the conduct of a trade or business within the U.S., are exempt from U.S. federal income taxes on (or in respect of) gross income derived from the international operation of ships. We believe that substantially all of our income from the international operation of ships is properly categorized as exempt Shipping Income.
 
    Effective for taxable years beginning after September 24, 2004, the Internal Revenue Service issued final regulations interpreting section 883 of the Code. These final regulations list several items of income which are not considered to be incidental to the international operation of ships and, to the extent derived from U.S. sources, are subject to U.S. federal income taxes. Income items considered non-incidental to the international operation of ships include income from the sale of single-day shore excursions, air and other transportation, and pre- and post-cruise land packages. We recorded an income tax provision of $1.2 million and an income tax benefit of $1.2 million for the years ended December 31, 2005 and 2006, respectively, due to the enactment of the Final Regulations.
 
    Income derived from our U.S. subsidiaries generally is subject to U.S. federal income taxation at graduated rates of up to 35%, after an allowance for deductions. U.S.-source dividends paid by NCL America generally would be subject to a 30% withholding tax.
 
    Deferred tax assets and liabilities that relate to our U.S. subsidiaries comprised the following at December 31, 2005 and 2006 (in thousands of dollars):

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Table of Contents

NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
 
                 
    2005   2006
Deferred tax assets:
               
Loss carryforwards
  $ 82,061     $ 154,198  
Start-up expenses
    11,209       12,063  
Disallowed interest
          16,975  
Translation loss and other
          6,057  
Allowances and accruals
    488       2,678  
 
               
Total deferred tax assets
  $ 93,758     $ 191,971  
 
               
Deferred tax liabilities:
               
Deprecation and amortization
    (47,022 )     (98,991 )
Translation loss and other
    (8,323 )     (401 )
 
               
Total deferred tax liabilities
    (55,345 )     (99,392 )
 
               
Net deferred tax assets
    38,413       (92,579
Valuation allowance
    (38,413 )     (92,579 )
 
               
Total net deferred taxes
  $     $  
 
               
      A valuation allowance has been provided against the net deferred tax asset since these operations are in the start-up phase and do not have a history of profitable operations. Therefore, realization of the deferred tax asset can not be assured at this time. We continue to evaluate the realizability of the deferred tax assets and this estimate is subject to change.
 
    We have net operating loss carryforwards for federal and state tax purposes totaling $209.6 million and $393.8 million at December 31, 2005 and 2006, respectively, expiring at various times commencing in 2024.
10.   Commitments and Contingencies
  (a)   Operating leases
 
      We operate principally in leased premises. Rent payable under non-cancelable operating lease commitments, primarily for offices and motor vehicles, was $6.5 million, $6.9 million and $9.0 million for the years ended December 31, 2004, 2005 and 2006, respectively.
 
      At December 31, 2006, minimum annual rentals for non-cancelable leases with initial or remaining terms in excess of one year were as follows (in thousands of dollars):
         
2007
  $ 5,795  
2008
    5,595  
2009
    4,780  
2010
    4,174  
2011
    3,690  
 
       
Total
  $ 24,034  
 
       

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Table of Contents

NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
 
      Rental payments applicable to such operating leases are recognized on a straight-line basis over the term of the lease.
 
  (b)   Ship charters
 
      We have entered into charter agreements with Star Cruises Limited for five ships for a period of one to four years in connection with the Reorganization (we refer you to Note 6). Charter expenses for these ships were $22.0 million, $28.6 million and $26.2 million for the years ended December 31, 2004, 2005 and 2006, respectively.
 
      At December 31, 2006, remaining charter payments were as follows (in thousands of dollars):
         
2007
  $ 21,005  
2008
    15,332  
2009
    11,344  
2010
    224  
 
       
Total
  $ 47,905  
 
       
  (c)   Capital expenditures
 
      As of December 31, 2006, we had three ships on order for additional capacity of approximately 10,800 berths with scheduled deliveries in the fourth quarter of 2007, the fourth quarter of 2009 and the second quarter of 2010. The aggregate cost of the ships under construction and on firm order is approximately $2.6 billion, of which we have paid $0.2 billion based on the Euro/U.S. dollar exchange rate at December 31, 2006. The remaining costs of the ships on order as of December 31, 2006 are exposed to fluctuations in the Euro/U.S. dollar exchange rate at December 31, 2006.
 
      As of December 31, 2006, we anticipate that capital expenditures, including the three ships on order, will be approximately $0.6 billion, $0.3 billion, and $1.0 billion for the years ending December 31, 2007, 2008, and 2009, respectively.
 
  (d)   Material litigation
  (i)   A proposed class action suit was filed on August 1, 2000 in the U.S. District Court for the Southern District of Texas against us, alleging that we violated the Americans with Disabilities Act of 1990 (“ADA”) in our treatment of physically impaired passengers. The same plaintiffs also filed on the same date a proposed class action suit in a Texas state court alleging that we and a third party violated Texas’ Deceptive Trade Practices and Consumer Protection Act. The state court judge granted our motion for summary judgment and the plaintiff filed an appeal which is currently pending. On June 6, 2005, the U.S. Supreme Court ruled in the Federal matter that the ADA is applicable to foreign flagged cruise ships that operate in U.S. waters to the same extent that it applies to U.S. flagged ships. The U.S. Supreme Court remanded the case to the Fifth Circuit Court of Appeals to determine which claims in the lawsuit remain and the Fifth Circuit remanded the case to the trial court. We have filed a motion for summary judgment in the trial court which is currently pending.

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Table of Contents

NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
 
  (ii)   A proposed class action suit was filed on December 20, 2000 in a Florida State Court alleging that we discriminated against disabled persons in violation of the ADA and the Florida Trade Act on several of our ships. Discovery has commenced. We believe that we have meritorious defenses to these claims and, accordingly, are defending vigorously this action.
 
  (iii)   A proposed class action suit was filed on May 17, 2001 in the U.S. District Court for the Southern District of New York alleging that during the period from January 1998 through March 2005, we failed to pay unlicensed seafarers overtime wages in accordance with their contracts of employment. The court entered an order certifying the case as a class action. In March 2005, the parties reached a settlement which was subsequently approved by the court. We believe that the ultimate outcome of this matter will not have a material impact on our financial position, results of operations or cash flows.
 
  (iv)   On July 25, 2002, we were served with a complaint in which a former employee alleged that we failed to pay him severance pay/employment benefits following his discharge. The matter was tried before a jury in January 2007 at which time a verdict in favor of plaintiff was returned. Trial counsel is currently evaluating possible appealable issues.
 
  (v)   In May 2003, an explosion in the boiler room onboard Norway resulted in the death of eight crew members and the injury of approximately 20 other crew members. All personal injury claims stemming from this incident are covered by our insurance. The incident is currently under investigation by regulatory authorities and the United States Attorney’s Office for the Southern District of Florida. We are cooperating with the investigation. To date, none of the agencies involved has rendered opinions or conclusions concerning the incident.
 
  (vi)   On or about February 3, 2006, we were served with a class action complaint filed in the United States District Court for the Southern District of New York alleging copyright infringement stemming from performances of certain portions of copyrighted music aboard our ships. We believe that we have meritorious defenses to these claims and, accordingly, are defending vigorously this action.
 
  (vii)   On June 16, 2006, a complaint was filed against us in the Circuit Court of Miami-Dade County, Florida, alleging breach of contract and fraudulent misrepresentation stemming from two 2004 charter sailings of Pride of Aloha. We believe that we have meritorious defenses to these claims and, accordingly, are defending vigorously this action.
 
  (viii)   On July 14, 2006, we were served with a complaint filed in Florida State court on behalf of a former onboard concessionaire alleging breach of contract and unjust enrichment. We believe that we have meritorious defenses to these claims and, accordingly, are defending vigorously this action.
 
  (ix)   On August 24, 2006, we were served with a complaint by the U.S. Equal Employment Opportunity Commission to correct alleged unlawful employment practices on the basis of national origin and religion and to provide relief to seven former employees who were allegedly terminated as a result of same. We believe that we have

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Table of Contents

NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
 
      meritorious defenses to these claims and, accordingly, are defending vigorously this action.
 
  (x)   In the normal course of our business, various other claims and lawsuits have been filed or are pending against us. Most of these claims and lawsuits are covered by insurance and, accordingly, the maximum amount of our liability is typically limited to our deductible amount. Nonetheless, the ultimate outcome of these claims and lawsuits that are not covered by insurance cannot be determined at this time. We have evaluated our overall exposure with respect to all of our threatened and pending litigation. To the extent required, we have accrued amounts for all estimable probable losses associated with our deemed exposure. We are currently unable to estimate any other potential contingent losses beyond those accrued, as discovery is not complete nor is adequate information available to estimate such range of loss or potential recovery. As discussed above, we intend to vigorously defend our legal position on all claims and, to the extent necessary, seek recovery. At December 31, 2006, we had accrued amounts of approximately $8.9 million for the above pending legal matters.
  (e)   Commitments
 
      We have future commitments to pay for usage of certain port facilities as follows at December 31, 2006 (in thousands of dollars):
         
2007
  $ 8,158  
2008
    7,819  
2009
    8,089  
2010
    8,174  
2011
    7,979  
Thereafter
    52,862  
 
       
Total
  $ 93,081  
 
       
  (f)   Credit Card Processor
 
      We have a letter of credit facility not to exceed $100 million, which collateralizes the risk in processing our credit card sales transactions. The letter of credit facility expires in April 2008.
 
  (g)   Other
 
      Certain contracts we enter into include indemnification provisions that obligate us to make payments to the counterparty if certain events occur. The indemnification clauses are often standard contractual terms that are entered into in the normal course of business. There are no stated or notional amounts included in the indemnification clauses and we are not able to estimate the maximum potential amount of future payments, if any, under these indemnification clauses. We have not been required to make any payments under such clauses in the past, and do not believe that, under current circumstances, a request for indemnification is probable.

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Table of Contents

NCL Corporation Ltd.
Notes to the Consolidated Financial Statements

 
 
11.   Supplemental Cash Flow Information
 
    In 2004, we had non-cash financing activities related to the retirement of debt due to our Parent of $366.6 million. Furthermore, during the year ended December 31, 2004, we had non-cash investing and financing activities associated with the transfer of $804.9 million in property and equipment, $19.7 million in other assets and $403.2 million in related debt to our Parent in exchange for a $46.5 million note receivable and settlement of $374.8 million in amounts due to our Parent.
 
    For the years ended 2005 and 2006 we had non-cash investing activities related to capital leases of $10.3 million and $8.4 million, respectively.

F-28

EX-4.25 2 g05791exv4w25.htm EX-4.25 SIXTH SUPPLEMENTAL DEED/NORWEGIAN DAWN EX-4.25 Sixth Supplemental Deed/Norwegian Dawn
 

Exhibit 4.25
[Confidential Treatment]
DATED 13 NOVEMBER 2006
NORWEGIAN DAWN LIMITED
(as borrower)
NCL CORPORATION LTD.
(as guarantor)
COMMERZBANK AKTIENGESELLSCHAFT
(as co-ordinator)
COMMERZBANK INTERNATIONAL S.A.
(as agent)
 
SIXTH SUPPLEMENTAL DEED TO (AMONG OTHER THINGS)
SECURED LOAN AGREEMENT
dated 26 June 1999 (as amended) post delivery
finance for one cruise vessel being
“NORWEGIAN DAWN”
 
[**] [Confidential Treatment]

 


 

CONTENTS
             
        Page  
1  
Definitions and Construction
    2  
             
2  
Amendment of Original Loan Agreement, Original Guarantee and Security Documents
    2  
             
3  
Conditions Precedent
    3  
             
4  
Representations and Warranties
    4  
             
5  
Expenses
    5  
             
6  
Further Assurance
    6  
             
7  
Counterparts
    6  
             
8  
Notices
    6  
             
9  
Governing Law
    7  
             
10  
Jurisdiction
    7  
             
Schedule 1  
Amendment of Original Loan Agreement
    9  
             
Schedule 2  
Amendment of Original Guarantee
    10  
             
Schedule 3  
Quarterly Statement of Financial Covenants
    11  

 


 

SIXTH SUPPLEMENTAL DEED
DATED 13 NOVEMBER 2006
BETWEEN:
(1)   NORWEGIAN DAWN LIMITED of International House, Castle Hill, Victoria Road, Douglas, Isle of Man IM2 4RB, British Isles as borrower (the “Borrower”);
 
(2)   NCL CORPORATION LTD. of Milner House, 18 Parliament Street, Hamilton HM12, Bermuda (the “Guarantor”);
 
(3)   COMMERZBANK AKTIENGESELLSCHAFT, Hamburg Branch of Ness 7-9, 20457 Hamburg, Federal Republic of Germany as co-ordinator (the “Co-ordinator”); and
 
(4)   COMMERZBANK INTERNATIONAL S.A. of 25 rue Edward Steichen, L-2540 Luxembourg as agent for itself and the Lenders (the “Agent”).
WHEREAS:
(A)   By a loan agreement dated 26 June 1999 as amended by transfer certificates dated 23 June 2000, 4 December 2000, 19 January 2001 and 22 February 2001 between Commerzbank Aktiengesellschaft, Emden Branch as transferor and Bremer Bank Niederlassung der Dresdner Bank Aktiengesellschaft, Bremen, Deutsche Schiffsbank Aktiengesellschaft, Bremen and Hamburg, The Bank of Nova Scotia, Singapore Branch and Landesbank Schleswig-Holstein Girozentrale (now known as HSH Nordbank AG) respectively as transferees, a first supplemental agreement dated 17 August 2000, a second supplemental agreement dated 23 October 2001, a third supplemental agreement dated 21 March 2002, a fourth supplemental agreement dated 20 April 2004 and a fifth supplemental agreement dated as of 30 September 2005 (the “Supplemental Agreements” and together with the said loan agreement and the said transfer certificates the “Original Loan Agreement”) entered into between (among others) the Borrower and Norwegian Star Limited (the “Original Borrowers”), the Lenders, the Co-ordinator and the Agent, the Lenders granted to the Original Borrowers a secured loan in the maximum amount of six hundred and twenty six million nine hundred and twenty two thousand Dollars (USD626,922,000) (the “Facility”) to part-finance the construction by the Builder of (among other things) the Norwegian Dawn Vessel to be purchased by Norwegian Dawn for the Norwegian Dawn Contract Price (as such term is defined in the Original Loan Agreement) on the terms and conditions therein contained. The repayment of the Facility by the Borrower has been secured by (among other things) a guarantee and indemnity dated 23 April 2004 executed by the Guarantor as amended by the said fifth supplemental agreement dated as of 30 September 2005 (the “Original Guarantee”).
 
(B)   The Guarantor has requested the consent of the Lenders, the Agent and the Co-ordinator to the amendment of certain provisions of the Original Loan Agreement and the Original Guarantee to conform such provisions to similar provisions in other loan documentation to which the Guarantor and/or other members of the NCLC Group are party. This Deed shall be executed as a deed.
NOW THIS DEED WITNESSES as follows:

 


 

1   Definitions and Construction
  1.1   In this Deed including the preamble and recitals hereto (unless the context otherwise requires) any term or expression defined in the preamble or the recitals shall have the meaning ascribed to it therein and terms and expressions not defined herein but whose meanings are defined in the Loan Agreement shall have the meanings set out therein. In addition, the following terms and expressions shall have the meanings set out below:
 
      Guarantee” means the Original Guarantee as amended by this Deed; and
 
      Loan Agreement” means the Original Loan Agreement as amended by this Deed.
 
  1.2   The provisions of Clauses 1.2 and 1.3 of the Loan Agreement shall apply hereto (mutatis mutandis).
2   Amendment of Original Loan Agreement, Original Guarantee and Security Documents
  2.1   Subject to Clause 3, the parties hereto agree that from the date of this Deed the Original Loan Agreement shall be read and construed as if the clauses referred to in the first column of Schedule 1 had been amended to read as set out in the second column of Schedule 1.
 
  2.2   Subject to Clause 3, the parties hereto agree that from the date of this Deed the Original Guarantee shall be read and construed as if:
  2.2.1   the clauses referred to in the first column of Schedule 2 had been amended to read as set out in the second column of Schedule 2; and
 
  2.2.2   schedule 1 had been deleted and substituted with Schedule 3.
  2.3   Each of the Borrower and the Guarantor hereby confirms to the Agent and the Co-ordinator that with effect from the date of this Deed:
  2.3.1   all references to the Original Loan Agreement in the Security Documents to which it is a party shall be construed as references to the Loan Agreement and all terms used in such Security Documents whose meanings are defined by reference to the Original Loan Agreement shall be defined by reference to the Loan Agreement;
 
  2.3.2   the Security Documents to which it is a party shall apply to, and extend to secure, the whole of the Outstanding Indebtedness as defined in clause 1.1 of the Loan Agreement;
 
  2.3.3   its obligations under the Security Documents to which it is a party shall not be discharged, impaired or otherwise affected by reason of the execution of this Deed or of any of the documents or transactions contemplated hereby; and
 
  2.3.4   its obligations under the Security Documents to which it is a party shall remain in full force and effect as security for the obligations of the

2


 

      Borrower under the Loan Agreement and the other Security Documents as amended by this Deed.
  2.4   Except as expressly amended hereby or pursuant hereto the Original Loan Agreement and the Security Documents shall remain in full force and effect and nothing herein contained shall relieve the Borrower or any other Obligor from any of its respective obligations under any such documents.
3   Conditions Precedent
  3.1   The consent of the Agent and the Co-ordinator for themselves and on behalf of the Lenders to the variation of the provisions of the Original Loan Agreement and the Original Guarantee is conditional upon and shall not be effective unless and until the Co-ordinator has received the following in form and substance satisfactory to it:
  3.1.1   on the date of this Deed, one (1) counterpart of this Deed duly executed by the Borrower and the Guarantor;
 
  3.1.2   a written confirmation from the Process Agent that it will act for the Borrower and the Guarantor as agent for service of process in England in respect of this Deed;
 
  3.1.3   the following corporate documents in respect of each of the Borrower and the Guarantor (together the “Relevant Parties”):
  (a)   Certified Copies of any consents required from any ministry, governmental, financial or other authority for the execution of and performance by the respective Relevant Party of its obligations under this Deed or if no such consents are required a certificate from a duly appointed officer of the Relevant Party to this effect confirming that no such consents are required;
 
  (b)   notarially attested secretary’s certificate of each of the Relevant Parties:
  (i)   attaching a copy of its Certificate of Incorporation and Memorandum of Association and Bye-Laws (or equivalent constitutional documents) evidencing power to enter into the transactions contemplated in this Deed;
 
  (ii)   giving the names of its present officers and directors;
 
  (iii)   setting out specimen signatures of such officers and directors as are authorised by the Relevant Party to sign documents or otherwise undertake the performance of that Relevant Party’s obligations under this Deed;
 
  (iv)   giving the legal owner of its shares and the number of such shares held;
 
  (v)   attaching copies of resolutions passed at duly convened meetings of the directors and, if required by the

3


 

      Co-ordinator, the shareholders or members of each of the Relevant Parties authorising (as applicable) the execution of this Deed and the issue of any power of attorney to execute the same; and
 
  (vi)   containing a declaration of solvency as at the date of the certificate of the duly appointed officer of the Relevant Party;
      or (if applicable) certifying that there has been no change to the statements made in his or her secretary’s certificate last provided to the Co-ordinator with respect to paragraphs (b)(i), (ii), (iii), (iv) and (vi) of this Clause 3.1.3(b) and attaching copies of resolutions passed at duly convened meetings of the directors and, if required by the Co-ordinator, the shareholders or members of each of the Relevant Parties authorising (as applicable) the execution of this Deed and the issue of any power of attorney to execute the same;
  3.1.4   the original powers of attorney, if any, issued pursuant to the resolutions referred to above and notarially attested;
 
  3.1.5   a Certified Copy of a letter from the Borrower to the Manager notifying of the provisions of clause 10.14(C) of the Loan Agreement; and
 
  3.1.6   the issue of such favourable written legal opinions including in respect of the Isle of Man and Bermuda in such form as the Co-ordinator may require relating to all aspects of the transactions contemplated hereby governed by any applicable law,
      PROVIDED THAT no Event of Default and (save as disclosed in writing to the Agent and the Co-ordinator before the date of this Deed) no Possible Event of Default has occurred and is continuing on the date on which the conditions precedent set out in this Clause 3.1 have been satisfied (subject to Clause 3.2).
 
  3.2   If the Co-ordinator in accordance with the Agency and Trust Deed decides to permit the amendment of the Original Loan Agreement and the Original Guarantee hereby without having received all of the documents or evidence referred to in Clause 3.1, the Borrower will nevertheless deliver the remaining documents or evidence to the Co-ordinator within fourteen (14) days of the date of this Deed (or such other period as the Co-ordinator may stipulate) and the amendment of the Original Loan Agreement and the Original Guarantee as aforesaid shall not be construed as a waiver of the Co-ordinator’s right to receive the documents or evidence as aforesaid nor shall this provision impose on the Agent, the Co-ordinator or the Lenders any obligation to permit the amendment in the absence of such documents or evidence.
4   Representations and Warranties
  4.1   Each of the Borrower and the Guarantor represents and warrants to the Agent and the Co-ordinator that:

4


 

  4.1.1   it has the power to enter into and perform this Deed and the transactions contemplated hereby and has taken all necessary action to authorise the entry into and performance of this Deed and such transactions;
 
  4.1.2   this Deed constitutes its legal, valid and binding obligations enforceable in accordance with its terms;
 
  4.1.3   its entry into and performance of this Deed and the transactions contemplated hereby do not and will not conflict with:
  (a)   any law or regulation or any official or judicial order; or
 
  (b)   its constitutional documents; or
 
  (c)   any agreement or document to which it is a party or which is binding upon it or any of its assets,
      nor result in the creation or imposition of any Encumbrance on it or its assets pursuant to the provisions of any such agreement or document and in particular but without prejudice to the foregoing the entry into and performance of this Deed and the transactions contemplated hereby and thereby will not render invalid, void or voidable any security granted by it to the Agent;
 
  4.1.4   all authorisations, approvals, consents, licences, exemptions, filings, registrations, notarisations and other matters, official or otherwise, required in connection with the entry into, performance, validity and enforceability of this Deed and each of the other documents contemplated hereby and thereby and the transactions contemplated hereby and thereby have been obtained or effected and are in full force and effect;
 
  4.1.5   all information furnished by it to the Co-ordinator or its agents relating to the business and affairs of an Obligor in connection with this Deed and the other documents contemplated hereby and thereby was and remains true and correct in all material respects and there are no other material facts or considerations the omission of which would render any such information misleading; and
 
  4.1.6   it has fully disclosed in writing to the Co-ordinator all facts relating to its business which it knows or should reasonably know and which might reasonably be expected to influence the Agent or the Co-ordinator in deciding whether or not to enter into this Deed.
5   Expenses
 
    The Borrower and the Guarantor jointly and severally undertake to reimburse the Co-ordinator immediately on demand on a full indemnity basis for the charges and expenses (together with value added tax or any similar tax thereon and including without limitation the fees and expenses of legal and other advisers) incurred by the Agent or the Co-ordinator in respect of the negotiation, preparation, printing, execution, registration and enforcement of this Deed and any other documents required in connection with the implementation of this Deed.

5


 

6   Further Assurance
 
    Each of the Borrower and the Guarantor will, from time to time on being required to do so by the Co-ordinator, do or procure the doing of all such acts and/or execute or procure the execution of all such documents in a form satisfactory to the Co-ordinator as the Co-ordinator may reasonably consider necessary for giving full effect to this Deed or any of the documents contemplated hereby or securing to the Agent or the Co-ordinator the full benefit of the rights, powers and remedies conferred upon the Agent or the Co-ordinator in any such document.
 
7   Counterparts
 
    This Deed may be executed in any number of counterparts and all such counterparts taken together shall be deemed to constitute one and the same agreement.
 
8   Notices
  8.1   Any notice, demand or other communication (unless made by telefax) to be made or delivered to the Borrower or the Guarantor pursuant to this Deed shall (unless the Borrower or the Guarantor has by fifteen (15) days’ written notice to the Agent specified another address) be made or delivered to the Borrower and/or the Guarantor c/o 7665 Corporate Center Drive, Miami, Florida 33126, United States of America (marked for the attention of Ms Bonnie Biumi and the Legal Department (but one (1) copy shall suffice)) with a copy to c/o Star Cruises Limited, Star Cruises Terminal, Pulau Indah, PO Box No. 288, 42009 Pelabuhan Klang, Selangor Darul Ehsan, Malaysia (marked for the attention of Mr Gerard Lim). Any notice, demand or other communication to be made or delivered by the Borrower or the Guarantor pursuant to this Deed shall (unless the Agent has by fifteen (15) days’ written notice to the Borrower and the Guarantor specified another address) be made or delivered to the Agent at its Office, the details of which are set out in schedule 2 of the Original Loan Agreement.
 
  8.2   Any notice, demand or other communication to be made or delivered pursuant to this Deed may be sent by telefax to the relevant telephone numbers (which at the date hereof in respect of the Borrower and the Guarantor is +1 305 436 4140 (marked for the attention of Ms Bonnie Biumi) and +1 305 436 4117 (marked for the attention of the Legal Department) with a copy to +60 3 3884 0213 (marked for the attention of Mr Gerard Lim) and in the case of the Agent or the Co-ordinator is as recorded in schedule 2 of the Original Loan Agreement) specified by it from time to time for the purpose and shall be deemed to have been received when transmission of such telefax communication has been completed. Each such telefax communication, if made to the Agent or the Co-ordinator by the Borrower or the Guarantor, shall be signed by the person or persons authorised in writing by the Borrower or the Guarantor (as the case may be) and whose signature appears on the list of specimen signatures contained in the secretary’s certificate required to be delivered by Clause 3 and shall be expressed to be for the attention of the department or officer whose name has been notified for the time being for that purpose by the Agent or the Co-ordinator to the Borrower and the Guarantor.
 
  8.3   The provisions of clauses 20.1, 20.4 and 20.5 of the Original Loan Agreement shall apply to this Deed.

6


 

9   Governing Law
 
    This Deed shall be governed by English law.
 
10   Jurisdiction
  10.1   The courts of England have exclusive jurisdiction to settle any dispute arising out of or in connection with this Deed (including a dispute regarding the existence, validity or termination of this Agreement) (a “Dispute”). Each party to this Deed agrees that the courts of England are the most appropriate and convenient courts to settle Disputes and accordingly no party will argue to the contrary.
 
      This Clause 10.1 is for the benefit of the Agent and the Co-ordinator only. As a result, no such party shall be prevented from taking proceedings relating to a Dispute in any other courts with jurisdiction. To the extent allowed by law, any such party may take concurrent proceedings in any number of jurisdictions.
 
  10.2   Neither the Borrower nor the Guarantor may, without the Agent’s prior written consent, terminate the appointment of the Process Agent; if the Process Agent resigns or its appointment ceases to be effective, the Borrower and/or the Guarantor (as the case may be) shall within fourteen (14) days appoint a company which has premises in London and has been approved by the Agent to act as the Borrower’s and/or the Guarantor’s (as the case may be) process agent with unconditional authority to receive and acknowledge service on behalf of the Borrower and/or the Guarantor of all process or other documents connected with proceedings in the English courts which relate to this Deed.
 
  10.3   For the purpose of securing its obligations under Clause 10.2, each of the Borrower and the Guarantor irrevocably agrees that, if it for any reason fails to appoint a process agent within the period specified in Clause 10.2, the Agent may appoint any person (including a company controlled by or associated with the Agent or any Lender) to act as the Borrower’s or the Guarantor’s (as the case may be) process agent in England with the unconditional authority described in Clause 10.2.
 
  10.4   No neglect or default by a process agent appointed or designated under this Clause (including a failure by it to notify the Borrower or the Guarantor (as the case may be) of the service of any process or to forward any process to the Borrower or the Guarantor (as the case may be)) shall invalidate any proceedings or judgment.
 
  10.5   Each of the Borrower and the Guarantor appoints in the case of the courts of England the Process Agent to receive, for and on its behalf service of process in England of any legal proceedings with respect to this Deed.
 
  10.6   A judgment relating to this Deed which is given or would be enforced by an English court shall be conclusive and binding on the Borrower and/or the Guarantor (as the case may be) and may be enforced without review in any other jurisdiction.
 
  10.7   Nothing in this Clause shall exclude or limit any right which the Agent or the Co-ordinator may have (whether under the laws of any country, an international convention or otherwise) with regard to the bringing of proceedings, the service

7


 

      of process, the recognition or enforcement of a judgment or any similar or related matter in any jurisdiction.
 
  10.8   In this Clause “judgment” includes order, injunction, declaration and any other decision or relief made or granted by a court.
IN WITNESS whereof the parties hereto have caused this Deed to be duly executed as a deed on the day and year first before written.
                 
SIGNED SEALED and DELIVERED as a DEED
        )     Vijay Jeyaratnam
by Vijay Jeyaratnam
        )      
for and on behalf of
        )      
NORWEIGIAN DAWN LIMITED
        )      
in the presence of:
  Jaya Prasannan     )      
 
  Trainee Solicitor     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Colin Veitch
by Colin Veitch
        )      
for and on behalf of
        )      
NCL CORPORATION LTD.
        )      
in the presence of:
  Mark E. Warren     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Julie Clegg
by Julie Clegg
        )      
for and on behalf of
        )      
COMMERZBANK AKTIENGESELLSCHAFT
        )      
in the presence of:
  Jaya Prasannan     )      
 
  Trainee Solicitor     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Julie Clegg
by Julie Clegg
        )      
for and on behalf of
        )      
COMMERZBANK INTERNATIONAL S.A.
        )      
in the presence of:
  Jaya Prasannan     )      
 
  Trainee Solicitor     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      

8


 

Schedule 1
Amendment of Original Loan Agreement
     
Definition/Clause   Amendment
 
Clause 9.2(U)
  Completeness of documents The copies of the Building Contracts, the Management Agreements and any other relevant third party agreements delivered to the Co-ordinator are true and complete copies of each such document constituting valid and binding obligations of the parties thereto enforceable in accordance with their respective terms and no amendments thereto or variations thereof have been agreed other than (if applicable), in the case of the Management Agreements, in accordance with Clause 10.14 nor has any action been taken by the parties thereto which would in any way render such document inoperative or unenforceable.
 
   
Clause 10.14
  Management
 
   
 
  Except with the prior consent of the Co-ordinator, neither Borrower will:
 
   
 
  (A) permit any person other than the Manager to be the manager of, including providing crewing services to, its Vessel;
 
   
 
  (B) permit any amendment to be made to the terms of the Management Agreement in respect of its Vessel unless the amendment is advised by the Borrower’s tax counsel or is deemed necessary by the parties thereto but provided that the amendment does not imperil the security to be provided pursuant to the Security Documents or adversely affect the ability of any Obligor to perform its obligations under the Transaction Documents; or
 
   
 
  (C) permit its Vessel to be employed other than within the NCL or NCL America brand (as applicable).

9


 

Schedule 2
Amendment of Original Guarantee
     
Definition/Clause   Amendment
Clause 11.1(C)
  as at 30 September 2006 and as at the end of each subsequent financial quarter, the ratio of Total Net Funded Debt to Total Capitalisation of the NCLC Group shall not exceed [**] [Confidential Treatment].
 
   
 
  Amounts available for drawing under any revolving or other credit facilities of the NCLC Group which remain undrawn at the time of the relevant calculation shall not be counted as cash or indebtedness for the purposes of this ratio.

10


 

Schedule 3
Quarterly Statement of Financial Covenants
     
TO:
  COMMERZBANK AKTIENGESELLSCHAFT
 
  Hamburg Branch
 
  Ness 7-9
 
  20457 Hamburg
 
  Federal Republic of Germany
          Attn: Mr Stefan Kuch/Mr Christian Renke
We refer to clause 11 of the guarantee dated 23 April 2004 (the “Guarantee”) issued by us in your favour. Terms defined in the Guarantee, whether by reference to the Loan Agreement (as therein defined) or otherwise, shall have the same meanings herein.
We hereby certify the amounts set out in the attached schedule as at the last day of the financial quarter ending                      20[                    ] for NCL Corporation Ltd. (the “Guarantor”) and its subsidiaries on a consolidated basis. We also hereby certify that the Guarantor is in compliance with all the financial covenants set out in clauses 11.1 and 11.3 of the Guarantee [[and that no Event of Default or Possible Event of Default has occurred and is continuing][an [Event of Default][Possible Event of Default] has occurred and is continuing under clause 11.1.[                     ] of the Loan Agreement and the following step[s][is/are] being taken to cure the same: [                     ]]].
   
NCL CORPORATION LTD.
 
 
 
By:    [                    ]
 
Chief Financial Officer
 
 
 
Dated:    20[                     ]
 

11


 

Schedule
Statement of Financial Covenants as of [                                        ] 20[                    ] (in USD ’000)
             
Clause (of            
Guarantee)       as of [•]   Required Covenants
11.1(A)/
11.1(B)(ii)**
  Free Liquidity   A   A>[**] [Confidential Treatment]
(11.1(A))**
A>[**] [Confidential Treatment]
(11.1(B)(ii))**
 
           
11.1(B)(i)
  Consolidated EBITDA:   B   >[**] [Confidential Treatment]
 
           
 
  Consolidated Debt Service   C    
 
           
11.1(C)
  Total Net Funded Debt:   D   <[**] [Confidential Treatment]
 
           
 
  Total Capitalisation   E    
             
 
  Consolidated EBITDA        
 
  Consolidated Net Income (loss)   x    
(Deduct)/Add:
  (Gain)/Loss on sale of assets or reserves   x    
Add:
  Consolidated Interest Expense   x    
Add:
  Depreciation and amortisation of assets   x    
Add:
  Impairment charges   x    
(Deduct)/Add:
  Other non-cash charges (gains)   x    
Add:
  Deferred income tax expense   x    
 
           
 
  Consolidated EBITDA   x   B
 
           
 
  Consolidated Debt Service        
 
  Principal paid/payable (excluding balloon payments, voluntary prepayments/repayments on sale/total loss of an NCLC Fleet vessel)   x    
Add:
  Consolidated Interest Expense   x    
 
  Distributions   x    
 
  Rent under capitalised leases   x    
 
           
 
  Consolidated Debt Service   x   C
 
           
 
  Total Net Funded Debt        
 
  Indebtedness for Borrowed Money   x    
Add:
  Guarantees of non-NCLC Group members’ obligations   x    
 
           
 
      x    
 
           
Deduct:
  Cash Balance   (x)    
 
           
 
  Total Net Funded Debt   (x)   D
 
           
 
  Total Capitalisation        
 
  Total Net Funded Debt   x    
Add:
  Consolidated stockholders’ equity   x    
 
           
 
  Total Capitalisation   x   E
 
           

12


 

For and on behalf of NCL CORPORATION LTD.
     
 
[                                                            ]
   
     I, [                                        ], the officer primarily responsible for the financial management of the NCLC Group, hereby declare that, to the best of knowledge and belief, the above Statement of Financial Covenants as of [                     ] 20[                     ], in my opinion, is true and correct.
     
 
[                                                            ]
   
Chief Financial Officer
   
NCL CORPORATION LTD.
   
Dated:    20[                     ]
 
**   Evidence satisfactory to the Co-ordinator of A at all times during the relevant period shall be provided together with this statement

13

EX-4.26 3 g05791exv4w26.htm EX-4.26 THIRD SUPPLEMENTAL DEED/NORWEGIAN SUN EX-4.26 Third Supplemental Deed/Norwegian Sun
 

Exhibit 4.26
[Confidential Treatment]
DATED 13 NOVEMBER 2006
NORWEGIAN SUN LIMITED
(as borrower)
NCL CORPORATION LTD.
(as guarantor)
DnB NOR BANK ASA
(as paying agent)
THE HONGKONG AND SHANGHAI BANKING CORPORATION LIMITED
(as security agent)
 
THIRD SUPPLEMENTAL DEED TO SECURED LOAN AGREEMENT
dated 9 July 2003 (as amended) (among other things)
Post delivery finance for one cruise vessel being
“NORWEGIAN SUN”

 
[**] [Confidential Treatment]

 


 

CONTENTS
             
        Page  
1  
Definitions and Construction
    1  
             
2  
Amendment of Original Loan Agreement, Original Guarantee and Security Documents
    2  
             
3  
Conditions Precedent
    2  
             
4  
Representations and Warranties
    4  
             
5  
Expenses
    5  
             
6  
Further Assurance
    5  
             
7  
Counterparts
    5  
             
8  
Notices
    6  
             
9  
Governing Law
    6  
             
10  
Jurisdiction
    6  
             
Schedule 1  
Amendment of Original Loan Agreement
    9  
             
Schedule 2  
Amendment of Original Guarantee
    10  
             
Schedule 3  
Quarterly Statement of Financial Covenants
    11  

 


 

THIRD SUPPLEMENTAL DEED
DATED 13 NOVEMBER 2006
BETWEEN:
(1)   NORWEGIAN SUN LIMITED of Canon’s Court, 22 Victoria Street, Hamilton HM 12, Bermuda as borrower (the “Borrower”);
 
(2)   NCL CORPORATION LTD. of Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda (the “Guarantor”);
 
(3)   DnB NOR BANK ASA of Stranden 21, NO-0021 Oslo, Norway as paying agent for itself and the Lenders (as hereinafter defined) (the “Paying Agent”); and
 
(4)   THE HONGKONG AND SHANGHAI BANKING CORPORATION LIMITED of 1 Queen’s Road Central, Hong Kong as security agent for the Lenders (the “Security Agent”).
WHEREAS:
(A)   By a loan agreement dated 9 July 2003 as amended and restated by a first supplemental deed thereto dated 20 April 2004 and as supplemented by a second supplemental deed thereto dated as of 30 September 2005 (the “Original Loan Agreement”) entered into between (among others) the Borrower, the Lenders, the Paying Agent and the Security Agent, the Lenders granted to the Borrower a secured loan in the maximum amount of two hundred and twenty five million Dollars (USD225,000,000) (the “Facility”) to part-finance the acquisition by the Borrower of m.v. “NORWEGIAN SUN” (the “Vessel”) on the terms and conditions therein contained. The repayment of the Facility by the Borrower has been secured by (among other things) a guarantee and indemnity dated 23 April 2004 executed by the Guarantor as amended by the said second supplemental deed dated as of 30 September 2005 (the “Original Guarantee”).
 
(B)   The Guarantor has requested the consent of the Lenders, the Security Agent and the Paying Agent to the amendment of certain provisions of the Original Loan Agreement and the Original Guarantee to conform such provisions to similar provisions in other loan documentation to which the Guarantor and/or other members of the NCLC Group are party. This Deed shall be executed as a deed.
NOW THIS DEED WITNESSES as follows:
1   Definitions and Construction
  1.1   In this Deed including the preamble and recitals hereto (unless the context otherwise requires) any term or expression defined in the preamble or the recitals shall have the meaning ascribed to it therein and terms and expressions not defined herein but whose meanings are defined in the Loan Agreement shall have the meanings set out therein. In addition, the following terms and expressions shall have the meanings set out below:
 
      Guarantee” means the Original Guarantee as amended by this Deed; and
 
      Loan Agreement” means the Original Loan Agreement as amended by this Deed.

 


 

  1.2   The provisions of Clauses 1.2 and 1.3 of the Loan Agreement shall apply hereto (mutatis mutandis).
 
  2   Amendment of Original Loan Agreement, Original Guarantee and Security Documents
 
  2.1   Subject to Clause 3, the parties hereto agree that from the date of this Deed the Original Loan Agreement shall be read and construed as if the clauses referred to in the first column of Schedule 1 had been amended to read as set out in the second column of Schedule 1.
 
  2.2   Subject to Clause 3, the parties hereto agree that from the date of this Deed the Original Guarantee shall be read and construed as if:
  2.2.1   the clause referred to in the first column of Schedule 2 had been amended to read as set out in the second column of Schedule 2; and
 
  2.2.2   schedule 1 had been deleted and substituted with Schedule 3.
2.3   Each of the Borrower and the Guarantor hereby confirms to the Security Agent and the Paying Agent that with effect from the date of this Deed:
  2.3.1   all references to the Original Loan Agreement in the Security Documents to which it is a party shall be construed as references to the Loan Agreement and all terms used in such Security Documents whose meanings are defined by reference to the Original Loan Agreement shall be defined by reference to the Loan Agreement;
 
  2.3.2   the Security Documents to which it is a party shall apply to, and extend to secure, the whole of the Outstanding Indebtedness as defined in clause 1.1 of the Loan Agreement;
 
  2.3.3   its obligations under the Security Documents to which it is a party shall not be discharged, impaired or otherwise affected by reason of the execution of this Deed or of any of the documents or transactions contemplated hereby; and
 
  2.3.4   its obligations under the Security Documents to which it is a party shall remain in full force and effect as security for the obligations of the Borrower under the Loan Agreement and the other Security Documents as amended by this Deed.
  2.4   Except as expressly amended hereby or pursuant hereto the Original Loan Agreement and the Security Documents shall remain in full force and effect and nothing herein contained shall relieve the Borrower or any other Obligor from any of its respective obligations under any such documents.
3   Conditions Precedent
  3.1   The consent of the Security Agent and the Paying Agent for themselves and on behalf of the Lenders to the variation of the provisions of the Original Loan Agreement and the Original Guarantee is conditional upon and shall not be

2


 

      effective unless and until the Paying Agent has received the following in form and substance satisfactory to it:
  3.1.1   on the date of this Deed, one (1) counterpart of this Deed duly executed by the Borrower and the Guarantor;
 
  3.1.2   a written confirmation from the Process Agent that it will act for the Borrower and the Guarantor as agent for service of process in England in respect of this Deed;
 
  3.1.3   the following corporate documents in respect of each of the Borrower and the Guarantor (together the “Relevant Parties”):
  (a)   Certified Copies of any consents required from any ministry, governmental, financial or other authority for the execution of and performance by the respective Relevant Party of its obligations under this Deed or if no such consents are required a certificate from a duly appointed officer of the Relevant Party to this effect confirming that no such consents are required;
 
  (b)   notarially attested secretary’s certificate of each of the Relevant Parties:
  (i)   attaching a copy of its Certificate of Incorporation and Memorandum of Association and Bye-Laws (or equivalent constitutional documents) evidencing power to enter into the transactions contemplated in this Deed;
 
  (ii)   giving the names of its present officers and directors;
 
  (iii)   setting out specimen signatures of such officers and directors as are authorised by the Relevant Party to sign documents or otherwise undertake the performance of that Relevant Party’s obligations under this Deed;
 
  (iv)   giving the legal owner of its shares and the number of such shares held;
 
  (v)   attaching copies of resolutions passed at duly convened meetings of the directors and, if required by the Paying Agent, the shareholders or members of each of the Relevant Parties authorising (as applicable) the execution of this Deed and the issue of any power of attorney to execute the same; and
 
  (vi)   containing a declaration of solvency as at the date of the certificate of the duly appointed officer of the Relevant Party;
      or (if applicable) certifying that there has been no change to the statements made in his or her secretary’s certificate last provided to the Paying Agent with respect to paragraphs (b)(i), (ii), (iii), (iv) and (vi) of this Clause 3.1.3(b) and attaching copies of

3


 

      resolutions passed at duly convened meetings of the directors and, if required by the Paying Agent, the shareholders or members of each of the Relevant Parties authorising (as applicable) the execution of this Deed and the issue of any power of attorney to execute the same;
  3.1.4   the original powers of attorney, if any, issued pursuant to the resolutions referred to above and notarially attested;
 
  3.1.5   a Certified Copy of a letter from the Borrower to the Manager notifying of the provisions of clause 10.14(c) of the Loan Agreement; and
 
  3.1.6   the issue of such favourable written legal opinions including in respect of Bermuda in such form as the Paying Agent may require relating to all aspects of the transactions contemplated hereby governed by any applicable law,
      PROVIDED THAT no Event of Default and (save as disclosed in writing to the Paying Agent and the Security Agent before the date of this Deed) no Possible Event of Default has occurred and is continuing on the date on which the conditions precedent set out in this Clause 3.1 have been satisfied (subject to Clause 3.2).
 
  3.2   If the Paying Agent in accordance with the Agency and Trust Deed decides to permit the amendment of the Original Loan Agreement and the Original Guarantee hereby without having received all of the documents or evidence referred to in Clause 3.1, the Borrower will nevertheless deliver the remaining documents or evidence to the Paying Agent within fourteen (14) days of the date of this Deed (or such other period as the Paying Agent may stipulate) and the amendment of the Original Loan Agreement and the Original Guarantee as aforesaid shall not be construed as a waiver of the Paying Agent’s right to receive the documents or evidence as aforesaid nor shall this provision impose on the Security Agent, the Paying Agent or the Lenders any obligation to permit the amendment in the absence of such documents or evidence.
4   Representations and Warranties
  4.1   Each of the Borrower and the Guarantor represents and warrants to the Security Agent and the Paying Agent that:
  4.1.1   it has the power to enter into and perform this Deed and the transactions contemplated hereby and has taken all necessary action to authorise the entry into and performance of this Deed and such transactions;
 
  4.1.2   this Deed constitutes its legal, valid and binding obligations enforceable in accordance with its terms;
 
  4.1.3   its entry into and performance of this Deed and the transactions contemplated hereby do not and will not conflict with:
  (a)   any law or regulation or any official or judicial order; or
 
  (b)   its constitutional documents; or

4


 

  (c)   any agreement or document to which it is a party or which is binding upon it or any of its assets,
      nor result in the creation or imposition of any Encumbrance on it or its assets pursuant to the provisions of any such agreement or document and in particular but without prejudice to the foregoing the entry into and performance of this Deed and the transactions contemplated hereby and thereby will not render invalid, void or voidable any security granted by it to the Security Agent;
  4.1.4   all authorisations, approvals, consents, licences, exemptions, filings, registrations, notarisations and other matters, official or otherwise, required in connection with the entry into, performance, validity and enforceability of this Deed and each of the other documents contemplated hereby and thereby and the transactions contemplated hereby and thereby have been obtained or effected and are in full force and effect;
 
  4.1.5   all information furnished by it to the Paying Agent or its agents relating to the business and affairs of an Obligor in connection with this Deed and the other documents contemplated hereby and thereby was and remains true and correct in all material respects and there are no other material facts or considerations the omission of which would render any such information misleading; and
 
  4.1.6   it has fully disclosed in writing to the Paying Agent all facts relating to its business which it knows or should reasonably know and which might reasonably be expected to influence the Security Agent or the Paying Agent in deciding whether or not to enter into this Deed.
5   Expenses
 
    The Borrower and the Guarantor jointly and severally undertake to reimburse the Paying Agent on demand on a full indemnity basis for the reasonable charges and expenses (together with value added tax or any similar tax thereon and including without limitation the fees and expenses of legal and other advisers) incurred by the Security Agent or the Paying Agent in respect of the negotiation, preparation, printing, execution, registration and enforcement of this Deed and any other documents required in connection with the implementation of this Deed.
 
6   Further Assurance
 
    Each of the Borrower and the Guarantor will, from time to time on being required to do so by the Paying Agent, do or procure the doing of all such acts and/or execute or procure the execution of all such documents in a form satisfactory to the Paying Agent as the Paying Agent may reasonably consider necessary for giving full effect to this Deed or any of the documents contemplated hereby or securing to the Security Agent or the Paying Agent the full benefit of the rights, powers and remedies conferred upon the Security Agent or the Paying Agent in any such document.
 
7   Counterparts
 
    This Deed may be executed in any number of counterparts and all such counterparts taken together shall be deemed to constitute one and the same agreement.

5


 

8   Notices
  8.1   Any notice, demand or other communication (unless made by telefax) to be made or delivered to the Borrower or the Guarantor pursuant to this Deed shall (unless the Borrower or the Guarantor has by fifteen (15) days’ written notice to the Paying Agent specified another address) be made or delivered to the Borrower and/or the Guarantor c/o 7665 Corporate Center Drive, Miami, Florida 33126, United States of America (marked for the attention of Ms Bonnie Biumi and the Legal Department (but one (1) copy shall suffice)) with a copy to c/o Star Cruises Limited, Star Cruises Terminal, Pulau Indah, PO Box No. 288, 42009 Pelabuhan Klang, Selangor Darul Ehsan, Malaysia (marked for the attention of Mr Gerard Lim). Any notice, demand or other communication to be made or delivered by the Borrower or the Guarantor pursuant to this Deed shall (unless the Paying Agent has by fifteen (15) days’ written notice to the Borrower and the Guarantor specified another address) be made or delivered to the Paying Agent at its Office, the details of which are set out in schedule 2 of the Original Loan Agreement.
 
  8.2   Any notice, demand or other communication to be made or delivered pursuant to this Deed may be sent by telefax to the relevant telephone numbers (which at the date hereof in respect of the Borrower and the Guarantor is +1 305 436 4140 (marked for the attention of Ms Bonnie Biumi) and +1 305 436 4117 (marked for the attention of the Legal Department) with a copy to +60 3 3884 0213 (marked for the attention of Mr Gerard Lim) and in the case of the Security Agent or the Paying Agent is as recorded in schedule 2 of the Original Loan Agreement) specified by it from time to time for the purpose and shall be deemed to have been received when transmission of such telefax communication has been completed. Each such telefax communication, if made to the Security Agent or the Paying Agent by the Borrower or the Guarantor, shall be signed by the person or persons authorised in writing by the Borrower or the Guarantor (as the case may be) and whose signature appears on the list of specimen signatures contained in the secretary’s certificate required to be delivered by Clause 3 and shall be expressed to be for the attention of the department or officer whose name has been notified for the time being for that purpose by the Security Agent or the Paying Agent to the Borrower and the Guarantor.
 
  8.3   The provisions of clauses 20.1, 20.4 and 20.5 of the Original Loan Agreement shall apply to this Deed.
9   Governing Law
 
    This Deed shall be governed by English law.
 
10   Jurisdiction
  10.1   The courts of England have exclusive jurisdiction to settle any dispute arising out of or in connection with this Deed (including a dispute regarding the existence, validity or termination of this Agreement) (a “Dispute”). Each party to this Deed agrees that the courts of England are the most appropriate and convenient courts to settle Disputes and accordingly no party will argue to the contrary.
 
      This Clause 10.1 is for the benefit of the Security Agent and the Paying Agent only. As a result, no such party shall be prevented from taking proceedings relating to a Dispute in any other courts with jurisdiction. To the extent allowed

6


 

      by law, any such party may take concurrent proceedings in any number of jurisdictions.
 
  10.2   Neither the Borrower nor the Guarantor may, without the Paying Agent’s prior written consent, terminate the appointment of the Process Agent; if the Process Agent resigns or its appointment ceases to be effective, the Borrower and/or the Guarantor (as the case may be) shall within fourteen (14) days appoint a company which has premises in London and has been approved by the Paying Agent to act as the Borrower’s and/or the Guarantor’s (as the case may be) process agent with unconditional authority to receive and acknowledge service on behalf of the Borrower and/or the Guarantor of all process or other documents connected with proceedings in the English courts which relate to this Deed.
 
  10.3   For the purpose of securing its obligations under Clause 10.2, each of the Borrower and the Guarantor irrevocably agrees that, if it for any reason fails to appoint a process agent within the period specified in Clause 10.2, the Paying Agent may appoint any person (including a company controlled by or associated with the Paying Agent or any Lender) to act as the Borrower’s or the Guarantor’s (as the case may be) process agent in England with the unconditional authority described in Clause 10.2.
 
  10.4   No neglect or default by a process agent appointed or designated under this Clause (including a failure by it to notify the Borrower or the Guarantor (as the case may be) of the service of any process or to forward any process to the Borrower or the Guarantor (as the case may be)) shall invalidate any proceedings or judgment.
 
  10.5   Each of the Borrower and the Guarantor appoints in the case of the courts of England the Process Agent to receive, for and on its behalf service of process in England of any legal proceedings with respect to this Deed.
 
  10.6   A judgment relating to this Deed which is given or would be enforced by an English court shall be conclusive and binding on the Borrower and/or the Guarantor (as the case may be) and may be enforced without review in any other jurisdiction.
 
  10.7   Nothing in this Clause shall exclude or limit any right which the Security Agent or the Paying Agent may have (whether under the laws of any country, an international convention or otherwise) with regard to the bringing of proceedings, the service of process, the recognition or enforcement of a judgment or any similar or related matter in any jurisdiction.
 
  10.8   In this Clause “judgment” includes order, injunction, declaration and any other decision or relief made or granted by a court.

7


 

IN WITNESS whereof the parties hereto have caused this Deed to be duly executed as a deed on the day and year first before written.
                 
SIGNED SEALED and DELIVERED as a DEED
        )     Vijay Jeyaratnam
by Vijay Jeyaratnam
        )      
for and on behalf of
        )      
NORWEIGIAN SUN LIMITED
        )      
in the presence of:
  Jaya Prasannan     )      
 
  Trainee Solicitor     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Colin Veitch
by Colin Veitch
        )      
for and on behalf of
        )      
NCL CORPORATION LTD.
        )      
in the presence of:
  Mark E. Warren     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Julie Clegg
by Julie Clegg
        )      
for and on behalf of
        )      
DnB NOR BANK ASA
        )      
as the Paying Agent
        )      
in the presence of:
  Jaya Prasannan     )      
 
  Trainee Solicitor     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Marcus Pcumley
by Marcus Pcumley
        )      
for and on behalf of
        )      
THE HONGKONG AND SHANGHAI
        )      
BANKING CORPORATION LIMITED
        )      
as the Security Agent
      )      
in the presence of:
  Mark Looi     )      
 
  HSBC Bank Plc     )      
 
  Project and Export Finance
Floor 17
    )      
 
  8 Canada Square     )      
 
  London EL14 5HQ     )      

8


 

Schedule 1
Amendment of Original Loan Agreement
     
Definition/Clause   Amendment
 
Clause 9.2.21
  Completeness of documents The copies of the MOA, the Management Agreement, the Second Mortgage Documents and any other relevant third party agreements delivered to the Paying Agent are true and complete copies of each such document constituting valid and binding obligations of the parties thereto enforceable in accordance with their respective terms and no amendments thereto or variations thereof have been agreed other than (if applicable), in the case of the Management Agreement, in accordance with Clause 10.14 nor has any action been taken by the parties thereto which would in any way render such document inoperative or unenforceable.
 
   
Clause 10.14
  Management
 
   
 
  Except with the prior consent of the Majority Lenders, the Borrower will not:
 
   
 
  (a) permit any person other than the Manager to be the manager of, including providing crewing services to, the Vessel;
 
   
 
 
(b) permit any amendment to be made to the terms of the Management Agreement unless the amendment is advised by the Borrower’s tax counsel or is deemed necessary by the parties thereto but provided that the amendment does not imperil the security to be provided pursuant to the Security Documents or adversely affect the ability of any Obligor to perform its obligations under the Transaction Documents; or
 
   
 
  (c) permit the Vessel to be employed other than within the NCL or NCL America brand (as applicable).

9


 

Schedule 2
Amendment of Original Guarantee
     
Definition/Clause   Amendment
 
Clause 11.1.3
  as at 30 September 2006 and as at the end of each subsequent financial quarter, the ratio of Total Net Funded Debt to Total Capitalisation of the NCLC Group shall not exceed [**] [Confidential Treatment].
 
   
 
  Amounts available for drawing under any revolving or other credit facilities of the NCLC Group which remain undrawn at the time of the relevant calculation shall not be counted as cash or indebtedness for the purposes of this ratio.

10


 

Schedule 3
Quarterly Statement of Financial Covenants
     
TO:
  DnB NOR BANK ASA
 
  Stranden 21
 
  NO-0021 Oslo
 
  Norway
 
   
 
  Attn: Mr Jon Flovik
We refer to clause 11 of the guarantee dated 23 April 2004 (as amended, varied and/or supplemented from time to time) (the “Guarantee”) issued by us in your favour. Terms defined in the Guarantee, whether by reference to the Loan Agreement (as therein defined) or otherwise, shall have the same meanings herein.
We hereby certify the amounts set out in the attached schedule as at the last day of the financial quarter ending                                                             20[                    ] for NCL Corporation Ltd. (the “Guarantor”) and its subsidiaries on a consolidated basis. We also hereby certify that the Guarantor is in compliance with all the financial covenants set out in clauses 11.1 and 11.3 of the Guarantee [[and that no Event of Default or Possible Event of Default has occurred and is continuing][an [Event of Default][Possible Event of Default] has occurred and is continuing under clause 12.1.[                     ] of the Loan Agreement and the following step[s][is/are] being taken to cure the same: [                     ]]].
     
NCL CORPORATION LTD.
   
 
   
 
By:         [                     ]
   
Chief Financial Officer
   
Dated:    20[                     ]

11


 

Schedule
Statement of Financial Covenants as of [                               ] 20[     ] (in USD’000)
             
Clause (of            
Guarantee)       as of [•]   Required Covenants
11.1.1/
11.1.2(b)**
  Free Liquidity   A   A > [**] [Confidential Treatment]
 
           
      A > [**] [Confidential Treatment]
(11.1.2(b))**
 
           
11.1.2(a)
  Consolidated EBITDA:   B   >[**] [Confidential Treatment]
 
           
 
  Consolidated Debt Service   C    
 
           
11.1.3
  Total Net Funded Debt:   D   <[**] [Confidential Treatment]
 
           
 
  Total Capitalisation   E    
             
 
  Consolidated EBITDA        
 
  Consolidated Net Income (loss)   x    
(Deduct)/Add:
  (Gain)/Loss on sale of assets or reserves   x    
Add:
  Consolidated Interest Expense   x    
Add:
  Depreciation and amortisation of assets   x    
Add:
  Impairment charges   x    
(Deduct)/Add:
  Other non-cash charges (gains)   x    
Add:
  Deferred income tax expense   x    
 
           
 
  Consolidated EBITDA   x   B
 
           
 
  Consolidated Debt Service        
 
  Principal paid/payable (excluding balloon payments, voluntary prepayments/repayments on sale/total loss of an NCLC Fleet vessel)   x    
Add:
  Consolidated Interest Expense   x    
 
  Distributions   x    
 
  Rent under capitalised leases   x    
 
           
 
  Consolidated Debt Service   x   C
 
           
 
  Total Net Funded Debt        
 
  Indebtedness for Borrowed Money   x    
Add:
  Guarantees of non-NCLC Group members’ obligations   x    
 
           
 
      x    
 
           
Deduct:
  Cash Balance   (x)    
 
           
 
  Total Net Funded Debt   (x)   D
 
           
 
  Total Capitalisation        
 
  Total Net Funded Debt   x    
Add:
  Consolidated stockholders’ equity   x    
 
           
 
  Total Capitalisation   x   E
 
           

12


 

For and on behalf of NCL CORPORATION LTD.
     
 
[                                        ]
   
I, [                                        ], the officer primarily responsible for the financial management of the NCLC Group, hereby declare that, to the best of knowledge and belief, the above Statement of Financial Covenants as of [     ] 20[                     ], in my opinion, is true and correct.
     
 
[                                        ]
   
Chief Financial Officer
   
NCL CORPORATION LTD.
   
Dated:    20[                     ]
 
**   Evidence satisfactory to the Paying Agent of A at all times during the relevant period shall be provided together with this statement

13

EX-4.27 4 g05791exv4w27.htm EX-4.27 SEVENTH SUPPLEMENTAL DEED/PRIDE OF AMERICA EX-4.27 Seventh Supplemental Deed/Pride of America
 

Exhibit 4.27
[Confidential Treatment]
DATED 13 NOVEMBER 2006
PRIDE OF AMERICA SHIP HOLDING, INC.
(as borrower)
NCL CORPORATION LTD.
(as guarantor)
HSBC BANK PLC
(as agent)
COMMERZBANK AKTIENGESELLSCHAFT
(as Hermes agent)
HSBC BANK PLC
(as trustee)
 
SEVENTH SUPPLEMENTAL DEED TO (AMONG OTHER THINGS)
SECURED LOAN AGREEMENT
dated 4 April 2003 for the equivalent amount in
United States Dollars and/or Euro of up to 258,000,000
pre- and post redelivery finance for one 1,075 cabin luxury cruise vessel
identified with no 7671 and working title “Project America”
at the yard of Lloyd Werft Bremerhaven GmbH
(now named “PRIDE OF AMERICA”)
 
[**] [Confidential Treatment]

 


 

CONTENTS
             
        Page
1  
Definitions and Construction
    1  
             
2  
Amendment of Original Loan Agreement, Original Guarantee and Security Documents
    2  
             
3  
Conditions Precedent
    3  
             
4  
Representations and Warranties
    5  
             
5  
Expenses
    6  
             
6  
Further Assurance
    6  
             
7  
Counterparts
    6  
             
8  
Notices
    6  
             
9  
Governing Law
    7  
             
10  
Jurisdiction
    7  
             
Schedule 1  
Amendment of Original Loan Agreement
    10  
             
Schedule 2  
Amendment of Original Guarantee
    11  
             
Schedule 3  
Quarterly Statement of Financial Covenants
    12  

 


 

SEVENTH SUPPLEMENTAL DEED
DATED 13 NOVEMBER 2006
BETWEEN:
(1)   PRIDE OF AMERICA SHIP HOLDING, INC. of Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801, United States of America as borrower (the “Borrower”);
 
(2)   NCL CORPORATION LTD. of Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda as guarantor (the “Guarantor”);
 
(3)   HSBC BANK PLC of 8 Canada Square, London E14 5HQ as agent (the “Agent”);
 
(4)   COMMERZBANK AKTIENGESELLSCHAFT of Kaiserplatz, 60311 Frankfurt am Main, Federal Republic of Germany as agent (the “Hermes Agent”); and
 
(5)   HSBC BANK PLC of 8 Canada Square, London E14 5HQ as trustee for itself and the Lenders (as hereinafter defined) (the “Trustee”).
WHEREAS:
(A)   By a loan agreement dated 4 April 2003 as amended and/or restated by a first supplemental agreement thereto dated 20 April 2004, a second supplemental agreement thereto dated 1 July 2004, a third supplemental agreement thereto dated 1 June 2005 (the “Third Supplement”), a fourth supplemental agreement thereto dated 3 August 2005, a fifth supplemental agreement thereto dated as of 30 September 2005 and a sixth supplemental agreement thereto dated 22 December 2005 entered into between the Borrower or its predecessor Ship Holding LLC (“SHLLC”) as borrower, the Lenders as lenders, the Agent as agent for (among others) the Lenders, the Hermes Agent as agent for (among others) the Lenders and the Trustee as trustee for (among others) the Lenders (the “Original Loan Agreement”), the Lenders granted to the Borrower a secured loan in the maximum amount of the equivalent in Dollars and/or Euro of two hundred and fifty eight million Euro (258,000,000) (the “Loan”) to part-finance the completion by the Builder of the Vessel for the Contract Price (as such terms are defined in the Original Loan Agreement) on the terms and conditions therein contained. The repayment of the Loan by the Borrower has been secured by (among other things) a guarantee and indemnity dated 23 April 2004 granted by the Guarantor as amended and/or supplemented from time to time (the “Original Guarantee”).
 
(B)   The Guarantor has requested the consent of the Lenders, the Agent, the Hermes Agent and the Trustee to the amendment of certain provisions of the Original Loan Agreement and the Original Guarantee to conform such provisions to similar provisions in other loan documentation to which the Guarantor and/or other members of the NCLC Group are party. This Deed shall be executed as a deed.
NOW THIS DEED WITNESSES as follows:
1   Definitions and Construction
  1.1   In this Deed including the preamble and recitals hereto (unless the context otherwise requires) any term or expression defined in the preamble or the recitals

 


 

      shall have the meaning ascribed to it therein and terms and expressions not defined herein but whose meanings are defined in the Loan Agreement shall have the meanings set out therein. In addition, the following terms and expressions shall have the meanings set out below:
 
      “Guarantee” means the Original Guarantee as amended by this Deed; and
 
      “Loan Agreement” means the Original Loan Agreement as amended by this Deed.
 
  1.2   The provisions of Clauses 1.2 and 1.3 of the Loan Agreement shall apply hereto (mutatis mutandis).
2   Amendment of Original Loan Agreement, Original Guarantee and Security Documents
  2.1   Subject to Clause 3, the parties hereto agree that from the date of this Deed the Original Loan Agreement shall be read and construed as if the clauses referred to in the first column of Schedule 1 had been amended to read as set out in the second column of Schedule 1.
 
  2.2   Subject to Clause 3, the parties hereto agree that from the date of this Deed the Original Guarantee shall be read and construed as if:
  2.2.1   the clause referred to in the first column of Schedule 2 had been amended to read as set out in the second column of Schedule 2; and
 
  2.2.2   schedule 1 had been deleted and substituted with Schedule 3.
  2.3   Each of the Borrower and the Guarantor hereby confirms to the Agent, the Hermes Agent and the Trustee that with effect from the date of this Deed:
  2.3.1   all references to the Original Loan Agreement in the Security Documents to which it is a party shall be construed as references to the Loan Agreement and all terms used in such Security Documents whose meanings are defined by reference to the Original Loan Agreement shall be defined by reference to the Loan Agreement;
 
  2.3.2   the Security Documents to which it is a party (in some cases, in the case of the Borrower, by virtue of the Merger (as defined in the Third Supplement)) shall apply to, and extend to secure, the whole of the Outstanding Indebtedness as defined in clause 1.1 of the Loan Agreement;
 
  2.3.3   its obligations under the Security Documents to which it is a party (in some cases, in the case of the Borrower, by virtue of the Merger) shall not be discharged, impaired or otherwise affected by reason of the execution of this Deed or of any of the documents or transactions contemplated hereby; and
 
  2.3.4   its obligations under the Security Documents to which it is a party (in some cases, in the case of the Borrower, by virtue of the Merger) shall remain in full force and effect as security for the obligations of the

2


 

      Borrower under the Loan Agreement and the other Security Documents as amended by this Deed.
  2.4   Except as expressly amended hereby or pursuant hereto the Original Loan Agreement and the Security Documents shall remain in full force and effect and nothing herein contained shall relieve the Borrower or any other Obligor from any of its respective obligations under any such documents.
3   Conditions Precedent
  3.1   The consent of the Agent, the Hermes Agent and the Trustee for themselves and on behalf of the Lenders to the variation of the provisions of the Original Loan Agreement and the Original Guarantee is conditional upon and shall not be effective unless and until the Agent has received the following in form and substance satisfactory to it:
  3.1.1   on the date of this Deed, one (1) counterpart of this Deed duly executed by the Borrower and the Guarantor;
 
  3.1.2   a written confirmation from the Process Agent that it will act for the Borrower and the Guarantor as agent for service of process in England in respect of this Deed;
 
  3.1.3   the following corporate documents in respect of each of the Borrower and the Guarantor (together the “Relevant Parties”):
  (a)   Certified Copies of any consents required from any ministry, governmental, financial or other authority for the execution of and performance by the respective Relevant Party of its obligations under this Deed or if no such consents are required a certificate from a duly appointed officer of the Relevant Party to this effect confirming that no such consents are required;
 
  (b)   notarially attested secretary’s certificate of each of the Relevant Parties:
  (i)   attaching a copy of its Certificate of Incorporation and Memorandum of Association and Bye-Laws (or equivalent constitutional documents) evidencing power to enter into the transactions contemplated in this Deed;
 
  (ii)   giving the names of its present officers and directors;
 
  (iii)   setting out specimen signatures of such officers and directors as are authorised by the Relevant Party to sign documents or otherwise undertake the performance of that Relevant Party’s obligations under this Deed;
 
  (iv)   giving the legal owner of its shares and the number of such shares held;
 
  (v)   attaching copies of resolutions passed at duly convened meetings of the directors and, if required by the Agent, the

3


 

      shareholders or members of each of the Relevant Parties authorising (as applicable) the execution of this Deed and the amendment to the Post Redelivery Mortgage and the issue of any power of attorney to execute the same; and
 
  (vi)   containing a declaration of solvency as at the date of the certificate of the duly appointed officer of the Relevant Party;
      or (if applicable) certifying that there has been no change to the statements made in his or her secretary’s certificate last provided to the Agent with respect to paragraphs (b)(i), (ii), (iii), (iv) and (vi) of this Clause 3.1.3(b) and attaching copies of resolutions passed at duly convened meetings of the directors and, if required by the Agent, the shareholders or members of each of the Relevant Parties authorising (as applicable) the execution of this Deed and the amendment to the Post Redelivery Mortgage and the issue of any power of attorney to execute the same;
  3.1.4   the original powers of attorney, if any, issued pursuant to the resolutions referred to above and notarially attested;
 
  3.1.5   a sixth amendment to the Post Redelivery Mortgage duly executed and lodged for recordation at the United States Coast Guard National Vessel Documentation Center;
 
  3.1.6   Certified Copies of letters from the Borrower to the Manager and from the Manager to the Sub-Agent notifying of the provisions of clause 10.14(c) of the Loan Agreement; and
 
  3.1.7   the issue of such favourable written legal opinions including in respect of the United States of America, Delaware and Bermuda in such form as the Agent may require relating to all aspects of the transactions contemplated hereby governed by any applicable law,
      PROVIDED THAT no Event of Default and (save as disclosed in writing to the Agent before the date of this Deed) no Possible Event of Default has occurred and is continuing on the date on which the conditions precedent set out in this Clause 3.1 have been satisfied (subject to Clause 3.2) other than that Event of Default waived by the Agent pursuant to the letters dated 9 March 2004 and 20 April 2004 from the Agent to SHLLC.
 
  3.2   If the Agent, the Hermes Agent and the Trustee, acting unanimously, decide (or the Agent in accordance with the Agency and Trust Deed decides) to permit the amendment of the Original Loan Agreement and the Original Guarantee hereby without the Agent having received all of the documents or evidence referred to in Clause 3.1, the Borrower will nevertheless deliver the remaining documents or evidence to the Agent within fourteen (14) days of the date of this Deed (or such other period as the Agent may stipulate) and the amendment of the Original Loan Agreement and the Original Guarantee as aforesaid shall not be construed as a waiver of the Agent’s right to receive the documents or evidence as aforesaid nor shall this provision impose on the Agent, the Hermes Agent, the Trustee or the

4


 

      Lenders any obligation to permit the amendment in the absence of such documents or evidence.
4   Representations and Warranties
  4.1   Each of the Borrower and the Guarantor represents and warrants to the Agent, the Hermes Agent and the Trustee that:
  4.1.1   it has the power to enter into and perform this Deed and the transactions contemplated hereby and has taken all necessary action to authorise the entry into and performance of this Deed and such transactions;
 
  4.1.2   this Deed constitutes its legal, valid and binding obligations enforceable in accordance with its terms;
 
  4.1.3   its entry into and performance of this Deed and the transactions contemplated hereby do not and will not conflict with:
  (a)   any law or regulation or any official or judicial order; or
 
  (b)   its constitutional documents; or
 
  (c)   any agreement or document to which it is a party or which is binding upon it or any of its assets,
      nor result in the creation or imposition of any Encumbrance on it or its assets pursuant to the provisions of any such agreement or document and in particular but without prejudice to the foregoing the entry into and performance of this Deed and the transactions contemplated hereby and thereby will not render invalid, void or voidable any security granted by it to the Trustee;
 
  4.1.4   all authorisations, approvals, consents, licences, exemptions, filings, registrations, notarisations and other matters, official or otherwise, required in connection with the entry into, performance, validity and enforceability of this Deed and each of the other documents contemplated hereby and thereby and the transactions contemplated hereby and thereby have been obtained or effected and are in full force and effect;
 
  4.1.5   all information furnished by it to the Agent or its agents relating to the business and affairs of an Obligor in connection with this Deed and the other documents contemplated hereby and thereby was and remains true and correct in all material respects and there are no other material facts or considerations the omission of which would render any such information misleading; and
 
  4.1.6   it has fully disclosed in writing to the Agent all facts relating to its business which it knows or should reasonably know and which might reasonably be expected to influence the Agent, the Hermes Agent and/or the Trustee in deciding whether or not to enter into this Deed.

5


 

5   Expenses
 
    The Borrower and the Guarantor jointly and severally undertake to reimburse the Agent on demand on a full indemnity basis for the reasonable charges and expenses (together with value added tax or any similar tax thereon and including without limitation the fees and expenses of legal and other advisers) incurred by the Agent, the Hermes Agent or the Trustee in respect of the negotiation, preparation, printing, execution, registration and enforcement of this Deed and any other documents required in connection with the implementation of this Deed.
 
6   Further Assurance
 
    Each of the Borrower and the Guarantor will, from time to time on being required to do so by the Agent, do or procure the doing of all such acts and/or execute or procure the execution of all such documents in a form satisfactory to the Agent and the Hermes Agent as the Agent and the Hermes Agent may reasonably consider necessary for giving full effect to this Deed or any of the documents contemplated hereby or securing to the Trustee the full benefit of the rights, powers and remedies conferred upon the Agent, the Hermes Agent or the Trustee in any such document.
 
7   Counterparts
 
    This Deed may be executed in any number of counterparts and all such counterparts taken together shall be deemed to constitute one and the same agreement.
 
8   Notices
  8.1   Any notice, demand or other communication (unless made by telefax) to be made or delivered to the Borrower or the Guarantor pursuant to this Deed shall (unless the Borrower or the Guarantor has by fifteen (15) days’ written notice to the Agent specified another address) be made or delivered to the Borrower and/or the Guarantor c/o 7665 Corporate Center Drive, Miami, Florida 33126, United States of America (marked for the attention of Ms Bonnie Biumi and the Legal Department (but one (1) copy shall suffice)) with a copy to c/o Star Cruises Limited, Star Cruises Terminal, Pulau Indah, PO Box No. 288, 42009 Pelabuhan Klang, Selangor Darul Ehsan, Malaysia (marked for the attention of Mr Gerard Lim). Any notice, demand or other communication to be made or delivered by the Borrower or the Guarantor pursuant to this Deed shall (unless the Agent has by fifteen (15) days’ written notice to the Borrower and the Guarantor specified another address) be made or delivered to the Agent at its Office, the details of which are set out in schedule 2 of the Original Loan Agreement.
 
  8.2   Any notice, demand or other communication to be made or delivered pursuant to this Deed may be sent by telefax to the relevant telephone numbers (which at the date hereof in respect of the Borrower and the Guarantor is +1 305 436 4140 (marked for the attention of Ms Bonnie Biumi) and +1 305 436 4117 (marked for the attention of the Legal Department) with a copy to +60 3 3884 0213 (marked for the attention of Mr Gerard Lim) and in the case of the Agent, the Hermes Agent or the Trustee is as recorded in schedule 2 of the Original Loan Agreement) specified by it from time to time for the purpose and shall be deemed to have been received when transmission of such telefax communication has been completed. Each such telefax communication, if made to the Agent, the Hermes Agent or the Trustee by the Borrower or the Guarantor, shall be signed by the

6


 

      person or persons authorised in writing by the Borrower or the Guarantor (as the case may be) and whose signature appears on the list of specimen signatures contained in the secretary’s certificate required to be delivered by Clause 3 and shall be expressed to be for the attention of the department or officer whose name has been notified for the time being for that purpose by the Agent, the Hermes Agent or the Trustee to the Borrower and the Guarantor.
 
  8.3   The provisions of clauses 18.1, 18.4 and 18.5 of the Original Loan Agreement shall apply to this Deed.
  9   Governing Law
 
      This Deed shall be governed by English law.
 
  10   Jurisdiction
  10.1   The courts of England have exclusive jurisdiction to settle any dispute arising out of or in connection with this Deed (including a dispute regarding the existence, validity or termination of this Agreement) (a “Dispute”). Each party to this Deed agrees that the courts of England are the most appropriate and convenient courts to settle Disputes and accordingly no party will argue to the contrary.
 
      This Clause 10.1 is for the benefit of the Agent, the Hermes Agent and the Trustee only. As a result, no such party shall be prevented from taking proceedings relating to a Dispute in any other courts with jurisdiction. To the extent allowed by law, any such party may take concurrent proceedings in any number of jurisdictions.
 
  10.2   Neither the Borrower nor the Guarantor may, without the Agent’s prior written consent, terminate the appointment of the Process Agent; if the Process Agent resigns or its appointment ceases to be effective, the Borrower and/or the Guarantor (as the case may be) shall within fourteen (14) days appoint a company which has premises in London and has been approved by the Agent to act as the Borrower’s and/or the Guarantor’s (as the case may be) process agent with unconditional authority to receive and acknowledge service on behalf of the Borrower and/or the Guarantor of all process or other documents connected with proceedings in the English courts which relate to this Deed.
 
  10.3   For the purpose of securing its obligations under Clause 10.2, each of the Borrower and the Guarantor irrevocably agrees that, if it for any reason fails to appoint a process agent within the period specified in Clause 10.2, the Agent may appoint any person (including a company controlled by or associated with the Agent or any Lender) to act as the Borrower’s or the Guarantor’s (as the case may be) process agent in England with the unconditional authority described in Clause 10.2.
 
  10.4   No neglect or default by a process agent appointed or designated under this Clause (including a failure by it to notify the Borrower or the Guarantor (as the case may be) of the service of any process or to forward any process to the Borrower or the Guarantor (as the case may be)) shall invalidate any proceedings or judgment.

7


 

  10.5   Each of the Borrower and the Guarantor appoints in the case of the courts of England the Process Agent to receive, for and on its behalf service of process in England of any legal proceedings with respect to this Deed.
 
  10.6   A judgment relating to this Deed which is given or would be enforced by an English court shall be conclusive and binding on the Borrower and/or the Guarantor (as the case may be) and may be enforced without review in any other jurisdiction.
 
  10.7   Nothing in this Clause shall exclude or limit any right which the Agent, the Hermes Agent or the Trustee may have (whether under the laws of any country, an international convention or otherwise) with regard to the bringing of proceedings, the service of process, the recognition or enforcement of a judgment or any similar or related matter in any jurisdiction.
 
  10.8   In this Clause “judgment” includes order, injunction, declaration and any other decision or relief made or granted by a court.
IN WITNESS whereof the parties hereto have caused this Deed to be duly executed as a deed on the day and year first before written.
                 
SIGNED SEALED and DELIVERED as a DEED
        )     Vijay Jeyaratnam
by Vijay Jeyaratnam
        )      
for and on behalf of
        )      
PRIDE OF AMERICA SHIP HOLDING, INC.
        )      
in the presence of:
  Jaya Prasannan     )      
 
  Trainee Solicitor     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Colin Veitch
by Colin Veitch
        )      
for and on behalf of
        )      
NCL CORPORATION LTD.
        )      
in the presence of:
  Mark E. Warren     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Julie Clegg
by Julie Clegg
        )      
for and on behalf of
        )      
COMMERZBANK AKTIENGESELLSCHAFT
        )      
in the presence of:
  Jaya Prasannan     )      
 
  Trainee Solicitor     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      

8


 

                 
SIGNED SEALED and DELIVERED as a DEED
        )     Mark Looi
by Mark Looi
        )      
for and on behalf of
        )      
HSBC BANK PLC
        )      
as the Agent and the Trustee
      )      
in the presence of:
  Marcus Pcumley     )      
 
  HSBC Bank Plc     )      
 
  Project and Export Finance     )      
  Floor 17     )      
 
  8 Canada Square     )      
 
  London E14 5HQ     )      
 
               

9


 

Schedule 1
Amendment of Original Loan Agreement
     
Definition/Clause   Amendment
 
Clause 9.2.21
  Completeness of documents
 
   
 
  The copies of the Building Contract, the Refund Guarantee, the Performance Guarantees, the Supervision Agreement, the Management Agreement, the Sub-Agency Agreement, the Interest Exchange Arrangements, the Commercial Loan Agreement and any other relevant third party agreements delivered to the Agent are true and complete copies of each such document constituting valid and binding obligations of the parties thereto enforceable in accordance with their respective terms and no amendments thereto or variations thereof have been agreed other than (if applicable), in the case of the Management Agreement or the Sub-Agency Agreement, in accordance with Clause 10.14 nor has any action been taken by the parties thereto which would in any way render such document inoperative or unenforceable.
 
   
Clause 10.14
  Supervision and Management
 
   
 
  Except with the prior consent of the Agent, the Borrower will not:
 
   
 
 
(a) permit any person other than the Supervisor, the Manager and the Sub-Agent to be the supervisor of completion and the manager and sub-agent of, including providing crewing services to, the Vessel;
 
   
 
 
(b) permit any amendment to be made to the terms of the Supervision Agreement, the Management Agreement or the Sub-Agency Agreement unless an amendment to the Management Agreement or the Sub-Agency Agreement is advised by the Borrower’s tax counsel or is deemed necessary by the parties thereto but provided that the amendment does not imperil the security to be provided pursuant to the Security Documents or adversely affect the ability of any Obligor to perform its obligations under the Transaction Documents; or
 
   
 
 
(c) permit the Vessel to be employed other than within the NCL or NCL America brand (as applicable).

10


 

Schedule 2
Amendment of Original Guarantee
     
Definition/Clause   Amendment
 
Clause 11.1.3
  as at 30 September 2006 and as at the end of each subsequent financial quarter, the ratio of Total Net Funded Debt to Total Capitalisation of the NCLC Group shall not exceed [**] [Confidential Treatment].
 
   
 
  Amounts available for drawing under any revolving or other credit facilities of the NCLC Group which remain undrawn at the time of the relevant calculation shall not be counted as cash or indebtedness for the purposes of this ratio.

11


 

Schedule 3
Quarterly Statement of Financial Covenants
     
TO:
  HSBC BANK PLC
 
  Project and Export Finance
 
  8 Canada Square
 
  London E14 5HQ
 
  England
 
 
  Attn: Mr Alan Marshall
 
 
  (as the Hermes Loan Agent and the Commercial Loan Agent (as each such term is defined in the Guarantee (as hereinafter defined))
We refer to clause 11 of the guarantee dated 23 April 2004 (as amended, varied and/or supplemented from time to time the “Guarantee”) issued by us in favour of the Hermes Loan Trustee and the Commercial Loan Trustee. Terms defined in the Loan Agreements (as therein defined) shall have the same meanings herein.
We hereby certify the amounts set out in the attached schedule as at the last day of the financial quarter ending         20[                    ] for NCL Corporation Ltd. (the “Guarantor”) and its subsidiaries on a consolidated basis. We also hereby certify that the Guarantor is in compliance with all the financial covenants set out in clauses 11.1 and 11.3 of the Guarantee [[and that no Event of Default or Possible Event of Default has occurred and is continuing][an [Event of Default][Possible Event of Default] has occurred and is continuing under clause 11.1.[                     ] of the [Hermes][Commercial] Loan Agreement and the following step[s][is/are] being taken to cure the same: [                     ]]].
     
NCL CORPORATION LTD.
   
 
   
 
By:    [
                                        ]
   
Chief Financial Officer
   
Dated:    20[                    ]

12


 

Schedule
Statement of Financial Covenants as of [                                         ] 20[                    ] (in USD ’000)
             
             
Clause (of Guarantee)       as of [·]   Required Covenants
11.1.1/
11.1.2(b)**
  Free Liquidity   A   A>[**] [Confidential Treatment]
(11.1.1)**
A>[**] [Confidential Treatment]
(11.1.2(b))**
 
           
11.1.2(a)
  Consolidated EBITDA:   B   >[**] [Confidential Treatment]
 
           
 
  Consolidated Debt Service   C    
 
           
11.1.3
  Total Net Funded Debt:   D   <[**] [Confidential Treatment]
 
           
 
  Total Capitalisation   E    
             
 
  Consolidated EBITDA        
 
  Consolidated Net Income (loss)   x    
(Deduct)/Add:
  (Gain)/Loss on sale of assets or reserves   x    
Add:
  Consolidated Interest Expense   x    
Add:
  Depreciation and amortisation of assets   x    
Add:
  Impairment charges   x    
(Deduct)/Add:
  Other non-cash charges (gains)   x    
Add:
  Deferred income tax expense   x    
 
           
 
           
 
  Consolidated EBITDA   x   B
 
           
 
  Consolidated Debt Service        
 
  Principal paid/payable (excluding balloon payments, voluntary
prepayments/repayments on sale/total loss of an NCLC Fleet vessel)
  x    
Add:
  Consolidated Interest Expense   x    
 
  Distributions   x    
 
  Rent under capitalised leases   x    
 
           
 
  Consolidated Debt Service   x   C
 
           
 
  Total Net Funded Debt        
 
  Indebtedness for Borrowed Money   x    
Add:
  Guarantees of non-NCLC Group members’ obligations   x    
 
           
 
      x    
 
           
 
           
Deduct:
  Cash Balance   (x)    
 
           
 
  Total Net Funded Debt   (x)   D
 
           
 
  Total Capitalisation        
 
  Total Net Funded Debt   x    
Add:
  Consolidated stockholders’ equity   x    
 
           
 
  Total Capitalisation   x   E
 
           

13


 

For and on behalf of NCL CORPORATION LTD.
     
 
[                                        ]
   
I, [                                        ], the officer primarily responsible for the financial management of the NCLC Group, hereby declare that, to the best of knowledge and belief, the above Statement of Financial Covenants as of [                    ] 20[                     ], in my opinion, is true and correct.
     
 
[                                        ]
   
Chief Financial Officer
   
NCL CORPORATION LTD.
   
Dated:    20[                    ]
 
**   Evidence satisfactory to the Agent of A at all times during the relevant period shall be provided together with this statement

14


 

DATED 13 NOVEMBER 2006
PRIDE OF AMERICA SHIP HOLDING, INC.
(as borrower)
NCL CORPORATION LTD.
(as guarantor)
HSBC BANK PLC
(as agent)
COMMERZBANK AKTIENGESELLSCHAFT
(as Hermes agent)
HSBC BANK PLC
(as trustee)
 
SIXTH SUPPLEMENTAL DEED TO (AMONG OTHER THINGS)
SECURED LOAN AGREEMENT
dated 4 April 2003 for the equivalent amount in
United States Dollars of up to 40,000,000
pre- and post redelivery finance for one 1,075 cabin luxury cruise vessel
identified with no 7671 and working title “Project America”
at the yard of Lloyd Werft Bremerhaven GmbH
(now named “PRIDE OF AMERICA”)
 
[**] [Confidential Treatment]

 


 

CONTENTS
             
        Page
1  
Definitions and Construction
    1  
             
2  
Amendment of Original Loan Agreement, Original Guarantee and Security Documents
    2  
             
3  
Conditions Precedent
    3  
             
4  
Representations and Warranties
    5  
             
5  
Expenses
    5  
             
6  
Further Assurance
    6  
             
7  
Counterparts
    6  
             
8  
Notices
    6  
             
9  
Governing Law
    7  
             
10  
Jurisdiction
    7  
             
Schedule 1  
Amendment of Original Loan Agreement
    9  
             
Schedule 2  
Amendment of Original Guarantee
    10  
             
Schedule 3  
Quarterly Statement of Financial Covenants
    11  

 


 

SIXTH SUPPLEMENTAL DEED
DATED 13 NOVEMBER 2006
BETWEEN:
(1)   PRIDE OF AMERICA SHIP HOLDING, INC. of Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801, United States of America as borrower (the “Borrower”);
 
(2)   NCL CORPORATION LTD. of Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda as guarantor (the “Guarantor”);
 
(3)   HSBC BANK PLC of 8 Canada Square, London E14 5HQ as agent (the “Agent”);
 
(4)   COMMERZBANK AKTIENGESELLSCHAFT of Kaiserplatz, 60311 Frankfurt am Main, Federal Republic of Germany as agent (the “Hermes Agent”); and
 
(5)   HSBC BANK PLC of 8 Canada Square, London E14 5HQ as trustee for itself and the Lenders (as hereinafter defined) (the “Trustee”).
WHEREAS:
(A)   By a loan agreement dated 4 April 2003 as amended and/or restated by a first supplemental agreement thereto dated 20 April 2004, a second supplemental agreement thereto dated 1 July 2004, a third supplemental agreement thereto dated 1 June 2005 (the “Third Supplement”), a fourth supplemental agreement thereto dated as of 30 September 2005 and a fifth supplemental agreement thereto dated 10 March 2006 entered into between the Borrower or its predecessor Ship Holding LLC (“SHLLC”) as borrower, the Lenders as lenders, the Agent as agent for (among others) the Lenders, the Hermes Agent as agent for (among others) the Lenders and the Trustee as trustee for (among others) the Lenders (the “Original Loan Agreement”), the Lenders granted to the Borrower a secured loan in the maximum amount of the equivalent in Dollars of forty million Euro (40,000,000) (the “Loan”) to part-finance the completion by the Builder of the Vessel for the Contract Price (as such term is defined in the Original Loan Agreement) on the terms and conditions therein contained. The repayment of the Loan by the Borrower has been secured by (among other things) a guarantee and indemnity dated 23 April 2004 granted by the Guarantor as amended and/or supplemented from time to time (the “Original Guarantee”).
 
(B)   The Guarantor has requested the consent of the Lenders, the Agent, the Hermes Agent and the Trustee to the amendment of certain provisions of the Original Loan Agreement and the Original Guarantee to conform such provisions to similar provisions in other loan documentation to which the Guarantor and/or other members of the NCLC Group are party. This Deed shall be executed as a deed.
NOW THIS DEED WITNESSES as follows:
1   Definitions and Construction
  1.1   In this Deed including the preamble and recitals hereto (unless the context otherwise requires) any term or expression defined in the preamble or the recitals shall have the meaning ascribed to it therein and terms and expressions not

 


 

      defined herein but whose meanings are defined in the Loan Agreement shall have the meanings set out therein. In addition, the following terms and expressions shall have the meanings set out below:
 
      “Guarantee” means the Original Guarantee as amended by this Deed; and
 
      “Loan Agreement” means the Original Loan Agreement as amended by this Deed.
 
  1.2   The provisions of Clauses 1.2 and 1.3 of the Loan Agreement shall apply hereto (mutatis mutandis).
2   Amendment of Original Loan Agreement, Original Guarantee and Security Documents
  2.1   Subject to Clause 3, the parties hereto agree that from the date of this Deed the Original Loan Agreement shall be read and construed as if the clauses referred to in the first column of Schedule 1 had been amended to read as set out in the second column of Schedule 1.
 
  2.2   Subject to Clause 3, the parties hereto agree that from the date of this Deed the Original Guarantee shall be read and construed as if:
  2.2.1   the clause referred to in the first column of Schedule 2 had been amended to read as set out in the second column of Schedule 2; and
 
  2.2.2   schedule 1 had been deleted and substituted with Schedule 3.
  2.3   Each of the Borrower and the Guarantor hereby confirms to the Agent, the Hermes Agent and the Trustee that with effect from the date of this Deed:
  2.3.1   all references to the Original Loan Agreement in the Security Documents to which it is a party shall be construed as references to the Loan Agreement and all terms used in such Security Documents whose meanings are defined by reference to the Original Loan Agreement shall be defined by reference to the Loan Agreement;
 
  2.3.2   the Security Documents to which it is a party (in some cases, in the case of the Borrower, by virtue of the Merger (as defined in the Third Supplement)) shall apply to, and extend to secure, the whole of the Outstanding Indebtedness as defined in clause 1.1 of the Loan Agreement;
 
  2.3.3   its obligations under the Security Documents to which it is a party (in some cases, in the case of the Borrower, by virtue of the Merger) shall not be discharged, impaired or otherwise affected by reason of the execution of this Deed or of any of the documents or transactions contemplated hereby; and
 
  2.3.4   its obligations under the Security Documents to which it is a party (in some cases, in the case of the Borrower, by virtue of the Merger) shall remain in full force and effect as security for the obligations of the Borrower under the Loan Agreement and the other Security Documents as amended by this Deed.

2


 

  2.4   Except as expressly amended hereby or pursuant hereto the Original Loan Agreement and the Security Documents shall remain in full force and effect and nothing herein contained shall relieve the Borrower or any other Obligor from any of its respective obligations under any such documents.
3   Conditions Precedent
  3.1   The consent of the Agent, the Hermes Agent and the Trustee for themselves and on behalf of the Lenders to the variation of the provisions of the Original Loan Agreement and the Original Guarantee is conditional upon and shall not be effective unless and until the Agent has received the following in form and substance satisfactory to it:
  3.1.1   on the date of this Deed, one (1) counterpart of this Deed duly executed by the Borrower and the Guarantor;
 
  3.1.2   a written confirmation from the Process Agent that it will act for the Borrower and the Guarantor as agent for service of process in England in respect of this Deed;
 
  3.1.3   the following corporate documents in respect of each of the Borrower and the Guarantor (together the “Relevant Parties”):
  (a)   Certified Copies of any consents required from any ministry, governmental, financial or other authority for the execution of and performance by the respective Relevant Party of its obligations under this Deed or if no such consents are required a certificate from a duly appointed officer of the Relevant Party to this effect confirming that no such consents are required;
 
  (b)   notarially attested secretary’s certificate of each of the Relevant Parties:
  (i)   attaching a copy of its Certificate of Incorporation and Memorandum of Association and Bye-Laws (or equivalent constitutional documents) evidencing power to enter into the transactions contemplated in this Deed;
 
  (ii)   giving the names of its present officers and directors;
 
  (iii)   setting out specimen signatures of such officers and directors as are authorised by the Relevant Party to sign documents or otherwise undertake the performance of that Relevant Party’s obligations under this Deed;
 
  (iv)   giving the legal owner of its shares and the number of such shares held;
 
  (v)   attaching copies of resolutions passed at duly convened meetings of the directors and, if required by the Agent, the shareholders or members of each of the Relevant Parties authorising (as applicable) the execution of this Deed and

3


 

      the amendment to the Mortgage and the issue of any power of attorney to execute the same; and
 
  (vi)   containing a declaration of solvency as at the date of the certificate of the duly appointed officer of the Relevant Party;
      or (if applicable) certifying that there has been no change to the statements made in his or her secretary’s certificate last provided to the Agent with respect to paragraphs (b)(i), (ii), (iii), (iv) and (vi) of this Clause 3.1.3(b) and attaching copies of resolutions passed at duly convened meetings of the directors and, if required by the Agent, the shareholders or members of each of the Relevant Parties authorising (as applicable) the execution of this Deed and the amendment to the Mortgage and the issue of any power of attorney to execute the same;
  3.1.4   the original powers of attorney, if any, issued pursuant to the resolutions referred to above and notarially attested;
 
  3.1.5   a sixth amendment to the Mortgage duly executed and lodged for recordation at the United States Coast Guard National Vessel Documentation Center;
 
  3.1.6   Certified Copies of letters from the Borrower to the Manager and from the Manager to the Sub-Agent notifying of the provisions of clause 10.14(c) of the Loan Agreement; and
 
  3.1.7   the issue of such favourable written legal opinions including in respect of the United States of America, Delaware and Bermuda in such form as the Agent may require relating to all aspects of the transactions contemplated hereby governed by any applicable law,
      PROVIDED THAT no Event of Default and (save as disclosed in writing to the Agent before the date of this Deed) no Possible Event of Default has occurred and is continuing on the date on which the conditions precedent set out in this Clause 3.1 have been satisfied (subject to Clause 3.2).
 
  3.2   If the Agent, the Hermes Agent and the Trustee, acting unanimously, decide (or the Agent in accordance with the Agency and Trust Deed decides) to permit the amendment of the Original Loan Agreement and the Original Guarantee hereby without the Agent having received all of the documents or evidence referred to in Clause 3.1, the Borrower will nevertheless deliver the remaining documents or evidence to the Agent within fourteen (14) days of the date of this Deed (or such other period as the Agent may stipulate) and the amendment of the Original Loan Agreement and the Original Guarantee as aforesaid shall not be construed as a waiver of the Agent’s right to receive the documents or evidence as aforesaid nor shall this provision impose on the Agent, the Hermes Agent, the Trustee or the Lenders any obligation to permit the amendment in the absence of such documents or evidence.

4


 

4   Representations and Warranties
  4.1   Each of the Borrower and the Guarantor represents and warrants to the Agent, the Hermes Agent and the Trustee that:
  4.1.1   it has the power to enter into and perform this Deed and the transactions contemplated hereby and has taken all necessary action to authorise the entry into and performance of this Deed and such transactions;
 
  4.1.2   this Deed constitutes its legal, valid and binding obligations enforceable in accordance with its terms;
 
  4.1.3   its entry into and performance of this Deed and the transactions contemplated hereby do not and will not conflict with:
  (a)   any law or regulation or any official or judicial order; or
 
  (b)   its constitutional documents; or
 
  (c)   any agreement or document to which it is a party or which is binding upon it or any of its assets,
      nor result in the creation or imposition of any Encumbrance on it or its assets pursuant to the provisions of any such agreement or document and in particular but without prejudice to the foregoing the entry into and performance of this Deed and the transactions contemplated hereby and thereby will not render invalid, void or voidable any security granted by it to the Trustee;
 
  4.1.4   all authorisations, approvals, consents, licences, exemptions, filings, registrations, notarisations and other matters, official or otherwise, required in connection with the entry into, performance, validity and enforceability of this Deed and each of the other documents contemplated hereby and thereby and the transactions contemplated hereby and thereby have been obtained or effected and are in full force and effect;
 
  4.1.5   all information furnished by it to the Agent or its agents relating to the business and affairs of an Obligor in connection with this Deed and the other documents contemplated hereby and thereby was and remains true and correct in all material respects and there are no other material facts or considerations the omission of which would render any such information misleading; and
 
  4.1.6   it has fully disclosed in writing to the Agent all facts relating to its business which it knows or should reasonably know and which might reasonably be expected to influence the Agent, the Hermes Agent and/or the Trustee in deciding whether or not to enter into this Deed.
5   Expenses
 
    The Borrower and the Guarantor jointly and severally undertake to reimburse the Agent on demand on a full indemnity basis for the reasonable charges and expenses (together with value added tax or any similar tax thereon and including without limitation the fees

5


 

    and expenses of legal and other advisers) incurred by the Agent, the Hermes Agent or the Trustee in respect of the negotiation, preparation, printing, execution, registration and enforcement of this Deed and any other documents required in connection with the implementation of this Deed.
 
6   Further Assurance
 
    Each of the Borrower and the Guarantor will, from time to time on being required to do so by the Agent, do or procure the doing of all such acts and/or execute or procure the execution of all such documents in a form satisfactory to the Agent and the Hermes Agent as the Agent and the Hermes Agent may reasonably consider necessary for giving full effect to this Deed or any of the documents contemplated hereby or securing to the Trustee the full benefit of the rights, powers and remedies conferred upon the Agent, the Hermes Agent or the Trustee in any such document.
 
7   Counterparts
 
    This Deed may be executed in any number of counterparts and all such counterparts taken together shall be deemed to constitute one and the same agreement.
 
8   Notices
  8.1   Any notice, demand or other communication (unless made by telefax) to be made or delivered to the Borrower or the Guarantor pursuant to this Deed shall (unless the Borrower or the Guarantor has by fifteen (15) days’ written notice to the Agent specified another address) be made or delivered to the Borrower and/or the Guarantor c/o 7665 Corporate Center Drive, Miami, Florida 33126, United States of America (marked for the attention of Ms Bonnie Biumi and the Legal Department (but one (1) copy shall suffice)) with a copy to c/o Star Cruises Limited, Star Cruises Terminal, Pulau Indah, PO Box No. 288, 42009 Pelabuhan Klang, Selangor Darul Ehsan, Malaysia (marked for the attention of Mr Gerard Lim). Any notice, demand or other communication to be made or delivered by the Borrower or the Guarantor pursuant to this Deed shall (unless the Agent has by fifteen (15) days’ written notice to the Borrower and the Guarantor specified another address) be made or delivered to the Agent at its Office, the details of which are set out in schedule 2 of the Original Loan Agreement.
 
  8.2   Any notice, demand or other communication to be made or delivered pursuant to this Deed may be sent by telefax to the relevant telephone numbers (which at the date hereof in respect of the Borrower and the Guarantor is +1 305 436 4140 (marked for the attention of Ms Bonnie Biumi) and +1 305 436 4117 (marked for the attention of the Legal Department) with a copy to +60 3 3884 0213 (marked for the attention of Mr Gerard Lim) and in the case of the Agent, the Hermes Agent or the Trustee is as recorded in schedule 2 of the Original Loan Agreement) specified by it from time to time for the purpose and shall be deemed to have been received when transmission of such telefax communication has been completed. Each such telefax communication, if made to the Agent, the Hermes Agent or the Trustee by the Borrower or the Guarantor, shall be signed by the person or persons authorised in writing by the Borrower or the Guarantor (as the case may be) and whose signature appears on the list of specimen signatures contained in the secretary’s certificate required to be delivered by Clause 3 and shall be expressed to be for the attention of the department or officer whose name

6


 

      has been notified for the time being for that purpose by the Agent, the Hermes Agent or the Trustee to the Borrower and the Guarantor.
 
  8.3   The provisions of clauses 18.1, 18.4 and 18.5 of the Original Loan Agreement shall apply to this Deed.
9   Governing Law
 
    This Deed shall be governed by English law.
 
10   Jurisdiction
  10.1   The courts of England have exclusive jurisdiction to settle any dispute arising out of or in connection with this Deed (including a dispute regarding the existence, validity or termination of this Agreement) (a “Dispute”). Each party to this Deed agrees that the courts of England are the most appropriate and convenient courts to settle Disputes and accordingly no party will argue to the contrary.
 
      This Clause 10.1 is for the benefit of the Agent, the Hermes Agent and the Trustee only. As a result, no such party shall be prevented from taking proceedings relating to a Dispute in any other courts with jurisdiction. To the extent allowed by law, any such party may take concurrent proceedings in any number of jurisdictions.
 
  10.2   Neither the Borrower nor the Guarantor may, without the Agent’s prior written consent, terminate the appointment of the Process Agent; if the Process Agent resigns or its appointment ceases to be effective, the Borrower and/or the Guarantor (as the case may be) shall within fourteen (14) days appoint a company which has premises in London and has been approved by the Agent to act as the Borrower’s and/or the Guarantor’s (as the case may be) process agent with unconditional authority to receive and acknowledge service on behalf of the Borrower and/or the Guarantor of all process or other documents connected with proceedings in the English courts which relate to this Deed.
 
  10.3   For the purpose of securing its obligations under Clause 10.2, each of the Borrower and the Guarantor irrevocably agrees that, if it for any reason fails to appoint a process agent within the period specified in Clause 10.2, the Agent may appoint any person (including a company controlled by or associated with the Agent or any Lender) to act as the Borrower’s or the Guarantor’s (as the case may be) process agent in England with the unconditional authority described in Clause 10.2.
 
  10.4   No neglect or default by a process agent appointed or designated under this Clause (including a failure by it to notify the Borrower or the Guarantor (as the case may be) of the service of any process or to forward any process to the Borrower or the Guarantor (as the case may be)) shall invalidate any proceedings or judgment.
 
  10.5   Each of the Borrower and the Guarantor appoints in the case of the courts of England the Process Agent to receive, for and on its behalf service of process in England of any legal proceedings with respect to this Deed.

7


 

  10.6   A judgment relating to this Deed which is given or would be enforced by an English court shall be conclusive and binding on the Borrower and/or the Guarantor (as the case may be) and may be enforced without review in any other jurisdiction.
 
  10.7   Nothing in this Clause shall exclude or limit any right which the Agent, the Hermes Agent or the Trustee may have (whether under the laws of any country, an international convention or otherwise) with regard to the bringing of proceedings, the service of process, the recognition or enforcement of a judgment or any similar or related matter in any jurisdiction.
 
  10.8   In this Clause “judgment” includes order, injunction, declaration and any other decision or relief made or granted by a court.
IN WITNESS whereof the parties hereto have caused this Deed to be duly executed as a deed on the day and year first before written.
                 
SIGNED SEALED and DELIVERED as a DEED
        )     Vijay Jeyaratnam
by Vijay Jeyaratnam
        )      
for and on behalf of
        )      
PRIDE OF AMERICA SHIP HOLDING, INC.
        )      
in the presence of:
  Jaya Prasannan     )      
 
  Trainee Solicitor     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Colin Veitch
by Colin Veitch
        )      
for and on behalf of
        )      
NCL CORPORATION LTD.
        )      
in the presence of:
  Mark E. Warren     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Julie Clegg
by Julie Clegg
        )      
for and on behalf of
        )      
COMMERZBANK AKTIENGESELLSCHAFT
        )      
in the presence of:
  Jaya Prasannan     )      
 
  Trainee Solicitor     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Mark Looi
by Mark Looi
        )      
for and on behalf of
        )      
HSBC BANK PLC
        )      
as the Agent and the Trustee
      )      
in the presence of:
  Marcus Pcumley     )      
 
  HSBC Bank Plc     )      
 
  Project and Export Finance     )      
 
  Floor 17     )      
 
  8 Canada Square     )      
 
  London EL14 5HQ     )      

8


 

Schedule 1
Amendment of Original Loan Agreement
     
Definition/Clause   Amendment
 
Clause 9.2.21
  Completeness of documents
 
   
 
  The copies of the Building Contract, the Management Agreement, the Sub-Agency Agreement, the Interest Exchange Arrangements, the Hermes Loan Agreement and any other relevant third party agreements delivered to the Agent are true and complete copies of each such document constituting valid and binding obligations of the parties thereto enforceable in accordance with their respective terms and no amendments thereto or variations thereof have been agreed other than (if applicable), in the case of the Management Agreement or the Sub-Agency Agreement, in accordance with Clause 10.14 nor has any action been taken by the parties thereto which would in any way render such document inoperative or unenforceable.
 
   
Clause 10.14
  Management
 
   
 
  Except with the prior consent of the Agent, the Borrower will not:
 
   
 
 
(a) permit any person other than the Manager and the Sub-Agent to be the manager and sub-agent of, including providing crewing services to, the Vessel;
 
   
 
 
(b) permit any amendment to be made to the terms of the Management Agreement or the Sub-Agency Agreement unless an amendment is advised by the Borrower’s tax counsel or is deemed necessary by the parties thereto but provided that the amendment does not imperil the security to be provided pursuant to the Security Documents or adversely affect the ability of any Obligor to perform its obligations under the Transaction Documents; or
 
   
 
  (c) permit the Vessel to be employed other than within the NCL or NCL America brand (as applicable).

9


 

Schedule 2
Amendment of Original Guarantee
     
Definition/Clause   Amendment
 
Clause 11.1.3
  as at 30 September 2006 and as at the end of each subsequent financial quarter, the ratio of Total Net Funded Debt to Total Capitalisation of the NCLC Group shall not exceed [**] [Confidential Treatment].
 
   
 
  Amounts available for drawing under any revolving or other credit facilities of the NCLC Group which remain undrawn at the time of the relevant calculation shall not be counted as cash or indebtedness for the purposes of this ratio.

10


 

Schedule 3
Quarterly Statement of Financial Covenants
     
TO:
  HSBC BANK PLC
 
  Project and Export Finance
 
  8 Canada Square
 
  London E14 5HQ
 
  England
 
 
  Attn: Mr Alan Marshall
 
 
  (as the Hermes Loan Agent and the Commercial Loan Agent (as each such term is defined in the Guarantee (as hereinafter defined))
We refer to clause 11 of the guarantee dated 23 April 2004 (as amended, varied and/or supplemented from time to time the “Guarantee”) issued by us in favour of the Hermes Loan Trustee and the Commercial Loan Trustee. Terms defined in the Loan Agreements (as therein defined) shall have the same meanings herein.
We hereby certify the amounts set out in the attached schedule as at the last day of the financial quarter ending                                                             20[                     ] for NCL Corporation Ltd. (the “Guarantor") and its subsidiaries on a consolidated basis. We also hereby certify that the Guarantor is in compliance with all the financial covenants set out in clauses 11.1 and 11.3 of the Guarantee [[and that no Event of Default or Possible Event of Default has occurred and is continuing][an [Event of Default][Possible Event of Default] has occurred and is continuing under clause 11.1.[                     ] of the [Hermes][Commercial] Loan Agreement and the following step[s][is/are] being taken to cure the same: [                     ]]].
     
NCL CORPORATION LTD.
   
 
   
 
By:    [                     ]
   
Chief Financial Officer
   
Dated:    20[                    ]

11


 

Schedule
Statement of Financial Covenants as of [                     ] 20[                     ] (in USD’000)
             
Clause (of            
Guarantee)       as of [•]   Required Covenants
11.1.1/
11.1.2(b)**
  Free Liquidity   A   A>[**] [Confidential Treatment]
(11.1.1)**
A>[**] [Confidential Treatment]
(11.1.2(b))**
 
           
11.1.2(a)
  Consolidated EBITDA:   B   >[**] [Confidential Treatment]
 
           
 
  Consolidated Debt Service   C    
 
           
11.1.3
  Total Net Funded Debt:   D   <[**] [Confidential Treatment]
 
           
 
  Total Capitalisation   E    
             
 
  Consolidated EBITDA        
 
  Consolidated Net Income (loss)   x    
(Deduct)/Add:
  (Gain)/Loss on sale of assets or reserves   x    
Add:
  Consolidated Interest Expense   x    
Add:
  Depreciation and amortisation of assets   x    
Add:
  Impairment charges   x    
(Deduct)/Add:
  Other non-cash charges (gains)   x    
Add:
  Deferred income tax expense   x    
 
           
 
  Consolidated EBITDA   x   B
 
           
 
  Consolidated Debt Service        
 
  Principal paid/payable (excluding balloon payments, voluntary prepayments/repayments on sale/total loss of an NCLC Fleet vessel)   x    
Add:
  Consolidated Interest Expense   x    
 
  Distributions   x    
 
  Rent under capitalised leases   x    
 
           
 
  Consolidated Debt Service   x   C
 
           
 
  Total Net Funded Debt        
 
  Indebtedness for Borrowed Money   x    
Add:
  Guarantees of non-NCLC Group members’ obligations   x    
 
           
 
      x    
 
           
 
           
Deduct:
  Cash Balance   (x)    
 
           
 
  Total Net Funded Debt   (x)   D
 
           
 
  Total Capitalisation        
 
  Total Net Funded Debt   x    
Add:
  Consolidated stockholders’ equity   x    
 
           
 
  Total Capitalisation   x   E
 
           

12


 

For and on behalf of NCL CORPORATION LTD.
     
 
[                                        ]
   
I, [                    ], the officer primarily responsible for the financial management of the NCLC Group, hereby declare that, to the best of knowledge and belief, the above Statement of Financial Covenants as of [     ] 20[                     ], in my opinion, is true and correct.
     
 
[                                        ]
Chief Financial Officer
   
NCL CORPORATION LTD.
   
Dated:    20[                    ]
 
**   Evidence satisfactory to the Agent of A at all times during the relevant period shall be provided together with this statement

13

EX-4.28 5 g05791exv4w28.htm EX-4.28 SECOND SUPPLEMENTAL DEED - NOV 13, 2006 EX-4.28 Second Supplemental Deed - Nov 13, 2006
 

Exhibit 4.28
[Confidential Treatment]
DATED 13 NOVEMBER 2006
NCL CORPORATION LTD.
(as borrower)
NORWEGIAN SPIRIT, LTD.
NORWEGIAN STAR LIMITED
PRIDE OF ALOHA, INC.
(as guarantors)
DnB NOR BANK ASA
(as agent)
 
SECOND SUPPLEMENTAL DEED TO
USD800,000,000 SECURED LOAN FACILITY AGREEMENT
dated 7 July 2004 (among other things)
 
[**] [Confidential Treatment]

 


 

CONTENTS
             
        Page  
1
  Definitions and Construction     2  
 
           
2
  Amendment of Original Facility Agreement, Original Mortgages and other Security Documents     2  
 
           
3
  Conditions Precedent     3  
 
           
4
  Representations and Warranties     5  
 
           
5
  Expenses     6  
 
           
6
  Further Assurance     6  
 
           
7
  Counterparts     6  
 
           
8
  Notices     6  
 
           
9
  Governing Law     7  
 
           
10
  Jurisdiction     7  
 
           
Schedule 1
  Amendment of Original Facility Agreement     10  
 
           
Schedule 2
  Amendment of Original Mortgages - m.v.s “NORWEGIAN SPIRIT” and     12  
 
  “NORWEGIAN STAR”        
 
           
Schedule 3
  Amendment of Original Mortgage - m.v. “PRIDE OF ALOHA”     13  
 
           
Schedule 4
  Quarterly Statement of Financial Covenants     14  

 


 

SECOND SUPPLEMENTAL DEED
DATED 13 NOVEMBER 2006
BETWEEN:
(1)   NCL CORPORATION LTD. of Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda as borrower (the “Borrower”);
 
(2)   NORWEGIAN SPIRIT, LTD., a company incorporated under the laws of Bermuda and having its registered office at Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda (“Norwegian Spirit”);
 
(3)   NORWEGIAN STAR LIMITED, a company incorporated under the laws of the Isle of Man and having its registered office at International House, Castle Hill, Victoria Road, Douglas, Isle of Man IM2 4RB, British Isles (“Norwegian Star”);
 
(4)   PRIDE OF ALOHA, INC., a corporation organised under the laws of the State of Delaware, United States of America and having its registered office at Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801, United States of America “Pride of Aloha” and together with Norwegian Spirit and Norwegian Star the “Guarantors”); and
 
(5)   DnB NOR BANK ASA of Stranden 21, NO-0021 Oslo, Norway as agent for itself and the Lenders (the “Agent”).
WHEREAS:
(A)   By a secured loan facility agreement dated 7 July 2004 as amended by a first supplemental deed thereto dated as of 30 September 2005 (the “Original Facility Agreement”) made between (among others) (1) the Borrower as borrower (2) the banks whose names and Lending Branches appear in schedule 1 to the Facility Agreement as lenders (the “Lenders”) and (3) the Agent, the Lenders agreed to make available to the Borrower a loan facility of up to eight hundred million Dollars (USD800,000,000) (the “Facility”). The repayment of the Facility by the Borrower has been secured by (among other things) guarantees and indemnities dated 16 July 2004 granted by the Guarantors each as amended by the said first supplemental deed dated as of 30 September 2005 and mortgages dated 16 July 2004 granted by the Guarantors respectively over m.v.s NORWEGIAN SPIRIT”, “NORWEGIAN STAR” and “PRIDE OF ALOHA” each as amended by the said first supplemental deed dated as of 30 September 2005 (the “Original Mortgages”).
 
(B)   The Borrower has requested the consent of the Lenders and the Agent to the amendment of certain provisions of the Original Facility Agreement and the Original Mortgages to conform such provisions to similar provisions in other loan documentation to which the Borrower and/or other members of the NCLC Group are party. This Deed shall be executed as a deed.
NOW THIS DEED WITNESSES as follows:

 


 

1   Definitions and Construction
  1.1   In this Deed including the preamble and recitals hereto (unless the context otherwise requires) any term or expression defined in the preamble or the recitals shall have the meaning ascribed to it therein and terms and expressions not defined herein but whose meanings are defined in the Facility Agreement shall have the meanings set out therein. In addition, the following terms and expressions shall have the meanings set out below:
 
      Facility Agreement” means the Original Facility Agreement as amended by this Deed; and
 
      Mortgage” means an Original Mortgage as amended by this Deed.
 
  1.2   The provisions of Clauses 1.2 and 1.3 of the Facility Agreement shall apply hereto (mutatis mutandis).
2   Amendment of Original Facility Agreement, Original Mortgages and other Security Documents
  2.1   Subject to Clause 3, the parties hereto agree that from the date of this Deed the Original Facility Agreement shall be read and construed as if:
  2.1.1   the clauses referred to in the first column of Schedule 1 had been amended to read as set out in the second column of Schedule 1; and
 
  2.1.2   schedule 6 had been deleted and substituted with Schedule 4.
  2.2   Subject to Clause 3, the parties hereto agree that from the date of this Deed the deeds of covenants forming part of the Original Mortgages granted by Norwegian Spirit and Norwegian Star over their Vessels shall be read and construed as if the clause referred to in the first column of Schedule 2 had been amended to read as set out in the second column of Schedule 2.
 
  2.3   Subject to Clause 3, the parties hereto agree that from the date of this Deed the Original Mortgage granted by Pride of Aloha over its Vessel shall be read and construed as if the clause referred to in the first column of Schedule 3 had been amended to read as set out in the second column of Schedule 3.
 
  2.4   The Borrower and each of the Guarantors hereby confirms to the Agent that with effect from the date of this Deed:
  2.4.1   all references to the Original Facility Agreement in the Security Documents to which it is a party shall be construed as references to the Facility Agreement and all terms used in such Security Documents whose meanings are defined by reference to the Original Facility Agreement shall be defined by reference to the Facility Agreement;
 
  2.4.2   the Security Documents to which it is a party shall apply to, and extend to secure, the whole of the Outstanding Indebtedness as defined in clause 1.1 of the Facility Agreement;
 
  2.4.3   its obligations under the Security Documents to which it is a party shall not be discharged, impaired or otherwise affected by reason of the

2


 

      execution of this Deed or of any of the documents or transactions contemplated hereby; and
 
  2.4.4   its obligations under the Security Documents to which it is a party shall remain in full force and effect as security for the obligations of the Borrower under the Facility Agreement and the other Security Documents as amended by this Deed.
  2.5   Except as expressly amended hereby or pursuant hereto the Original Facility Agreement and the Security Documents shall remain in full force and effect and nothing herein contained shall relieve the Borrower or any other Obligor from any of its respective obligations under any such documents.
3   Conditions Precedent
  3.1   The consent of the Agent for itself and on behalf of the Lenders to the variation of the provisions of the Original Facility Agreement and the Original Mortgages is conditional upon and shall not be effective unless and until the Agent has received the following in form and substance satisfactory to it:
  3.1.1   on the date of this Deed, one (1) counterpart of this Deed duly executed by the Borrower and the Guarantors;
 
  3.1.2   a written confirmation from the Process Agent that it will act for the Borrower and the Guarantors as agent for service of process in England in respect of this Deed;
 
  3.1.3   the following corporate documents in respect of each of the Borrower and the Guarantors (together the “Relevant Parties”):
  (a)   Certified Copies of any consents required from any ministry, governmental, financial or other authority for the execution of and performance by the respective Relevant Party of its obligations under this Deed or if no such consents are required a certificate from a duly appointed officer of the Relevant Party to this effect confirming that no such consents are required;
 
  (b)   notarially attested secretary’s certificate of each of the Relevant Parties:
  (i)   attaching a copy of its Certificate of Incorporation and Memorandum of Association and Bye-Laws (or equivalent constitutional documents) evidencing power to enter into the transactions contemplated in this Deed;
 
  (ii)   giving the names of its present officers and directors;
 
  (iii)   setting out specimen signatures of such officers and directors as are authorised by the Relevant Party to sign documents or otherwise undertake the performance of that Relevant Party’s obligations under this Deed;

3


 

  (iv)   giving the legal owner of its shares and the number of such shares held;
 
  (v)   attaching copies of resolutions passed at duly convened meetings of the directors and, if required by the Agent, the shareholders or members of each of the Relevant Parties authorising (as applicable) the execution of this Deed, in the case of Pride of Aloha, the second amendment to the Original Mortgage over m.v. “PRIDE OF ALOHA” and the issue of any power of attorney to execute the same; and
 
  (vi)   containing a declaration of solvency as at the date of the certificate of the duly appointed officer of the Relevant Party;
      or (if applicable) certifying that there has been no change to the statements made in his or her secretary’s certificate last provided to the Agent with respect to paragraphs (b)(i), (ii), (iii), (iv) and (vi) of this Clause 3.1.3(b) and attaching copies of resolutions passed at duly convened meetings of the directors and, if required by the Agent, the shareholders or members of each of the Relevant Parties authorising (as applicable) the execution of this Deed, in the case of Pride of Aloha, the second amendment to the Original Mortgage over m.v. “PRIDE OF ALOHA” and the issue of any power of attorney to execute the same;
  3.1.4   the original powers of attorney, if any, issued pursuant to the resolutions referred to above and notarially attested;
 
  3.1.5   a second amendment to the Mortgage over m.v. “PRIDE OF ALOHA” duly executed and lodged for recordation at the United States Coast Guard National Vessel Documentation Center;
 
  3.1.6   a Certified Copy of each of the following:
  (a)   letters from each of the Guarantors to the relevant Manager in respect of its Vessel; and
 
  (b)   a letter from the relevant Manager to the Sub-Agent in the case of m.v. “PRIDE OF ALOHA”,
      notifying of the provisions of clause 6.1.15(c) of the two (2) deeds of covenants collateral to the two (2) first priority statutory Bahamian ship mortgages granted by each of Norwegian Spirit and Norwegian Star over its Vessel or clause 5.5.15(c) of the first preferred US ship mortgage granted by Pride of Aloha over its Vessel (as applicable); and
  (c)   the issue of such favourable written legal opinions including in respect of the United States of America, Delaware, Bermuda and the Isle of Man in such form as the Agent may require relating to all aspects of the transactions contemplated hereby governed by any applicable law,

4


 

      PROVIDED THAT no Event of Default and (save as disclosed in writing to the Agent before the date of this Deed) no Possible Event of Default has occurred and is continuing on the date on which the conditions precedent set out in this Clause 3.1 have been satisfied (subject to Clause 3.2).
 
  3.2   If the Agent in accordance with clause 22 of the Original Facility Agreement decides to permit the amendment of the Original Facility Agreement and the Original Mortgages hereby without having received all of the documents or evidence referred to in Clause 3.1, the Borrower will nevertheless deliver the remaining documents or evidence to the Agent within fourteen (14) days of the date of this Deed (or such other period as the Agent may stipulate) and the amendment of the Original Facility Agreement and the Original Mortgages as aforesaid shall not be construed as a waiver of the Agent’s right to receive the documents or evidence as aforesaid nor shall this provision impose on the Agent or the Lenders any obligation to permit the amendment in the absence of such documents or evidence.
4   Representations and Warranties
  4.1   The Borrower and each of the Guarantors represents and warrants to the Agent that:
  4.1.1   it has the power to enter into and perform this Deed and the transactions and documents contemplated hereby and has taken all necessary action to authorise the entry into and performance of this Deed and such transactions and documents;
 
  4.1.2   this Deed constitutes its legal, valid and binding obligations enforceable in accordance with its terms;
 
  4.1.3   its entry into and performance of this Deed and the transactions contemplated hereby do not and will not conflict with:
  (a)   any law or regulation or any official or judicial order; or
 
  (b)   its constitutional documents; or
 
  (c)   any agreement or document to which it is a party or which is binding upon it or any of its assets,
      nor result in the creation or imposition of any Encumbrance on it or its assets pursuant to the provisions of any such agreement or document and in particular but without prejudice to the foregoing the entry into and performance of this Deed and the transactions and documents contemplated hereby and thereby will not render invalid, void or voidable any security granted by it to the Agent;
 
  4.1.4   all authorisations, approvals, consents, licences, exemptions, filings, registrations, notarisations and other matters, official or otherwise, required in connection with the entry into, performance, validity and enforceability of this Deed and each of the other documents contemplated hereby and thereby and the transactions contemplated hereby and thereby have been obtained or effected and are in full force and effect;

5


 

  4.1.5   all information furnished by it to the Agent or its agents relating to the business and affairs of an Obligor in connection with this Deed and the other documents contemplated hereby and thereby was and remains true and correct in all material respects and there are no other material facts or considerations the omission of which would render any such information misleading; and
 
  4.1.6   it has fully disclosed in writing to the Agent all facts relating to its business which it knows or should reasonably know and which might reasonably be expected to influence the Agent in deciding whether or not to enter into this Deed.
5   Expenses
 
    The Borrower and the Guarantors jointly and severally undertake to reimburse the Agent on demand on a full indemnity basis for the reasonable charges and expenses (together with value added tax or any similar tax thereon and including without limitation the fees and expenses of legal and other advisers) incurred by the Agent in respect of the negotiation, preparation, printing, execution, registration and enforcement of this Deed and any other documents required in connection with the implementation of this Deed.
 
6   Further Assurance
 
    The Borrower and each of the Guarantors will, from time to time on being required to do so by the Agent, do or procure the doing of all such acts and/or execute or procure the execution of all such documents in a form satisfactory to the Agent as the Agent may reasonably consider necessary for giving full effect to this Deed or any of the documents contemplated hereby or securing to the Agent the full benefit of the rights, powers and remedies conferred upon the Agent in any such document.
 
7   Counterparts
 
    This Deed may be executed in any number of counterparts and all such counterparts taken together shall be deemed to constitute one and the same agreement.
 
8   Notices
  8.1   Any notice, demand or other communication (unless made by telefax) to be made or delivered to the Borrower or the Guarantors pursuant to this Deed shall (unless the Borrower or a Guarantor has by fifteen (15) days’ written notice to the Agent specified another address) be made or delivered to the Borrower and/or the Guarantors c/o 7665 Corporate Center Drive, Miami, Florida 33126, United States of America (marked for the attention of Ms Bonnie Biumi and the Legal Department (but one (1) copy shall suffice)) with a copy to c/o Star Cruises Limited, Star Cruises Terminal, Pulau Indah, PO Box No. 288, 42009 Pelabuhan Klang, Selangor Darul Ehsan, Malaysia (marked for the attention of Mr Gerard Lim). Any notice, demand or other communication to be made or delivered by the Borrower or a Guarantor pursuant to this Deed shall (unless the Agent has by fifteen (15) days’ written notice to the Borrower and the Guarantor specified another address) be made or delivered to the Agent at its Office, the details of which are set out in schedule 1 of the Original Facility Agreement.

6


 

  8.2   Any notice, demand or other communication to be made or delivered pursuant to this Deed may be sent by telefax to the relevant telephone numbers (which at the date hereof in respect of the Borrower and the Guarantors is +1 305 436 4140 (marked for the attention of Ms Bonnie Biumi) and +1 305 436 4117 (marked for the attention of the Legal Department) with a copy to +60 3 3884 0213 (marked for the attention of Mr Gerard Lim) and in the case of the Agent is as recorded in schedule 1 of the Original Facility Agreement) specified by it from time to time for the purpose and shall be deemed to have been received when transmission of such telefax communication has been completed. Each such telefax communication, if made to the Agent by the Borrower or a Guarantor, shall be signed by the person or persons authorised in writing by the Borrower or the Guarantor (as the case may be) and whose signature appears on the list of specimen signatures contained in the secretary’s certificate required to be delivered by Clause 3 and shall be expressed to be for the attention of the department or officer whose name has been notified for the time being for that purpose by the Agent to the Borrower and the Guarantor.
 
  8.3   The provisions of clauses 23.1, 23.5 and 23.6 of the Original Facility Agreement shall apply to this Deed.
9   Governing Law
 
    This Deed shall be governed by English law.
 
10   Jurisdiction
  10.1   The courts of England have exclusive jurisdiction to settle any dispute arising out of or in connection with this Deed (including a dispute regarding the existence, validity or termination of this Agreement) (a “Dispute”). Each party to this Deed agrees that the courts of England are the most appropriate and convenient courts to settle Disputes and accordingly no party will argue to the contrary.
 
      This Clause 10.1 is for the benefit of the Agent only. As a result, no such party shall be prevented from taking proceedings relating to a Dispute in any other courts with jurisdiction. To the extent allowed by law, any such party may take concurrent proceedings in any number of jurisdictions.
 
  10.2   Neither the Borrower nor the Guarantors may, without the Agent’s prior written consent, terminate the appointment of the Process Agent; if the Process Agent resigns or its appointment ceases to be effective, the Borrower and/or the Guarantors (as the case may be) shall within fourteen (14) days appoint a company which has premises in London and has been approved by the Agent to act as the Borrower’s and/or the Guarantors’ (as the case may be) process agent with unconditional authority to receive and acknowledge service on behalf of the Borrower and/or the Guarantors of all process or other documents connected with proceedings in the English courts which relate to this Deed.
 
  10.3   For the purpose of securing its obligations under Clause 10.2, the Borrower and each of the Guarantors irrevocably agrees that, if it for any reason fails to appoint a process agent within the period specified in Clause 10.2, the Agent may appoint any person (including a company controlled by or associated with the Agent or any Lender) to act as the Borrower’s or that Guarantor’s (as the case may be)

7


 

      process agent in England with the unconditional authority described in Clause 10.2.
 
  10.4   No neglect or default by a process agent appointed or designated under this Clause (including a failure by it to notify the Borrower or the Guarantors (as the case may be) of the service of any process or to forward any process to the Borrower or the Guarantors (as the case may be)) shall invalidate any proceedings or judgment.
 
  10.5   The Borrower and each of the Guarantors appoints in the case of the courts of England the Process Agent to receive, for and on its behalf service of process in England of any legal proceedings with respect to this Deed.
 
  10.6   A judgment relating to this Deed which is given or would be enforced by an English court shall be conclusive and binding on the Borrower and/or the Guarantors (as the case may be) and may be enforced without review in any other jurisdiction.
 
  10.7   Nothing in this Clause shall exclude or limit any right which the Agent may have (whether under the laws of any country, an international convention or otherwise) with regard to the bringing of proceedings, the service of process, the recognition or enforcement of a judgment or any similar or related matter in any jurisdiction.
 
  10.8   In this Clause “judgment” includes order, injunction, declaration and any other decision or relief made or granted by a court.
IN WITNESS whereof the parties hereto have caused this Deed to be duly executed as a deed on the day and year first before written.
                 
SIGNED SEALED and DELIVERED as a DEED
        )     Colin Veitch
by Colin Veitch
        )      
for and on behalf of
        )      
NCL CORPORATION LTD.
        )      
in the presence of:
  Mark E. Warren     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Vijay Jeyaratnam
by Vijay Jeyaratnam
        )      
for and on behalf of
        )      
NORWEGIAN SPIRIT LTD.
        )      
in the presence of:
  Jaya Prasannan     )      
  Trainee Solicitor     )      
  One St. Paul’s ChurchYard     )      
  London, EC4M 8SH     )      
 
               

8


 

                 
SIGNED SEALED and DELIVERED as a DEED
        )     Vijay Jeyaratnam
by Vijay Jeyaratnam
        )      
for and on behalf of
        )      
NORWEGIAN STAR LIMITED
        )      
in the presence of:
  Jaya Prasannan     )      
 
  Trainee Solicitor     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Vijay Jeyaratnam
by Vijay Jeyaratnam
        )      
for and on behalf of
        )      
PRIDE OF ALOHA, INC.
        )      
in the presence of:
  Jaya Prasannan     )      
 
  Trainee Solicitor     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Julie Clegg
by Julie Clegg
        )      
for and on behalf of
        )      
DnB NOR BANK ASA
        )      
in the presence of:
  Jaya Prasannan     )      
 
  Trainee Solicitor     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               

9


 

Schedule 1
Amendment of Original Facility Agreement
     
Definition/Clause   Amendment
Clause 10.2.21
  Completeness of documents The copies of the MOA, the Management Agreements, the Sub-Agency Agreement and any other relevant third party agreements delivered to the Agent are true and complete copies of each such document constituting valid and binding obligations of the parties thereto enforceable in accordance with their respective terms and no amendments thereto or variations thereof have been agreed other than (if applicable), in the case of the Management Agreements and the Sub-Agency Agreement, in accordance with clause 6.1.15 of the two (2) deeds of covenants collateral to the two (2) first priority statutory Bahamian ship mortgages granted by each of Norwegian Spirit and Norwegian Star over its Vessel or clause 5.5.15 of the first preferred US ship mortgage granted by Pride of Aloha over its Vessel nor has any action been taken by the parties thereto which would in any way render such document inoperative or unenforceable.
 
   
Clause 11.2.1(e)
  within fifteen (15) days of a request from the Agent (but at intervals no more frequently than annually at the Borrower’s expense unless an Event of Default has occurred and is continuing), a valuation of each of the Vessels obtained in accordance with the provisions of Clause 11.17;
 
   
Clause 11.3.3
  as at 30 September 2006 and as at the end of each subsequent financial quarter, the ratio of Total Net Funded Debt to Total Capitalisation of the NCLC Group shall not exceed [**] [Confidential Treatment].
 
   
 
  Amounts available for drawing under the Facility or any other revolving or other credit facilities of the NCLC Group which remain undrawn at the time of the relevant calculation shall not be counted as cash or indebtedness for the purposes of this ratio.

10


 

     
Definition/Clause   Amendment
Clause 11.17.1
  Each of the Vessels shall for the purposes of this Clause 11.17 be valued in Dollars by two (2) independent firms of shipbrokers or shipvaluers nominated by the Borrower and approved by the Agent (acting on the instructions of the Majority Lenders) or failing such nomination and approval, appointed by the Agent (acting on such instructions) in its sole discretion (each such valuation to be made without, unless reasonably required by the Agent, physical inspection and on the basis of a sale for prompt delivery for cash at arm’s length on normal commercial terms as between a willing buyer and a willing seller without taking into account the benefit of any charterparty or other engagement concerning the Vessel). Such valuations shall be obtained within fifteen (15) days of a request from the Agent but no more frequently than annually at the Borrower’s expense (unless an Event of Default has occurred and is continuing) PROVIDED HOWEVER that if the Borrower has requested the drawdown of the Term Loan Facility or the advance of a Drawing pursuant to Clause 2.3 and, at such time, such valuations are more than ninety (90) days old, the Borrower shall, upon the Agent’s request and at the Borrower’s additional expense, obtain new valuations at that time. The average of the valuations shall constitute the value of the Vessel for the purposes of this Clause 11.17.

11


 

Schedule 2
Amendment of Original Mortgages – m.v.s “NORWEGIAN SPIRIT” and “NORWEGIAN STAR”
     
Definition/Clause   Amendment
Clause 6.1.15
  except with the prior consent of the Mortgagee, not:
 
   
 
 
(a) permit any person other than the relevant Manager to be the manager of, including providing crewing services to, the Vessel;
 
   
 
 
(b) permit any amendment to be made to the terms of the management agreement in respect of the Vessel unless the amendment is advised by the Owner’s tax counsel or is deemed necessary by the parties thereto but provided that the amendment does not imperil the security to be provided pursuant to the Security Documents or adversely affect the ability of any Obligor to perform its obligations under the Transaction Documents; or
 
   
 
 
(c) permit the Vessel to be employed other than within the NCL or NCL America brand (as applicable).

12


 

Schedule 3
Amendment of Original Mortgage – m.v. “PRIDE OF ALOHA”
     
Definition/Clause   Amendment
Clause 5.5.15
  except with the prior consent of the Mortgagee, not:
 
   
 
 
(a)  permit any person other than the relevant Manager and the Sub-Agent to be the managers of, including providing crewing services to, the Vessel;
 
   
 
 
(b)  permit any amendment to be made to the terms of the Management Agreement or the Sub-Agency Agreement unless the amendment is advised by the Owner’s tax counsel or is deemed necessary by the parties thereto but provided that the amendment does not imperil the security to be provided pursuant to the Security Documents or adversely affect the ability of any Obligor to perform its obligations under the Transaction Documents; or
 
   
 
 
(c)  permit the Vessel to be employed other than within the NCL or NCL America brand (as applicable).

13


 

Schedule 4
Quarterly Statement of Financial Covenants
TO:   DnB NOR BANK ASA
Stranden 21
NO-0021 Oslo
Norway

Attn: Mr Jon Flovik
We refer to clause 11.3 of the loan facility agreement dated 7 July 2004 (as amended, varied and/or supplemented from time to time) (the “Facility Agreement”) between (among others) you as agent and ourselves as borrower. Terms defined in the Facility Agreement shall have the same meanings herein.
We hereby certify the amounts set out in the attached schedule as at the last day of the financial quarter ending 20[                     ] for NCL Corporation Ltd. (the “Borrower”) and its subsidiaries on a consolidated basis. We also hereby certify that the Borrower is in compliance with all the financial covenants set out in clause 11.3 of the Facility Agreement [[and that no Event of Default or Possible Event of Default has occurred and is continuing][an [Event of Default][Possible Event of Default] has occurred and is continuing under clause 13.1.[                     ] of the Facility Agreement and the following step[s][is/are] being taken to cure the same: [                     ]]].
NCL CORPORATION LTD.
                                                            
By:         [                           ]
Chief Financial Officer
Dated:            20[                     ]

14


 

Schedule
Statement of Financial Covenants as of [    ] 20[           ] (in USD’000)
             
Clause (of            
Facility            
Agreement)       as of [ • ]   Required Covenants
11.3.1/
  Free Liquidity   A   A>[**] [Confidential Treatment]
11.3.2(b)**
          (11.3.1)**
 
           
 
          A>[**] [Confidential Treatment]
 
          (11.3.2(b))**
 
           
11.3.2(a)
  Consolidated EBITDA:   B   >[**] [Confidential Treatment]
 
           
 
  Consolidated Debt Service   C    
 
           
11.3.3
  Total Net Funded Debt:   D   <[**] [Confidential Treatment]
 
           
 
  Total Capitalisation   E    
                 
 
  Consolidated EBITDA            
 
  Consolidated Net Income (loss)     x      
(Deduct)/Add:
  (Gain)/Loss on sale of assets or reserves     x      
Add:
  Consolidated Interest Expense     x      
Add:
  Depreciation and amortisation of assets     x      
Add:
  Impairment charges     x      
(Deduct)/Add:
  Other non-cash charges (gains)     x      
Add:
  Deferred income tax expense     x      
 
             
 
  Consolidated EBITDA     x     B
 
             
 
  Consolidated Debt Service            
 
  Principal paid/payable (excluding balloon payments, voluntary     x      
 
  prepayments/repayments on sale/total loss of an NCLC Fleet            
 
  vessel)            
Add:
  Consolidated Interest Expense     x      
 
  Distributions     x      
 
  Rent under capitalised leases     x      
 
             
 
  Consolidated Debt Service     x     C
 
             
 
  Total Net Funded Debt            
 
  Indebtedness for Borrowed Money     x      
Add:
  Guarantees of non-NCLC Group members' obligations     x      
 
             
 
        x      
 
             
Deduct:
  Cash Balance     (x )    
 
             
 
  Total Net Funded Debt     (x )   D
 
             
 
  Total Capitalisation            
 
  Total Net Funded Debt     x      
Add:
  Consolidated stockholders' equity     x      
 
             
 
  Total Capitalisation     x     E
 
             

15


 

For and on behalf of NCL CORPORATION LTD.
                                                            
[            ]
I, [       ], the officer primarily responsible for the financial management of the NCLC Group, hereby declare that, to the best of knowledge and belief, the above Statement of Financial Covenants as of [                     ] 20[                     ], in my opinion, is true and correct.
                                                            
[            ]
Chief Financial Officer
NCL CORPORATION LTD.
Dated:            20[                     ]
 
**   Evidence satisfactory to the Agent of A at all times during the relevant period shall be provided together with this statement

16

EX-4.29 6 g05791exv4w29.htm EX-4.29 FIRST SUPPLEMENTAL DEED - NOV. 13, 2006 EX-4.29 First Supplemental Deed - Nov. 13, 2006
 

Exhibit 4.29
[Confidential Treatment]
DATED 13 NOVEMBER 2006
NCL CORPORATION LTD.
(as Indemnifier)
NORWEGIAN SUN LIMITED
(as owner)
DnB NOR BANK ASA
(as agent)
 
FIRST SUPPLEMENTAL DEED TO
LETTERS OF CREDIT
FACILITY AGREEMENT
dated 23 September 2005 (among other things)
 
[**] [Confidential Treatment]

 


 

CONTENTS
             
        Page  
1
  Definitions and Construction     1  
 
           
2
  Amendment of Original Facility Agreement, Original Mortgage and other Security Documents     2  
 
           
3
  Conditions Precedent     2  
 
           
4
  Representations and Warranties     4  
 
           
5
  Expenses     5  
 
           
6
  Further Assurance     5  
 
           
7
  Counterparts     5  
 
           
8
  Notices     5  
 
           
9
  Governing Law     6  
 
           
10
  Jurisdiction     6  
 
           
Schedule 1
  Amendment of Original Facility Agreement     9  
 
           
Schedule 2
  Amendment of Original Mortgage     10  
 
           
Schedule 3
  Quarterly Statement of Financial Covenants     11  

 


 

FIRST SUPPLEMENTAL DEED
DATED 13 NOVEMBER 2006
BETWEEN:
(1)   NCL CORPORATION LTD. of Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda as indemnifier (the “Indemnifier”);
 
(2)   NORWEGIAN SUN LIMITED of Canon’s Court, 22 Victoria Street, Hamilton HM 12, Bermuda as owner (the “Owner”); and
 
(3)   DnB NOR BANK ASA of Stranden 21, NO-0021 Oslo, Norway as agent for itself and the Issuers (the “Agent”).
     WHEREAS:
(A)   By a letters of credit facility agreement dated 23 September 2005 (the “Original Facility Agreement”) made between (among others) (1) the Indemnifier as indemnifier (2) the banks whose names and particulars appear in appendix A to the Facility Agreement as issuers (the “Issuers”) and (3) the Agent, the Issuers agreed to issue in favour of Chase Merchant Services, LLC letters of credit in the aggregate maximum amount of one hundred million Dollars (USD100,000,000). The repayment of the Indebtedness by the Indemnifier has been secured by (among other things) a second priority Bahamian statutory mortgage dated 23 September 2005 granted by the Owner over m.v. “NORWEGIAN SUN” (the “Original Mortgage”).
 
(B)   The Indemnifier has requested the consent of the Issuers and the Agent to the amendment of certain provisions of the Original Facility Agreement and the Original Mortgage to conform such provisions to similar provisions in other loan documentation to which the Indemnifier and/or other members of the NCLC Group are party. This Deed shall be executed as a deed.
NOW THIS DEED WITNESSES as follows:
1   Definitions and Construction
  1.1   In this Deed including the preamble and recitals hereto (unless the context otherwise requires) any term or expression defined in the preamble or the recitals shall have the meaning ascribed to it therein and terms and expressions not defined herein but whose meanings are defined in the Facility Agreement shall have the meanings set out therein. In addition, the following terms and expressions shall have the meanings set out below:
 
      Facility Agreement” means the Original Facility Agreement as amended by this Deed; and
 
      Mortgage” means the Original Mortgage as amended by this Deed.
 
  1.2   The provisions of Clauses 1.2 and 1.3 of the Facility Agreement shall apply hereto (mutatis mutandis).

 


 

2   Amendment of Original Facility Agreement, Original Mortgage and other Security Documents
  2.1   Subject to Clause 3, the parties hereto agree that from the date of this Deed the Original Facility Agreement shall be read and construed as if:
  2.1.1   the clauses referred to in the first column of Schedule 1 had been amended to read as set out in the second column of Schedule 1; and
 
  2.1.2   appendix D had been deleted and substituted with Schedule 3.
2.2   Subject to Clause 3, the parties hereto agree that from the date of this Deed the deed of covenants forming part of the Original Mortgage shall be read and construed as if the clause referred to in the first column of Schedule 2 had been amended to read as set out in the second column of Schedule 2.
  2.3   The Indemnifier and the Owner hereby confirms to the Agent that with effect from the date of this Deed:
  2.3.1   all references to the Original Facility Agreement in the Security Documents to which it is a party shall be construed as references to the Facility Agreement and all terms used in such Security Documents whose meanings are defined by reference to the Original Facility Agreement shall be defined by reference to the Facility Agreement;
 
  2.3.2   the Security Documents to which it is a party shall apply to, and extend to secure, the whole of the Outstanding Indebtedness as defined in clause 1.1 of the Facility Agreement;
 
  2.3.3   its obligations under the Security Documents to which it is a party shall not be discharged, impaired or otherwise affected by reason of the execution of this Deed or of any of the documents or transactions contemplated hereby; and
 
  2.3.4   its obligations under the Security Documents to which it is a party shall remain in full force and effect as security for the obligations of the Indemnifier under the Facility Agreement and the other Security Documents as amended by this Deed.
  2.4   Except as expressly amended hereby or pursuant hereto the Original Facility Agreement and the Security Documents shall remain in full force and effect and nothing herein contained shall relieve the Indemnifier or any other Obligor from any of its respective obligations under any such documents.
3   Conditions Precedent
  3.1   The consent of the Agent for itself and on behalf of the Issuers to the variation of the provisions of the Original Facility Agreement and the Original Mortgage is conditional upon and shall not be effective unless and until the Agent has received the following in form and substance satisfactory to it:
  3.1.1   on the date of this Deed, one (1) counterpart of this Deed duly executed by the Indemnifier and the Owner;

2


 

  3.1.2   a written confirmation from the Process Agent that it will act for the Indemnifier and the Owner as agent for service of process in England in respect of this Deed;
 
  3.1.3   the following corporate documents in respect of each of the Indemnifier and the Owner (together the “Relevant Parties”):
  (a)   Certified Copies of any consents required from any ministry, governmental, financial or other authority for the execution of and performance by the respective Relevant Party of its obligations under this Deed or if no such consents are required a certificate from a duly appointed officer of the Relevant Party to this effect confirming that no such consents are required;
 
  (b)   notarially attested secretary’s certificate of each of the Relevant Parties:
  (i)   attaching a copy of its Certificate of Incorporation and Memorandum of Association and Bye-Laws (or equivalent constitutional documents) evidencing power to enter into the transactions contemplated in this Deed;
 
  (ii)   giving the names of its present officers and directors;
 
  (iii)   setting out specimen signatures of such officers and directors as are authorised by the Relevant Party to sign documents or otherwise undertake the performance of that Relevant Party’s obligations under this Deed;
 
  (iv)   giving the legal owner of its shares and the number of such shares held;
 
  (v)   attaching copies of resolutions passed at duly convened meetings of the directors and, if required by the Agent, the shareholders or members of each of the Relevant Parties authorising (as applicable) the execution of this Deed and the issue of any power of attorney to execute the same; and
 
  (vi)   containing a declaration of solvency as at the date of the certificate of the duly appointed officer of the Relevant Party;
      or (if applicable) certifying that there has been no change to the statements made in his or her secretary’s certificate last provided to the Agent with respect to paragraphs (b)(i), (ii), (iii), (iv) and (vi) of this Clause 3.1.3(b) and attaching copies of resolutions passed at duly convened meetings of the directors and, if required by the Agent, the shareholders or members of each of the Relevant Parties authorising (as applicable) the execution of this Deed and the issue of any power of attorney to execute the same;

3


 

  3.1.4   the original powers of attorney, if any, issued pursuant to the resolutions referred to above and notarially attested;
 
  3.1.5   a Certified Copy of a letter from the Owner to the Managers notifying of the provisions of clause 6.1.17(c) of the Mortgage; and
 
  3.1.6   the issue of such favourable written legal opinions including in respect of Bermuda in such form as the Agent may require relating to all aspects of the transactions contemplated hereby governed by any applicable law,
      PROVIDED THAT no Event of Default and (save as disclosed in writing to the Agent before the date of this Deed) no Possible Event of Default has occurred and is continuing on the date on which the conditions precedent set out in this Clause 3.1 have been satisfied (subject to Clause 3.2).
 
  3.2   If the Agent in accordance with clause 14 of the Original Facility Agreement decides to permit the amendment of the Original Facility Agreement and the Original Mortgage hereby without having received all of the documents or evidence referred to in Clause 3.1, the Indemnifier will nevertheless deliver the remaining documents or evidence to the Agent within fourteen (14) days of the date of this Deed (or such other period as the Agent may stipulate) and the amendment of the Original Facility Agreement and the Original Mortgage as aforesaid shall not be construed as a waiver of the Agent’s right to receive the documents or evidence as aforesaid nor shall this provision impose on the Agent or the Issuers any obligation to permit the amendment in the absence of such documents or evidence.
4   Representations and Warranties
  4.1   Each of the Indemnifier and the Owner represents and warrants to the Agent that:
  4.1.1   it has the power to enter into and perform this Deed and the transactions and documents contemplated hereby and has taken all necessary action to authorise the entry into and performance of this Deed and such transactions and documents;
 
  4.1.2   this Deed constitutes its legal, valid and binding obligations enforceable in accordance with its terms;
 
  4.1.3   its entry into and performance of this Deed and the transactions contemplated hereby do not and will not conflict with:
  (a)   any law or regulation or any official or judicial order; or
 
  (b)   its constitutional documents; or
 
  (c)   any agreement or document to which it is a party or which is binding upon it or any of its assets,
      nor result in the creation or imposition of any Encumbrance on it or its assets pursuant to the provisions of any such agreement or document and in particular but without prejudice to the foregoing the entry into and performance of this Deed and the transactions and documents

4


 

      contemplated hereby and thereby will not render invalid, void or voidable any security granted by it to the Agent;
 
  4.1.4   all authorisations, approvals, consents, licences, exemptions, filings, registrations, notarisations and other matters, official or otherwise, required in connection with the entry into, performance, validity and enforceability of this Deed and each of the other documents contemplated hereby and thereby and the transactions contemplated hereby and thereby have been obtained or effected and are in full force and effect;
 
  4.1.5   all information furnished by it to the Agent or its agents relating to the business and affairs of an Obligor in connection with this Deed and the other documents contemplated hereby and thereby was and remains true and correct in all material respects and there are no other material facts or considerations the omission of which would render any such information misleading; and
 
  4.1.6   it has fully disclosed in writing to the Agent all facts relating to its business which it knows or should reasonably know and which might reasonably be expected to influence the Agent in deciding whether or not to enter into this Deed.
5   Expenses
 
    The Indemnifier and the Owner jointly and severally undertake to reimburse the Agent on demand on a full indemnity basis for the reasonable charges and expenses (together with value added tax or any similar tax thereon and including without limitation the fees and expenses of legal and other advisers) incurred by the Agent in respect of the negotiation, preparation, printing, execution, registration and enforcement of this Deed and any other documents required in connection with the implementation of this Deed.
 
6   Further Assurance
 
    The Indemnifier and the Owner will, from time to time on being required to do so by the Agent, do or procure the doing of all such acts and/or execute or procure the execution of all such documents in a form satisfactory to the Agent as the Agent may reasonably consider necessary for giving full effect to this Deed or any of the documents contemplated hereby or securing to the Agent the full benefit of the rights, powers and remedies conferred upon the Agent in any such document.
 
7   Counterparts
 
    This Deed may be executed in any number of counterparts and all such counterparts taken together shall be deemed to constitute one and the same agreement.
 
8   Notices
  8.1   Any notice, demand or other communication (unless made by telefax) to be made or delivered to the Indemnifier or the Owner pursuant to this Deed shall (unless the Indemnifier or the Owner has by fifteen (15) days’ written notice to the Agent specified another address) be made or delivered to the Indemnifier and/or the Owner c/o 7665 Corporate Center Drive, Miami, Florida 33126, United States of America (marked for the attention of Ms Bonnie Biumi and the Legal Department

5


 

      (but one (1) copy shall suffice)) with a copy to c/o Sun Cruises Limited, Sun Cruises Terminal, Pulau Indah, PO Box No. 288, 42009 Pelabuhan Klang, Selangor Darul Ehsan, Malaysia (marked for the attention of Mr Gerard Lim). Any notice, demand or other communication to be made or delivered by the Indemnifier or the Owner pursuant to this Deed shall (unless the Agent has by fifteen (15) days’ written notice to the Indemnifier and the Owner specified another address) be made or delivered to the Agent at its Office, the details of which are set out in schedule 1 of the Original Facility Agreement.
 
  8.2   Any notice, demand or other communication to be made or delivered pursuant to this Deed may be sent by telefax to the relevant telephone numbers (which at the date hereof in respect of the Indemnifier and the Owner is +1 305 436 4140 (marked for the attention of Ms Bonnie Biumi) and +1 305 436 4117 (marked for the attention of the Legal Department) with a copy to +60 3 3884 0213 (marked for the attention of Mr Gerard Lim) and in the case of the Agent is as recorded in schedule 1 of the Original Facility Agreement) specified by it from time to time for the purpose and shall be deemed to have been received when transmission of such telefax communication has been completed. Each such telefax communication, if made to the Agent by the Indemnifier or the Owner, shall be signed by the person or persons authorised in writing by the Indemnifier or the Owner (as the case may be) and whose signature appears on the list of specimen signatures contained in the secretary’s certificate required to be delivered by Clause 3 and shall be expressed to be for the attention of the department or officer whose name has been notified for the time being for that purpose by the Agent to the Indemnifier and the Owner.
 
  8.3   The provisions of clauses 23.1, 23.5 and 23.6 of the Original Facility Agreement shall apply to this Deed.
9   Governing Law
 
    This Deed shall be governed by English law.
 
10   Jurisdiction
  10.1   The courts of England have exclusive jurisdiction to settle any dispute arising out of or in connection with this Deed (including a dispute regarding the existence, validity or termination of this Agreement) (a “Dispute”). Each party to this Deed agrees that the courts of England are the most appropriate and convenient courts to settle Disputes and accordingly no party will argue to the contrary.
 
      This Clause 10.1 is for the benefit of the Agent only. As a result, no such party shall be prevented from taking proceedings relating to a Dispute in any other courts with jurisdiction. To the extent allowed by law, any such party may take concurrent proceedings in any number of jurisdictions.
 
  10.2   Neither the Indemnifier nor the Owner may, without the Agent’s prior written consent, terminate the appointment of the Process Agent; if the Process Agent resigns or its appointment ceases to be effective, the Indemnifier and/or the Owner (as the case may be) shall within fourteen (14) days appoint a company which has premises in London and has been approved by the Agent to act as the Indemnifier’s and/or the Owner’ (as the case may be) process agent with unconditional authority to receive and acknowledge service on behalf of the

6


 

      Indemnifier and/or the Owner of all process or other documents connected with proceedings in the English courts which relate to this Deed.
 
  10.3   For the purpose of securing its obligations under Clause 10.2, the Indemnifier and each of the Owner irrevocably agrees that, if it for any reason fails to appoint a process agent within the period specified in Clause 10.2, the Agent may appoint any person (including a company controlled by or associated with the Agent or any Lender) to act as the Indemnifier’s or the Owner’s (as the case may be) process agent in England with the unconditional authority described in Clause 10.2.
 
  10.4   No neglect or default by a process agent appointed or designated under this Clause (including a failure by it to notify the Indemnifier or the Owner (as the case may be) of the service of any process or to forward any process to the Indemnifier or the Owner (as the case may be)) shall invalidate any proceedings or judgment.
 
  10.5   The Indemnifier and the Owner appoints in the case of the courts of England the Process Agent to receive, for and on its behalf service of process in England of any legal proceedings with respect to this Deed.
 
  10.6   A judgment relating to this Deed which is given or would be enforced by an English court shall be conclusive and binding on the Indemnifier and/or the Owner (as the case may be) and may be enforced without review in any other jurisdiction.
 
  10.7   Nothing in this Clause shall exclude or limit any right which the Agent may have (whether under the laws of any country, an international convention or otherwise) with regard to the bringing of proceedings, the service of process, the recognition or enforcement of a judgment or any similar or related matter in any jurisdiction.
 
  10.8   In this Clause “judgment” includes order, injunction, declaration and any other decision or relief made or granted by a court.
     IN WITNESS whereof the parties hereto have caused this Deed to be duly executed as a deed on the day and year first before written.
                 
SIGNED SEALED and DELIVERED as a DEED
        )     Colin Veitch
by Colin Veitch
        )      
for and on behalf of
        )      
NCL CORPORATION LTD.
        )      
in the presence of:
  Mark E. Warren          

7


 

                 
SIGNED SEALED and DELIVERED as a DEED
        )     Vijay Jeyaratnam
by Vijay Jeyaratnam
        )      
for and on behalf of
        )      
NORWEGIAN SUN LIMITED
        )      
in the presence of:
  Jaya Prasannan     )      
  Trainee Solicitor     )      
  One St. Paul’s ChurchYard     )      
  London, EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Julie Clegg
by Julie Clegg
        )      
for and on behalf of
        )      
DnB NOR BANK ASA
        )      
in the presence of:
  Jaya Prasannan     )      
  Trainee Solicitor     )      
  One St. Paul’s ChurchYard     )      
  London, EC4M 8SH     )      
 
               

8


 

Schedule 1
Amendment of Original Facility Agreement
     
Definition/Clause   Amendment
Clause 10.2.21
  Completeness of documents The copies of the Transaction Documents and any other relevant third party agreements delivered to the Agent are true and complete copies of each such document constituting valid and binding obligations of the parties thereto enforceable in accordance with their respective terms and no amendments thereto or variations thereof have been agreed other than (if applicable), in the case of the management agreement between the Owner and the Managers in respect of the Vessel, in accordance with clause 6.1.17 of the deed of covenants collateral to the second priority statutory Bahamian ship mortgage granted by the Owner over the Vessel nor has any action been taken by the parties thereto which would in any way render such document inoperative or unenforceable.
 
   
Clause 11.3.3
  as at 30 September 2006 and as at the end of each subsequent financial quarter, the ratio of Total Net Funded Debt to Total Capitalisation of the NCLC Group shall not exceed [**] [Confidential Treatment].
 
   
 
  Amounts available for drawing under any revolving or other credit facilities of the NCLC Group which remain undrawn at the time of the relevant calculation shall not be counted as cash or indebtedness for the purposes of this ratio.

9


 

Schedule 2
Amendment of Original Mortgage
     
Definition/Clause   Amendment
Clause 6.1.17
  except with the prior consent of the Mortgagees, not:
 
   
 
 
(a)   permit any person other than the Manager to be the manager of, including providing crewing services to, the Vessel;
 
   
 
 
(b)   permit any amendment to be made to the terms of the management agreement with the Managers in respect of the Vessel unless the amendment is advised by the Owner’s tax counsel or is deemed necessary by the parties thereto but provided that the amendment does not imperil the security to be provided pursuant to the Security Documents or adversely affect the ability of any Security Party to perform its obligations under the Transaction Documents; or
 
   
 
 
(c)   permit the Vessel to be employed other than within the NCL or NCL America brand (as applicable).

10


 

Schedule 3
Quarterly Statement of Financial Covenants
TO:   DnB NOR BANK ASA
Stranden 21
NO-0021 Oslo
Norway

Attn: Mr Jon Flovik
We refer to clause 9.24 of the letter of credit facility agreement dated 23 September 2005 (as amended, varied and/or supplemented from time to time) (the “Facility Agreement”) between (among others) you as agent and ourselves as indemnifier. Terms defined in the Facility Agreement shall have the same meanings herein.
We hereby certify the amounts set out in the attached schedule as at the last day of the financial quarter ending 20[ ] for NCL Corporation Ltd. (the “Indemnifier”) and its subsidiaries on a consolidated basis. We also hereby certify that the Indemnifier is in compliance with all the financial covenants set out in clause 9.24 of the Facility Agreement [[and that no Event of Default or Potential Event of Default has occurred and is continuing][an [Event of Default][Potential Event of Default] has occurred and is continuing under clause 10.2.[                     ] of the Facility Agreement and the following step[s][is/are] being taken to cure the same: [                     ]]].
NCL CORPORATION LTD.
                                                            
By: [       ]
Chief Financial Officer
Dated:            20[                     ]

11


 

Schedule
Statement of Financial Covenants as of [    ] 20[ ] (in USD’000)
             
Clause (of            
Facility            
Agreement)       as of [ • ]   Required Covenants
9.24.1/
  Free Liquidity   A   A>[**] [Confidential Treatment]
9.24.2(b)**
          (11.3.1)**
 
           
 
          A>[**] [Confidential Treatment]
 
          (11.3.2(b))**
 
           
9.24.2(a)
  Consolidated EBITDA:   B   >[**] [Confidential Treatment]
 
           
 
  Consolidated Debt Service   C    
 
           
9.24.3
  Total Net Funded Debt:   D   <[**] [Confidential Treatment]
 
           
 
  Total Capitalisation   E    
                 
 
  Consolidated EBITDA            
 
  Consolidated Net Income (loss)     x      
(Deduct)/Add:
  (Gain)/Loss on sale of assets or reserves     x      
Add:
  Consolidated Interest Expense     x      
Add:
  Depreciation and amortisation of assets     x      
Add:
  Impairment charges     x      
(Deduct)/Add:
  Other non-cash charges (gains)     x      
Add:
  Deferred income tax expense     x      
 
             
 
  Consolidated EBITDA     x     B
 
             
 
  Consolidated Debt Service            
 
  Principal paid/payable (excluding balloon payments, voluntary     x      
 
  prepayments/repayments on sale/total loss of an NCLC Fleet            
 
  vessel)            
Add:
  Consolidated Interest Expense     x      
 
  Distributions     x      
 
  Rent under capitalised leases     x      
 
             
 
  Consolidated Debt Service     x     C
 
             
 
  Total Net Funded Debt            
 
  Indebtedness for Borrowed Money     x      
Add:
  Guarantees of non-NCLC Group members’ obligations     x      
 
             
 
        x      
 
             
Deduct:
  Cash Balance     (x )    
 
             
 
  Total Net Funded Debt     (x )   D
 
             
 
  Total Capitalisation            
 
  Total Net Funded Debt     x      
Add:
  Consolidated stockholders’ equity     x      
 
             
 
  Total Capitalisation     x     E
 
             

12


 

For and on behalf of NCL CORPORATION LTD.
                                                            
[            ]
I, [       ], the officer primarily responsible for the financial management of the NCLC Group, hereby declare that, to the best of knowledge and belief, the above Statement of Financial Covenants as of [                     ] 20[                     ], in my opinion, is true and correct.
                                                            
[            ]
Chief Financial Officer
NCL CORPORATION LTD.
Dated:            20[                     ]
 
**   Evidence satisfactory to the Agent of A at all times during the relevant period shall be provided together with this statement

13

EX-4.30 7 g05791exv4w30.htm EX-4.30 SECOND SUPPLEMENTAL DEED - APRIL 4, 2006 EX-4.30 Second Supplemental Deed - April 4, 2006
 

[Confidential Treatment]
Exhibit 4.30
DATED 4 APRIL 2006
NORWEGIAN JEWEL LIMITED
(as borrower)
NCL CORPORATION LTD.
(as guarantor)
THE SEVERAL BANKS
particulars of which are set out in Schedule 1
(as lenders)
HSBC BANK PLC
(as agent)
COMMERZBANK AKTIENGESELLSCHAFT
(as Hermes agent)
HSBC BANK PLC
(as trustee)
 
SECOND SUPPLEMENTAL DEED TO (AMONG OTHER THINGS)
THE SECURED LOAN AGREEMENT
dated 20 April 2004 for the amount of up to USD334,050,000
pre- and post delivery finance for “NORWEGIAN JEWEL”
a luxury cruise vessel with 1,188 passenger cabins
being hull no S.667 at the yard of Meyer Werft GmbH
 
[**] [Confidential Treatment]

 


 

CONTENTS
             
        Page  
1
  Definitions and Construction     1  
 
           
2
  Amendment of Original Loan Agreement and Security Documents     2  
 
           
3
  Conversion     4  
 
           
4
  Conditions Precedent     5  
 
           
5
  Representations and Warranties     6  
 
           
6
  Expenses     7  
 
           
7
  Further Assurance     8  
 
           
8
  Counterparts     8  
 
           
9
  Notices     8  
 
           
10
  Governing Law     9  
 
           
11
  Jurisdiction     9  
 
           
Schedule 1
  The Lenders     13  

 


 

SECOND SUPPLEMENTAL DEED
DATED 4 APRIL 2006
BETWEEN:
(1)   NORWEGIAN JEWEL LIMITED of International House, Castle Hill, Victoria Road, Douglas, Isle of Man, British Isles as borrower (the “Borrower”);
 
(2)   NCL CORPORATION LTD. of Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda as guarantor (the “Guarantor”);
 
(3)   THE SEVERAL BANKS particulars of which are set out in Schedule 1 as lenders (collectively the “Lenders” and each individually a “Lender”);
 
(4)   HSBC BANK PLC of 8 Canada Square, London E14 5HQ as agent (the “Agent”);
 
(5)   COMMERZBANK AKTIENGESELLSCHAFT of Kaiserplatz, 60311 Frankfurt am Main, Federal Republic of Germany as agent (the “Hermes Agent”); and
 
(6)   HSBC BANK PLC of 8 Canada Square, London E14 5HQ as trustee for itself and the Lenders (as hereinafter defined) (the “Trustee”).
WHEREAS:
(A)   By a loan agreement dated 20 April 2004 as amended and supplemented by a first supplemental deed dated as of 30 September 2005 (the “Original Loan Agreement”) entered into between the Borrower as borrower, the Lenders as lenders, the Agent as agent for (among others) the Lenders, the Hermes Agent as agent for (among others) the Lenders and the Trustee as trustee for (among others) the Lenders, the Lenders granted to the Borrower a secured loan in the maximum amount of three hundred and thirty four million and fifty thousand Dollars (USD334,050,000) (the “Loan”) for the purpose of enabling the Borrower to finance (among other things) the construction of the Vessel (as such term is defined in the Original Loan Agreement) on the terms and conditions therein contained. The repayment of the Loan by the Borrower has been secured by (among other things) a guarantee and indemnity dated 20 April 2004 granted by the Guarantor.
 
(B)   The Guarantor has requested the consent of the Lenders, the Agent, the Hermes Agent and the Trustee to the amendment of certain of the provisions of the Original Loan Agreement which relate to an election by the Borrower for a Fixed Rate.
 
(C)   This Deed shall be executed as a deed.
NOW THIS DEED WITNESSES as follows:
1   Definitions and Construction
  1.1   In this Deed including the preamble and recitals hereto (unless the context otherwise requires) any term or expression defined in the preamble or the recitals shall have the meaning ascribed to it therein and terms and expressions not defined herein but whose meanings are defined in the Loan Agreement shall have the meanings set out therein except that terms and expressions used in Clause 2.2 and not defined herein but whose meanings are defined in the Debenture (as

 


 

      amended by this Deed) shall have the meanings set out therein. In addition, the following term and expression shall have the meaning set out below:
 
      “Loan Agreement” means the Original Loan Agreement as amended by this Deed.
 
  1.2   The provisions of Clauses 1.2 and 1.3 of the Loan Agreement shall apply hereto (mutatis mutandis).
2   Amendment of Original Loan Agreement and Security Documents
  2.1   Subject to Clause 4, the parties hereto agree that from the date of this Deed the Original Loan Agreement shall be read and construed as if:
  2.1.1   clause 5.3.2 had been deleted and substituted with the following:
  5.3.2   Subject to the consent of Hermes and of each of the Lenders remaining in full force and effect on the date of the Election Notice (as hereinafter defined), the Borrower may, if no Event of Default has occurred and is continuing and no Total Loss has occurred, at any time prior to 29 September 2006, elect to convert the basis upon which interest is calculated hereunder by giving notice (an “Election Notice”) to the Agent not less than fifteen (15) Business Days (or such shorter time as the parties may agree) before the date on which the Interest Exchange Arrangements are to be entered into (the “Election Date”) to request that with effect from a date on or prior to 29 September 2006 (the “Conversion Date”) the rate of interest applicable to the Loan then outstanding shall be the Fixed Rate.”; and
  2.1.2   the second paragraph of clause 5.6 had been deleted and substituted with the following:
 
      If it is necessary for the Lenders to break deposits or re-employ funds taken or borrowed to make or maintain such Lender’s Contribution to the Portions in order for Conversion to take place on the Conversion Date, the Borrower shall pay to the Agent for the account of the Lenders interest accrued to but excluding the Conversion Date together with such amount as the Agent may certify to be necessary to compensate a Lender for any losses incurred as a consequence of the Pre-Delivery Interest Period(s) in respect of the Portions or the Interest Period in respect of the Loan (as the case may be) being prematurely terminated in order to allow Conversion to occur on the Conversion Date including, without limitation, any loss (including the cost of breaking deposits (including warehousing and other related costs)) or expense (including warehousing and other related costs) on account of funds borrowed, contracted for or utilised to fund such Lender’s Contribution to the Loan..
  2.2   The parties hereto agree that from the date of this Deed the Debenture shall be read and construed as if:
  2.2.1   the definition of “Outstanding Indebtedness” in clause 1.2 thereof had been deleted and substituted with the following:

2


 

      “Outstanding Indebtedness” means all sums of any kind arising at any time for any reason payable actually or contingently by the Obligors to any of the Beneficiaries under or pursuant to the Loan Agreement and the other Transaction Documents to which the Obligors are a party (whether by way of repayment of principal, payment of interest or default interest, payment upon any indemnity or counter-indemnity, reimbursement for costs or otherwise howsoever);”; and
 
  2.2.2   the first paragraph of clause 3.1 thereof had been deleted and substituted with the following:
  3.1   As continuing security for all obligations whatsoever of the Company, actual or contingent, present and future and whether of payment or performance under or pursuant to the Loan Agreement and the other Transaction Documents to which the Obligors are a party, the Company with full title guarantee hereby:”;
      and to the extent that the Debenture as amended by this Deed does not provide continuing security for all obligations whatsoever of the Borrower, actual or contingent, present and future and whether of payment or performance under or pursuant to the Loan Agreement and the other Transaction Documents to which the Obligors are a party the Borrower with full title guarantee hereby:
  (a)   conveys, transfers and assigns absolutely to and unto the Trustee all rights of the Borrower in and to the Current Receivables by way of fixed security;
 
  (b)   mortgages, charges and assigns, and agrees to mortgage, charge and assign to the Trustee all present and future rights of the Borrower in and to all freehold or leasehold property of the Borrower and all other estates or interests therein together with all trade fixtures and fixed plant and machinery now and for the time being thereon, by way of a fixed charge;
 
  (c)   mortgages, charges and assigns, and agrees to mortgage, charge and assign, to the Trustee all rights now owned or hereafter acquired in and to the goodwill, franchises, patent rights, copyrights, trademarks and other intangible assets of the Borrower by way of fixed charge;
 
  (d)   mortgages, charges and assigns, and agrees to mortgage, charge and assign, to the Trustee all rights relating to the aforesaid property specified in Clauses 2.2.2(b) and (c) including, inter alia, negotiable instruments, legal and equitable charges, reservations of property rights, rights of action, collection, recovery or security, rights of tracing and unpaid vendor’s liens and similar and associated rights, by way of first fixed legal mortgage and charge; and
 
  (e)   mortgages and charges in favour of the Trustee all rights of the Borrower now owned or hereafter acquired in and to all other assets for the time being of the Borrower not subject to the fixed securities created by Clauses 2.2.2(a), (b), (c) and (d) wheresoever situate (including, inter alia, all undertakings and businesses of the Borrower) by way of first floating charge and the Borrower shall not be at liberty to create any other mortgage or charge on any of the securities created by this Clause 2.2.2(e)

3


 

      and no lien shall in any case or in any manner arise on or affect any part of the said securities in priority to or pari passu with all charges hereby created, it being the intention that the Borrower shall have no power, without the written consent of the Agent, to part with or dispose of any part of the said securities except by way of sale in the ordinary course of its business;
      PROVIDED THAT upon the unconditional payment and satisfaction of the Outstanding Indebtedness the rights of the Trustee under this Clause 2.2 will terminate and the Trustee will at the direction, cost and expense of the Borrower release or reassign to the Borrower all remaining rights of the Trustee in and to the balance of the Security Assets.
 
  2.3   Each of the Borrower and the Guarantor hereby confirms to the Lenders, the Agent, the Hermes Agent and the Trustee that with effect from the date of this Deed:
  2.3.1   all references to the Original Loan Agreement in the Security Documents to which it is a party shall be construed as references to the Loan Agreement and all terms used in such Security Documents whose meanings are defined by reference to the Original Loan Agreement shall be defined by reference to the Loan Agreement;
 
  2.3.2   the Security Documents to which it is a party shall continue to apply to, and extend to secure, the whole of the Outstanding Indebtedness;
 
  2.3.3   its obligations under the Security Documents to which it is a party shall not be discharged, impaired or otherwise affected by reason of the execution of this Deed or of any of the documents or transactions contemplated hereby; and
 
  2.3.4   its obligations under the Security Documents to which it is a party shall remain in full force and effect as security for the obligations of the Borrower under the Loan Agreement and the other Security Documents as amended by this Deed.
  2.4   Except as expressly amended hereby or pursuant hereto the Original Loan Agreement and the Security Documents shall remain in full force and effect and nothing herein contained shall relieve the Borrower or any other Obligor from any of its respective obligations under any such documents.
3   Conversion
  3.1   On the date of this Deed the principal amount of the Loan outstanding under the Loan Agreement is [**][Confidential Treatment] ([**] [Confidential Treatment]).
 
  3.2   The Agent has received an Election Notice to convert the basis upon which interest is calculated under the Loan Agreement to a Fixed Rate with effect from [**] [Confidential Treatment] (the “Relevant Election Notice”).

4


 

  3.3   The Agent has notified the Lenders of its receipt of the Relevant Election Notice and of the applicable Election Date and Conversion Date.
 
  3.4   The Guarantor hereby confirms to the Borrower and the Agent that it has received a copy of the Relevant Election Notice and the Guarantee remains in full force and effect.
 
  3.5   Each of the Borrower and the Guarantor acknowledges that if Conversion does not occur on [**] [Confidential Treatment] as contemplated by the Relevant Election Notice, interest on the Loan shall continue to be calculated at the Floating Interest Rate until Conversion does occur.
 
  3.6   Each of the Borrower and the Guarantor acknowledges and agrees that any arrangements made or to be made by any of the Lenders in respect of its Contribution, whether with HSBC Bank plc as swap provider or otherwise, in order to offer a Fixed Rate to the Borrower on or prior to [**] [Confidential Treatment] as contemplated by this Deed shall constitute an Interest Exchange Arrangement.
4   Conditions Precedent
  4.1   The consent of Hermes, the Lenders, the Agent, the Hermes Agent and the Trustee to the variation of the provisions of the Original Loan Agreement is conditional upon and shall not be effective unless and until the Agent has received the following in form and substance satisfactory to it:
  4.1.1   on the date of this Deed, one (1) counterpart of this Deed duly executed by the Borrower and the Guarantor;
 
  4.1.2   a written confirmation from the Process Agent that it will act for the Borrower and the Guarantor as agent for service of process in England in respect of this Deed;
 
  4.1.3   the following corporate documents in respect of each of the Borrower and the Guarantor (together the “Relevant Parties”):
  (a)   Certified Copies of any consents required from any ministry, governmental, financial or other authority for the execution of and performance by the respective Relevant Party of its obligations under this Deed or if no such consents are required a certificate from a duly appointed officer of the Relevant Party to this effect confirming that no such consents are required;
 
  (b)   notarially attested secretary’s certificate of each of the Relevant Parties:
  (i)   attaching a copy of its Certificate of Incorporation and Memorandum of Association and Bye-Laws (or equivalent constitutional documents) evidencing power to enter into the transactions contemplated in this Deed;
 
  (ii)   giving the names of its present officers and directors;

5


 

  (iii)   setting out specimen signatures of such officers and directors as are authorised by the Relevant Party to sign documents or otherwise undertake the performance of that Relevant Party’s obligations under this Deed;
 
  (iv)   giving the legal owner of its shares and the number of such shares held;
 
  (v)   attaching copies of resolutions passed at duly convened meetings of the directors and, if required by the Agent, the shareholders or members of each of the Relevant Parties authorising (as applicable) the execution of this Deed and the issue of any power of attorney to execute the same; and
 
  (vi)   containing a declaration of solvency as at the date of the certificate of the duly appointed officer of the Relevant Party;
  4.1.4   the original powers of attorney, if any, issued pursuant to the resolutions referred to above and notarially attested; and
 
  4.1.5   the issue of such favourable written legal opinions including in respect of the Isle of Man and Bermuda in such form as the Agent may require relating to all aspects of the transactions contemplated hereby governed by any applicable law,
      PROVIDED THAT no Event of Default and no Possible Event of Default has occurred and is continuing on the date on which the conditions precedent set out in this Clause 4.1 have been satisfied (subject to Clause 4.2).
 
  4.2   If the Agent, the Hermes Agent and the Trustee, acting unanimously, decide (or the Agent in accordance with the Agency and Trust Deed decides) to permit the amendment of the Original Loan Agreement hereby without the Agent having received all of the documents or evidence referred to in Clause 4.1, the Borrower will nevertheless deliver the remaining documents or evidence to the Agent within fourteen (14) days of the date of this Deed (or such other period as the Agent may stipulate) and the amendment of the Original Loan Agreement as aforesaid shall not be construed as a waiver of the Agent’s right to receive the documents or evidence as aforesaid nor shall this provision impose on the Agent, the Hermes Agent, the Trustee or the Lenders any obligation to permit the amendment in the absence of such documents or evidence.
5   Representations and Warranties
  5.1   Each of the Borrower and the Guarantor represents and warrants to the Lenders, the Agent, the Hermes Agent and the Trustee that:
  5.1.1   it has the power to enter into and perform this Deed and the transactions contemplated hereby and has taken all necessary action to authorise the entry into and performance of this Deed and such transactions;

6


 

  5.1.2   this Deed constitutes its legal, valid and binding obligations enforceable in accordance with its terms;
 
  5.1.3   its entry into and performance of this Deed and the transactions contemplated hereby do not and will not conflict with:
  (a)   any law or regulation or any official or judicial order; or
 
  (b)   its constitutional documents; or
 
  (c)   any agreement or document to which it is a party or which is binding upon it or any of its assets,
      nor result in the creation or imposition of any Encumbrance on it or its assets pursuant to the provisions of any such agreement or document save to the extent contemplated in Clause 2.2 and in particular but without prejudice to the foregoing the entry into and performance of this Deed and the transactions contemplated hereby and thereby will not render invalid, void or voidable any security granted by it to the Trustee;
 
  5.1.4   all authorisations, approvals, consents, licences, exemptions, filings, registrations, notarisations and other matters, official or otherwise, required in connection with the entry into, performance, validity and enforceability of this Deed and each of the other documents contemplated hereby and thereby and the transactions contemplated hereby and thereby have been obtained or effected and are in full force and effect;
 
  5.1.5   all information furnished by it to the Agent or its agents relating to the business and affairs of an Obligor in connection with this Deed and the other documents contemplated hereby and thereby was and remains true and correct in all material respects and there are no other material facts or considerations the omission of which would render any such information misleading; and
 
  5.1.6   it has fully disclosed in writing to the Agent all facts relating to its business which it knows or should reasonably know and which might reasonably be expected to influence the Lenders, the Agent, the Hermes Agent and/or the Trustee in deciding whether or not to enter into this Deed.
6   Expenses
 
    The Borrower and the Guarantor jointly and severally undertake to reimburse the Agent on demand on a full indemnity basis for the reasonable charges and expenses (together with value added tax or any similar tax thereon and including without limitation the fees and expenses of legal and other advisers) incurred by the Agent, the Hermes Agent or the Trustee in respect of the negotiation, preparation, printing, execution, registration and enforcement of this Deed and any other documents required in connection with the implementation of this Deed.

7


 

7   Further Assurance
 
    Each of the Borrower and the Guarantor will, from time to time on being required to do so by the Agent, do or procure the doing of all such acts and/or execute or procure the execution of all such documents in a form satisfactory to the Agent and the Hermes Agent as the Agent and the Hermes Agent may reasonably consider necessary for giving full effect to this Deed or any of the documents contemplated hereby or securing to the Trustee the full benefit of the rights, powers and remedies conferred upon the Agent, the Hermes Agent or the Trustee in any such document.
 
8   Counterparts
 
    This Deed may be executed in any number of counterparts and all such counterparts taken together shall be deemed to constitute one and the same agreement.
 
9   Notices
  9.1   Any notice, demand or other communication (unless made by telefax) to be made or delivered to the Borrower or the Guarantor pursuant to this Deed shall (unless the Borrower or the Guarantor has by fifteen (15) days’ written notice to the Agent specified another address) be made or delivered to the Borrower and/or the Guarantor c/o 7665 Corporate Center Drive, Miami, Florida 33126, United States of America (marked for the attention of Ms Bonnie Biumi and the Legal Department (but one (1) copy shall suffice)) with a copy to c/o Star Cruises Limited, Star Cruises Terminal, Pulau Indah, PO Box No. 288, 42009 Pelabuhan Klang, Selangor Darul Ehsan, Malaysia (marked for the attention of Mr Gerard Lim). Any notice, demand or other communication to be made or delivered by the Borrower or the Guarantor pursuant to this Deed shall (unless the Agent has by fifteen (15) days’ written notice to the Borrower and the Guarantor specified another address) be made or delivered to the Agent at its Office, the details of which are set out in schedule 2 of the Original Loan Agreement.
 
  9.2   Any notice, demand or other communication to be made or delivered pursuant to this Deed may be sent by telefax to the relevant telephone numbers (which at the date hereof in respect of the Borrower and the Guarantor is +1 305 436 4140 (marked for the attention of Ms Bonnie Biumi) and +1 305 436 4117 (marked for the attention of the Legal Department) with a copy to +60 3 3884 0213 (marked for the attention of Mr Gerard Lim) and in the case of the Agent, the Hermes Agent or the Trustee is as recorded in schedule 2 of the Original Loan Agreement) specified by it from time to time for the purpose and shall be deemed to have been received when transmission of such telefax communication has been completed. Each such telefax communication, if made to the Agent, the Hermes Agent or the Trustee by the Borrower or the Guarantor, shall be signed by the person or persons authorised in writing by the Borrower or the Guarantor (as the case may be) and whose signature appears on the list of specimen signatures contained in the secretary’s certificate required to be delivered by Clause 3 and shall be expressed to be for the attention of the department or officer whose name has been notified for the time being for that purpose by the Agent, the Hermes Agent or the Trustee to the Borrower and the Guarantor.
 
  9.3   The provisions of clauses 18.1, 18.4 and 18.5 of the Original Loan Agreement shall apply to this Deed.

8


 

10   Governing Law
 
    This Deed shall be governed by English law.
 
11   Jurisdiction
  11.1   The courts of England have exclusive jurisdiction to settle any dispute arising out of or in connection with this Deed (including a dispute regarding the existence, validity or termination of this Agreement) (a “Dispute”). Each party to this Deed agrees that the courts of England are the most appropriate and convenient courts to settle Disputes and accordingly no party will argue to the contrary.
 
      This Clause 11.1 is for the benefit of the Agent, the Hermes Agent and the Trustee only. As a result, no such party shall be prevented from taking proceedings relating to a Dispute in any other courts with jurisdiction. To the extent allowed by law, any such party may take concurrent proceedings in any number of jurisdictions.
 
  11.2   Neither the Borrower nor the Guarantor may, without the Agent’s prior written consent, terminate the appointment of the Process Agent; if the Process Agent resigns or its appointment ceases to be effective, the Borrower and/or the Guarantor (as the case may be) shall within fourteen (14) days appoint a company which has premises in London and has been approved by the Agent to act as the Borrower’s and/or the Guarantor’s (as the case may be) process agent with unconditional authority to receive and acknowledge service on behalf of the Borrower and/or the Guarantor of all process or other documents connected with proceedings in the English courts which relate to this Deed.
 
  11.3   For the purpose of securing its obligations under Clause 11.2, each of the Borrower and the Guarantor irrevocably agrees that, if it for any reason fails to appoint a process agent within the period specified in Clause 11.2, the Agent may appoint any person (including a company controlled by or associated with the Agent or any Lender) to act as the Borrower’s or the Guarantor’s (as the case may be) process agent in England with the unconditional authority described in Clause 11.2.
 
  11.4   No neglect or default by a process agent appointed or designated under this Clause (including a failure by it to notify the Borrower or the Guarantor (as the case may be) of the service of any process or to forward any process to the Borrower or the Guarantor (as the case may be)) shall invalidate any proceedings or judgment.
 
  11.5   Each of the Borrower and the Guarantor appoints in the case of the courts of England the Process Agent to receive, for and on its behalf service of process in England of any legal proceedings with respect to this Deed.
 
  11.6   A judgment relating to this Deed which is given or would be enforced by an English court shall be conclusive and binding on the Borrower and/or the Guarantor (as the case may be) and may be enforced without review in any other jurisdiction.
 
  11.7   Nothing in this Clause shall exclude or limit any right which the Agent, the Hermes Agent or the Trustee may have (whether under the laws of any country,

9


 

      an international convention or otherwise) with regard to the bringing of proceedings, the service of process, the recognition or enforcement of a judgment or any similar or related matter in any jurisdiction.
 
  11.8   In this Clause “judgment” includes order, injunction, declaration and any other decision or relief made or granted by a court.
IN WITNESS whereof the parties hereto have caused this Deed to be duly executed as a deed on the day first written above.
                 
SIGNED SEALED and DELIVERED as a DEED
        )     PA Turner
by Paul Turner
        )      
for and on behalf of
        )      
NORWEGIAN JEWEL LIMITED
        )      
in the presence of:
  Illegible Signature     )      
 
  Trainee     )      
 
  Stephenson Hardwood     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     PA Turner
by Paul Turner
        )      
for and on behalf of
        )      
NCL CORPORATION LTD.
        )      
in the presence of:
  Illegible Signature     )      
 
  Trainee     )      
 
  Stephenson Hardwood     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Julie Clegg
by Julie Clegg
        )      
for and on behalf of
        )      
COMMERZBANK
        )      
AKTIENGESELLSCHAFT
        )      
Bremen Branch as a Lender
      )      
in the presence of:
  Illegible Signature     )      
 
  Trainee     )      
 
  Stephenson Hardwood     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Mark Looi
by Mark Looi
        )      
an authorized signatory of
        )      
HSBC BANK PLC
        )      
as a Lender
        )      
in the presence of:
  Nigel Groom     )      
 
  HSBC Bank Plc     )      
 
  Project and Export Finance     )      
 
  Floor 17     )      
 
  8 Canada Square     )      
 
  London E14 5SH     )      

10


 

                 
SIGNED SEALED and DELIVERED as a DEED
        )     Julie Clegg
by Julie Clegg
        )      
for and on behalf of
        )      
KfW
        )      
in the presence of:
  Illegible Signature     )      
 
  Trainee     )      
 
  Stephenson Hardwood     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Julie Clegg
by Julie Clegg
        )      
for and on behalf of
        )      
DnB NOR BANK ASA
        )      
in the presence of:
  Illegible Signature     )      
 
  Trainee     )      
 
  Stephenson Hardwood     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Illegible Signature
by Illegible Signature
        )      
for and on behalf of
        )      
OVERSEA-CHINESE BANKING
        )      
CORPORATION LIMITED
        )      
Singapore Branch
        )      
in the presence of:
  Illegible Signature     )      
 
  Trainee     )      
 
  Stephenson Hardwood     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Julie Clegg
by Julie Clegg
        )      
for and on behalf of
        )      
NORDDEUTSCHE LANDESBANK
        )      
GIROZENTRALE
        )      
in the presence of:
  Illegible Signature     )      
 
  Trainee     )      
 
  Stephenson Hardwood     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Julie Clegg
by Julie Clegg
        )      
for and on behalf of
        )      
CALYON
        )      
in the presence of:
  Illegible Signature            
 
  Trainee     )      
 
  Stephenson Hardwood     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      

11


 

                 
SIGNED SEALED and DELIVERED as a DEED
        )     Julie Clegg
by Julie Clegg
        )      
for and on behalf of
        )      
COMMERZBANK AKTIENGESELLSCHART
        )      
as the Hermes Agent
        )      
in the presence of:
  Illegible Signature     )      
 
  Trainee     )      
 
  Stephenson Hardwood     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Mark Looi
by Mark Looi
        )      
an authorised signatory of
        )      
HSBC BANK PLC
        )      
as the Agent and the Trustee
        )      
in the presence of:
  Nigel Groom     )      
 
  Project and Export Finance     )      
 
  Floor 17     )      
 
  8 Canada Square     )      
 
  London E14 5HQ     )      

12


 

Schedule 1
The Lenders
Name and address
Lenders
COMMERZBANK AKTIENGESELLSCHAFT (“CoBa”)
Bremen Branch
Schüsselkorb 5-11
28195 Bremen
Federal Republic of Germany
Fax: +49 40 3683 2049
Attn: Mr Siegfried Hoffmann
Email: siegfried.hoffmann@commerzbank.com
HSBC BANK PLC (“HSBC”)
Project and Export Finance
8 Canada Square
London E14 5HQ
Fax: +44 (0)20 7992 4428
Attn: Mr Alan Marshall
Email: alan.p.marshall@hsbcib.com
KfW
Palmengartenstrasse 5-9
60325 Frankfurt am Main
Federal Republic of Germany
Fax: +49 69 7431 2944
Attn: Mr Josef Schmid
Email: josef.schmid@kfw.de
DnB NOR BANK ASA (“DnB NOR”)
Stranden 21
NO-0021 Oslo
Norway
Fax: +47 22 482020
Attn: Mr Jon Flovik
Email: jon.flovik@dnbnor.no

13


 

OVERSEA-CHINESE BANKING
CORPORATION LIMITED (“OCBC”)

Singapore Branch
65 Chulia Street #10-00
Singapore 049513
Fax: +65 6536 6449/6532 5347
Attn: Ms Pearlwyn Ho/Ms Elaine Lam
Email: LamSYElaine@ocbc.com.sg
NORDDEUTSCHE LANDESBANK
GIROZENTRALE (“Nord/LB”)

Friedrichswall 10
30159 Hannover
Federal Republic of Germany
Fax: +49 511 361 4785
Attn: Mr Alexander Viets
Email: shipping@nordlb.de
CALYON
Friedrich-Ebert-Anlage 49
60308 Frankfurt am Main
Federal Republic of Germany
Fax: +49 69 74221 197
Attn: Ms Angelika Schönegger-Wenzel
Email: angelica.schoenegger-wenzel@de.calyon.com
with copy to:
CALYON ASIA SHIPFINANCE LIMITED
Fax: +852 2868 1448
Attn: Mr Terence Yuen/Ms Iris Lai
Email: terence.yuen@hk.calyon.com/iris.lai@hk.calyon.com

14


 

DATED 13 NOVEMBER 2006
NORWEGIAN JEWEL LIMITED
(as borrower)
NCL CORPORATION LTD.
(as guarantor)
HSBC BANK PLC
(as agent)
COMMERZBANK AKTIENGESELLSCHAFT
(as Hermes agent)
HSBC BANK PLC
(as trustee)
 
THIRD SUPPLEMENTAL DEED TO (AMONG OTHER THINGS)
SECURED LOAN AGREEMENT
dated 20 April 2004 for the amount of up to USD334,050,000
pre- and post delivery finance for
“NORWEGIAN JEWEL”
a luxury cruise vessel with 1,188 passenger cabins
being hull no S.667 at the yard of Meyer Werft GmbH
 
[**] [Confidential Treatment]

 


 

CONTENTS
             
        Page  
1
  Definitions and Construction     1  
 
           
2
  Amendment of Original Loan Agreement, Original Guarantee and Security Documents     2  
 
           
3
  Conditions Precedent     3  
 
           
4
  Representations and Warranties     4  
 
           
5
  Expenses     5  
 
           
6
  Further Assurance     5  
 
           
7
  Counterparts     6  
 
           
8
  Notices     6  
 
           
9
  Governing Law     6  
 
           
10
  Jurisdiction     6  
 
           
Schedule 1
  The Lenders     9  
 
           
Schedule 2
  Amendment of Original Loan Agreement     11  
 
           
Schedule 3
  Amendment of Original Guarantee     12  
 
           
Schedule 4
  Quarterly Statement of Financial Covenants     13  

 


 

THIRD SUPPLEMENTAL DEED
DATED 13 NOVEMBER 2006
BETWEEN:
(1)   NORWEGIAN JEWEL LIMITED of International House, Castle Hill, Victoria Road, Douglas, Isle of Man, British Isles as borrower (the “Borrower”);
 
(2)   NCL CORPORATION LTD. of Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda as guarantor (the “Guarantor”);
 
(3)   HSBC BANK PLC of 8 Canada Square, London E14 5HQ as agent (the “Agent”);
 
(4)   COMMERZBANK AKTIENGESELLSCHAFT of Kaiserplatz, 60311 Frankfurt am Main, Federal Republic of Germany as agent (the “Hermes Agent”); and
 
(5)   HSBC BANK PLC of 8 Canada Square, London E14 5HQ as trustee for itself and the Lenders (as hereinafter defined) (the “Trustee”).
WHEREAS:
(A)   By a loan agreement dated 20 April 2004 as amended by a first supplemental deed thereto dated as of 30 September 2005 and a second supplemental deed thereto dated 4 April 2006 entered into between the Borrower as borrower, the several banks particulars of which are set out in Schedule 1 as lenders (the “Lenders”), the Agent as agent for (among others) the Lenders, the Hermes Agent as agent for (among others) the Lenders and the Trustee as trustee for (among others) the Lenders (the “Original Loan Agreement”), the Lenders granted to the Borrower a secured loan in the maximum amount of three hundred and thirty four million and fifty thousand Dollars (USD334,050,000) (the “Loan”) for the purpose of enabling the Borrower to finance (among other things) the construction of the Vessel (as such term is defined in the Original Loan Agreement) on the terms and conditions therein contained. The repayment of the Loan by the Borrower has been secured by (among other things) a guarantee and indemnity dated 20 April 2004 granted by the Guarantor as amended by the said first supplement dated as of 30 September 2005 (the “Original Guarantee”).
 
(B)   The Guarantor has requested the consent of the Lenders, the Agent, the Hermes Agent and the Trustee to the amendment of certain provisions of the Original Loan Agreement and the Original Guarantee to conform such provisions to similar provisions in other loan documentation to which the Guarantor and/or other members of the NCLC Group are party. This Deed shall be executed as a deed.
NOW THIS DEED WITNESSES as follows:
1   Definitions and Construction
  1.1   In this Deed including the preamble and recitals hereto (unless the context otherwise requires) any term or expression defined in the preamble or the recitals shall have the meaning ascribed to it therein and terms and expressions not defined herein but whose meanings are defined in the Loan Agreement shall have the meanings set out therein. In addition, the following terms and expressions shall have the meanings set out below:

 


 

      “Guarantee” means the Original Guarantee as amended by this Deed; and
 
      “Loan Agreement” means the Original Loan Agreement as amended by this Deed.
 
  1.2   The provisions of Clauses 1.2 and 1.3 of the Loan Agreement shall apply hereto (mutatis mutandis).
2   Amendment of Original Loan Agreement, Original Guarantee and Security Documents
  2.1   Subject to Clause 3, the parties hereto agree that from the date of this Deed the Original Loan Agreement shall be read and construed as if the clauses referred to in the first column of Schedule 2 had been amended to read as set out in the second column of Schedule 2.
 
  2.2   Subject to Clause 3, the parties hereto agree that from the date of this Deed the Original Guarantee shall be read and construed as if:
  2.2.1   the clause referred to in the first column of Schedule 3 had been amended to read as set out in the second column of Schedule 3; and
 
  2.2.2   schedule 1 had been deleted and substituted with Schedule 4.
  2.3   Each of the Borrower and the Guarantor hereby confirms to the Agent, the Hermes Agent and the Trustee that with effect from the date of this Deed:
  2.3.1   all references to the Original Loan Agreement in the Security Documents to which it is a party shall be construed as references to the Loan Agreement and all terms used in such Security Documents whose meanings are defined by reference to the Original Loan Agreement shall be defined by reference to the Loan Agreement;
 
  2.3.2   the Security Documents to which it is a party shall apply to, and extend to secure, the whole of the Outstanding Indebtedness as defined in clause 1.1 of the Loan Agreement;
 
  2.3.3   its obligations under the Security Documents to which it is a party shall not be discharged, impaired or otherwise affected by reason of the execution of this Deed or of any of the documents or transactions contemplated hereby; and
 
  2.3.4   its obligations under the Security Documents to which it is a party shall remain in full force and effect as security for the obligations of the Borrower under the Loan Agreement and the other Security Documents as amended by this Deed.
  2.4   Except as expressly amended hereby or pursuant hereto the Original Loan Agreement and the Security Documents shall remain in full force and effect and nothing herein contained shall relieve the Borrower or any other Obligor from any of its respective obligations under any such documents.

2


 

3   Conditions Precedent
  3.1   The consent of the Agent, the Hermes Agent and the Trustee for themselves and on behalf of the Lenders to the variation of the provisions of the Original Loan Agreement and the Original Guarantee is conditional upon and shall not be effective unless and until the Agent has received the following in form and substance satisfactory to it:
  3.1.1   on the date of this Deed, one (1) counterpart of this Deed duly executed by the Borrower and the Guarantor;
 
  3.1.2   a written confirmation from the Process Agent that it will act for the Borrower and the Guarantor as agent for service of process in England in respect of this Deed;
 
  3.1.3   the following corporate documents in respect of each of the Borrower and the Guarantor (together the “Relevant Parties”):
  (a)   Certified Copies of any consents required from any ministry, governmental, financial or other authority for the execution of and performance by the respective Relevant Party of its obligations under this Deed or if no such consents are required a certificate from a duly appointed officer of the Relevant Party to this effect confirming that no such consents are required;
 
  (b)   notarially attested secretary’s certificate of each of the Relevant Parties:
  (i)   attaching a copy of its Certificate of Incorporation and Memorandum of Association and Bye-Laws (or equivalent constitutional documents) evidencing power to enter into the transactions contemplated in this Deed;
 
  (ii)   giving the names of its present officers and directors;
 
  (iii)   setting out specimen signatures of such officers and directors as are authorised by the Relevant Party to sign documents or otherwise undertake the performance of that Relevant Party’s obligations under this Deed;
 
  (iv)   giving the legal owner of its shares and the number of such shares held;
 
  (v)   attaching copies of resolutions passed at duly convened meetings of the directors and, if required by the Agent, the shareholders or members of each of the Relevant Parties authorising (as applicable) the execution of this Deed and the issue of any power of attorney to execute the same; and
 
  (vi)   containing a declaration of solvency as at the date of the certificate of the duly appointed officer of the Relevant Party;

3


 

      or (if applicable) certifying that there has been no change to the statements made in his or her secretary’s certificate last provided to the Agent with respect to paragraphs (b)(i), (ii), (iii), (iv) and (vi) of this Clause 3.1.3(b) and attaching copies of resolutions passed at duly convened meetings of the directors and, if required by the Agent, the shareholders or members of each of the Relevant Parties authorising (as applicable) the execution of this Deed and the issue of any power of attorney to execute the same;
  3.1.4   the original powers of attorney, if any, issued pursuant to the resolutions referred to above and notarially attested;
 
  3.1.5   a Certified Copy of a letter from the Borrower to the Manager notifying of the provisions of clause 10.14(c) of the Loan Agreement; and
 
  3.1.6   the issue of such favourable written legal opinions including in respect of the Isle of Man and Bermuda in such form as the Agent may require relating to all aspects of the transactions contemplated hereby governed by any applicable law,
      PROVIDED THAT no Event of Default and no (save as disclosed in writing to the Agent before the date of this Deed) Possible Event of Default has occurred and is continuing on the date on which the conditions precedent set out in this Clause 3.1 have been satisfied (subject to Clause 3.2).
 
  3.2   If the Agent, the Hermes Agent and the Trustee, acting unanimously, decide (or the Agent in accordance with the Agency and Trust Deed decides) to permit the amendment of the Original Loan Agreement and the Original Guarantee hereby without the Agent having received all of the documents or evidence referred to in Clause 3.1, the Borrower will nevertheless deliver the remaining documents or evidence to the Agent within fourteen (14) days of the date of this Deed (or such other period as the Agent may stipulate) and the amendment of the Original Loan Agreement and the Original Guarantee as aforesaid shall not be construed as a waiver of the Agent’s right to receive the documents or evidence as aforesaid nor shall this provision impose on the Agent, the Hermes Agent, the Trustee or the Lenders any obligation to permit the amendment in the absence of such documents or evidence.
4   Representations and Warranties
  4.1   Each of the Borrower and the Guarantor represents and warrants to the Agent, the Hermes Agent and the Trustee that:
  4.1.1   it has the power to enter into and perform this Deed and the transactions contemplated hereby and has taken all necessary action to authorise the entry into and performance of this Deed and such transactions;
 
  4.1.2   this Deed constitutes its legal, valid and binding obligations enforceable in accordance with its terms;
 
  4.1.3   its entry into and performance of this Deed and the transactions contemplated hereby do not and will not conflict with:

4


 

  (a)   any law or regulation or any official or judicial order; or
 
  (b)   its constitutional documents; or
 
  (c)   any agreement or document to which it is a party or which is binding upon it or any of its assets,
      nor result in the creation or imposition of any Encumbrance on it or its assets pursuant to the provisions of any such agreement or document and in particular but without prejudice to the foregoing the entry into and performance of this Deed and the transactions contemplated hereby and thereby will not render invalid, void or voidable any security granted by it to the Trustee;
 
  4.1.4   all authorisations, approvals, consents, licences, exemptions, filings, registrations, notarisations and other matters, official or otherwise, required in connection with the entry into, performance, validity and enforceability of this Deed and each of the other documents contemplated hereby and thereby and the transactions contemplated hereby and thereby have been obtained or effected and are in full force and effect;
 
  4.1.5   all information furnished by it to the Agent or its agents relating to the business and affairs of an Obligor in connection with this Deed and the other documents contemplated hereby and thereby was and remains true and correct in all material respects and there are no other material facts or considerations the omission of which would render any such information misleading; and
 
  4.1.6   it has fully disclosed in writing to the Agent all facts relating to its business which it knows or should reasonably know and which might reasonably be expected to influence the Agent, the Hermes Agent and/or the Trustee in deciding whether or not to enter into this Deed.
5   Expenses
 
    The Borrower and the Guarantor jointly and severally undertake to reimburse the Agent on demand on a full indemnity basis for the reasonable charges and expenses (together with value added tax or any similar tax thereon and including without limitation the fees and expenses of legal and other advisers) incurred by the Agent, the Hermes Agent or the Trustee in respect of the negotiation, preparation, printing, execution, registration and enforcement of this Deed and any other documents required in connection with the implementation of this Deed.
 
6   Further Assurance
 
    Each of the Borrower and the Guarantor will, from time to time on being required to do so by the Agent, do or procure the doing of all such acts and/or execute or procure the execution of all such documents in a form satisfactory to the Agent and the Hermes Agent as the Agent and the Hermes Agent may reasonably consider necessary for giving full effect to this Deed or any of the documents contemplated hereby or securing to the Trustee the full benefit of the rights, powers and remedies conferred upon the Agent, the Hermes Agent or the Trustee in any such document.

5


 

7   Counterparts
 
    This Deed may be executed in any number of counterparts and all such counterparts taken together shall be deemed to constitute one and the same agreement.
 
8   Notices
  8.1   Any notice, demand or other communication (unless made by telefax) to be made or delivered to the Borrower or the Guarantor pursuant to this Deed shall (unless the Borrower or the Guarantor has by fifteen (15) days’ written notice to the Agent specified another address) be made or delivered to the Borrower and/or the Guarantor c/o 7665 Corporate Center Drive, Miami, Florida 33126, United States of America (marked for the attention of Ms Bonnie Biumi and the Legal Department (but one (1) copy shall suffice)) with a copy to c/o Star Cruises Limited, Star Cruises Terminal, Pulau Indah, PO Box No. 288, 42009 Pelabuhan Klang, Selangor Darul Ehsan, Malaysia (marked for the attention of Mr Gerard Lim). Any notice, demand or other communication to be made or delivered by the Borrower or the Guarantor pursuant to this Deed shall (unless the Agent has by fifteen (15) days’ written notice to the Borrower and the Guarantor specified another address) be made or delivered to the Agent at its Office, the details of which are set out in schedule 2 of the Original Loan Agreement.
 
  8.2   Any notice, demand or other communication to be made or delivered pursuant to this Deed may be sent by telefax to the relevant telephone numbers (which at the date hereof in respect of the Borrower and the Guarantor is +1 305 436 4140 (marked for the attention of Ms Bonnie Biumi) and +1 305 436 4117 (marked for the attention of the Legal Department) with a copy to +60 3 3884 0213 (marked for the attention of Mr Gerard Lim) and in the case of the Agent, the Hermes Agent or the Trustee is as recorded in schedule 2 of the Original Loan Agreement) specified by it from time to time for the purpose and shall be deemed to have been received when transmission of such telefax communication has been completed. Each such telefax communication, if made to the Agent, the Hermes Agent or the Trustee by the Borrower or the Guarantor, shall be signed by the person or persons authorised in writing by the Borrower or the Guarantor (as the case may be) and whose signature appears on the list of specimen signatures contained in the secretary’s certificate required to be delivered by Clause 3 and shall be expressed to be for the attention of the department or officer whose name has been notified for the time being for that purpose by the Agent, the Hermes Agent or the Trustee to the Borrower and the Guarantor.
 
  8.3   The provisions of clauses 18.1, 18.4 and 18.5 of the Original Loan Agreement shall apply to this Deed.
9   Governing Law
 
    This Deed shall be governed by English law.
 
10   Jurisdiction
  10.1   The courts of England have exclusive jurisdiction to settle any dispute arising out of or in connection with this Deed (including a dispute regarding the existence, validity or termination of this Agreement) (a “Dispute"). Each party to this Deed

6


 

      agrees that the courts of England are the most appropriate and convenient courts to settle Disputes and accordingly no party will argue to the contrary.
 
      This Clause 10.1 is for the benefit of the Agent, the Hermes Agent and the Trustee only. As a result, no such party shall be prevented from taking proceedings relating to a Dispute in any other courts with jurisdiction. To the extent allowed by law, any such party may take concurrent proceedings in any number of jurisdictions.
 
  10.2   Neither the Borrower nor the Guarantor may, without the Agent’s prior written consent, terminate the appointment of the Process Agent; if the Process Agent resigns or its appointment ceases to be effective, the Borrower and/or the Guarantor (as the case may be) shall within fourteen (14) days appoint a company which has premises in London and has been approved by the Agent to act as the Borrower’s and/or the Guarantor’s (as the case may be) process agent with unconditional authority to receive and acknowledge service on behalf of the Borrower and/or the Guarantor of all process or other documents connected with proceedings in the English courts which relate to this Deed.
 
  10.3   For the purpose of securing its obligations under Clause 10.2, each of the Borrower and the Guarantor irrevocably agrees that, if it for any reason fails to appoint a process agent within the period specified in Clause 10.2, the Agent may appoint any person (including a company controlled by or associated with the Agent or any Lender) to act as the Borrower’s or the Guarantor’s (as the case may be) process agent in England with the unconditional authority described in Clause 10.2.
 
  10.4   No neglect or default by a process agent appointed or designated under this Clause (including a failure by it to notify the Borrower or the Guarantor (as the case may be) of the service of any process or to forward any process to the Borrower or the Guarantor (as the case may be)) shall invalidate any proceedings or judgment.
 
  10.5   Each of the Borrower and the Guarantor appoints in the case of the courts of England the Process Agent to receive, for and on its behalf service of process in England of any legal proceedings with respect to this Deed.
 
  10.6   A judgment relating to this Deed which is given or would be enforced by an English court shall be conclusive and binding on the Borrower and/or the Guarantor (as the case may be) and may be enforced without review in any other jurisdiction.
 
  10.7   Nothing in this Clause shall exclude or limit any right which the Agent, the Hermes Agent or the Trustee may have (whether under the laws of any country, an international convention or otherwise) with regard to the bringing of proceedings, the service of process, the recognition or enforcement of a judgment or any similar or related matter in any jurisdiction.
 
  10.8   In this Clause “judgment” includes order, injunction, declaration and any other decision or relief made or granted by a court.

7


 

IN WITNESS whereof the parties hereto have caused this Deed to be duly executed as a deed on the day and year first before written.
                 
SIGNED SEALED and DELIVERED as a DEED
        )     Vijay Jeyaratnam
by Vijay Jeyaratnam
        )      
for and on behalf of
        )      
NORWEGIAN JEWEL LIMITED
        )      
in the presence of:
  Jaya Prasannan     )      
 
  Trainee Solicitor     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Colin Veitch
by Colin Veitch
        )      
for and on behalf of
        )      
NCL CORPORATION LTD.
        )      
in the presence of:
  Mark E. Warren     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Julie Clegg
by Julie Clegg
        )      
for and on behalf of
        )      
COMMERZBANK AKTIENGESELLSCHAFT
        )      
as the Hermes Agent
        )      
in the presence of:
  Jaya Prasannan     )      
 
  Trainee Solicitation     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Mark Looi
by Mark Looi
        )      
for and on behalf of
        )      
HSBC BANK PLC
        )      
as the Agent and the Trustee
        )      
in the presence of:
  Marcus Pcumley     )      
 
  HSBC Bank Plc     )      
 
  Project and Export Finance
Floor 17
    )      
 
  8 Canada Square     )      
 
  London E14 5HQ     )      

8


 

Schedule 1
The Lenders
Name and address
COMMERZBANK AKTIENGESELLSCHAFT
Bremen Branch
Schüsselkorb 5-11
28195 Bremen
Federal Republic of Germany
Fax: +49 40 3683 2049
Attn: Mr Siegfried Hoffmann
Email: siegfried.hoffmann@commerzbank.com
HSBC BANK PLC
Project and Export Finance
8 Canada Square
London E14 5HQ
Fax: +44 (0)20 7992 4428
Attn: Mr Alan Marshall
Email: alan.p.marshall@hsbcib.com
KfW
Palmengartenstrasse 5-9
60325 Frankfurt am Main
Federal Republic of Germany
Fax: +49 69 7431 2944
Attn: Mr Josef Schmid
Email: josef.schmid@kfw.de
DnB NOR BANK ASA
Stranden 21
NO-0021 Oslo
Norway
Fax: +47 22 482020
Attn: Mr Jon Flovik
Email: jon.flovik@dnbnor.no

9


 

OVERSEA-CHINESE BANKING
CORPORATION LIMITED

Singapore Branch
65 Chulia Street #10-00
Singapore 049513
Fax: +65 6536 6449/6532 5347
Attn: Ms Pearlwyn Ho/Ms Elaine Lam
Email: LamSYElaine@ocbc.com.sg
NORDDEUTSCHE LANDESBANK
GIROZENTRALE

Friedrichswall 10
30159 Hannover
Federal Republic of Germany
Fax: +49 511 361 4785
Attn: Mr Alexander Viets
Email: shipping@nordlb.de
CALYON
Friedrich-Ebert-Anlage 49
60308 Frankfurt am Main
Federal Republic of Germany
Fax: +49 69 74221 197
Attn: Ms Angelika Schönegger-Wenzel
Email: angelika.schoenegger-wenzel@de.calyon.com
with copy to:
CALYON ASIA SHIPFINANCE LIMITED
Fax: +852 2868 1448
Attn: Mr Terence Yuen/Ms Iris Lai
Email: terence.yuen@hk.calyon.com/iris.lai@hk.calyon.com

10


 

Schedule 2
Amendment of Original Loan Agreement
     
Definition/Clause   Amendment
Clause 9.2.21
  Completeness of documents
 
   
 
  The copies of the Building Contract, the Supervision Agreement, the Management Agreement, the Interest Exchange Arrangements and any other relevant third party agreements delivered to the Agent are true and complete copies of each such document constituting valid and binding obligations of the parties thereto enforceable in accordance with their respective terms and no amendments thereto or variations thereof have been agreed other than (if applicable), in the case of the Management Agreement, in accordance with Clause 10.14 nor has any action been taken by the parties thereto which would in any way render such document inoperative or unenforceable.
 
   
Clause 10.14
  Supervision and management
 
   
 
  Except with the prior consent of the Agent, the Borrower will not:
 
   
 
 
(a)  permit any person other than the Supervisor and the Manager to be the supervisor of construction and the manager of, including providing crewing services to, the Vessel;
 
   
 
 
(b)  permit any amendment to be made to the terms of the Supervision Agreement or the Management Agreement unless an amendment to the Management Agreement is advised by the Borrower’s tax counsel or is deemed necessary by the parties thereto but provided that the amendment does not imperil the security to be provided pursuant to the Security Documents or adversely affect the ability of any Obligor to perform its obligations under the Transaction Documents; or
 
   
 
 
(c)  permit the Vessel to be employed other than within the NCL or NCL America brand (as applicable).

11


 

Schedule 3
Amendment of Original Guarantee
     
Definition/Clause   Amendment
Clause 11.1.3
  as at 30 September 2006 and as at the end of each subsequent financial quarter, the ratio of Total Net Funded Debt to Total Capitalisation of the NCLC Group shall not exceed [**] [Confidential Treatment].
 
   
 
  Amounts available for drawing under any revolving or other credit facilities of the NCLC Group which remain undrawn at the time of the relevant calculation shall not be counted as cash or indebtedness for the purposes of this ratio.

12


 

Schedule 4
Quarterly Statement of Financial Covenants
TO:   HSBC BANK PLC
Project and Export Finance
8 Canada Square
London E14 5HQ
England

Attn: Mr Alan Marshall

(as the Agent (as such term is defined in the Guarantee (as hereinafter defined))
We refer to clause 11 of the guarantee dated 20 April 2004 (as amended, varied and/or supplemented from time to time the “Guarantee“) issued by us in favour of the Trustee. Terms defined in the Guarantee, whether by reference to the Loan Agreement (as therein defined) or otherwise, shall have the same meanings herein.
We hereby certify the amounts set out in the attached schedule as at the last day of the financial quarter ending 20[    ] for NCL Corporation Ltd. (the “Guarantor”) and its subsidiaries on a consolidated basis. We also hereby certify that the Guarantor is in compliance with all the financial covenants set out in clauses 11.1 and 11.3 of the Guarantee [[and that no Event of Default or Possible Event of Default has occurred and is continuing][an [Event of Default][Possible Event of Default] has occurred and is continuing under clause 11.1.[   ] of the Loan Agreement and the following step[s][is/are] being taken to cure the same: [   ]]].
NCL CORPORATION LTD.
                                                            
By: [       ]
Chief Financial Officer
Dated:           20[   ]

13


 

Schedule
Statement of Financial Covenants as of [    ] 20[    ] (in USD’000)
             
Clause (of Guarantee)       as of [•]   Required Covenants
11.1.1/
  Free Liquidity   A   A>[**] [Confidential Treatment]
11.1.2(b)**
          (11.1.1)**
 
           
 
          A>[**] [Confidential Treatment]
 
          (11.1.2(b))**
 
           
11.1.2(a)
  Consolidated EBITDA:   B   >[**] [Confidential Treatment]
 
           
 
  Consolidated Debt Service   C    
 
           
11.1.3
  Total Net Funded Debt:   D   <[**] [Confidential Treatment]
 
           
 
  Total Capitalisation   E    
                 
 
  Consolidated EBITDA            
 
  Consolidated Net Income (loss)     x      
(Deduct)/Add:
  (Gain)/Loss on sale of assets or reserves     x      
Add:
  Consolidated Interest Expense     x      
Add:
  Depreciation and amortisation of assets     x      
Add:
  Impairment charges     x      
(Deduct)/Add:
  Other non-cash charges (gains)     x      
Add:
  Deferred income tax expense     x      
 
             
 
  Consolidated EBITDA     x     B
 
             
 
  Consolidated Debt Service            
 
  Principal paid/payable (excluding balloon payments, voluntary     x      
 
  prepayments/repayments on sale/total loss of an NCLC Fleet            
 
  vessel)            
Add:
  Consolidated Interest Expense     x      
 
  Distributions     x      
 
  Rent under capitalised leases     x      
 
             
 
  Consolidated Debt Service     x     C
 
             
 
  Total Net Funded Debt            
 
  Indebtedness for Borrowed Money     x      
Add:
  Guarantees of non-NCLC Group members' obligations     x      
 
             
 
        x      
 
             
Deduct:
  Cash Balance     (x )    
 
             
 
  Total Net Funded Debt     (x )   D
 
             
 
  Total Capitalisation            
 
  Total Net Funded Debt     x      
Add:
  Consolidated stockholders' equity     x      
 
             
 
  Total Capitalisation     x     E
 
             

14


 

For and on behalf of NCL CORPORATION LTD.
                                                            
[            ]
I, [       ], the officer primarily responsible for the financial management of the NCLC Group, hereby declare that, to the best of knowledge and belief, the above Statement of Financial Covenants as of [ ] 20[    ], in my opinion, is true and correct.
                                                            
[            ]
Chief Financial Officer
NCL CORPORATION LTD.
Dated:            20[            ]
 
**   Evidence satisfactory to the Agent of A at all times during the relevant period shall be provided together with this statement

15

EX-4.31 8 g05791exv4w31.htm EX-4.31 THIRD SUPPLEMENTAL DEED/PRIDE OF HAWAI'I EX-4.31 Third Supplemental Deed/Pride of Hawai'i
 

Exhibit 4.31
[Confidential Treatment]
DATED 13 NOVEMBER 2006
PRIDE OF HAWAII, INC.
(as borrower)
NCL CORPORATION LTD.
(as guarantor)
HSBC BANK PLC
(as agent)
COMMERZBANK AKTIENGESELLSCHAFT
(as Hermes agent)
HSBC BANK PLC
(as trustee)
 
THIRD SUPPLEMENTAL DEED TO (AMONG OTHER THINGS)
SECURED LOAN AGREEMENT
dated 20 April 2004 for the equivalent amount in United States Dollars
of up to 308,130,000 pre- and post delivery finance for
“PRIDE OF HAWAII”
a luxury cruise vessel with 1,188 passenger cabins
being hull no S.668 at the yard of Meyer Werft GmbH
 
[**] [Confidential Treatment]

 


 

CONTENTS
             
        Page  
1
  Definitions and Construction     1  
 
           
2
  Amendment of Original Loan Agreement, Original Guarantee and Security Documents     2  
 
           
3
  Conditions Precedent     3  
 
           
4
  Representations and Warranties     4  
 
           
5
  Expenses     5  
 
           
6
  Further Assurance     5  
 
           
7
  Counterparts     6  
 
           
8
  Notices     6  
 
           
9
  Governing Law     6  
 
           
10
  Jurisdiction     7  
 
           
Schedule 1
  The Lenders     9  
 
           
Schedule 2
  Amendment of Original Loan Agreement     11  
 
           
Schedule 3
  Amendment of Original Guarantee     12  
 
           
Schedule 4
  Quarterly Statement of Financial Covenants     13  

 


 

THIRD SUPPLEMENTAL DEED
DATED 13 NOVEMBER 2006
BETWEEN:
(1)   PRIDE OF HAWAII, INC. of 1209 Orange Street, Wilmington, Delaware 19801, United States of America as borrower (the “Borrower”);
 
(2)   NCL CORPORATION LTD. of Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda as guarantor (the “Guarantor”);
 
(3)   HSBC BANK PLC of 8 Canada Square, London E14 5HQ as agent (the “Agent”);
 
(4)   COMMERZBANK AKTIENGESELLSCHAFT of Kaiserplatz, 60311 Frankfurt am Main, Federal Republic of Germany as agent (the “Hermes Agent”); and
 
(5)   HSBC BANK PLC of 8 Canada Square, London E14 5HQ as trustee for itself and the Lenders (as hereinafter defined) (the “Trustee”).
WHEREAS:
(A)   By a loan agreement dated 20 April 2004 as amended by a first supplement thereto dated 25 October 2004 and a second supplement thereto dated as of 30 September 2005 entered into between the Borrower as borrower, the several banks particulars of which are set out in Schedule 1 as lenders (the “Lenders”), the Agent as agent for (among others) the Lenders, the Hermes Agent as agent for (among others) the Lenders and the Trustee as trustee for (among others) the Lenders (the “Original Loan Agreement”), the Lenders granted to the Borrower a secured loan in the Equivalent Amount of up to three hundred and eight million one hundred and thirty thousand Euro (308,130,000) (the “Loan”), subject to clause 2.5 of the Original Loan Agreement, for the purpose of enabling the Borrower to finance (among other things) the construction of the Vessel (as such term is defined in the Original Loan Agreement) on the terms and conditions therein contained. The repayment of the Loan by the Borrower has been secured by (among other things) a guarantee and indemnity dated 20 April 2004 granted by the Guarantor as amended by the said second supplement dated as of 30 September 2005 (the “Original Guarantee”).
 
(B)   The Guarantor has requested the consent of the Lenders, the Agent, the Hermes Agent and the Trustee to the amendment of certain provisions of the Original Loan Agreement and the Original Guarantee to conform such provisions to similar provisions in other loan documentation to which the Guarantor and/or other members of the NCLC Group are party. This Deed shall be executed as a deed.
NOW THIS DEED WITNESSES as follows:
1   Definitions and Construction
  1.1   In this Deed including the preamble and recitals hereto (unless the context otherwise requires) any term or expression defined in the preamble or the recitals shall have the meaning ascribed to it therein and terms and expressions not defined herein but whose meanings are defined in the Loan Agreement shall have the meanings set out therein. In addition, the following terms and expressions shall have the meanings set out below:

 


 

      “Guarantee” means the Original Guarantee as amended by this Deed; and
 
      “Loan Agreement” means the Original Loan Agreement as amended by this Deed.
 
  1.2   The provisions of Clauses 1.2 and 1.3 of the Loan Agreement shall apply hereto (mutatis mutandis).
2   Amendment of Original Loan Agreement, Original Guarantee and Security Documents
  2.1   Subject to Clause 3, the parties hereto agree that from the date of this Deed the Original Loan Agreement shall be read and construed as if the clauses referred to in the first column of Schedule 2 had been amended to read as set out in the second column of Schedule 2.
 
  2.2   Subject to Clause 3, the parties hereto agree that from the date of this Deed the Original Guarantee shall be read and construed as if:
  2.2.1   the clause referred to in the first column of Schedule 3 had been amended to read as set out in the second column of Schedule 3; and
 
  2.2.2   schedule 1 had been deleted and substituted with Schedule 4.
  2.3   Each of the Borrower and the Guarantor hereby confirms to the Agent, the Hermes Agent and the Trustee that with effect from the date of this Deed:
  2.3.1   all references to the Original Loan Agreement in the Security Documents to which it is a party shall be construed as references to the Loan Agreement and all terms used in such Security Documents whose meanings are defined by reference to the Original Loan Agreement shall be defined by reference to the Loan Agreement;
 
  2.3.2   the Security Documents to which it is a party shall apply to, and extend to secure, the whole of the Outstanding Indebtedness as defined in clause 1.1 of the Loan Agreement;
 
  2.3.3   its obligations under the Security Documents to which it is a party shall not be discharged, impaired or otherwise affected by reason of the execution of this Deed or of any of the documents or transactions contemplated hereby; and
 
  2.3.4   its obligations under the Security Documents to which it is a party shall remain in full force and effect as security for the obligations of the Borrower under the Loan Agreement and the other Security Documents as amended by this Deed.
  2.4   Except as expressly amended hereby or pursuant hereto the Original Loan Agreement and the Security Documents shall remain in full force and effect and nothing herein contained shall relieve the Borrower or any other Obligor from any of its respective obligations under any such documents.

2


 

3   Conditions Precedent
  3.1   The consent of the Agent, the Hermes Agent and the Trustee for themselves and on behalf of the Lenders to the variation of the provisions of the Original Loan Agreement and the Original Guarantee is conditional upon and shall not be effective unless and until the Agent has received the following in form and substance satisfactory to it:
  3.1.1   on the date of this Deed, one (1) counterpart of this Deed duly executed by the Borrower and the Guarantor;
 
  3.1.2   a written confirmation from the Process Agent that it will act for the Borrower and the Guarantor as agent for service of process in England in respect of this Deed;
 
  3.1.3   the following corporate documents in respect of each of the Borrower and the Guarantor (together the “Relevant Parties”):
  (a)   Certified Copies of any consents required from any ministry, governmental, financial or other authority for the execution of and performance by the respective Relevant Party of its obligations under this Deed or if no such consents are required a certificate from a duly appointed officer of the Relevant Party to this effect confirming that no such consents are required;
 
  (b)   notarially attested secretary’s certificate of each of the Relevant Parties:
  (i)   attaching a copy of its Certificate of Incorporation and Memorandum of Association and Bye-Laws (or equivalent constitutional documents) evidencing power to enter into the transactions contemplated in this Deed;
 
  (ii)   giving the names of its present officers and directors;
 
  (iii)   setting out specimen signatures of such officers and directors as are authorised by the Relevant Party to sign documents or otherwise undertake the performance of that Relevant Party’s obligations under this Deed;
 
  (iv)   giving the legal owner of its shares and the number of such shares held;
 
  (v)   attaching copies of resolutions passed at duly convened meetings of the directors and, if required by the Agent, the shareholders or members of each of the Relevant Parties authorising (as applicable) the execution of this Deed and the amendment to the Post Delivery Mortgage and the issue of any power of attorney to execute the same; and
 
  (vi)   containing a declaration of solvency as at the date of the certificate of the duly appointed officer of the Relevant Party;

3


 

      or (if applicable) certifying that there has been no change to the statements made in his or her secretary’s certificate last provided to the Agent with respect to paragraphs (b)(i), (ii), (iii), (iv) and (vi) of this Clause 3.1.3(b) and attaching copies of resolutions passed at duly convened meetings of the directors and, if required by the Agent, the shareholders or members of each of the Relevant Parties authorising (as applicable) the execution of this Deed and the amendment to the Post Delivery Mortgage and the issue of any power of attorney to execute the same;
  3.1.4   the original powers of attorney, if any, issued pursuant to the resolutions referred to above and notarially attested;
 
  3.1.5   a first amendment to the Post Delivery Mortgage duly executed and lodged for recordation at the United States Coast Guard National Vessel Documentation Center;
 
  3.1.6   Certified Copies of letters from the Borrower to the Manager and from the Manager to the Sub-Agent notifying of the provisions of clause 10.14(c) of the Loan Agreement; and
 
  3.1.7   the issue of such favourable written legal opinions including in respect of the United States of America, Delaware and Bermuda in such form as the Agent may require relating to all aspects of the transactions contemplated hereby governed by any applicable law,
      PROVIDED THAT no Event of Default and (save as disclosed in writing to the Agent before the date of this Deed) no Possible Event of Default has occurred and is continuing on the date on which the conditions precedent set out in this Clause 3.1 have been satisfied (subject to Clause 3.2).
 
  3.2   If the Agent, the Hermes Agent and the Trustee, acting unanimously, decide (or the Agent in accordance with the Agency and Trust Deed decides) to permit the amendment of the Original Loan Agreement and the Original Guarantee hereby without the Agent having received all of the documents or evidence referred to in Clause 3.1, the Borrower will nevertheless deliver the remaining documents or evidence to the Agent within fourteen (14) days of the date of this Deed (or such other period as the Agent may stipulate) and the amendment of the Original Loan Agreement and the Original Guarantee as aforesaid shall not be construed as a waiver of the Agent’s right to receive the documents or evidence as aforesaid nor shall this provision impose on the Agent, the Hermes Agent, the Trustee or the Lenders any obligation to permit the amendment in the absence of such documents or evidence.
4   Representations and Warranties
  4.1   Each of the Borrower and the Guarantor represents and warrants to the Agent, the Hermes Agent and the Trustee that:
  4.1.1   it has the power to enter into and perform this Deed and the transactions contemplated hereby and has taken all necessary action to authorise the entry into and performance of this Deed and such transactions;

4


 

  4.1.2   this Deed constitutes its legal, valid and binding obligations enforceable in accordance with its terms;
 
  4.1.3   its entry into and performance of this Deed and the transactions contemplated hereby do not and will not conflict with:
  (a)   any law or regulation or any official or judicial order; or
 
  (b)   its constitutional documents; or
 
  (c)   any agreement or document to which it is a party or which is binding upon it or any of its assets,
      nor result in the creation or imposition of any Encumbrance on it or its assets pursuant to the provisions of any such agreement or document and in particular but without prejudice to the foregoing the entry into and performance of this Deed and the transactions contemplated hereby and thereby will not render invalid, void or voidable any security granted by it to the Trustee;
 
  4.1.4   all authorisations, approvals, consents, licences, exemptions, filings, registrations, notarisations and other matters, official or otherwise, required in connection with the entry into, performance, validity and enforceability of this Deed and each of the other documents contemplated hereby and thereby and the transactions contemplated hereby and thereby have been obtained or effected and are in full force and effect;
 
  4.1.5   all information furnished by it to the Agent or its agents relating to the business and affairs of an Obligor in connection with this Deed and the other documents contemplated hereby and thereby was and remains true and correct in all material respects and there are no other material facts or considerations the omission of which would render any such information misleading; and
 
  4.1.6   it has fully disclosed in writing to the Agent all facts relating to its business which it knows or should reasonably know and which might reasonably be expected to influence the Agent, the Hermes Agent and/or the Trustee in deciding whether or not to enter into this Deed.
5   Expenses
 
    The Borrower and the Guarantor jointly and severally undertake to reimburse the Agent on demand on a full indemnity basis for the reasonable charges and expenses (together with value added tax or any similar tax thereon and including without limitation the fees and expenses of legal and other advisers) incurred by the Agent, the Hermes Agent or the Trustee in respect of the negotiation, preparation, printing, execution, registration and enforcement of this Deed and any other documents required in connection with the implementation of this Deed.
 
6   Further Assurance
 
    Each of the Borrower and the Guarantor will, from time to time on being required to do so by the Agent, do or procure the doing of all such acts and/or execute or procure the

5


 

    execution of all such documents in a form satisfactory to the Agent and the Hermes Agent as the Agent and the Hermes Agent may reasonably consider necessary for giving full effect to this Deed or any of the documents contemplated hereby or securing to the Trustee the full benefit of the rights, powers and remedies conferred upon the Agent, the Hermes Agent or the Trustee in any such document.
 
7   Counterparts
 
    This Deed may be executed in any number of counterparts and all such counterparts taken together shall be deemed to constitute one and the same agreement.
 
8   Notices
  8.1   Any notice, demand or other communication (unless made by telefax) to be made or delivered to the Borrower or the Guarantor pursuant to this Deed shall (unless the Borrower or the Guarantor has by fifteen (15) days’ written notice to the Agent specified another address) be made or delivered to the Borrower and/or the Guarantor c/o 7665 Corporate Center Drive, Miami, Florida 33126, United States of America (marked for the attention of Ms Bonnie Biumi and the Legal Department (but one (1) copy shall suffice)) with a copy to c/o Star Cruises Limited, Star Cruises Terminal, Pulau Indah, PO Box No. 288, 42009 Pelabuhan Klang, Selangor Darul Ehsan, Malaysia (marked for the attention of Mr Gerard Lim). Any notice, demand or other communication to be made or delivered by the Borrower or the Guarantor pursuant to this Deed shall (unless the Agent has by fifteen (15) days’ written notice to the Borrower and the Guarantor specified another address) be made or delivered to the Agent at its Office, the details of which are set out in schedule 2 of the Original Loan Agreement.
 
  8.2   Any notice, demand or other communication to be made or delivered pursuant to this Deed may be sent by telefax to the relevant telephone numbers (which at the date hereof in respect of the Borrower and the Guarantor is +1 305 436 4140 (marked for the attention of Ms Bonnie Biumi) and +1 305 436 4117 (marked for the attention of the Legal Department) with a copy to +60 3 3884 0213 (marked for the attention of Mr Gerard Lim) and in the case of the Agent, the Hermes Agent or the Trustee is as recorded in schedule 2 of the Original Loan Agreement) specified by it from time to time for the purpose and shall be deemed to have been received when transmission of such telefax communication has been completed. Each such telefax communication, if made to the Agent, the Hermes Agent or the Trustee by the Borrower or the Guarantor, shall be signed by the person or persons authorised in writing by the Borrower or the Guarantor (as the case may be) and whose signature appears on the list of specimen signatures contained in the secretary’s certificate required to be delivered by Clause 3 and shall be expressed to be for the attention of the department or officer whose name has been notified for the time being for that purpose by the Agent, the Hermes Agent or the Trustee to the Borrower and the Guarantor.
 
  8.3   The provisions of clauses 18.1, 18.4 and 18.5 of the Original Loan Agreement shall apply to this Deed.
9   Governing Law
 
    This Deed shall be governed by English law.

6


 

10   Jurisdiction
  10.1   The courts of England have exclusive jurisdiction to settle any dispute arising out of or in connection with this Deed (including a dispute regarding the existence, validity or termination of this Agreement) (a “Dispute”). Each party to this Deed agrees that the courts of England are the most appropriate and convenient courts to settle Disputes and accordingly no party will argue to the contrary.
 
      This Clause 10.1 is for the benefit of the Agent, the Hermes Agent and the Trustee only. As a result, no such party shall be prevented from taking proceedings relating to a Dispute in any other courts with jurisdiction. To the extent allowed by law, any such party may take concurrent proceedings in any number of jurisdictions.
 
  10.2   Neither the Borrower nor the Guarantor may, without the Agent’s prior written consent, terminate the appointment of the Process Agent; if the Process Agent resigns or its appointment ceases to be effective, the Borrower and/or the Guarantor (as the case may be) shall within fourteen (14) days appoint a company which has premises in London and has been approved by the Agent to act as the Borrower’s and/or the Guarantor’s (as the case may be) process agent with unconditional authority to receive and acknowledge service on behalf of the Borrower and/or the Guarantor of all process or other documents connected with proceedings in the English courts which relate to this Deed.
 
  10.3   For the purpose of securing its obligations under Clause 10.2, each of the Borrower and the Guarantor irrevocably agrees that, if it for any reason fails to appoint a process agent within the period specified in Clause 10.2, the Agent may appoint any person (including a company controlled by or associated with the Agent or any Lender) to act as the Borrower’s or the Guarantor’s (as the case may be) process agent in England with the unconditional authority described in Clause 10.2.
 
  10.4   No neglect or default by a process agent appointed or designated under this Clause (including a failure by it to notify the Borrower or the Guarantor (as the case may be) of the service of any process or to forward any process to the Borrower or the Guarantor (as the case may be)) shall invalidate any proceedings or judgment.
 
  10.5   Each of the Borrower and the Guarantor appoints in the case of the courts of England the Process Agent to receive, for and on its behalf service of process in England of any legal proceedings with respect to this Deed.
 
  10.6   A judgment relating to this Deed which is given or would be enforced by an English court shall be conclusive and binding on the Borrower and/or the Guarantor (as the case may be) and may be enforced without review in any other jurisdiction.
 
  10.7   Nothing in this Clause shall exclude or limit any right which the Agent, the Hermes Agent or the Trustee may have (whether under the laws of any country, an international convention or otherwise) with regard to the bringing of proceedings, the service of process, the recognition or enforcement of a judgment or any similar or related matter in any jurisdiction.

7


 

  10.8   In this Clause “judgment” includes order, injunction, declaration and any other decision or relief made or granted by a court.
IN WITNESS whereof the parties hereto have caused this Deed to be duly executed as a deed on the day and year first before written.
                 
SIGNED SEALED and DELIVERED as a DEED
        )     Vijay Jeyaratnam
by Vijay Jeyaratnam
        )      
for and on behalf of
        )      
PRIDE OF HAWAII, INC.
        )      
in the presence of:
  Jaya Prasannan     )      
 
  Trainee Solicitor     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Colin Veitch
by Colin Veitch
        )      
for and on behalf of
        )      
NCL CORPORATION LTD.
        )      
in the presence of:
  Mark E. Warren     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Julie Clegg
by Julie Clegg
        )      
for and on behalf of
        )      
COMMERZBANK AKTIENGESELLSCHART
        )      
as the Henmes Agent
        )      
in the presence of:
  Jaya Prasannan     )      
 
  Trainee Solicitor     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Mark Looi
by Mark Looi
        )      
for and on behalf of
        )      
HSBC BANK PLC
        )      
as the Agent and the Trustee
        )      
in the presence of:
  Marcus Pcumley     )      
 
  HSBC Bank Plc     )      
 
  Project and Export Finance
Floor 17
    )      
 
  8 Canada Square     )      
 
  London E14 5HQ     )      

8


 

Schedule 1
The Lenders
Name and address
COMMERZBANK AKTIENGESELLSCHAFT
Bremen Branch
Schüsselkorb 5-11
28195 Bremen
Federal Republic of Germany
Fax: +49 40 3683 2049
Attn: Mr Siegfried Hoffmann
Email: siegfried.hoffmann@commerzbank.com
HSBC BANK PLC
Project and Export Finance
8 Canada Square
London E14 5HQ
Fax: +44 (0)20 7992 4428
Attn: Mr Alan Marshall
Email: alan.p.marshall@hsbcib.com
KfW
Palmengartenstrasse 5-9
60325 Frankfurt am Main
Federal Republic of Germany
Fax: +49 69 7431 2944
Attn: Mr Josef Schmid
Email: josef.schmid@kfw.de
DnB NOR BANK ASA
Stranden 21
NO-0021 Oslo
Norway
Fax: +47 22 482020
Attn: Mr Jon Flovik
Email: jon.flovik@dnbnor.no

9


 

OVERSEA-CHINESE BANKING
CORPORATION LIMITED

Singapore Branch
65 Chulia Street #10-00
Singapore 049513
Fax: +65 6536 6449/6532 5347
Attn: Ms Pearlwyn Ho/Ms Elaine Lam
Email: LamSYElaine@ocbc.com.sg
NORDDEUTSCHE LANDESBANK
GIROZENTRALE

Friedrichswall 10
30159 Hannover
Federal Republic of Germany
Fax: +49 511 361 4785
Attn: Mr Alexander Viets
Email: shipping@nordlb.de
CALYON
Friedrich-Ebert-Anlage 49
60308 Frankfurt am Main
Federal Republic of Germany
Fax: +49 69 74221 197
Attn: Ms Angelika Schönegger-Wenzel
Email: angelika.schoenegger-wenzel@de.calyon.com
with copy to:
CALYON ASIA SHIPFINANCE LIMITED
Fax: +852 2868 1448
Attn: Mr Terence Yuen/Ms Iris Lai
Email: terence.yuen@hk.calyon.com/iris.lai@hk.calyon.com

10


 

Schedule 2
Amendment of Original Loan Agreement
     
Definition/Clause   Amendment
Clause 9.2.21
  Completeness of documents
 
   
 
  The copies of the Building Contract, the Supervision Agreement, the Management Agreement the Sub-Agency Agreement, the Interest Exchange Arrangements and any other relevant third party agreements delivered to the Agent are true and complete copies of each such document constituting valid and binding obligations of the parties thereto enforceable in accordance with their respective terms and no amendments thereto or variations thereof have been agreed other than (if applicable), in the case of the Management Agreement or the Sub-Agency Agreement, in accordance with Clause 10.14 nor has any action been taken by the parties thereto which would in any way render such document inoperative or unenforceable.
 
   
Clause 10.14
  Supervision and management
 
   
 
  Except with the prior consent of the Agent, the Borrower will not:
 
   
 
 
(a)   permit any person other than the Supervisor, the Manager and the Sub-Agent to be the supervisor of construction and the manager and sub-agent of, including providing crewing services to, the Vessel;
 
   
 
 
(b)   permit any amendment to be made to the terms of the Supervision Agreement, the Management Agreement or the Sub-Agency Agreement unless an amendment to the Management Agreement or the Sub-Agency Agreement is advised by the Borrower’s tax counsel or is deemed necessary by the parties thereto but provided that the amendment does not imperil the security to be provided pursuant to the Security Documents or adversely affect the ability of any Obligor to perform its obligations under the Transaction Documents; or
 
   
 
 
(c)   permit the Vessel to be employed other than within the NCL or NCL America brand (as applicable).

11


 

Schedule 3
Amendment of Original Guarantee
     
Definition/Clause   Amendment
Clause 11.1.3
  as at 30 September 2006 and as at the end of each subsequent financial quarter, the ratio of Total Net Funded Debt to Total Capitalisation of the NCLC Group shall not exceed [**] [Confidential Treatment].
 
   
 
  Amounts available for drawing under any revolving or other credit facilities of the NCLC Group which remain undrawn at the time of the relevant calculation shall not be counted as cash or indebtedness for the purposes of this ratio.

12


 

Schedule 4
Quarterly Statement of Financial Covenants
TO:   HSBC BANK PLC
Project and Export Finance
8 Canada Square
London E14 5HQ
England

Attn: Mr Alan Marshall

(as the Agent (as such term is defined in the Guarantee (as hereinafter defined))
We refer to clause 11 of the guarantee dated 20 April 2004 (as amended, varied and/or supplemented from time to time the “Guarantee”) issued by us in favour of the Trustee. Terms defined in the Guarantee, whether by reference to the Loan Agreement (as therein defined) or otherwise, shall have the same meanings herein.
We hereby certify the amounts set out in the attached schedule as at the last day of the financial quarter ending      20[       ] for NCL Corporation Ltd. (the “Guarantor”) and its subsidiaries on a consolidated basis. We also hereby certify that the Guarantor is in compliance with all the financial covenants set out in clauses 11.1 and 11.3 of the Guarantee [[and that no Event of Default or Possible Event of Default has occurred and is continuing][an [Event of Default][Possible Event of Default] has occurred and is continuing under clause 11.1.[       ] of the Loan Agreement and the following step[s][is/are] being taken to cure the same: [       ]]].
NCL CORPORATION LTD.
                                                            
By: [       ]
Chief Financial Officer
Dated:            20[       ]

13


 

Schedule
Statement of Financial Covenants as of [    ] 20[ ] (in USD’000)
             
Clause (of Guarantee)            
      as of [• ]   Required Covenants
11.1.1/
  Free Liquidity   A   A>[**] [Confidential Treatment]
11.1.2(b)**
          (11.1.1)**
 
           
 
          A>[**] [Confidential Treatment]
 
          (11.1.2(b))**
 
           
11.1.2(a)
  Consolidated EBITDA:   B   >[**] [Confidential Treatment]
 
           
 
  Consolidated Debt Service   C    
 
           
11.1.3
  Total Net Funded Debt:   D   <[**] [Confidential Treatment]
 
           
 
  Total Capitalisation   E    
                 
 
  Consolidated EBITDA            
 
  Consolidated Net Income (loss)     x      
(Deduct)/Add:
  (Gain)/Loss on sale of assets or reserves     x      
Add:
  Consolidated Interest Expense     x      
Add:
  Depreciation and amortisation of assets     x      
Add:
  Impairment charges     x      
(Deduct)/Add:
  Other non-cash charges (gains)     x      
Add:
  Deferred income tax expense     x      
 
             
 
  Consolidated EBITDA     x     B
 
             
 
  Consolidated Debt Service            
 
  Principal paid/payable (excluding balloon payments, voluntary     x      
 
  prepayments/repayments on sale/total loss of an NCLC Fleet            
 
  vessel)            
Add:
  Consolidated Interest Expense     x      
 
  Distributions     x      
 
  Rent under capitalised leases     x      
 
             
 
  Consolidated Debt Service     x     C
 
             
 
  Total Net Funded Debt            
 
  Indebtedness for Borrowed Money     x      
Add:
  Guarantees of non-NCLC Group members’ obligations     x      
 
             
 
        x      
 
             
Deduct:
  Cash Balance     (x )    
 
             
 
  Total Net Funded Debt     (x )   D
 
             
 
  Total Capitalisation            
 
  Total Net Funded Debt     x      
Add:
  Consolidated stockholders’ equity     x      
 
             
 
  Total Capitalisation     x     E
 
             

14


 

For and on behalf of NCL CORPORATION LTD.
                                                            
[            ]
I, [       ], the officer primarily responsible for the financial management of the NCLC Group, hereby declare that, to the best of knowledge and belief, the above Statement of Financial Covenants as of [        ] 20[      ], in my opinion, is true and correct.
                                                            
[            ]
Chief Financial Officer
NCL CORPORATION LTD.
Dated:            20[ ]
 
**   Evidence satisfactory to the Agent of A at all times during the relevant period shall be provided together with this statement

15

EX-4.32 9 g05791exv4w32.htm EX-4.32 FIRST SUPPLEMENTAL DEED REVOLVING LOAN FACILITY EX-4.32 First Supplemental Deed Revolving Loan
 

Exhibit 4.32
[Confidential Treatment]
DATED 13 NOVEMBER 2006
NCL CORPORATION LTD.
(as borrower)
DnB NOR BANK ASA
(as agent)
COMMERZBANK AKTIENGESELLSCHAFT
(as Lower Saxony guarantee agent)
 
FIRST SUPPLEMENTAL DEED TO
UP TO EUR624,000,000
REVOLVING LOAN FACILITY AGREEMENT
dated 7 October 2005
 
[**] [Confidential Treatment]

 


 

CONTENTS
             
        Page
1
  Definitions and Construction     1  
 
           
2
  Amendment of Original Facility Agreement and other Security Documents     2  
 
           
3
  Conditions Precedent     2  
 
           
4
  Representations and Warranties     4  
 
           
5
  Expenses     5  
 
           
6
  Further Assurance     5  
 
           
7
  Counterparts     5  
 
           
8
  Notices     5  
 
           
9
  Governing Law     6  
 
           
10
  Jurisdiction     6  
 
           
Schedule 1
  Amendment of Original Facility Agreement     8  
 
           
Schedule 2
  Amendment of Deed of Covenants     10  
 
           
Schedule 3
  Amendment of Management Agreement Assignment     11  
 
           
Schedule 4
  Quarterly Statement of Financial Covenants     12  
 
           
Schedule 5
  Management Agreement     15  

 


 

FIRST SUPPLEMENTAL DEED
         
DATED 13 NOVEMBER 2006
     
BETWEEN:
(1)   NCL CORPORATION LTD. of Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda as borrower (the “Borrower”);
 
(2)   DnB NOR BANK ASA of Stranden 21, NO-0021 Oslo, Norway as agent for itself and the Lenders (the “Agent”); and
 
(3)   COMMERZBANK AKTIENGESELLSCHAFT of Ness 7-9, 20457 Hamburg, Federal Republic of Germany as German State of Lower Saxony agent (the “Lower Saxony Guarantee Agent”).
WHEREAS:
(A)   By a secured loan facility agreement dated 7 October 2005 (the “Original Facility Agreement”) made between (among others) (1) the Borrower as borrower (2) the banks whose names and Lending Branches appear in schedule 1 to the Facility Agreement as lenders (the “Lenders”) (3) the Agent as agent and (4) the Lower Saxony Guarantee Agent as agent, the Lenders agreed to make available to the Borrower a revolving loan facility of up to six hundred and twenty four million euro (EUR624,000,000) or the equivalent in Dollars (the “Facility”) in two (2) tranches. The repayment of the Facility by the Borrower will be secured by (among other things) first priority statutory Bahamian ship mortgages to be granted by the Owners respectively over the Vessels (the “Mortgages”).
 
(B)   The Borrower has requested the consent of the Lenders and the Agent to the amendment of certain provisions of the Original Facility Agreement and of the agreed form of the deed of covenants which will constitute part of each of the Mortgages (the “Deed of Covenants”), which form is attached to the security letter dated 7 October 2005 between the Borrower and the Agent (the “Security Letter”), to conform such provisions to similar provisions in other loan documentation to which the Borrower and/or other members of the NCLC Group are party. This Deed shall be executed as a deed.
NOW THIS DEED WITNESSES as follows:
1   Definitions and Construction
  1.1   In this Deed including the preamble and recitals hereto (unless the context otherwise requires) any term or expression defined in the preamble or the recitals shall have the meaning ascribed to it therein and terms and expressions not defined herein but whose meanings are defined in the Facility Agreement shall have the meanings set out therein. In addition, the following terms and expressions shall have the meanings set out below:
 
      "Facility Agreement” means the Original Facility Agreement as amended by this Deed.
 
  1.2   The provisions of Clauses 1.2 and 1.3 of the Facility Agreement shall apply hereto (mutatis mutandis).

 


 

2   Amendment of Original Facility Agreement and other Security Documents
  2.1   Subject to Clause 3, the parties hereto agree that from the date of this Deed the Original Facility Agreement shall be read and construed as if:
  2.1.1   the clauses referred to in the first column of Schedule 1 had been amended to read as set out in the second column of Schedule 1; and
 
  2.1.2   schedule 6 had been deleted and substituted with Schedule 4.
  2.2   Subject to Clause 3, the parties hereto agree that from the date of this Deed the agreed form of the Deed of Covenants to be granted by each of the Guarantors over its Vessel shall be deemed to be amended so that the clause referred to in the first column of Schedule 2 reads as set out in the second column of Schedule 2.
 
  2.3   Subject to Clause 3, the parties hereto agree that from the date of this Deed and primarily consequent upon the amendment of the agreed form of the Deed of Covenants the agreed form of the Management Agreement Assignments attached to the Security Letter shall be deemed to be amended so that:
  2.3.1   the clauses referred to in the first column of Schedule 3 read as set out in the second column of Schedule 3; and
 
  2.3.2   a new clause 5.15 of the schedule of covenants to schedule 1 thereto read as follows:
 
      not permit the Vessel to be employed other than within the NCL or NCL America brand (as applicable).”;
  2.3.3   Subject to Clause 3, the parties hereto agree that from the date of this Deed the Security Letter shall be read and construed as if the Management Agreement attached to the Security Letter had been substituted with the Management Agreement attached to this Deed as Schedule 5.
 
  2.3.4   The Borrower hereby confirms to the Agent that with effect from the date of this Deed its obligations under the Loan Agreement shall not be discharged, impaired or otherwise affected by reason of the execution of this Deed or of any of the documents or transactions contemplated hereby.
 
  2.4   Except as expressly amended hereby or pursuant hereto the Original Facility Agreement shall remain in full force and effect and nothing herein contained shall relieve the Borrower from any of its obligations under such document.
3   Conditions Precedent
  3.1   The consent of the Agent and the Lower Saxony Guarantee Agent for themselves and on behalf of the Lenders to the variation of the provisions of the Original Facility Agreement and the Deed of Covenants is conditional upon and shall not be effective unless and until the Agent has received the following in form and substance satisfactory to it:
  3.1.1   on the date of this Deed, one (1) counterpart of this Deed duly executed by the Borrower;

2


 

  3.1.2   a written confirmation from the Process Agent that it will act for the Borrower as agent for service of process in England in respect of this Deed;
 
  3.1.3   the following corporate documents in respect of the Borrower:
  (a)   Certified Copies of any consents required from any ministry, governmental, financial or other authority for the execution of and performance by the Borrower of its obligations under this Deed or if no such consents are required a certificate from a duly appointed officer of the Borrower to this effect confirming that no such consents are required;
 
  (b)   notarially attested secretary’s certificate of the Borrower:
  (i)   attaching a copy of its Certificate of Incorporation and Memorandum of Association and Bye-Laws (or equivalent constitutional documents) evidencing power to enter into the transactions contemplated in this Deed;
 
  (ii)   giving the names of its present officers and directors;
 
  (iii)   setting out specimen signatures of such officers and directors as are authorised by the Borrower to sign documents or otherwise undertake the performance of the Borrower’s obligations under this Deed;
 
  (iv)   giving the legal owner of its shares and the number of such shares held;
 
  (v)   attaching copies of resolutions passed at duly convened meetings of the directors and, if required by the Agent, the shareholders or members of each of the Relevant Parties authorising (as applicable) the execution of this Deed and the issue of any power of attorney to execute the same; and
 
  (vi)   containing a declaration of solvency as at the date of the certificate of the duly appointed officer of the Borrower;
or (if applicable) certifying that there has been no change to the statements made in his or her secretary’s certificate last provided to the Agent with respect to paragraphs (b)(i), (ii), (iii), (iv) and (vi) of this Clause 3.1.3(b) and attaching copies of resolutions passed at duly convened meetings of the directors and, if required by the Agent, the shareholders or members of each of the Relevant Parties authorising (as applicable) the execution of this Deed and the issue of any power of attorney to execute the same;
  3.1.4   the original powers of attorney, if any, issued pursuant to the resolutions referred to above and notarially attested; and

3


 

  3.1.5   the issue of such favourable written legal opinions including in respect of Bermuda in such form as the Agent may require relating to all aspects of the transactions contemplated hereby governed by any applicable law,
      PROVIDED THAT no Event of Default and (save as disclosed in writing to the Agent before the date of this Deed) no Possible Event of Default has occurred and is continuing on the date on which the conditions precedent set out in this Clause 3.1 have been satisfied (subject to Clause 3.2).
 
  3.2   If the Agent in accordance with clause 20 of the Original Facility Agreement decides to permit the amendment of the Original Facility Agreement and the Deed of Covenants hereby without having received all of the documents or evidence referred to in Clause 3.1, the Borrower will nevertheless deliver the remaining documents or evidence to the Agent within fourteen (14) days of the date of this Deed (or such other period as the Agent may stipulate) and the amendment of the Original Facility Agreement and the Deed of Covenants as aforesaid shall not be construed as a waiver of the Agent’s right to receive the documents or evidence as aforesaid nor shall this provision impose on the Agent or the Lenders any obligation to permit the amendment in the absence of such documents or evidence.
4   Representations and Warranties
  4.1   The Borrower represents and warrants to the Agent that:
  4.1.1   it has the power to enter into and perform this Deed and the transactions and documents contemplated hereby and has taken all necessary action to authorise the entry into and performance of this Deed and such transactions and documents;
 
  4.1.2   this Deed constitutes its legal, valid and binding obligations enforceable in accordance with its terms;
 
  4.1.3   its entry into and performance of this Deed and the transactions contemplated hereby do not and will not conflict with:
  (a)   any law or regulation or any official or judicial order; or
 
  (b)   its constitutional documents; or
 
  (c)   any agreement or document to which it is a party or which is binding upon it or any of its assets,
      nor result in the creation or imposition of any Encumbrance on it or its assets pursuant to the provisions of any such agreement or document and in particular but without prejudice to the foregoing the entry into and performance of this Deed and the transactions and documents contemplated hereby and thereby will not render invalid, void or voidable any security granted by it to the Agent;
 
  4.1.4   all authorisations, approvals, consents, licences, exemptions, filings, registrations, notarisations and other matters, official or otherwise, required in connection with the entry into, performance, validity and

4


 

      enforceability of this Deed and each of the other documents contemplated hereby and thereby and the transactions contemplated hereby and thereby have been obtained or effected and are in full force and effect;
 
  4.1.5   all information furnished by it to the Agent or its agents relating to the business and affairs of an Obligor in connection with this Deed and the other documents contemplated hereby and thereby was and remains true and correct in all material respects and there are no other material facts or considerations the omission of which would render any such information misleading; and
 
  4.1.6   it has fully disclosed in writing to the Agent all facts relating to its business which it knows or should reasonably know and which might reasonably be expected to influence the Agent in deciding whether or not to enter into this Deed.
5   Expenses
 
    The Borrower undertakes to reimburse the Agent on demand on a full indemnity basis for the reasonable charges and expenses (together with value added tax or any similar tax thereon and including without limitation the fees and expenses of legal and other advisers) incurred by the Agent in respect of the negotiation, preparation, printing, execution, registration and enforcement of this Deed and any other documents required in connection with the implementation of this Deed.
 
6   Further Assurance
 
    The Borrower will, from time to time on being required to do so by the Agent, do or procure the doing of all such acts and/or execute or procure the execution of all such documents in a form satisfactory to the Agent as the Agent may reasonably consider necessary for giving full effect to this Deed or any of the documents contemplated hereby or securing to the Agent the full benefit of the rights, powers and remedies conferred upon the Agent in any such document.
 
7   Counterparts
 
    This Deed may be executed in any number of counterparts and all such counterparts taken together shall be deemed to constitute one and the same agreement.
 
8   Notices
  8.1   Any notice, demand or other communication (unless made by telefax) to be made or delivered to the Borrower pursuant to this Deed shall (unless the Borrower has by fifteen (15) days’ written notice to the Agent specified another address) be made or delivered to the Borrower c/o 7665 Corporate Center Drive, Miami, Florida 33126, United States of America (marked for the attention of Ms Bonnie Biumi and the Legal Department (but one (1) copy shall suffice)) with a copy to c/o Star Cruises Limited, Star Cruises Terminal, Pulau Indah, PO Box No. 288, 42009 Pelabuhan Klang, Selangor Darul Ehsan, Malaysia (marked for the attention of Mr Gerard Lim). Any notice, demand or other communication to be made or delivered by the Borrower pursuant to this Deed shall (unless the Agent has by fifteen (15) days’ written notice to the Borrower specified another address)

5


 

      be made or delivered to the Agent at its Office, the details of which are set out in schedule 1 of the Original Facility Agreement.
 
  8.2   Any notice, demand or other communication to be made or delivered pursuant to this Deed may be sent by telefax to the relevant telephone numbers (which at the date hereof in respect of the Borrower is +1 305 436 4140 (marked for the attention of Ms Bonnie Biumi) and +1 305 436 4117 (marked for the attention of the Legal Department) with a copy to +60 3 3884 0213 (marked for the attention of Mr Gerard Lim) and in the case of the Agent is as recorded in schedule 1 of the Original Facility Agreement) specified by it from time to time for the purpose and shall be deemed to have been received when transmission of such telefax communication has been completed. Each such telefax communication, if made to the Agent by the Borrower, shall be signed by the person or persons authorised in writing by the Borrower and whose signature appears on the list of specimen signatures contained in the secretary’s certificate required to be delivered by Clause 3 and shall be expressed to be for the attention of the department or officer whose name has been notified for the time being for that purpose by the Agent to the Borrower.
 
  8.3   The provisions of clauses 23.1, 23.5 and 23.6 of the Original Facility Agreement shall apply to this Deed.
9   Governing Law
 
    This Deed shall be governed by English law.
 
10   Jurisdiction
  10.1   The courts of England have exclusive jurisdiction to settle any dispute arising out of or in connection with this Deed (including a dispute regarding the existence, validity or termination of this Agreement) (a “Dispute”). Each party to this Deed agrees that the courts of England are the most appropriate and convenient courts to settle Disputes and accordingly no party will argue to the contrary.
 
      This Clause 10.1 is for the benefit of the Agent only. As a result, no such party shall be prevented from taking proceedings relating to a Dispute in any other courts with jurisdiction. To the extent allowed by law, any such party may take concurrent proceedings in any number of jurisdictions.
 
  10.2   The Borrower may not, without the Agent’s prior written consent, terminate the appointment of the Process Agent; if the Process Agent resigns or its appointment ceases to be effective, the Borrower shall within fourteen (14) days appoint a company which has premises in London and has been approved by the Agent to act as the Borrower’s process agent with unconditional authority to receive and acknowledge service on behalf of the Borrower of all process or other documents connected with proceedings in the English courts which relate to this Deed.
 
  10.3   For the purpose of securing its obligations under Clause 10.2, the Borrower irrevocably agrees that, if it for any reason fails to appoint a process agent within the period specified in Clause 10.2, the Agent may appoint any person (including a company controlled by or associated with the Agent or any Lender) to act as the Borrower’s process agent in England with the unconditional authority described in Clause 10.2.

6


 

  10.4   No neglect or default by a process agent appointed or designated under this Clause (including a failure by it to notify the Borrower of the service of any process or to forward any process to the Borrower) shall invalidate any proceedings or judgment.
 
  10.5   The Borrower appoints in the case of the courts of England the Process Agent to receive, for and on its behalf service of process in England of any legal proceedings with respect to this Deed.
 
  10.6   A judgment relating to this Deed which is given or would be enforced by an English court shall be conclusive and binding on the Borrower and may be enforced without review in any other jurisdiction.
 
  10.7   Nothing in this Clause shall exclude or limit any right which the Agent may have (whether under the laws of any country, an international convention or otherwise) with regard to the bringing of proceedings, the service of process, the recognition or enforcement of a judgment or any similar or related matter in any jurisdiction.
 
  10.8   In this Clause “judgment” includes order, injunction, declaration and any other decision or relief made or granted by a court.
IN WITNESS whereof the parties hereto have caused this Deed to be duly executed as a deed on the day and year first before written.
                 
SIGNED SEALED and DELIVERED as a DEED
        )     Colin Veitch
by Colin Veitch
        )      
for and on behalf of
        )      
NCL CORPORATION LTD.
        )      
in the presence of:
  Mark E. Warren     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Julie Clegg
by Julie Clegg
        )      
for and on behalf
        )      
DaB NOR BANK ASA
        )      
as the Agent
        )      
in the presence of:
  Jaya Prasannan     )      
 
  Trainee Solicitor     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Julie Clegg
by Julie Clegg
        )      
for and on behalf
        )      
COMMERZBANK AKTIENGESELLSCHART
        )      
as the Lower Saxony Guarantee Agent
        )      
in the presence of:
  Jaya Prasannan     )      
 
  Trainee Solicitor     )      
 
  One St. Paul’s ChurchYard     )      
 
  London EC4M 8SH     )      

7


 

Schedule 1
Amendment of Original Facility Agreement
     
Definition/Clause   Amendment
Clause 9.2.21
  Completeness of documents The copies of the Building Contracts, the Management Agreements and any other relevant third party agreements delivered to the Agent are true and complete copies of each such document constituting valid and binding obligations of the parties thereto enforceable in accordance with their respective terms and no amendments thereto or variations thereof have been agreed other than (if applicable), in the case of the Management Agreements, in accordance with clause 6.1.17 of the two (2) deeds of covenants collateral to the two (2) first priority statutory Bahamian ship mortgages to be granted by each of the Owners over its Vessel nor has any action been taken by the parties thereto which would in any way render such document inoperative or unenforceable.
 
   
Clause 10.2.5
  within fifteen (15) days of a request from the Agent (but at intervals no more frequently than annually at the Borrower’s expense unless an Event of Default has occurred and is continuing), a valuation of each of the Vessels obtained in accordance with the provisions of Clause 10.17;
 
   
Clause 10.3.3
  as at 30 September 2006 and as at the end of each subsequent financial quarter, the ratio of Total Net Funded Debt to Total Capitalisation of the NCLC Group shall not exceed [**] [Confidential Treatment].
 
   
 
  Amounts available for drawing under the Facility or any other revolving or other credit facilities of the NCLC Group which remain undrawn at the time of the relevant calculation shall not be counted as cash or indebtedness for the purposes of this ratio.

8


 

     
Definition/Clause   Amendment
Clause 10.17.1
  Each of the Vessels shall for the purposes of this Clause 10.17 be valued in Dollars by two (2) independent firms of shipbrokers or shipvaluers nominated by the Borrower and approved by the Agent (acting on the instructions of the Majority Lenders) or failing such nomination and approval, appointed by the Agent (acting on such instructions) in its sole discretion (each such valuation to be made without, unless reasonably required by the Agent, physical inspection and on the basis of a sale for prompt delivery for cash at arm’s length on normal commercial terms as between a willing buyer and a willing seller without taking into account the benefit of any charterparty or other engagement concerning the Vessel). The first such valuations shall be obtained on or about thirty (30) days prior to the Delivery Date in respect of a Vessel and thereafter they shall be obtained within fifteen (15) days of a request from the Agent (but at intervals no more frequently than annually at the Borrower’s expense unless an Event of Default has occurred and is continuing). The average of the valuations shall constitute the value of the Vessel for the purposes of this Clause 10.17.

9


 

Schedule 2
Amendment of Deed of Covenants
         
Definition/Clause   Amendment  
Clause 6.1.17   except with the prior consent of the Agent (acting on the instructions of the Majority Lenders) not:
 
       
 
  (a) permit any person other than the Manager to be the manager of, including providing crewing services to, the Vessel;
 
       
 
  (b) permit any amendment to be made to the terms of the Management Agreement in respect of the Vessel unless the amendment is advised by the Owner’s tax counsel or is deemed necessary by the parties thereto but provided that the amendment does not imperil the security to be provided pursuant to the Security Documents or adversely affect the ability of any Obligor to perform its obligations under the Transaction Documents; or
 
       
 
  (c) permit the Vessel to be employed other than within the NCL or NCL America brand (as applicable).

10


 

Schedule 3
Amendment of Management Agreement Assignment
     
Definition/Clause   Amendment
Clause 4
  Revenue and Operating Costs
 
   
 
  Upon the Agent’s first written request, to provide to the Agent for information purposes only the regular financial statements including balance sheets, income statement and management reports of revenues and expenses compared to budget received pursuant to section [5.3] of the Management Agreement.
 
   
Schedule 1, Acknowledgement of Notice of Assignment, Clauses 6.1 and 6.2
  upon the Agent’s first written request, the regular financial statements including balance sheets, income statement and management reports of revenues and expenses compared to budget more particularly described in section [5.3] of the Management Agreement;
 
   
Schedule 1, Acknowledgement of Notice of Assignment, Clause 8
  agree not to make or permit to be made any amendment or modification to the terms of the Management Agreement without the prior written consent of the Agent, unless such amendment or modification thereto is advised by the Owner’s tax counsel or is deemed necessary by the parties thereto to reflect the prevailing circumstances, provided always that no such amendment shall imperil the security to be provided pursuant to the Security Documents or adversely affect the ability of any Obligor to perform its obligations under the Transaction Documents (as defined in the Facility Agreement);

11


 

Schedule 4
Quarterly Statement of Financial Covenants
     
TO:
  DnB NOR BANK ASA
 
  Stranden 21
 
  NO-0021 Oslo
 
  Norway
 
   
 
  Attn: Mr Jon Flovik
We refer to clause 10.3 of the loan facility agreement dated 7 October 2005 (as amended, varied and/or supplemented from time to time) (the “Facility Agreement”) between (among others) you as agent and ourselves as borrower. Terms defined in the Facility Agreement shall have the same meanings herein.
We hereby certify the amounts set out in the attached schedule as at the last day of the financial quarter ending      20[       ] for NCL Corporation Ltd. (the “Borrower”) and its subsidiaries on a consolidated basis. We also hereby certify that the Borrower is in compliance with all the financial covenants set out in clause 10.3 of the Facility Agreement [[and that no Event of Default or Possible Event of Default has occurred and is continuing][an [Event of Default][Possible Event of Default] has occurred and is continuing under clause 12.1.[       ] of the Facility Agreement and the following step[s][is/are] being taken to cure the same: [       ]]].
NCL CORPORATION LTD.
         
     
By:
  [                        ]    
Chief Financial Officer    
     
Dated:
  20[       ]

12


 

Schedule
Statement of Financial Covenants as of [       ] 20[   ] (in USD’000)
                 
Clause (of Facility                
Agreement)       as of [• ] Required Covenants    
10.3.1/ 10.3.2(b)**   Free Liquidity   A   A> [**] [Confidential Treatment] (11.3.1)**
            A> [**] [Confidential Treatment] (11.3.2(b))**
 
               
10.3.2(a)   Consolidated EBITDA:   B   > [**] [Confidential Treatment]
 
               
 
  Consolidated Debt Service   C        
 
               
10.3.3   Total Net Funded Debt:   D   < [**] [Confidential Treatment]
 
               
 
  Total Capitalisation   E        
 
               
 
  Consolidated EBITDA            
 
  Consolidated Net Income (loss)       x    
(Deduct)/Add:
  (Gain)/Loss on sale of assets or reserves       x    
Add:
  Consolidated Interest Expense       x    
Add:
  Depreciation and amortisation of assets       x    
Add:
  Impairment charges       x    
(Deduct)/Add:
  Other non-cash charges (gains)       x    
Add:
  Deferred income tax expense       x    
 
               
 
  Consolidated EBITDA       x   B
 
               
 
  Consolidated Debt Service
Principal paid/payable (excluding balloon payments, voluntary prepayments/repayments on sale/total loss of an NCLC Fleet vessel)
     
x
   
Add:
  Consolidated Interest Expense       x    
 
  Distributions       x    
 
  Rent under capitalised leases       x    
 
               
 
  Consolidated Debt Service       x   C
 
               
 
  Total Net Funded Debt
Indebtedness for Borrowed Money
      x    
Add:
  Guarantees of non-NCLC Group members’ obligations       x    
 
               
 
               
 
          x    
 
               
Deduct:
  Cash Balance       (x  
 
               
 
  Total Net Funded Debt       (x D
 
               
 
  Total Capitalisation            
 
  Total Net Funded Debt       x    
Add:
  Consolidated stockholders’ equity       x    
 
               
 
  Total Capitalisation       x   E
 
               

13


 

For and on behalf of NCL CORPORATION LTD.
         
     
[      
  ]    
I, [    ], the officer primarily responsible for the financial management of the NCLC Group, hereby declare that, to the best of knowledge and belief, the above Statement of Financial Covenants as of [ ] 20[ ], in my opinion, is true and correct.
         
     
[       ]
       
Chief Financial Officer    
NCL CORPORATION LTD.    
         
Dated:
  20[      ]    
 
**   Evidence satisfactory to the Agent of A at all times during the relevant period shall be provided together with this statement

14


 

Schedule 5
Management Agreement

15

EX-4.33 10 g05791exv4w33.htm EX-4.33 SYNDICATE LOAN FACILITY/HULL C33 EX-4.33 Syndicate Loan Facility/Hull C33
 

Exhibit 4.33
[Confidential Treatment]
 
DATED 22 SEPTEMBER 2006
F3 ONE, LTD.
as Borrower
BNP PARIBAS
as Agent
BNP PARIBAS, CALYON, HSBC FRANCE AND SOCIETE GENERALE
as Mandated Lead Arrangers and Lenders
 
LOAN AGREEMENT
Hull No. C33
The equivalent in US Dollars of EUR662,905,320
 

 


 

CONTENTS
             
Clause       Page
1.
  DEFINITIONS AND CONSTRUCTION     2  
 
           
2.
  AVAILABILITY OF THE LOAN     9  
 
           
3.
  DRAWING     9  
 
           
4.
  REPAYMENT OF LOAN AND PAYMENT OF INTEREST     15  
 
           
5.
  CLAIMS OR DEFENCES MAY NOT BE OPPOSED TO THE LENDERS     16  
 
           
6.
  COFACE PREMIUM     16  
 
           
7.
  FEES     16  
 
           
8.
  TAXES, INCREASED COSTS, COSTS AND RELATED CHARGES     17  
 
           
9.
  REPRESENTATIONS AND WARRANTIES     19  
 
           
10.
  UNDERTAKINGS     25  
 
           
11.
  PREPAYMENT     38  
 
           
12.
  INTEREST ON LATE PAYMENTS     39  
 
           
13.
  ACCELERATION — EVENTS OF DEFAULT     39  
 
           
14.
  MANDATORY PREPAYMENT     44  
 
           
15.
  CURRENCY OF PAYMENT     45  
 
           
16.
  SECURITY     45  
 
           
17.
  APPLICATION OF SUMS RECEIVED     45  
 
           
18.
  CHANGES TO THE LENDERS     46  
 
           
19.
  CHANGES TO THE OBLIGORS     49  
 
           
20.
  ROLE OF THE AGENT AND THE MANDATED LEAD ARRANGERS     49  
 
           
21.
  CONDUCT OF BUSINESS BY THE FINANCE PARTIES     54  
 
           
22.
  SHARING AMONG THE FINANCE PARTIES     54  
 
           
23.
  PAYMENT MECHANICS     55  
 
           
24.
  GOVERNING LAW     57  
 
           
25.
  ENFORCEMENT     57  
 
           
26.
  APPENDICES     58  
 
           
27.
  NOTICES     58  
 
           
28.
  MISCELLANEOUS     58  
 
           
29.
  COMING INTO FORCE     59  

 


 

THIS LOAN AGREEMENT (the “Agreement”) is entered into this            day of September 2006
BETWEEN:
(1)   F3 ONE, LTD., a company incorporated in and existing under the laws of Bermuda with registration number EC38769 and with its registered office at Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda (the “Borrower”);
 
(2)   THE SEVERAL BANKS, particulars of which are set out in Appendix II as lenders (the “Original Lenders”);
 
(3)   THE SEVERAL BANKS, particulars of which are set out in Appendix II as mandated lead arrangers (the “Mandated Lead Arrangers”); and
 
(4)   BNP PARIBAS as agent for the lenders (the “Agent”).
WHEREAS:
(A)   A shipbuilding contract was signed as of 7 September 2006 (the “Building Contract”), between the Borrower and Aker Yards S.A. (the “Builder”) for the design, construction and delivery of a two thousand one hundred (2,100) passenger cabin cruise vessel having hull no. C33, specification hull no. [**] [Confidential Treatment] dated 7 September 2006, to be ready for delivery on 16 November 2009 (the “Vessel”).
 
(B)   The contract price of the Vessel is seven hundred and thirty five million euro (EUR735,000,000) (subject to adjustment in accordance with the terms of the Building Contract) (the “Contract Price”), payable at the times and in the manner specified in the Building Contract. The terms of payment of the Contract Price are as follows:
  (i)   [**] [Confidential Treatment] payable within three (3) Working Days (as defined in the Building Contract) after the Effective Date (as defined in the Building Contract);
 
  (ii)   [**] [Confidential Treatment] payable on first steel cutting but not before [**] [Confidential Treatment];
 
  (iii)   [**] [Confidential Treatment] payable on completion of keel laying but not before [**] [Confidential Treatment];
 
  (iv)   [**] [Confidential Treatment] payable on the date the Vessel is launched into the water at the yard of the Builder but not before [**] [Confidential Treatment]; and
 
  (v)   the remainder payable upon delivery and acceptance of the Vessel.
(C)   The Contract Price may be increased or decreased from time to time with respect to certain modifications to the Building Contract, the plans or the specification (the “Change Orders”).
(D)   The Lenders agree to make available to the Borrower a loan facility on the terms and conditions set out herein for the purpose of assisting the Borrower to finance part of the Contract Price (including the amount of the Change Orders) and the related Coface Premium.

 


 

NOW THEREFORE, it is agreed as follows:
1.   DEFINITIONS AND CONSTRUCTION
 
1.1   Definitions
 
    In this Agreement (including the Recitals) and the Appendices (all of which form an integral part of this Agreement) the following expressions shall have the meanings set out opposite them below.
 
    “Affiliate” means, with respect to any person, any other person controlling, controlled by or under common control with, such person and for purposes of this definition, “control” (including, with correlative meanings, the terms “controlling”, “controlled by” and “under common control with”), as applied to any person, means the possession, directly or indirectly, of the power to vote ten per cent. (10%) or more of the securities having voting power for the election of directors of such person, or otherwise to direct or cause the direction of the management and policies of that person, whether through the ownership of voting securities or by contract of otherwise.
 
    “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).
 
    “Assignment of Earnings” means an assignment to be entered into between the Borrower and the Finance Parties and to be in the agreed form.
 
    “Assignment of Insurances” means an assignment to be entered into between the Borrower, the Manager, if applicable, and the Finance Parties and to be in the agreed form.
 
    “Assignment of Management Agreement” means an assignment to be entered into between the Borrower and the Finance Parties and to be in the agreed form.
 
    “Assignment of Warranty Rights” means an assignment to be entered into between the Borrower and the Finance Parties with respect to the Borrower’s rights under the post-delivery warranty given by the Builder under the Building Contract.
 
    “Availability Termination Date” means the date falling [**] [Confidential Treatment] days (being the period stipulated in article 9, clause 2.1(i)(b) of the Building Contract) after [**] [Confidential Treatment].
 
    “Building Contract” means that certain contract entered into between the Borrower and the Builder dated as of 7 September 2006, as from time to time amended, in respect of the design, construction and delivery of the Vessel.
 
    “Builder” means Aker Yards S.A., a company incorporated in France and having its principal office at Avenue Bourdelle — B.P. 90180, 44613 Saint-Nazaire Cedex, France, Republic of France.
 
    “Business Day” means a full day on which commercial banks are open for business and dealing in deposits in London, New York City and Paris.
 
    “Certified Copy” means, in relation to any document delivered or issued by or on behalf of any company, a copy of such document certified as a true, complete and up-to-date copy of the original by any of the directors or the secretary or assistant secretary or any attorney-in-fact for the time being of that company.

-2-


 

    “Change Order Amount” means the cost of the Change Orders.
 
    “Change Orders” means those certain change orders to the specifications of the Vessel as may be agreed to from time to time by the Borrower and the Builder, the net cost of which is payable at delivery.
 
    “CIRR” (Commercial Interest Reference Rate) means six point nought five per cent. (6.05%) per annum being the fixed rate in force for medium and long term export credits in Dollars according to the Organisation for Economic Co-operation and Development rules as determined by the competent French Authorities.
 
    “Coface” means Compagnie Française d’Assurance pour le Commerce Extérieur a French société anonyme with its registered office at 12 Cours Michelet, La Défense, 92800 Puteaux, France, registered with the Registry of Commerce and Companies of Nanterre under number 552 069 791.
 
    “Coface Insurance Policy” means the insurance policy in respect of this Agreement to be issued by Coface for the benefit of the Lenders, in form and substance satisfactory to the Agent and the Lenders.
 
    “Coface Premium” means the amount payable by the Borrower to Coface through the Agent on the Delivery Date in respect of the Coface Insurance Policy which shall be [**] [Confidential Treatment] of the Total Financed Contract Price.
 
    “Commitment” means:
  (a)   in relation to an Original Lender, [**] [Confidential Treatment] of the Maximum Loan Amount and the amount of any other Commitment transferred to it under this Agreement; and
 
  (b)   in relation to any other Lender, the amount of any Commitment transferred to it under this Agreement,
to the extent not increased, cancelled, reduced or transferred by it under this Agreement.
“Compulsory Acquisition” means requisition for title or other compulsory acquisition of the Vessel including her capture, seizure, detention or confiscation or expropriation but excluding any requisition for hire by or on behalf of any government or governmental authority or agency or by any persons acting or purporting to act on behalf of any such government or governmental authority or agency.
“Contract Price” means the total price payable by the Borrower to the Builder for the Vessel in accordance with the Building Contract being, as at the date of the Building Contract, seven hundred and thirty five million euro (EUR735,000,000).
“Delivery Date” means the date and time stated in the Protocol of Delivery and Acceptance.
“Document of Compliance” means a document issued to the Vessel’s operator as evidence of its compliance with the requirements of the ISM Code.
“Dollar” and “USD” mean the lawful currency of the United States of America and, in respect of all payments to be made hereunder, mean funds which are for same day settlement in the New York Clearing House Interbank Payments System (or such other funds as may at the relevant time be customary for the settlement of international banking transactions denominated in United States Dollars).

-3-


 

“Drawdown Date” means the date on which the Loan is drawn down and applied in accordance with Clause 2.
“Drawdown Notice” means the drawdown notice and certificate duly executed by the Borrower substantially in the form of Appendix IV.
“Earnings” means, in respect of the Vessel, (whether earned or to be earned) any and all freights, hire, fares and passage monies, proceeds of requisition (other than proceeds of Compulsory Acquisition), rebates and commissions, all earnings deriving from contracts of employment, demurrage, charterparties, contracts of affreightment, pooling agreements and joint ventures, compensation, remuneration for salvage and towage services, damages howsoever arising and detention monies, damages for breach of any charterparty or other contract for the employment of the Vessel, any amounts payable in consideration of the termination or variation of any charterparty or other such contract and any other earnings whatsoever due or to become due to the Borrower.
“Encumbrance” means any mortgage, charge, pledge, lien, assignment, hypothecation, title retention, preferential right or trust arrangement or any other security agreement or arrangement.
“euro” and “EUR” means the single currency of the Participating Member States.
“Event of Default” means any one of the events specified in Clause 13.2.
“Facility Office” means the office or offices notified by a Lender to the Agent in writing on or before the date it becomes a Lender (or, following that date, by not less than five (5) Business Days’ written notice) as the office or offices through which it will perform its obligations under this Agreement.
“Financed Contract Price” means the lesser of five hundred and eighty eight million euro (EUR588,000,000) and eighty per cent. (80%) of the Contract Price less the Change Order Amount.
“Financed Change Order Amount” means the lesser of fifty eight million eight hundred thousand euro (EUR58,800,000) and eighty per cent. (80%) of the Change Order Amount.
“Finance Party” means the Agent, a Mandated Lead Arranger or a Lender and its successors in title, permitted assignees and permitted transferees.
“Financial Indebtedness” means any obligation for the payment or repayment of money, whether as principal or as surety and whether present or future, actual or contingent.
“French Authorities” means the Direction Générale du Trésor et de la Politique Economique of the French Ministry of Economy and Finance, any successors thereto, or any other authority in or of the French Republic having jurisdiction over and responsibility for the provision, management or regulation of the terms, conditions and issuance of export credits in or for the French Republic including (inter alia) such entities to whom authority in respect of extension or administration of export financing matters have been delegated, such as Coface.
“GAAP” means generally accepted accounting principles in the United States of America consistently applied (or, if not consistently applied, accompanied by details of the inconsistencies) including, without limitation, those set forth in the opinion and pronouncements of the Accounting Principles Board of the American Institute of

-4-


 

Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board.
“Group” means the Guarantor and its Subsidiaries.
“Guarantee” means the guarantee of the obligations of the Borrower under this Agreement to be signed by the Guarantor and to be in the agreed form.
“Guarantor” means NCL Corporation Ltd., a company incorporated in and existing under the laws of Bermuda with registration number EC34678 and with its registered office at Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda.
“IAPPC” means a valid international air pollution prevention certificate for the Vessel issued under Annex VI.
“Insurances” means all policies and contracts of insurance and entries of the Vessel in a protection and indemnity or war risks association which are effected in respect of the Vessel, her freights, disbursements, profits or otherwise and all benefits, including all claims and returns of premiums thereunder and shall also include all compensation payable by virtue of Compulsory Acquisition.
“Intended Delivery Date” means 16 November 2009 (the date on which the Vessel will be ready for delivery pursuant to the Building Contract as at the date of this Agreement) or any other date notified by the Borrower to the Agent in accordance with Clause 27 as being the date on which the Vessel will be ready for delivery pursuant to the Building Contract.
“ISM Code” means the International Management Code for the Safe Operation of Ships and for Pollution Prevention adopted by the International Maritime Organisation.
“ISPS Code” means the International Ship and Port Facility Security Code adopted by the International Maritime Organisation.
“Lender” means:
  (a)   any Original Lender; and
 
  (b)   any bank or financial institution which has become a Party in accordance with Clause 18,
which in each case has not ceased to be a Party in accordance with the terms of this Agreement.
“Loan” means the aggregate of the amount of the Total Financed Contract Price paid to the Builder pursuant to Clause 2.1.1 and the amount of the Coface Premium reimbursed to the Agent pursuant to Clause 2.1.2 as such amount may be increased or decreased pursuant to the terms of this Agreement or (as the context may require) the amount thereof for the time being drawn down and outstanding hereunder.
“Management Agreement” means the management agreement entered or to be entered into between the Borrower and the Manager with respect to the Vessel.
“Manager” means NCL (Bahamas) Ltd., a company incorporated in and existing under the laws of Bermuda with registration number EC34680 and with its registered office at Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda.

-5-


 

“Maritime Registry” means the maritime registry which the Borrower will specify to the Lenders no later than three (3) months before the Intended Delivery Date, being that of the Bahamas or such other registry as the Lenders may in their discretion agree.
“Maximum Loan Amount” means the amount of six hundred and sixty two million nine hundred and five thousand three hundred and twenty euro (EUR662,905,320).
“Mortgage” means the first priority mortgage and, if applicable, deed of covenants collateral thereto over the Vessel in favour of the Finance Parties, to be granted as provided for in Clause 16 and to be in the agreed form.
“Obligors” means the Borrower, the Guarantor and the Manager.
“Overnight LIBOR” means, on any date, the London interbank offered rate, being the day to day rate at which Dollars are offered to prime banks in the London interbank market and published by the British Bankers’ Association at or about 11.00 a.m. London time on page LIBOR01 of the Reuters screen. If the agreed page is replaced or the service ceases to be available, the Agent may specify another page or service displaying the appropriate rate after consultation with the Borrower.
“Participating Member State” means any member state of the European Union that adopts or has adopted the euro as its lawful currency in accordance with legislation of the European Union relating to Economic and Monetary Union.
“Party” means a party to this Agreement.
“Permitted Liens” means:
  (a)   any Encumbrance created by or pursuant to the Security Documents; and
 
  (b)   liens on the Vessel up to an aggregate amount at any time not exceeding ten million Dollars (USD10,000,000) for current crew’s wages and salvage and liens incurred in the ordinary course of trading the Vessel; and
in the case of the Manager in respect of paragraph (d) only and in the case of the Guarantor:
  (c)   any deposits or pledges to secure the performance of bids, tenders, bonds or contracts;
 
  (d)   any other Encumbrance notified by any of the Obligors to the Agent prior to the date hereof;
 
  (e)   any Encumbrance in respect of existing Financial Indebtedness of a person which becomes a Subsidiary of the Guarantor or is merged with or into the Guarantor or any of its Subsidiaries;
 
  (f)   liens on assets leased, acquired or upgraded after the date hereof or assets newly constructed or converted after the date hereof provided that (i) such liens secure Financial Indebtedness otherwise permitted under this Agreement (ii) such liens are incurred within one (1) year following such lease, acquisition, upgrade, construction or conversion and (iii) the Financial Indebtedness secured by such liens does not exceed the cost of such upgrade or the cost of such assets acquired or leased;
 
  (g)   statutory and other similar liens arising in the ordinary course of business unrelated to Financial Indebtedness and securing obligations not yet delinquent

-6-


 

      or which are being contested in good faith by appropriate proceedings and for which adequate reserves have been established; and
 
  (h)   liens arising out of the existence of judgments or awards in respect of the Guarantor or any of its Subsidiaries,
provided that the aggregate amount of all cash and the fair market value of all other property subject to such liens as are described in paragraphs (f) to (h) above does not exceed twenty five million Dollars (USD25,000,000).
“Protocol of Delivery and Acceptance” means the protocol of delivery and acceptance of the Vessel to be signed by the Borrower and the Builder in accordance with article 7, clause 1.3(i) of the Building Contract.
“Safety Management Certificate” means a document issued to the Vessel as evidence that the Vessel’s operator and its shipboard management operate in accordance with an approved Safety Management System.
“Safety Management System” means a structured and documented system enabling the personnel of the Vessel’s operator to implement effectively the safety and environmental protection policy of that Vessel operator.
“Security Documents” means this Agreement, the Guarantee, the Mortgage, the Assignment of Warranty Rights, the Assignment of Insurances, the Assignment of Earnings, the Assignment of Management Agreement and all such other documents as may be executed at any time in favour of the Finance Parties or any of them as security for the obligations of the Borrower and the other Obligors whether executed pursuant to the express provisions of this Agreement or otherwise howsoever.
“Security Period” means the period beginning on the Drawdown Date and ending on the date on which the amounts outstanding under this Agreement and under each of the other Security Documents are finally paid or repaid in full.
“Subsidiary” means, with respect to the Guarantor, any company or corporation of which more than fifty per cent. (50%) of the outstanding share capital having ordinary voting power to elect a majority of the board of directors of such company or corporation (irrespective of whether at the time share capital of any other class or classes of such company or corporation shall or might have voting power upon the occurrence of any contingency) is at the time directly or indirectly owned by the Guarantor, by the Guarantor and one or more other Subsidiaries of the Guarantor, or by one or more other Subsidiaries of the Guarantor.
“Taxes” means all present and future income and other taxes, levies, imposts, deductions, compulsory liens and withholdings whatsoever together with interest thereon and penalties with respect thereto, if any, and any payments made on or in respect thereof and “Taxation” shall be construed accordingly.
“Termination Date” means the date falling [**] [Confidential Treatment] years after the Delivery Date.
“Total Commitments” means the aggregate of the Commitments, being six hundred and sixty two million nine hundred and five thousand three hundred and twenty euro (EUR662,905,320).
“Total Financed Contract Price” means the aggregate of:
  (a)   the Financed Contract Price; and

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  (b)   the Financed Change Order Amount.
“Total Loss” means the actual or constructive or compromised or agreed or arranged total loss or the Compulsory Acquisition of the Vessel, including any such total loss as may arise during a requisition for hire.
“Total Loss Date” means:
  (a)   in the case of an actual total loss of the Vessel, the actual date on which the Vessel was lost or, if such date is not known, the date on which the Vessel was last reported; or
 
  (b)   in the case of a constructive total loss of the Vessel, or in the case of a compromised or arranged total loss of the Vessel, the date of the event giving rise to the claim for such constructive total loss or to the claim for a compromised or arranged total loss; or
 
  (c)   in the case of a Compulsory Acquisition on the date of the Compulsory Acquisition.
“Transaction Documents” means the Security Documents, the Building Contract, the Drawdown Notice, the Management Agreement and any other material document now or hereafter issued in connection with the documents or the transaction referred to in this Agreement.
“Transfer Certificate” means a certificate substantially in the form set out in Appendix III or any other form agreed between the Agent and the Borrower.
“Transfer Date” means, in relation to a transfer, 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.
“Vessel” means the passenger cruise vessel referred to in Recital (A) of this Agreement and more specially described in the Building Contract, and, to the extent the context permits, includes all manuals, logs and technical records relating to the said vessel.
1.2   Construction
 
    References in this Agreement to a document “in the agreed form” are to the form of the relevant document which is attached to the security letter of the same date as this Agreement or to such other form as the parties hereto may from time to time agree, subject to modification in accordance with the provisions of the security letter.
 
    A person who is not a Party has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce or to enjoy the benefit of any term of this Agreement.
 
    A provision of law including but without limitation a regulation is a reference to that provision or regulation as amended or re-enacted from time to time and a regulation includes any regulation, rule, official directive, request or guideline (whether or not having the force of law) of any governmental, intergovernmental or supranational body, agency, department or regulatory, self-regulatory or other authority or organisation.

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2.   AVAILABILITY OF THE LOAN
 
2.1   Commitment
 
    Each of the Lenders shall (in proportion to its share of the Total Commitments) make available to the Borrower a loan in a maximum amount of the counter value in Dollars of six hundred and two million six hundred and forty one thousand two hundred euro (EUR602,641,200) intended to:
  2.1.1   be paid to the Builder up to a maximum amount of five hundred and eighty eight million euro (EUR588,000,000) corresponding to eighty per cent. (80%) of the Contract Price of the Vessel prior to any Change Order;
 
  2.1.2   reimburse the Agent up to an amount of the counter value in Dollars of [**] [Confidential Treatment] corresponding to [**] [Confidential Treatment] per cent. [**] [Confidential Treatment] of the related Coface Premium payable to Coface.
In the event that the Contract Price for the Vessel prior to any Change Order increases pursuant to the terms of the Building Contract, the Lenders agree, if the Borrower so requests in the Drawdown Notice, to increase the maximum amount of the Loan by:
  2.1.3   up to an amount of the counter value in Dollars of [**] [Confidential Treatment] being [**] [Confidential Treatment] per cent. [**] [Confidential Treatment] of the Financed Contract Price) to pay to the Builder up to [**] [Confidential Treatment] per cent. [**] [Confidential Treatment] of the Change Order Amount; and
 
  2.1.4   up to an amount of the counter value in Dollars of [**] [Confidential Treatment] to reimburse the Agent [**] [Confidential Treatment] per cent. [**] [Confidential Treatment] of the related Coface Premium payable to Coface.
2.2   Purpose
The Loan may only be used to pay for goods and services of French origin. However, within the limits and under the conditions fixed by the French Authorities, this may be extended to cover goods and services incorporated in deliveries made by the Builder and originating from countries other than the Borrower’s country and France, which have been sub-contracted by the Builder and therefore remain under the Builder’s responsibility.
3.   DRAWING
 
3.1   Conditions precedent
 
    The Borrower may only draw under the Loan when the following conditions have been fulfilled to the satisfaction of the Lenders and provided no Event of Default shall have occurred and remains unremedied or be likely to occur:
  3.1.1   No later than the date of this Agreement:
  (a)   Receipt by the Agent of an opinion of legal counsel to the Lenders as to Bermudan law, together with the corporate documentation of the Borrower supporting the opinion, including but without limitation the Memorandum of Association and Bye-laws as filed with the competent authorities and a certificate of a competent officer of the Borrower

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      containing specimen signatures of the persons authorised to sign the documents on behalf of the Borrower, to the effect that:
  (i)   the Borrower has been duly organized and is validly existing as a company under the laws of Bermuda;
 
  (ii)   this Agreement falls within the scope of the Borrower’s corporate purpose as defined by its Memorandum of Association and Bye-laws;
 
  (iii)   the Borrower’s representatives were at the date of this Agreement fully empowered to sign this Agreement;
 
  (iv)   either all administrative requirements applicable to the Borrower (whether in Bermuda or elsewhere) concerning the transfer of funds abroad and acquisitions of Dollars to meet its obligations hereunder have been complied with, or that there are no such requirements; and
 
  (v)   this Agreement is the legal, valid and binding obligations of the Borrower enforceable in accordance with their terms (containing such exceptions as are standard for opinions of this type).
  (b)   Receipt by the Agent of an opinion of legal counsel to the Agent as to English law confirming that the obligations of the Borrower under this Agreement are legally valid and binding obligations enforceable by the relevant Finance Parties in the English courts.
 
  (c)   Receipt by the Agent of a Certified Copy of the executed Building Contract.
 
  (d)   Receipt by the Agent of a confirmation from Clifford Chance Secretaries Limited that it will act for the Borrower as agent for service of process in England in respect of this Agreement.
  3.1.2   No later than ten (10) Business Days after the date of this Agreement:
  (a)   Receipt by the Agent of an opinion of legal counsel to the Lenders as to Bermudan law, together with the corporate documentation of the Guarantor supporting the opinion, including but without limitation the Memorandum of Association and Bye-laws as filed with the competent authorities and a certificate of a competent officer of the Guarantor containing specimen signatures of the persons authorised to sign the documents on behalf of the Guarantor, to the effect that:
  (i)   the Guarantor has been duly organized and is validly existing as a company under the laws of Bermuda;
 
  (ii)   the Guarantee falls within the scope of the Guarantor’s corporate purpose as defined by its Memorandum of Association and Bye-laws;
 
  (iii)   the Guarantor’s representative was at the date of the Guarantee fully empowered to sign the Guarantee;
 
  (iv)   either all administrative requirements applicable to the Guarantor (whether in Bermuda or elsewhere) concerning the transfer of funds

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      abroad and acquisitions of Dollars to meet its obligations under the Guarantee have been complied with, or that there are no such requirements; and
 
  (v)   the Guarantee is the legal, valid and binding obligations of the Guarantor enforceable in accordance with their terms (containing such exceptions as are standard for opinions of this type).
  (b)   Receipt by the Agent of the executed Guarantee and a statement confirming that the Guarantor is in compliance with its obligations under clauses 11.1 and 11.3 of the Guarantee. The statement shall be signed by the chief financial officer of the Group (as such term is defined in clause 11.4 of the Guarantee), be in the form of schedule 1 to the Guarantee and be for the financial quarter ending 30 June 2006.
 
  (c)   Receipt by the Agent of an opinion of legal counsel to the Agent as to English law confirming that the obligations of the Guarantor under the Guarantee are legally valid and binding obligations enforceable by the relevant Finance Parties in the English courts.
 
  (d)   Receipt by the Agent of a confirmation from Clifford Chance Secretaries Limited that it will act for the Guarantor as agent for service of process in England in respect of the Guarantee.
  3.1.3   No later than three (3) months before the Intended Delivery Date, receipt by the Agent of notification from the Borrower of its preferred Maritime Registry.
 
  3.1.4   On the date falling ninety (90) days before the Intended Delivery Date and on each subsequent date prior to the Drawdown Date on which a statement in the form of schedule 1 to the Guarantee is to be received by the Agent pursuant to clause 9.2.5 of the Guarantee, receipt by the Agent of a statement confirming that the Guarantor is in compliance with its obligations under clauses 11.1 and 11.3 of the Guarantee. The statement shall be signed by the chief financial officer of the Group (as such term is defined in clause 11.4 of the Guarantee), be in the form of schedule 1 to the Guarantee and be for the last financial quarter in respect of which the Guarantor is obliged to provide such a statement pursuant to clause 9.2.5 of the Guarantee.
 
  3.1.5   No later than sixty (60) days before the Intended Delivery Date, receipt by the Agent of notification from the Borrower of the Intended Delivery Date.
 
  3.1.6   No later than ten (10) Business Days before the Intended Delivery Date, receipt by the Agent of insurance documents in form and substance satisfactory to the Lenders confirming that the Insurances have been effected and will be in full force and effect on the Delivery Date.
 
  3.1.7   No later than five (5) Business Days before the Intended Delivery Date, receipt by the Agent of:
  (a)   the Drawdown Notice from the Borrower, signed by a duly authorised signatory of the Borrower, specifying the amount of the Loan to be drawn down;
 
  (b)   a Certified Copy of each of the Change Orders and of the power of attorney pursuant to which the authorised signatory of the Borrower signed the Drawdown Notice and a specimen of his signature; and

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  (c)   a copy of the notice of delivery given by the Builder to the Borrower pursuant to and in accordance with article 7, clause 1.1 of the Building Contract.
  3.1.8   No later than the Delivery Date:
  (a)   Receipt by the Agent of a legal opinion of counsel to the Lenders as to Bermudan law together with the corporate documentation of the Borrower and the Manager supporting such opinions, including but without limitation, in the case of the Manager, the Memorandum of Association and Bye-laws as filed with the competent authorities and a certificate of a competent officer of the Borrower and the Manager containing specimen signatures of the persons authorised to sign the documents on behalf of the Borrower and the Manager, confirming that:
  (i)   the Lenders may continue to rely on the legal opinion given pursuant to Clause 3.1.1(a)(i);
 
  (ii)   the Mortgage, the Assignment of Warranty Rights, the Assignment of Insurances, the Assignment of Earnings and the Assignment of Management Agreement fall within the scope of the Borrower’s corporate purpose as defined by its Memorandum of Association and Bye-laws and are binding on it;
 
  (iii)   the Assignment of Insurances (if applicable) and the acknowledgement of the notice of assignment of the Management Agreement fall within the scope of the Manager’s corporate purpose as defined by its Memorandum of Association and Bye-laws and are binding on it; and
 
  (iv)   the Borrower’s representatives are fully empowered to sign the Protocol of Delivery and Acceptance, the Mortgage, the Assignment of Warranty Rights, the Assignment of Insurances, the Assignment of Earnings and the Assignment of Management Agreement and the Manager’s representatives are fully empowered to sign the Assignment of Insurances (if applicable) and the acknowledgement of the notice of assignment of the Management Agreement.
  (b)   Receipt by the Agent of evidence of payment to the Builder of:
  (i)   the four (4) pre-delivery instalments of the Contract Price; and
 
  (ii)   any other part of the Contract Price as at the Delivery Date not being financed hereunder.
  (c)   Evidence that:
  (i)   the Vessel is at least provisionally registered in the name of the Borrower in the Maritime Registry;
 
  (ii)   title to the Vessel is held by the Borrower free of all Encumbrances other than any maritime lien in respect of crew’s wages and trade debts arising out of equipment, consumable and other stores placed on board the Vessel prior to or concurrently with delivery, none of which is overdue;

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  (iii)   the Mortgage has been duly registered in the Maritime Registry and constitutes a first priority security interest over the Vessel and that all taxes and fees payable to the Maritime Registry in respect of the Vessel have been paid in full.
  (d)   Receipt by the Agent of a Certified Copy of a classification certificate (or interim classification certificate) showing the Vessel to be classed in accordance with Clause 9.4.3.
 
  (e)   Receipt by the Agent of duly executed originals of the Mortgage, the Assignment of Warranty Rights, the Assignment of Insurances, the Assignment of Earnings and the Assignment of Management Agreement together with relevant notices of assignment and the acknowledgement of the notice of assignment of the Management Agreement.
 
  (f)   Receipt by the Agent of all amounts which are due and payable hereunder by the Borrower on or prior to the Delivery Date.
 
  (g)   Receipt by the Agent of a legal opinion of counsel to the Lenders as to the law of the Maritime Registry confirming:
  (i)   the valid registration of the Vessel in the Maritime Registry; and
 
  (ii)   the Mortgage over the Vessel has been validly registered in the Maritime Registry.
  (h)   Receipt by the Agent of an opinion of legal counsel to the Agent as to English law confirming that the obligations of the Borrower under the deed of covenants constituting part of the Mortgage (if applicable), the Assignment of Warranty Rights, the Assignment of Insurances, the Assignment of Earnings and the Assignment of Management Agreement are legally valid and binding obligations enforceable by the relevant Finance Parties in the English courts.
 
  (i)   Receipt by the Agent of a certificate from the Borrower, signed by an authorised representative of the Borrower, attesting that the representations and warranties contained in Clause 9 are true and correct as of the Delivery Date in consideration of the facts and circumstances existing as of the Delivery Date.
 
  (j)   Receipt by the Agent of the documents mentioned in Appendix I.
 
  (k)   Receipt by the Agent of a Certified Copy of the executed Management Agreement.
 
  (l)   Receipt by the Agent of a Certified Copy of the carrier initiative agreement executed pursuant to Clause 10.16, any current certificate of financial responsibility in respect of the Vessel issued under OPA, a valid Safety Management Certificate (or interim Safety Management Certificate) issued to the Vessel in respect of its management by the Manager pursuant to the ISM Code, a valid Document of Compliance (or interim Document of Compliance) issued to the Manager in respect of ships of the same type as the Vessel pursuant to the ISM Code, a valid International Ship Security Certificate issued to the Vessel in accordance with the ISPS Code and a valid IAPPC issued to the Vessel in accordance with Annex VI.

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  (m)   Receipt by the Agent of a Certified Copy of the power of attorney pursuant to which the authorised signatory(ies) of the Borrower signed the documents referred to in this Clause 3.1.6 and to which the Borrower is a party and a specimen of his or their signature(s).
 
  (n)   Receipt by the Agent of a confirmation from Clifford Chance Secretaries Limited that it will act for each of the relevant Obligors as agent for service of process in England in respect of the deed of covenants constituting part of the Mortgage (if applicable), the Assignment of Warranty Rights, the Assignment of Insurances, the Assignment of Earnings and the Assignment of Management Agreement.
 
  (o)   The Coface Insurance Policy documentation relating to the transactions contemplated by this Agreement has been received by the Agent and remains in full force and effect, the Agent having notified the Borrower of the issue of the Coface Insurance Policy in form and substance satisfactory to the Lenders as soon as practicable after its issue.
3.2   Borrower’s irrevocable payment instructions
 
    The Lenders shall not be obliged to fulfil their obligation to make the Loan available other than by paying the Builder the Total Financed Contract Price (or (as the context may require) the amount thereof drawn down) on behalf of and in the name of the Borrower and by reimbursing the Agent for the related Coface Premium.
 
    The Borrower hereby instructs the Lenders in accordance with this Clause 3.2:
  3.2.1   to pay to the Builder:
  (a)   the amount in euro remaining due under the Building Contract up to an amount equal to the lesser of five hundred and eighty eight million euro (EUR588,000,000) and eighty per cent. (80%) of the Contract Price of the Vessel prior to any Change Order; and
 
  (b)   subject to Clause 2.2, the amount in euro up to the lesser of fifty eight million eight hundred thousand euro (EUR58,800,000) and eighty per cent. (80%) of the Change Order Amount capped at [**] [Confidential Treatment] per cent [**] [Confidential Treatment] of the Financed Contract Price; and
  3.2.2   to reimburse the Agent, by drawing under the Loan, the related Coface Premium.
The payment instruction contained in this Clause 3.2 is irrevocable.
Subject to Clause 3.1, payment will be made to the Builder by a single advance in euro on the Delivery Date of the Vessel during usual banking hours in the French Republic to the Builder’s account as specified by the Builder in accordance with the Building Contract after receipt and verification by the Agent of the documents provided under Appendix I.
Verification of the documents provided under Appendix I shall be limited to checking their apparent compliance as defined in the Uniform Customs and Practices for Documentary Credits — ICC Publication 500 (UCP 500 latest revision).
The Loan shall be converted from euro into Dollars on, and with effect from, the Drawdown Date at the official daily fixing rate (EUR/USD) of the European Central

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Bank quoted on Reuters’ page ECB37 at 11.00 a.m. Paris time two (2) Business Days prior to the Drawdown Date.
Subject to Coface approval, the Lenders agree to use an alternative conversion rate based on foreign exchange hedging transactions arranged by the Borrower provided that, by the date falling sixty (60) days before the Intended Delivery Date, the Borrower and the Lenders shall have agreed the hedging arrangements made, the applicable blended conversion rate and the mechanical terms upon which the proceeds of such hedging arrangements will be made available to the Lenders. The Borrower shall procure delivery to the Agent of confirmations of all hedging transactions as soon as reasonably practicable after such transactions have been executed.
The Borrower expressly acknowledges that the payment terms set out in this Clause may only be modified with the agreement of the Builder, the Agent, the Lenders and the Borrower in the case of Clause 3.2.1 and with the agreement of the Agent, the Lenders and the Borrower in the case of Clause 3.2.2.
Drawing may not be made under this Agreement (and the Loan shall not be available) after the earlier of the Delivery Date and the Availability Termination Date.
However, the Lenders will use their best efforts to agree to a postponement of the Availability Termination Date upon application by the Borrower accompanied by an explanation in reasonable detail of the reason for the delay in the Intended Delivery Date beyond the Availability Termination Date. The Borrower acknowledges that any such postponement is subject to the prior written approval of Coface.
4.   REPAYMENT OF LOAN AND PAYMENT OF INTEREST
 
    The Borrower shall repay to the Lenders the principal amount of the Loan drawn down under this Agreement together with interest on the Loan at the CIRR from the Drawdown Date by twenty four (24) consecutive equal half yearly instalments. The first instalment of principal and interest shall be due six (6) months after the Delivery Date and the final instalment shall be due on the Termination Date together with all other sums due under this Agreement. The interest shall be calculated on the actual number of days elapsed divided by three hundred and sixty (360).
 
    The amount of each instalment of principal and interest will be calculated by the Agent following the Drawdown Date. The Agent shall deliver to the Borrower and the Lenders as soon as practicable following such calculation and in any event no later than ten (10) Business Days after the Drawdown Date, a repayment schedule setting out the dates and the amounts of the instalments up to and including the Termination Date.
 
    The repayment schedule shall be sent by fax and, in the case of the Borrower, by international express courier.
 
    In the absence of manifest error, the repayment schedule will constitute an unconditional and irrevocable undertaking by the Borrower to pay the Lenders the amounts of principal and interest set out therein.
 
    The Borrower reserves the right to inform the Agent within ten (10) Business Days of receipt of the repayment schedule by courier if it contains a material error and to request its correction.

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5.   CLAIMS OR DEFENCES MAY NOT BE OPPOSED TO THE LENDERS
 
    The Borrower may not escape liability under the terms of this Agreement by opposing to the Lenders claims or defences of any kind whatsoever arising under the Building Contract, and in particular from its performance, or from any other relationship between the Borrower and the Builder.
6.   COFACE PREMIUM
 
    The Coface Premium is due and payable on or prior to the Drawdown Date and proportionally to the amount of the Loan drawn down under this Agreement. A minimum non-refundable premium, being the counter value in Dollars of [**] [Confidential Treatment] shall be paid to Coface upon signature of the Coface Insurance Policy. Otherwise, no Coface Premium is due if the Loan is not drawn down. Except as otherwise stated below in the case of a prepayment, the Coface Premium is not refundable for any reason whatsoever.
 
    The Borrower has requested and the Lenders have agreed to finance [**] [Confidential Treatment] per cent. [**] [Confidential Treatment] of the Coface Premium payable under this Agreement in accordance with Clauses 2.1.2 and 2.1.4 up to the amount being the counter value in Dollars of [**] [Confidential Treatment].
 
    Consequently, the Borrower hereby irrevocably instructs the Agent to pay the Coface Premium to Coface on the Borrower’s behalf and the financing of such payment shall be made by drawing under the Loan in accordance with Clauses 2.1.2 and 2.1.4 of this Agreement. Notwithstanding any other provision of this Agreement, the Borrower acknowledges that the obligation of the Borrower to reimburse the Lenders for the full amount of the Coface Premium referred to in this Agreement as and when it arises is absolute and unconditional.
 
    The Coface Premium financed by the Loan will be repayable in any event by the Borrower to the Lenders in the manner specified in Clause 4 and under any and all circumstances including but without limitation in the event of prepayment or acceleration of the Loan.
 
    If the Loan is prepaid in whole or in part by the Borrower and if no amounts are then due and unpaid by the Borrower to the Finance Parties, the Agent will, on receipt from Coface, refund to the Borrower the portion of the Coface Premium reimbursed by Coface. If there is an amount due and unpaid by the Borrower to the Finance Parties, the Agent shall apply any amount received from Coface in accordance with Clause 17.
 
    Any refund of the Coface Premium will not exceed eighty per cent. (80%) of the amount of the Coface Premium for the period from the prepayment date to the Termination Date.
7.   FEES
 
    The following fees shall be paid to the Agent by the Borrower as required hereunder:
  7.1.1   For the Mandated Lead Arrangers, an arrangement fee in Dollars equal to [**] [Confidential Treatment] per cent. [**] [Confidential Treatment] of the Maximum Loan Amount (converted from euro into Dollars at the official daily fixing rate (EUR/USD) of the European Central Bank quoted on Reuters’ page ECB37 at 11.00 a.m. Paris time on the date of this Agreement) payable:
  (a)   as to [**] [Confidential Treatment] per cent. [**] [Confidential Treatment] of such fee amount within ten (10) Business Days after the date of this Agreement; and

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  (b)   unless this Agreement is terminated pursuant to Clause 29, as to [**] [Confidential Treatment] per cent. [**] [Confidential Treatment] of such fee amount on the first anniversary of the date of this Agreement.
  7.1.2   For the Lenders, a commitment fee in Dollars for the period from the date of this Agreement to the Delivery Date of the Vessel, or the date of receipt by the Agent of the written termination notice sent by the Borrower as described in Clause 29, whichever is the earliest, computed at the rate of:
  (a)   [**] [Confidential Treatment] per cent. [**] [Confidential Treatment] per annum for the first two (2) years after the date of this Agreement; and
 
  (b)   [**] [Confidential Treatment] per cent. [**] [Confidential Treatment] per annum thereafter.
This commitment fee shall be calculated on the undrawn amount of the Maximum Loan Amount (converted from euro into Dollars at the official daily fixing rate (EUR/USD) of the European Central Bank quoted on Reuters’ page ECB37 at 11.00 a.m. Paris time on the date falling ten (10) Business Days before the payment date) and paid in arrears on the date falling six (6) months after the date of this Agreement and on each date falling at the end of each following consecutive six (6) month period, with the exception of the commitment fee due in respect of the last period, which shall be paid on the Drawdown Date, or the date of receipt by the Agent of the written termination notice sent by the Borrower as described in Clause 29, whichever is the earliest. The commitment fee shall be calculated on the actual number of days elapsed divided by three hundred and sixty (360).
  7.1.3   For the Agent, an annual agency fee in Dollars of [**] [Confidential Treatment] (converted from euro into Dollars at the official daily fixing rate (EUR/USD) of the European Central Bank quoted on Reuters’ page ECB37 at 11.00 a.m. Paris time on the date of this Agreement and, unless this Agreement is terminated pursuant to Clause 29, on each anniversary date thereof) shall be paid within ten (10) Business Days of the date of this Agreement and, unless this Agreement is terminated pursuant to Clause 29, on or before each anniversary date thereof until total repayment of the Loan.
8.   TAXES, INCREASED COSTS, COSTS AND RELATED CHARGES
 
8.1   All Taxes legally payable in France as a consequence of the signature or performance of this Agreement shall be paid by the Lenders.
 
8.2   All Taxes legally payable outside France (other than taxes payable by each of the Lenders on its overall net income) as a consequence of the signature or performance of this Agreement shall be paid by the Borrower. In consequence, all payments of principal and interest, interest on late payments, compensation, costs, fees and related charges, due in connection with this Agreement shall be made without any deduction or withholding in respect of Taxes. The Borrower therefore hereby agrees expressly that if for any reason full payment of the above amounts is not made, it will immediately pay the Lenders the sums necessary to compensate exactly the effect of the deductions or withholdings made in respect of Taxes. If the Borrower fails to perform this obligation, the Lenders shall be entitled, in accordance with Clause 13, either not to make available the Loan or, as the case may require, to require immediate repayment of the Loan.
 
    If an additional payment is made under this Clause and any Lender or the Agent on its behalf determines that it has received or been granted a credit against or relief of or calculated with reference to the deduction or withholding giving rise to such additional

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    payment, such Lender or the Agent (as the case may be) shall, to the extent that it can do so without prejudice to the retention of the amount of such credit, relief, remission or repayment and provided that it has received the cash benefit of such credit, relief or remission, pay to the Borrower such amount as such Lender or the Agent shall in its reasonable opinion have concluded to be attributable to the relevant deduction or withholding. Any such payment shall be conclusive evidence of the amount due to the Borrower hereunder and shall be accepted by the Borrower in full and final settlement of its rights of reimbursement hereunder in respect of such deduction or withholding. Nothing herein contained shall interfere with the right of any Lender and the Agent to arrange their respective tax affairs in whatever manner they think fit.
 
8.3   If after the date of this Agreement by reason of:
  8.3.1   any change in law or in its interpretation or administration; and/or
 
  8.3.2   compliance with any request from or requirement of any central bank or other fiscal, monetary or other authority including but without limitation the Basle Committee on Banking Regulations and Supervisory Practices whether or not having the force of law:
  (a)   any of the Lenders incurs a cost as a result of its performing its obligations under this Agreement and/or its advancing its Commitment hereunder; or
 
  (b)   there is any increase in the cost to any of the Lenders of funding or maintaining all or any of the advances comprised in a class of advances formed by or including its Commitment advanced or to be advanced by it hereunder; or
 
  (c)   any of the Lenders incurs a cost as a result of its having entered into and/or its assuming or maintaining its commitment under this Agreement; or
 
  (d)   any of the Lenders becomes liable to make any payment on account of Tax or otherwise (other than Tax on its overall net income) on or calculated by reference to the amount of its Commitment advanced or to be advanced hereunder and/or any sum received or receivable by it hereunder; or
 
  (e)   any of the Lenders suffers any decrease in its rate of return as a result of any changes in the requirements relating to capital ratios, monetary control ratios, the payment of special deposits, liquidity costs or other similar requirements affecting that Lender,
then the Borrower shall from time to time on demand pay to the Agent for the account of the relevant Lender or Lenders amounts sufficient to indemnify the relevant Lender or Lenders against, as the case may be, such cost, such increased cost (or such proportion of such increased cost as is in the reasonable opinion of the relevant Lender or Lenders attributable to the funding or maintaining of its or their Commitment(s) hereunder) or such liability.
A Lender affected by any provision of this Clause 8.3 shall promptly inform the Agent after becoming aware of the relevant change and its possible results (which notice shall be conclusive evidence of the relevant change and its possible results) and the Agent shall, as soon as reasonably practicable thereafter, notify the Borrower of the change and its possible results. Without affecting the Borrower’s obligations under this Clause 8.3 and in consultation with the Agent, the affected Lender will then take all such reasonable

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steps as may be open to it to mitigate the effect of the change (for example (if then possible) by changing its Facility Office or transferring some or all of its rights and obligations under this Agreement to another financial institution reasonably acceptable to the Borrower and the Agent). The reasonable costs of mitigating the effect of any such change shall be borne by the Borrower save where such costs are of an internal administrative nature and are not incurred in dealings by any Lender with third parties.
8.4   The Borrower undertakes to pay to the Agent, upon demand, all reasonable costs and expenses, duties and fees, including but without limitation agreed legal costs, out of pocket expenses and travel costs, incurred by the Mandated Lead Arrangers and the Original Lenders in connection with the negotiation, preparation and execution of all agreements, guarantees, security agreements and related documents entered into, or to be entered into, for the purpose of the transaction contemplated hereby as well as all costs and expenses, duties and fees incurred by the Lenders in connection with the registration, filing, enforcement or discharge of the said guarantees or security agreements, including without limitation the fees and expenses of legal advisers and insurance experts, the cost of registration and discharge of security interests and the related travel and out of pocket expenses; the Borrower further undertakes to pay to the Agent all costs, expenses, duties and fees incurred by the Lenders in connection with any variation of this Agreement and the related documents, guarantees and security agreements, any supplements thereto and waiver given in relation thereto, in connection with the enforcement or preservation of any rights under this Agreement and/or the related guarantees and security agreements, including in each case the fees and expenses of legal advisers, and in connection with the consultations or proceedings made necessary by the acts of, or failure to act on the part of, the Borrower.
 
8.5   The Borrower undertakes to pay to the Agent, upon demand, any reasonable costs necessarily incurred by the Lenders in funding the Loan in the event that the Delivery Date is later than the Intended Delivery Date unless the Borrower has given the Agent at least three (3) Business Days’ notification of such delay in the Delivery Date.
 
9.   REPRESENTATIONS AND WARRANTIES
 
9.1   Duration
  9.1.1   The representations and warranties in Clause 9.2 are made on the date of this Agreement and shall be deemed to be repeated, with reference mutatis mutandis to the facts and circumstances subsisting, as if made on each day until the Borrower has no remaining obligations, actual or contingent, under or pursuant to this Agreement or any of the other Security Documents.
 
  9.1.2   The representations and warranties in Clause 9.3 are made on the date of this Agreement and shall be deemed to be repeated, with reference mutatis mutandis to the facts and circumstances subsisting, as if made on the date falling sixty (60) days before the Intended Delivery Date and thereafter on each day until the Borrower has no remaining obligations, actual or contingent, under or pursuant to this Agreement or any of the other Security Documents.
 
  9.1.3   The representations and warranties in Clause 9.4 are made on the Delivery Date and shall be deemed to be repeated, with reference mutatis mutandis to the facts and circumstances subsisting, as if made thereafter on each day until the Borrower has no remaining obligations, actual or contingent, under or pursuant to this Agreement or any of the other Security Documents.

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9.2   Continuing representations and warranties
 
    The Borrower represents and warrants to each of the Lenders that:
  9.2.1   Status
 
      Each Obligor is a company duly organised, constituted and validly existing under the laws of the country of its incorporation, possessing perpetual corporate existence, the capacity to sue and be sued in its own name and the power to own and charge its assets and carry on its business as it is now being conducted.
 
  9.2.2   Powers and authority
 
      Each of the Obligors has the power to enter into and perform this Agreement and those of the other Security Documents to which it is a party and the transactions contemplated hereby and thereby and has taken all necessary action to authorise the entry into and performance of this Agreement and such other Security Documents and such transactions.
 
  9.2.3   Legal validity
 
      This Agreement and each other Transaction Document constitutes (or will constitute when executed) legal, valid and binding obligations of each Obligor expressed to be a party thereto enforceable in accordance with their respective terms and in entering into this Agreement and borrowing the Loan, the Borrower is acting on its own account.
 
  9.2.4   Non-conflict with laws
 
      The entry into and performance of this Agreement and the other Transaction Documents and the transactions contemplated hereby and thereby do not and will not conflict with:
  (a)   any law or regulation or any official or judicial order; or
 
  (b)   the constitutional documents of any Obligor; or
 
  (c)   any agreement or document to which any Obligor is a party or which is binding upon such Obligor or any of its assets,
      nor result in the creation or imposition of any Encumbrance on an Obligor or its assets pursuant to the provisions of any such agreement or document, except for Permitted Liens.
 
  9.2.5   Consents
 
      Except for:
  (a)   the filing of those Security Documents to be filed with the Registrar of Companies in Bermuda; and
 
  (b)   the registration of the Mortgage through the relevant authority of the Maritime Registry,
all authorisations, approvals, consents, licences, exemptions, filings, registrations, notarisations and other matters, official or otherwise, required in

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connection with the entry into, performance, validity and enforceability of this Agreement and each of the other Transaction Documents to which any Obligor is a party and the transactions contemplated thereby have been obtained or effected and are in full force and effect except authorisations, approvals, consents, licences, exemptions, filings and registrations required in the normal day to day course of the operation of the Vessel and not already obtained by the Borrower.
  9.2.6   Accuracy of information
 
      All information furnished by any Obligor relating to the business and affairs of any Obligor in connection with this Agreement and the other Transaction Documents was and remains true and correct in all material respects and there are no other material facts or considerations the omission of which would render any such information misleading.
 
  9.2.7   Full disclosure
 
      Each Obligor has fully disclosed to the Agent all facts relating to each Obligor which it knows or should reasonably know and which might reasonably be expected to influence the Lenders in deciding whether or not to enter into this Agreement.
 
  9.2.8   Pari passu or priority status
 
      The claims of the Finance Parties against the Borrower under this Agreement will rank at least pari passu with the claims of all unsecured creditors of the Borrower (other than claims of such creditors to the extent that they are statutorily preferred) and in priority to the claims of any creditor of the Borrower who is also an Obligor.
 
  9.2.9   Solvency
 
      The Borrower is and shall remain, after the advance to it of the Loan, solvent in accordance with the laws of Bermuda and the United Kingdom and in particular with the provisions of the Insolvency Act 1986 (as from time to time amended) and the requirements thereof.
 
  9.2.10   Winding-up, etc.
 
      Subject to clause 10.6 of the Guarantee, neither the Borrower nor any other Obligor has taken any corporate action nor have any other steps been taken or legal proceedings been started or (to the best of its knowledge and belief) threatened against any of them for the reorganisation, winding-up, dissolution or for the appointment of a liquidator, administrator, receiver, administrative receiver, trustee or similar officer of any of them or any or all of their assets or revenues nor has it sought any other relief under any applicable insolvency or bankruptcy law.
 
  9.2.11   Accounts
 
      The consolidated audited accounts of the Guarantor for the period ending on 31 December 2005 (which accounts have been prepared in accordance with GAAP) fairly represent the financial condition of the Guarantor as shown in such audited accounts.

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  9.2.12   No immunity
 
      None of the Obligors nor any of their respective assets enjoys any right of immunity (sovereign or otherwise) from set-off, suit or execution in respect of their obligations under this Agreement or any of the other Transaction Documents or by any relevant or applicable law.
 
  9.2.13   Ownership of shares
 
      All the shares in the Borrower and the Manager shall be legally and beneficially owned directly or indirectly by the Guarantor and such structure shall remain so throughout the Security Period. Further, no Event of Default has occurred under clause 11.2 of the Guarantee in respect of the ownership and/or control of the shares in the Guarantor.
 
  9.2.14   Completeness of documents
 
      The copies of the Building Contract, the Management Agreement and any other relevant third party agreements including but without limitation the copies of any documents in respect of the Insurances delivered to the Agent are true and complete copies of each such document constituting valid and binding obligations of the parties thereto enforceable in accordance with their respective terms and, subject to Clauses 10.14 and 10.25, no amendments thereto or variations thereof have been agreed nor has any action been taken by the parties thereto which would in any way render such document inoperative or unenforceable.
 
  9.2.15   Money laundering
 
      Any borrowing by the Borrower under this Agreement, and the performance of its obligations under this Agreement and the other Transaction Documents, will be for its own account and will not involve any breach by it of any law or regulatory measure relating to “money laundering” as defined in Article 1 of the Directive (91/308/EEC) of the Council of the European Communities.
9.3   Semi-continuing representations and warranties
 
    The Borrower represents and warrants to each of the Lenders that:
  9.3.1   No default
 
      No event has occurred which constitutes a default under or in respect of any Transaction Document to which any Obligor or the Builder is a party or by which any Obligor or the Builder may be bound (including (inter alia) this Agreement) and no event has occurred which constitutes a default under or in respect of any agreement or document to which any Obligor is a party or by which any Obligor may be bound to an extent or in a manner which might have a material adverse effect on the ability of that Obligor to perform its obligations under the Transaction Documents to which it is a party.
 
  9.3.2   No encumbrances
 
      None of the assets or rights of any Obligor is subject to any Encumbrance except Permitted Liens.

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  9.3.3   Litigation
 
      No litigation, arbitration or administrative proceedings are current or pending or, to its knowledge, threatened, which might, if adversely determined, have a material adverse effect on the ability of an Obligor to perform its obligations under the Transaction Documents to which it is a party, save as disclosed by the Guarantor in its most recent US Securities Exchange Commission filing.
 
  9.3.4   Tax liabilities
 
      To the best of its knowledge, each of the Obligors has complied with all taxation laws in all jurisdictions in which it is subject to Taxation and has paid all Taxes due and payable by it including but without limitation any disputed Taxes unless a sufficient reserve has been made pending resolution of the dispute and no material claims are being asserted against any of the Obligors with respect to Taxes, which might, if such claims were successful, have a material adverse effect on the ability of that Obligor to perform its obligations under the Transaction Documents to which it is a party.
 
  9.3.5   Ownership of assets
 
      Each member of the Group has good and marketable title to all its assets which are reflected in the audited accounts referred to in Clause 9.2.11.
 
  9.3.6   Place of business
 
      None of the Obligors has a place of business in any jurisdiction (except as already disclosed) which requires any of the Security Documents to be filed or registered in that jurisdiction to ensure the validity of the Security Documents to which it is a party.
 
  9.3.7   Environment
 
      Each of the Obligors:
  (a)   is in compliance with all applicable federal, state, local, foreign and international laws, regulations, conventions and agreements relating to pollution prevention or protection of human health or the environment (including, without limitation, ambient air, surface water, ground water, navigable waters, water of the contiguous zone, ocean waters and international waters), including without limitation, laws, regulations, conventions and agreements relating to:
  (i)   emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants, wastes, toxic substances, hazardous materials, oil, hazard substances, petroleum and petroleum products and by-products (“Materials of Environmental Concern”); or
 
  (ii)   the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Materials of Environmental Concern (such laws, regulations, conventions and agreements the “Environmental Laws”);
  (b)   has all permits, licences, approvals, rulings, variances, exemptions, clearances, consents or other authorisations required under applicable Environmental Laws (“Environmental Approvals”) and is in

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      compliance with all Environmental Approvals required to operate its business as presently conducted or as reasonably anticipated to be conducted;
  (c)   has not received any notice, claim, action, cause of action, investigation or demand by any other person, alleging potential liability for, or a requirement to incur, investigatory costs, clean-up costs, response and/or remedial costs (whether incurred by a governmental entity or otherwise), natural resources damages, property damages, personal injuries, attorney’s fees and expenses or fines or penalties, in each case arising out of, based on or resulting from:
  (i)   the presence or release or threat of release into the environment of any Material of Environmental Concern at any location, whether or not owned by such person; or
 
  (ii)   circumstances forming the basis of any violation, or alleged violation, of any Environmental Law or Environmental Approval (“Environmental Claim”); and
      there are no circumstances that may prevent or interfere with such full compliance in the future.
 
      There is no material Environmental Claim pending or threatened against any of the Obligors.
 
      There are no past or present actions, activities, circumstances, conditions, events or incidents, including, without limitation, the release, emission, discharge or disposal of any Material of Environmental Concern, that could form the basis of any Environmental Claim against any of the Obligors.
9.4   Representations on the Delivery Date
    The Borrower further represents and warrants to each of the Lenders that on the Delivery Date the Vessel will be:
  9.4.1   in its absolute and unencumbered ownership save as contemplated by the Security Documents;
 
  9.4.2   at least provisionally registered in its name under the laws and flag of the Maritime Registry;
 
  9.4.3   classed with the highest classification available for a vessel of its type free of all recommendations and qualifications with Det Norske Veritas;
 
  9.4.4   operationally seaworthy and in compliance with all relevant provisions, regulations and requirements (statutory or otherwise) applicable to ships registered under the laws and flag of the Maritime Registry;
 
  9.4.5   in compliance with the ISM Code, the ISPS Code and Annex VI;
 
  9.4.6   insured in accordance with the provisions of Clause 10.20 and in compliance with the requirements therein in respect of such insurances; and
 
  9.4.7   managed by the Manager on and subject to the terms set out in the Management Agreement.

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10.   UNDERTAKINGS
 
10.1   Duration
  10.1.1   The undertakings in Clauses 10.2, 10.3, 10.4, 10.5, 10.6, 10.7, 10.8, 10.9, 10.10, 10.11, 10.13, 10.15, 10.17, 10.23, 10.24 and 10.25 shall remain in full force and effect until the Borrower has no remaining obligations, actual or contingent, under or pursuant to this Agreement or any of the other Security Documents.
 
  10.1.2   The undertakings in Clauses 10.12, 10.14, 10.16, 10.18, 10.19, 10.20, 10.21 and 10.22 shall apply with effect from, and shall remain in full force and effect after, the date falling sixty (60) days before the Intended Delivery Date until the Borrower has no remaining obligations, actual or contingent, under or pursuant to this Agreement or any of the other Security Documents.
10.2   Information
 
    The Borrower will provide to the Agent for the benefit of the Lenders (or will procure the provision of):
  10.2.1   as soon as practicable (and in any event within one hundred and twenty (120) days after the close of each of its financial years) a Certified Copy of its unaudited accounts for that year and a Certified Copy of the audited accounts of the Guarantor and its consolidated Subsidiaries for that year (commencing with accounts made up to 31 December in the year in which the Drawdown Date occurs in the case of the Borrower and with accounts made up to 31 December 2005 in the case of the consolidated accounts of the Guarantor);
 
  10.2.2   as soon as practicable (and in any event within sixty (60) days of the end of each quarter of each financial year) a copy of the unaudited consolidated accounts of the Guarantor for that quarter (commencing with unaudited accounts made up to 30 June 2006);
 
  10.2.3   promptly, such further information in its possession or control regarding its financial condition and operations and those of any company in the Group as the Agent may request for the benefit of the Finance Parties; and
 
  10.2.4   details of any material litigation, arbitration or administrative proceedings which affect any Obligor as soon as the same are instituted and served, or, to the knowledge of the Borrower, threatened (and for this purpose proceedings shall be deemed to be material if they involve a claim in an amount exceeding [**] [Confidential Treatment] Dollars [**] [Confidential Treatment] or the equivalent in another currency).
      All accounts required under this Clause 10.2 shall be prepared in accordance with GAAP and shall fairly represent the financial condition of the relevant company. In this Clause 10.2 and in Clause 9.3.5 “Group” shall have the meaning ascribed to it in clause 11.4 of the Guarantee.
10.3   Notification of default
 
    The Borrower will notify the Agent of any Event of Default forthwith upon becoming aware of the occurrence thereof. Upon the Agent’s request from time to time the Borrower will issue a certificate stating whether any Obligor is aware of the occurrence of any Event of Default.

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10.4   Consents and registrations
 
    The Borrower will procure that (and will promptly furnish Certified Copies to the Agent on the request of the Agent of) all such authorisations, approvals, consents, licences and exemptions as may be required under any applicable law or regulation to enable it or any Obligor to perform its obligations under, and ensure the validity or enforceability of, each of the Transaction Documents are obtained and promptly renewed from time to time and will procure that the terms of the same are complied with at all times. Insofar as such filings or registrations have not been completed on or before the Drawdown Date the Borrower will procure the filing or registration within applicable time limits of each Security Document which requires filing or registration together with all ancillary documents required to preserve the priority and enforceability of the Security Documents.
 
10.5   Negative pledge
 
    The Borrower will not create or permit to subsist any Encumbrance on the whole or any part of its present or future assets, except for the following:
  10.5.1   Encumbrances created with the prior consent of the Lenders; or
 
  10.5.2   Permitted Liens.
10.6   Disposals
 
    Except with the prior consent of all the Lenders, the Borrower shall not, either in a single transaction or in a series of transactions whether related or not and whether voluntarily or involuntarily, sell, transfer, lease or otherwise dispose of any of its assets except in the case of items being replaced or renewed provided that the net impact is not a reduction in the value of the Vessel.
 
10.7   Change of business
 
    Except with the prior consent of the Agent, the Borrower shall not make or threaten to make any substantial change in its business as presently conducted, namely that of a single ship owning company for the Vessel, or carry on any other business which is substantial in relation to its business as presently conducted so as to affect, in the opinion of the Agent, the Borrower’s ability to perform its obligations hereunder and the Borrower will procure that the other Obligors continue, throughout the Security Period, to perform their current business activities.
 
10.8   Mergers
 
    Except with the prior consent of the Lenders, the Borrower will not enter into any amalgamation, restructure, substantial reorganisation, merger, de-merger or consolidation or anything analogous to the foregoing nor will it acquire any equity, share capital or obligations of any corporation or other entity.
 
10.9   Maintenance of status and franchises
 
    The Borrower will do all such things as are necessary to maintain its corporate existence in good standing and will ensure that it has the right and is duly qualified to conduct its business as it is conducted in all applicable jurisdictions and will obtain and maintain all franchises and rights necessary for the conduct of its business.

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10.10   Financial records
 
    The Borrower will keep proper books of record and account, in which proper and correct entries shall be made of all financial transactions and the assets, liabilities and business of the Borrower in accordance with GAAP.
 
10.11   Financial indebtedness and subordination of indebtedness
  10.11.1   Otherwise than in the ordinary course of business as owner of the Vessel, except as contemplated by this Agreement and except any loan, advance or credit extended by the Guarantor or any member of the Group which is a wholly owned Subsidiary of the Guarantor, the Borrower will not create, incur, assume or allow to exist any financial indebtedness, enter into any finance lease or undertake any material capital commitment (including but not limited to the purchase of any capital asset).
 
  10.11.2   The Borrower shall procure that any and all indebtedness (and in particular with any other Obligor) is at all times fully subordinated to the Security Documents and the obligations of the Borrower hereunder. Upon the occurrence of an Event of Default, the Borrower shall not make any repayments of principal, payments of interest or of any other costs, fees, expenses or liabilities arising from or representing such indebtedness. In this Clause “fully subordinated” shall mean that any claim of the lender against the Borrower in relation to such indebtedness shall rank after and be in all respects subordinate to all of the rights and claims of the Finance Parties under this Agreement and the other Security Documents and that the lender shall not take any steps to enforce its rights to recover any monies owing to it by the Borrower and in particular but without limitation the lender will not institute any legal or quasi-legal proceedings under any jurisdiction at any time against the Vessel, her Earnings or Insurances or the Borrower and it will not compete with the Finance Parties or any of them in a liquidation or other winding-up or bankruptcy of the Borrower or in any proceedings in connection with the Vessel, her Earnings or Insurances.
10.12   Pooling of earnings and charters
 
    The Borrower will not enter into in respect of the Vessel, nor permit to exist:
  10.12.1   any pooling agreement or other arrangement for the sharing of any of the Earnings or the expenses of the Vessel except with a member of the Group and provided that it does not adversely affect the rights of the Finance Parties under the Assignment of Earnings in the reasonable opinion of the Agent; or
 
  10.12.2   any demise or bareboat charter; or
 
  10.12.3   any charter whereunder two (2) months’ charterhire (or the equivalent thereof) is payable in advance in respect of the Vessel; or
 
  10.12.4   any charter of the Vessel or contract of affreightment or employment which, with the exercise of options for extension, could be for a period longer than thirteen (13) months; or
 
  10.12.5   any charter of the Vessel or contract of affreightment or employment whereunder the hire payable is below approximately the market rate prevailing when the Vessel’s letting or employment is fixed,

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      but if, with the prior written consent of the Agent, the Borrower enters into in respect of the Vessel a charter with a company outside the Group, the Borrower hereby undertakes to execute in favour of the Finance Parties an assignment of such charter and the Earnings therefrom such assignment to be in substantially the form of the Assignment of Earnings and as required by the Agent provided however that the Borrower may in respect of the Vessel enter into a bareboat charter in form approved by the Agent with any company which is a member of the Group provided that if so requested by the Agent and without limitation:
  10.12.6   any such bareboat charterer shall enter into such deeds (including but not limited to a subordination and assignment deed), agreements and indemnities as the Agent shall in its sole discretion require prior to entering into the bareboat charter with the Borrower; and
 
  10.12.7   the Borrower shall assign the benefit of any such bareboat charter and its interest in the Insurances to the Finance Parties by way of further security for the Borrower’s obligations under the Security Documents.
10.13   Loans and guarantees by the Borrower
 
    Otherwise than in the ordinary course of business as owner of the Vessel, the Borrower will not make any loan or advance or extend credit to any person, firm or corporation or issue or enter into any guarantee or indemnity or otherwise become directly or contingently liable for the obligations of any other person, firm or corporation.
 
10.14   Management and employment
 
    Except with the prior consent of the Agent, the Borrower will not:
  10.14.1   permit any person other than the Manager to be the manager of, including providing crewing services to, the Vessel;
 
  10.14.2   permit any amendment to be made to the terms of the Management Agreement unless the amendment is advised by the Borrower’s tax counsel or is deemed necessary by the parties thereto to reflect the prevailing circumstances but provided that the amendment does not imperil the security to be provided pursuant to the Security Documents or adversely affect the ability of any Obligor to perform its obligations under the Transaction Documents; or
 
  10.14.3   permit the Vessel to be employed other than within the NCL or NCL America brand (as applicable).
10.15   Acquisition of shares
 
    The Borrower will not acquire any equity, share capital, assets or obligations of any corporation or other entity or permit its shares to be held other than directly or indirectly by the Guarantor.
 
10.16   Trading with the United States of America
 
    The Borrower shall in respect of the Vessel take all reasonable precautions to prevent any infringements of the Anti-Drug Abuse Act of 1986 of the United States of America (as the same may be amended and/or re-enacted from time to time hereafter) or any similar legislation applicable to the Vessel in any other jurisdiction in which the Vessel shall trade (a “Relevant Jurisdiction”) where the Vessel trades in the territorial waters of the United States of America or a Relevant Jurisdiction and, for this purpose, the Borrower shall, inter alia, enter into a “Carrier Initiative Agreement” with the United

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      States’ Customs Service (if such is possible) and procure that the same (or a similar agreement in a Relevant Jurisdiction) is maintained in full force and effect and its obligations thereunder performed by it in respect of the Vessel throughout any period of United States of America (including coastal waters over which it claims jurisdiction) or Relevant Jurisdiction related trading.
10.17   Further assurance
 
    The Borrower will, from time to time on being required to do so by the Agent, do or procure the doing of all such acts and/or execute or procure the execution of all such documents in a form satisfactory to the Agent as the Agent may reasonably consider necessary for giving full effect to any of the Transaction Documents or the Coface Insurance Policy or securing to the Finance Parties the full benefit of the rights, powers and remedies conferred upon the Finance Parties or any of them in any such Transaction Document.
 
10.18   Valuation of the Vessel
  10.18.1   The Borrower will from time to time (but at intervals no more frequently than annually at the Borrower’s expense unless an Event of Default has occurred and remains unremedied) within thirty (30) days of receiving any request to that effect from the Agent, procure that the Vessel is valued by an independent reputable shipbroker or shipvaluer experienced in valuing cruise ships appointed by the Borrower and approved by the Agent (which approval shall not be unreasonably withheld or delayed and such valuation to be made with or without taking into account the benefit or otherwise of any fixed employment relating to the Vessel as the Agent may require).
 
  10.18.2   If the Borrower does not accept the valuation obtained pursuant to Clause 10.18.1 (the “First Valuation”) it may (at its own expense) within five (5) Business Days of receipt of the First Valuation obtain a second valuation (the “Second Valuation”) from another independent reputable shipbroker or shipvaluer experienced in valuing cruise ships appointed by the Borrower and approved by the Agent which approval shall not be unreasonably withheld or delayed.
 
  10.18.3   If the Second Valuation exceeds the First Valuation by a margin of no less than ten per cent. (10%) of the First Valuation the Borrower may at its expense forthwith upon receipt of the Second Valuation request the shipbrokers and/or shipvaluers appointed pursuant to Clauses 10.18.1 and 10.18.2 to obtain a third valuation (the “Third Valuation”) from a further independent reputable shipbroker or shipvaluer experienced in valuing cruise ships approved by the Agent such approval not to be unreasonably withheld or delayed. Subject to the Third Valuation being made available within five (5) Business Days of the date of the Second Valuation, the valuation of the Vessel will be determined on the basis of the average of the three valuations so obtained. If the Third Valuation is not made available within the aforementioned time limit, the Vessel shall be valued on the basis of the average of the First Valuation and the Second Valuation.
 
  10.18.4   The Borrower shall procure that forthwith upon the issuance of any valuation obtained pursuant to this Clause 10.18 a copy thereof is sent directly to the Agent for review.

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10.19   Earnings
 
    The Borrower will procure that the Earnings (if any) are paid in full without set off and free and clear of and without deduction for any taxes levies duties imposts charges fees restrictions or conditions of any nature whatsoever.
 
10.20   Insurances
 
    The Borrower covenants with the Finance Parties and undertakes:
  10.20.1   from the Delivery Date until the end of the Security Period to insure the Vessel in its name and keep the Vessel insured on an agreed value basis for an amount in the currency in which the Loan is denominated approved by the Agent but not being less than the greater of:
  (a)   one hundred and twenty five per cent. (125%) of the amount of the Loan; and
 
  (b)   the full market and commercial value of the Vessel determined in accordance with Clause 10.18 from time to time
 
      through internationally recognised independent first class insurance companies, underwriters, war risks and protection and indemnity associations acceptable to the Agent in each instance on terms and conditions approved by the Agent including as to deductibles but at least in respect of:
 
  (i)   fire and marine risks including but without limitation hull and machinery and all other risks customarily and usually covered by first-class and prudent shipowners in the London insurance markets under English marine policies or Agent-approved policies containing the ordinary conditions applicable to similar vessels;
 
  (ii)   war risks and war risks (protection and indemnity) up to the insured amount;
 
  (iii)   excess risks that is to say the proportion of claims for general average and salvage charges and under the running down clause not recoverable in consequence of the value at which the Vessel is assessed for the purpose of such claims exceeding the insured value;
 
  (iv)   protection and indemnity risks with full standard coverage as offered by first-class protection and indemnity associations and up to the highest limit of liability available (for oil pollution risk the highest limit currently available is one billion Dollars (USD1,000,000,000) and this to be increased if reasonably requested by the Agent and the increase is possible in accordance with the standard protection and indemnity cover for vessels of its type and is compatible with prudent insurance practice for first class cruise shipowners or operators in waters where the Vessel trades from time to time from the Delivery Date until the end of the Security Period);
 
  (v)   when and while the Vessel is laid-up, in lieu of hull insurance, normal port risks; and
 
  (vi)   such other risks as the Agent may from time to time reasonably require;

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      and in any event in respect of those risks and at those levels covered by first class and prudent owners and/or financiers in the international market in respect of similar tonnage provided that if any of such insurances are also effected in the name of any other person (other than the Borrower and/or a Finance Party) such person shall if so required by the Agent execute a first priority assignment of its interest in such insurances in favour of the Finance Parties in similar terms mutatis mutandis to the Assignment of Insurances;
  10.20.2   to agree that the Agent shall take out mortgagee interest insurance on such conditions as the Agent may reasonably require and mortgagee interest insurance for pollution risks as from time to time agreed each for an amount in the currency in which the Loan is denominated of one hundred and ten per cent. (110%) of the amount of the Loan, the Borrower having no interest or entitlement in respect of such policies; the Borrower shall upon demand of the Agent reimburse the Agent for the costs of effecting and/or maintaining any such insurance(s) and the Agent hereby undertakes to use its reasonable endeavours to match the premium level that the Borrower would have paid if the Borrower itself had arranged such cover on such conditions (as demonstrated to the reasonable satisfaction of the Agent);
 
  10.20.3   if the Vessel shall trade in the United States of America and/or the Exclusive Economic Zone of the United States of America (the “EEZ”) as such term is defined in the US Oil Pollution Act 1990 (“OPA”), to comply strictly with the requirements of OPA and any similar legislation which may from time to time be enacted in any jurisdiction in which the Vessel presently trades or may or will trade at any time during the existence of this Agreement and in particular before such trade is commenced and during the entire period during which such trade is carried on:
  (a)   to pay any additional premiums required to maintain protection and indemnity cover for oil pollution up to the limit available to it for the Vessel in the market;
 
  (b)   to make all such quarterly or other voyage declarations as may from time to time be required by the Vessel’s protection and indemnity association and to comply with all obligations in order to maintain such cover, and promptly to deliver to the Agent copies of such declarations;
 
  (c)   to submit the Vessel to such additional periodic, classification, structural or other surveys which may be required by the Vessel’s protection and indemnity insurers to maintain cover for such trade and promptly to deliver to the Agent copies of reports made in respect of such surveys;
 
  (d)   to implement any recommendations contained in the reports issued following the surveys referred to in Clause 10.20.4(c) within the time limit specified therein and to provide evidence satisfactory to the Agent that the protection and indemnity insurers are satisfied that this has been done;
 
  (e)   in particular strictly to comply with the requirements of any applicable law, convention, regulation, proclamation or order with regard to financial responsibility for liabilities imposed on the Borrower or the Vessel with respect to pollution by any state or nation or political subdivision thereof, including but not limited to OPA, and to provide the Agent on demand with such information or evidence as it may reasonably require of such compliance;

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  (f)   to procure that the protection and indemnity insurances do not contain a clause excluding the Vessel from trading in waters of the United States of America and the EEZ or any other provision analogous thereto and to provide the Agent with evidence that this is so; and
 
  (g)   strictly to comply with any operational or structural regulations issued from time to time by any relevant authorities under OPA so that at all times the Vessel falls within the provisions which limit strict liability under OPA for oil pollution;
  10.20.4   to give notice forthwith of any assignment of its interest in the Insurances to the relevant brokers, insurance companies, underwriters and/or associations in the form approved by the Agent;
 
  10.20.5   to execute and deliver all such documents and do all such things as may be necessary to confer upon the Finance Parties legal title to the Insurances in respect of the Vessel and to procure that the interest of the Finance Parties is at all times filed with all slips, cover notes, policies and certificates of entry and to procure (a) that a loss payable clause in the form approved by the Agent shall be filed with all the hull, machinery and equipment and war risks policies in respect of the Vessel and (b) that a loss payable clause in the form approved by the Agent shall be endorsed upon the protection and indemnity certificates of entry in respect of the Vessel;
 
  10.20.6   to procure that each of the relevant brokers and associations furnishes the Agent with a letter of undertaking in such form as may be required by the Agent and waives any lien for premiums or calls except in relation to premiums or calls solely attributable to the Vessel;
 
  10.20.7   punctually to pay all premiums, calls, contributions or other sums payable in respect of the Insurances on the Vessel and to produce all relevant receipts when so required by the Agent;
 
  10.20.8   to renew each of the Insurances on the Vessel at least five (5) days before the expiry thereof and to give immediate notice to the Agent of such renewal and to procure that the relevant brokers or associations shall promptly confirm in writing to the Agent that such renewal is effected it being understood by the Borrower that any failure to renew the Insurances on the Vessel at least five (5) days before the expiry thereof or to give or procure the relevant notices of such renewal shall constitute an Event of Default;
 
  10.20.9   to arrange for the execution of such guarantees as may from time to time be required by any protection and indemnity and/or war risks association;
 
  10.20.10   to furnish the Agent from time to time on request with full information about all Insurances maintained on the Vessel and the names of the offices, companies, underwriters, associations or clubs with which such Insurances are placed;
 
  10.20.11   not to agree to any variation in the terms of any of the Insurances on the Vessel without the prior approval of the Agent nor to do any act or voluntarily suffer or permit any act to be done whereby any Insurances shall or may be rendered invalid, void, voidable, suspended, defeated or unenforceable and not to suffer or permit the Vessel to engage in any voyage nor to carry any cargo not permitted under any of the Insurances without first obtaining the consent of the insurers or reinsurers concerned and complying with such requirements as to

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      payment of extra premiums or otherwise as the insurers or reinsurers may impose;
 
  10.20.12   not without the prior written consent of the Agent to settle, compromise or abandon any claim in respect of any of the Insurances on the Vessel other than a claim of less than ten million Dollars (USD10,000,000) or the equivalent in any other currency and not being a claim arising out of a Total Loss;
 
  10.20.13   promptly to furnish the Agent with full information regarding any casualties or other accidents or damage to the Vessel involving an amount in excess of [**] [Confidential Treatment] Dollars [**] [Confidential Treatment];
 
  10.20.14   to apply or ensure the appliance of all such sums receivable in respect of the Insurances on the Vessel for the purpose of making good the loss and fully repairing all damage in respect whereof the insurance monies shall have been received;
 
  10.20.15   that in the event of it making default in insuring and keeping insured the Vessel as hereinbefore provided then the Agent may (but shall not be bound to) insure the Vessel or enter the Vessel in such manner and to such extent as the Agent in its discretion thinks fit and in such case all the cost of effecting and maintaining such insurance together with interest thereon at the Interest Rate shall be paid on demand by the Borrower to the Agent; and
 
  10.20.16   to agree that the Agent shall be entitled from time to time (but at intervals no more frequently than annually at the Borrower’s expense up to an amount of ten thousand euro (EUR10,000) annually, except in the case that the Delivery Date and any renewal or amendment of the Insurances to be assigned to the Finance Parties pursuant to the Assignment of Insurances fall within one (1) year of each other or such Insurances are amended within one (1) year of the Delivery Date or their renewal (as the case may be)) to instruct independent reputable insurance advisers for the purpose of obtaining any advice or information regarding any matter concerning the Insurances which the Agent shall at its sole discretion deem necessary, it being hereby specifically agreed that it shall reimburse the Agent on demand for all reasonable costs and expenses incurred by the Agent in connection with the instruction of such advisers as aforesaid.
10.21   Operation and maintenance of the Vessel
 
    From the Delivery Date until the end of the Security Period at its own expense the Borrower will:
  10.21.1   keep the Vessel in a good and efficient state of repair so as to maintain it to the highest classification notation available for the Vessel of its age and type free of all recommendations and qualifications with Det Norske Veritas. On the Delivery Date and annually thereafter, it will furnish to the Agent a statement by such classification society that such classification notation is maintained. It will comply with all recommendations, regulations and requirements (statutory or otherwise) from time to time applicable to the Vessel and shall have on board as and when required thereby valid certificates showing compliance therewith and shall procure that all repairs to or replacements of any damaged, worn or lost parts or equipment are carried out (both as regards workmanship and quality of materials) so as not to diminish the value or class of the Vessel. It will not make any substantial modifications or alterations to the Vessel or any part thereof which would reduce the market and commercial value of the Vessel

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      determined in accordance with Clause 10.18 without the prior consent of the Agent;
 
  10.21.2   submit the Vessel to continuous survey in respect of its machinery and hull and such other surveys as may be required for classification purposes and, if so required by the Agent, supply to the Agent copies in English of the survey reports;
 
  10.21.3   permit surveyors or agents appointed by the Agent to board the Vessel at all reasonable times to inspect its condition or satisfy themselves as to repairs proposed or already carried out and afford all proper facilities for such inspections;
 
  10.21.4   comply, or procure that the Manager will comply, with the ISM Code (as the same may be amended from time to time) or any replacement of the ISM Code (as the same may be amended from time to time) and in particular, without prejudice to the generality of the foregoing, as and when required to do so by the ISM Code and at all times thereafter:
  (a)   hold, or procure that the Manager holds, a valid Document of Compliance duly issued to the Borrower or the Manager (as the case may be) pursuant to the ISM Code and a valid Safety Management Certificate duly issued to the Vessel pursuant to the ISM Code;
 
  (b)   provide the Agent with copies of any such Document of Compliance and Safety Management Certificate as soon as the same are issued; and
 
  (c)   keep, or procure that there is kept, on board the Vessel a copy of any such Document of Compliance and the original of any such Safety Management Certificate;
  10.21.5   comply, or procure that the Manager will comply, with the ISPS Code (as the same may be amended from time to time) or any replacement of the ISPS Code (as the same may be amended from time to time) and in particular, without prejudice to the generality of the foregoing, as and when required to do so by the ISPS Code and at all times thereafter:
  (a)   keep, or procure that there is kept, on board the Vessel the original of the International Ship Security Certificate; and
 
  (b)   keep, or procure that there is kept, on board the Vessel a copy of the ship security plan prepared pursuant to the ISPS Code;
  10.21.6   comply with Annex VI (as the same may be amended from time to time) or any replacement of Annex VI (as the same may be amended from time to time) and in particular, without limitation, to:
  (a)   procure that the Vessel’s master and crew are familiar with, and that the Vessel complies with, Annex VI; and
 
  (b)   maintain for the Vessel throughout the Security Period a valid and current IAPPC and provide a copy to the Agent; and
 
  (c)   notify the Agent immediately in writing of any actual or threatened withdrawal, suspension, cancellation or modification of the IAPPC;

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  10.21.7   not employ the Vessel or permit its employment in any trade or business which is forbidden by any applicable law or is otherwise illicit or in carrying illicit or prohibited goods or in any manner whatsoever which may render it liable to condemnation in a prize court or to destruction, seizure or confiscation or that may expose the Vessel to penalties. In the event of hostilities in any part of the world (whether war be declared or not) it will not employ the Vessel or permit its employment in carrying any contraband goods;
 
  10.21.8   promptly provide the Agent with (a) all information which the Agent may reasonably require regarding the Vessel, its employment, earnings, position and engagements (b) particulars of all towages and salvages and (c) copies of all charters and other contracts for its employment and otherwise concerning it;
 
  10.21.9   give notice to the Agent promptly and in reasonable detail upon the Borrower or any other Obligor becoming aware of:
  (a)   accidents to the Vessel involving repairs the cost of which will or is likely to exceed [**] [Confidential Treatment] Dollars [**] [Confidential Treatment];
 
  (b)   the Vessel becoming or being likely to become a Total Loss;
 
  (c)   any recommendation or requirement made by any insurer or classification society or by any competent authority which is not complied with, or cannot be complied with, within any time limit relating thereto and that might reasonably affect the maintenance of either the Insurances or the classification of the Vessel;
 
  (d)   any writ or claim served against or any arrest of the Vessel or the exercise of any lien or purported lien on the Vessel, her Earnings or Insurances;
 
  (e)   the Vessel ceasing to be registered under the flag of the Maritime Registry or anything which is done or not done whereby such registration may be imperilled;
 
  (f)   it becoming impossible or unlawful for it to fulfil any of its obligations under the Security Documents; and
 
  (g)   anything done or permitted or not done in respect of the Vessel by any person which is likely to imperil the security created by the Security Documents;
  10.21.10   promptly pay and discharge all debts, damages and liabilities, taxes, assessments, charges, fines, penalties, tolls, dues and other outgoings in respect of the Vessel and keep proper books of account in respect thereof provided always that the Borrower shall not be obliged to compromise any debts, damages and liabilities as aforesaid which are being contested in good faith subject always that full details of any such contested debt, damage or liability which, either individually or in aggregate exceeds [**] [Confidential Treatment] Dollars [**] [Confidential Treatment] shall forthwith be provided to the Agent. As and when the Agent may so require the Borrower will make such books available for inspection on behalf of the Agent and provide evidence satisfactory to the Agent that the wages and allotments and the insurance and pension contributions of the master and crew are being regularly paid, that all deductions of crew’s wages in respect of any tax liability are being properly accounted for and that the master has no claim for disbursements other than those incurred in the

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      ordinary course of trading on the voyage then in progress or completed prior to such inspection;
  10.21.11   maintain the type of the Vessel as at the Delivery Date and not put the Vessel into the possession of any person without the prior consent of the Agent for the purpose of work being done on it in an amount exceeding or likely to exceed [**] [Confidential Treatment] Dollars [**] [Confidential Treatment] unless such person shall first have given to the Agent a written undertaking addressed to the Agent in terms satisfactory to the Agent agreeing not to exercise a lien on the Vessel or her Earnings for the cost of such work or for any other reason;
 
  10.21.12   promptly pay and discharge all liabilities which have given rise, or may give rise, to liens or claims enforceable against the Vessel under the laws of all countries to whose jurisdiction the Vessel may from time to time be subject and in particular the Borrower hereby agrees to indemnify and hold the Finance Parties, their successors, assigns, directors, officers, shareholders, employees and agents harmless from and against any and all claims, losses, liabilities, damages, expenses (including attorneys, fees and expenses and consultant fees) and injuries of any kind whatsoever asserted against the Finance Parties, with respect to or as a result of the presence, escape, seepage, spillage, release, leaking, discharge or migration from the Vessel or other properties owned or operated by the Borrower of any hazardous substance, including without limitation, any claims asserted or arising under any applicable environmental, health and safety laws, codes and ordinances, and all rules and regulations promulgated thereunder of all governmental agencies, regardless of whether or not caused by or within the control of the Borrower subject to the following:
  (a)   it is the parties’ understanding that the Finance Parties do not now, have never and do not intend in the future to exercise any operational control or maintenance over the Vessel or any other properties and operations owned or operated by the Borrower, nor in the past, presently, or intend in the future to, maintain an ownership interest in the Vessel or any other properties owned or operated by the Borrower except as may arise upon enforcement of the Lenders’ rights under the Mortgage;
 
  (b)   the indemnity and hold harmless contained in this Clause 10.21.12 shall not extend to the Finance Parties in their capacity as equity investors in the Borrower or as an owner of any property or interest as to which the Borrower is also owner but only to their capacity as lenders, holders of security interests or beneficiaries of security interests; and
 
  (c)   unless and until an Event of Default shall have occurred and without prejudice to the right of each Lender to be indemnified pursuant to this Clause 10.21.12:
  (i)   each Lender will, if it is reasonably practicable to do so, notify the Borrower upon receiving a claim in respect of which the relevant Lender is or may become entitled to an indemnity under this Clause 10.21.12;
 
  (ii)   subject to the prior written approval of the relevant Lender which the Lender shall have the right to withhold, the Borrower will be entitled to take, in the name of the relevant Lender, such action as the Borrower may see fit to avoid, dispute, resist, appeal, compromise or defend any such claims, losses, liabilities, damages, expenses and injuries as are referred to

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      above in this Clause 10.21.12 or to recover the same from any third party, subject to the Borrower first ensuring that the relevant Lender is secured to its reasonable satisfaction against all expenses thereby incurred or to be incurred; and
  (iii)   the relevant Lender will, to the extent that it is reasonably practicable to do so, seek the approval of the Borrower (such approval not to be unreasonably withheld or delayed) before making any admission of liability, agreement or compromise with a third party, or any payment to a third party, in respect of such claims, losses, liabilities, damages, expenses and injuries as are referred to above in this Clause 10.21.12 and, to the extent that the Borrower is entitled to take action in accordance with sub-clause (ii) above and subject to the Borrower first ensuring that the relevant Lender is secured to its reasonable satisfaction against all expenses thereby incurred or to be incurred, the relevant Lender will provide such information, assistance and other co-operation as the Borrower may reasonably request in connection with such action,
      provided always that the Borrower shall not be obliged to compromise any liabilities as aforesaid which are being contested in good faith subject always that full details of any such contested liabilities which, either individually or in aggregate, exceed [**] [Confidential Treatment] Dollars [**] [Confidential Treatment] shall be forthwith provided to the Agent. If the Vessel is arrested or detained for any reason it will procure its immediate release by providing bail or taking such other steps as the circumstances may require;
  10.21.13   give to the Agent at such times as it may from time to time reasonably require a certificate, duly signed on its behalf, as to the total amount of any debts, damages and liabilities relating to the Vessel and details of such of those debts, damages and liabilities as are over a certain amount to be specified by the Agent at the relevant time and, if so required by the Agent, forthwith discharge such of those debts, damages and liabilities as the Agent shall require other than those being contested in good faith; and
 
  10.21.14   maintain the registration of the Vessel under and fly the flag of the Maritime Registry and not do or permit anything to be done whereby such registration may be forfeited or imperilled.
10.22   Dividends
 
    Subject to the provisions of clause 11.3 of the Guarantee, the Borrower will procure that any dividends or other distributions and interest paid or payable in connection with such dividends or other distributions will be received promptly by the Guarantor directly or indirectly from the Borrower’s shareholder (if such shareholder is not the Guarantor) by way of dividend.
 
10.23   Irrevocable payment instructions
 
    The Borrower shall not modify, revoke or withhold the payment instructions set out in Clause 3.2 without the agreement of the Builder (in the case of Clause 3.2.1 only), the Agent and the Lenders.

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10.24   “Know your customer” checks
 
    If:
  10.24.1   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;
 
  10.24.2   any change in the status of a Borrower after the date of this Agreement; or
 
  10.24.3   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 Clause 10.24.3, 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 any Lender (for itself or, in the case of the event described in Clause 10.24.3, on behalf of any prospective New Lender) in order for the Agent, such Lender or, in the case of the event described in Clause 20.6.1(c), 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.
10.25   Building Contract
 
    The Borrower shall not substantially modify the Building Contract, directly or indirectly, if, by reason of regulations which apply to a Lender, such modification would make such Lender’s Commitment impossible to fulfil or would change the substance or form of its Commitment. The Borrower may, therefore, submit to the Lenders any proposals for modification which, in its opinion, might have such a consequence, and the Lenders will indicate in a timely manner whether the modification proposed will allow the Loan to be maintained.
 
    On or about the last day of each successive period of three (3) months commencing on the date of this Agreement and on the date of the Drawdown Notice, the Borrower undertakes to provide the Agent with a copy of any Change Order entered into during that three (3) month or other period. The Borrower also undertakes to notify the Agent of any change in the Intended Delivery Date as soon as practicable after the change has occurred.
 
11.   PREPAYMENT
 
11.1   The Borrower may prepay all or part of the Loan (but if in part being an amount that reduces the Loan by a minimum amount of one (1) repayment instalment of principal of the Loan together with interest thereon) without penalty provided the prepayment is made on the relevant interest payment date and one (1) month’s prior written notice indicating the intended date of prepayment is given to the Agent, but compensation shall be payable to the Lenders in the sum of:
  11.1.1   the difference (if positive), calculated by the Lenders, between the actual cost for the Lenders of the funding for the Loan and the rate of interest for the monies to be invested by the Lenders, applied to the amounts so prepaid for the period from said prepayment until the next interest prepayment date (if

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      prepayment does not occur on an interest payment date). Details of any such calculation shall be supplied to the Borrower by the Lenders; and
  11.1.2   the charges (if any) imposed on the Lenders by the French Authorities (funding or breakage costs of the French Authority in charge of monitoring the CIRR).
11.2   Any prepayment of the whole of the Loan shall be made together with all other sums due under this Agreement.
 
11.3   Amounts prepaid shall be applied in accordance with Clause 17.
 
11.4   Amounts prepaid may not be reborrowed.
 
12.   INTEREST ON LATE PAYMENTS
 
12.1   Without prejudice to the provisions of Clause 13 and without this Clause in any way constituting a waiver of terms of payment, all sums due by the Borrower under this Agreement will automatically bear interest on a day to day basis from the date when they are payable until the date of actual payment at a rate per annum equal to the higher of:
  12.1.1   Overnight LIBOR plus [**] [Confidential Treatment] per cent. [**] [Confidential Treatment]; and
 
  12.1.2   the CIRR plus [**] [Confidential Treatment] per cent. [**] [Confidential Treatment].
      Such interest will itself bear interest at the above rate if it is due for an entire year.
13.   ACCELERATION — EVENTS OF DEFAULT
 
13.1   If any one of the Events of Default set out in Clause 13.2 occurs and remains unremedied:
  13.1.1   if the Loan has not been drawn down, no drawing under the Loan may be requested from the Lenders; or
 
  13.1.2   if the Loan has already been drawn down, the Lenders may require immediate payment of the outstanding principal amount of the Loan (including but without limitation the amount representing the financed Coface Premium) together with all other sums due under this Agreement:
13.2   The following are the Events of Default referred to in Clause 13.1:
  13.2.1   Non-payment
 
      The Borrower or any other Obligor does not pay on the due date any amount of principal or interest of the Loan (provided however that if any such amount is not paid when due solely by reason of some error or omission on the part of the bank or banks through whom the relevant funds are being transmitted no Event of Default shall occur for the purposes of this Clause 13.2.1 until the expiry of three (3) Business Days following the date on which such payment is due), or within three (3) Business Days of the due date any other amount payable by it under any Security Document to which it may at any time be a party including but without limitation any amount payable by the Guarantor under the Guarantee, at the place and in the currency in which it is expressed to be payable.

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  13.2.2   Breach of other obligations
  (a)   Any Obligor fails to comply with any provision of any Security Document and in particular but without limitation any failure by the Guarantor to comply with the provisions of Clauses 9 (General Undertakings: Positive Covenants), 10 (General Undertakings: Negative Covenants) and/or 11 (Financial Undertakings and Ownership and Control of the Guarantor) of the Guarantee or there is any breach in the sole opinion of the Agent of any of the Transaction Documents.
 
      If the Loan has already been drawn down, an Event of Default shall not have arisen if the failure (if in the opinion of the Agent in its sole discretion it is capable of remedy) has been remedied within a period of thirty (30) days from the date of its occurrence, if the failure was known to that Obligor, or from the date the relevant Obligor is notified by the Agent of the failure, if the failure was not known to that Obligor, unless in any such case as aforesaid the Agent in its sole discretion considers that the failure is or could reasonably be expected to become materially prejudicial to the interests, rights or position of the Lenders; or
 
  (b)   If there is a repudiation or termination of any Transaction Document or if any of the parties thereto becomes entitled to terminate or repudiate any of them and evidences an intention so to do.
  13.2.3   Misrepresentation
 
      Any representation, warranty or statement made or repeated in, or in connection with, any Transaction Document or the Coface Insurance Policy or in any accounts, certificate, statement or opinion delivered by or on behalf of any Obligor thereunder or in connection therewith is materially incorrect when made or would, if repeated at any time hereafter by reference to the facts subsisting at such time, no longer be materially correct.
 
  13.2.4   Cross default
  (a)   Any event of default occurs under any financial contract or financial document relating to any Financial Indebtedness of any member of the Group;
 
  (b)   Any such Financial Indebtedness or any sum payable in respect thereof is not paid when due (after the expiry of any applicable grace period(s)) whether by acceleration or otherwise;
 
  (c)   Any Encumbrance over any assets of any member of the Group becomes enforceable;
 
  (d)   Any other Financial Indebtedness of any member of the Group is not paid when due or is or becomes capable of being declared due prematurely by reason of default or any security for the same becomes enforceable by reason of default;
      provided that:
  (i)   No Event of Default will arise if the relevant Financial Indebtedness is not accelerated or, if it is accelerated but, in aggregate, the Financial

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      Indebtedness is less than twenty five million Dollars (USD25,000,000); and
  (ii)   Financial Indebtedness being contested by the Borrower in good faith will be disregarded for a period of one hundred and fifty (150) days from its occurrence if full details of the dispute are submitted to the Agent forthwith upon its occurrence. If the dispute remains unresolved for a period of more than one hundred and fifty (150) days from its occurrence, this Clause 13.2.4(ii) shall not apply to that Financial Indebtedness.
  13.2.5   Winding-up
 
      Subject to clause 10.6 of the Guarantee, any order is made or an effective resolution passed or other action taken for the suspension of payments or reorganisation, dissolution, termination of existence, liquidation, winding-up or bankruptcy of any member of the Group.
 
  13.2.6   Moratorium or arrangement with creditors
 
      A moratorium in respect of all or any debts of any member of the Group or a composition or an arrangement with creditors of any member of the Group or any similar proceeding or arrangement by which the assets of any member of the Group are submitted to the control of its creditors is applied for, ordered or declared or any member of the Group commences negotiations with any one or more of its creditors with a view to the general readjustment or rescheduling of all or a significant part of its Financial Indebtedness.
 
  13.2.7   Appointment of liquidators etc.
 
      A liquidator, trustee, administrator, receiver, administrative receiver, manager or similar officer is appointed in respect of any member of the Group or in respect of all or any substantial part of the assets of any member of the Group and in any such case such appointment is not withdrawn within thirty (30) days (the “Grace Period”) unless the Agent considers in its sole discretion that the interest of the Lenders might reasonably be expected to be adversely affected in which event the Grace Period shall not apply.
 
  13.2.8   Insolvency
 
      Any member of the Group becomes or is declared insolvent or is unable, or admits in writing its inability, to pay its debts as they fall due or becomes insolvent within the terms of any applicable law.
 
  13.2.9   Legal process
 
      Any distress, execution, attachment or other process affects the whole or any substantial part of the assets of any member of the Group and remains undischarged for a period of twenty one (21) days or any uninsured judgment in excess of [**] [Confidential Treatment] Dollars [**] [Confidential Treatment] following final appeal remains unsatisfied for a period of thirty (30) days in the case of a judgment made in the United States of America and otherwise for a period of sixty (60) days provided that no Event of Default shall be deemed to have occurred unless the distress, execution, attachment or other process adversely affects any Obligor’s ability to meet any of its material obligations under this Agreement or the other Security Documents or cause to occur any of the events specified in

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      Clauses 13.2.5 to 13.2.8 (the determination of which shall be in the Agent’s sole discretion).
  13.2.10   Analogous events
 
      Anything analogous to or having a substantially similar effect to any of the events specified in Clauses 13.2.5 to 13.2.9 shall occur under the laws of any applicable jurisdiction.
 
  13.2.11   Cessation of business
 
      Subject to clause 10.6 of the Guarantee, any member of the Group ceases to carry on all or a substantial part of its business.
 
  13.2.12   Revocation of consents
 
      Any authorisation, approval, consent, licence, exemption, filing, registration or notarisation or other requirement necessary to enable any Obligor to comply with any of its obligations under any of the Transaction Documents is materially adversely modified, revoked or withheld or does not remain in full force and effect and within ninety (90) days of the date of its occurrence such event is not remedied to the satisfaction of the Agent and the Agent considers in its sole discretion that such failure is or might be expected to become materially prejudicial to the interests, rights or position of the Lenders provided that the Borrower shall not be entitled to the aforesaid ninety (90) day period if the modification, revocation or withholding of the authorisation, approval or consent is due to an act or omission of any Obligor and the Agent is satisfied in its sole discretion that the Lenders’ interests might reasonably be expected to be materially adversely affected.
 
  13.2.13   Unlawfulness
 
      At any time it is unlawful or impossible for any Obligor to perform any of its material (to the Finance Parties or any of them) obligations under any Transaction Document to which it is a party or it is unlawful or impossible for the Finance Parties or any Lender to exercise any of their or its rights under any of the Transaction Documents, provided that no Event of Default shall be deemed to have occurred where:
  (a)   the unlawfulness or impossibility preventing any Obligor from performing its obligations (other than its payment obligations under this Agreement, the other Transaction Documents) is cured within a period of twenty one (21) days of the occurrence of the event giving rise to the unlawfulness or impossibility and the relevant Obligor within the aforesaid period, performs its obligation(s) (except where the unlawfulness or impossibility adversely affects any Obligor’s payment obligations under this Agreement, the other Transaction Documents (the determination of which shall be in the Agent’s sole discretion) in which case the following provisions of this Clause 13.2.13 shall not apply); and/or
 
  (b)   where a Finance Party was aware of the default and could, in its sole discretion, mitigate the consequences of the unlawfulness or impossibility. The reasonable costs of mitigating the consequences of the unlawfulness or impossibility shall be borne by the Borrower save where such costs are of an internal administrative nature and are not incurred in dealings by the Finance Party with third parties.

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  13.2.14   Insurances
 
      The Borrower fails to insure the Vessel in the manner specified in Clause 10.20 or fails to renew the Insurances at least five (5) days prior to the date of expiry thereof and produce prompt confirmation of such renewal to the Agent.
 
  13.2.15   Disposals
 
      If the Borrower or any other member of the Group shall have concealed, removed, or permitted to be concealed or removed, any part of its property, with intent to hinder, delay or defraud its creditors or any of them, or made or suffered a transfer of any of its property which may be fraudulent under any bankruptcy, fraudulent conveyance or similar law; or shall have made any transfer of its property to or for the benefit of a creditor with the intention of preferring such creditor over any other creditor.
 
  13.2.16   Prejudice to security
 
      Anything is done or suffered or omitted to be done by any Obligor which in the reasonable opinion of the Agent would or might be expected to imperil the security created by any of the Security Documents.
 
  13.2.17   Material adverse change
 
      Any material adverse change in the business, assets or financial condition of any Obligor occurs which in the reasonable opinion of the Agent would or might reasonably be expected to affect the ability of that Obligor duly to perform any of its material obligations under any Security Document to which it may at any time be a party. For the purposes of this Clause 13.2.17 and without prejudice to the generality of the expression “material obligations” any payment obligations of any Obligor shall be deemed material.
 
  13.2.18   Governmental intervention
 
      The authority of any member of the Group in the conduct of its business is wholly or substantially curtailed by any seizure or intervention by or on behalf of any authority and within ninety (90) days of the date of its occurrence any such seizure or intervention is not relinquished or withdrawn and the Agent reasonably considers that the relevant occurrence is or might be expected to become materially prejudicial to the interests, rights or position of the Lenders provided that the Borrower shall not be entitled to the aforesaid ninety (90) day period if the seizure or intervention executed by any authority is due to an act or omission of any member of the Group and the Agent is satisfied, in its sole discretion, that the Lenders’ interest might reasonably be expected to be materially adversely affected.
13.3   If at any time during the period commencing on the day after the date of this Agreement and ending on the date falling sixty (60) days before the Intended Delivery Date (the “Limited Period”) any event should occur that would constitute an Event of Default, the Agent shall not be entitled to serve a notice under Clause 13.4 unless during the Limited Period:
  13.3.1   there is a failure by an Obligor to perform any material obligation under the Transaction Documents on the relevant due date or within any applicable grace period, including but without limitation if the Guarantor fails to provide to the

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      Agent the statement referred to in Clause 3.1.4 in the manner described in that Clause; or
  13.3.2   the relevant event would imperil the security created by the Guarantee.
      In no event shall the provisions of this Clause 13.3 be interpreted as a waiver of the Agent’s right to serve a notice under Clause 13.4 in respect of any Event of Default which has occurred and remains unremedied on the date falling sixty (60) days before the Intended Delivery Date.
13.4   Notice of any Event of Default and/or of the acceleration of the payment of the principal of the Loan, interest thereon and all other sums due under this Agreement shall be given by the Agent in accordance with Clause 27.
 
13.5   In no event shall any delay in exercising the Lenders’ right to require advance repayment be interpreted as a waiver of this right.
 
13.6   Furthermore, in case of such accelerated repayment following an Event of Default, the Borrower shall be liable to pay to the Agent, in addition to the Coface Premium pursuant to Clause 6, compensation calculated as provided for in Clause 11.
 
13.7   Following an Event of Default and for so long as the same remains unremedied, the Borrower irrevocably authorises the Agent and the Lenders to apply any credit balance to which the Borrower is entitled upon any account of the Borrower with any branch of any of the Agent and the Lenders in or towards satisfaction of any sum due to the Agent or any Lender hereunder but unpaid, and to combine any accounts of the Borrower for this purpose. If such set-off requires a credit balance in a currency other than the required currency to be transferred to an account maintained in connection herewith the transfer shall be effected by crediting to the account in question the amount of the required currency which the Agent or the Lender (as the case may be) could obtain by exchanging such currency for the required currency at the rate of exchange at which its Facility Office would, at the opening of business on the date on which the combination is effected, have sold the currency of that credit balance for the required currency for immediate delivery.
 
13.8   In the event that the accelerated amount is received by the Agent before the date of normal maturity of the accelerated interest payments, the Borrower shall, subject to no sums remaining due to the Lenders from the Borrower, be entitled to refund of interest for the actual number of days between the date on which the Lenders received the amount and the normal date for payment of such amount.
 
14.   MANDATORY PREPAYMENT
 
14.1   Subject to Clause 14.2, the Borrower shall forthwith prepay the outstanding principal amount of the Loan (including but without limitation the amount representing the financed Coface Premium) together with all other sums due under this Agreement if:
  14.1.1   the Vessel shall become a Total Loss; or
 
  14.1.2   if the Coface Insurance Policy is modified, suspended, terminated or rescinded unless caused by the wilful misconduct or gross negligence of a Finance Party.
14.2   However, if the Vessel shall become a Total Loss (but without prejudice to the Lenders’ rights to receive the proceeds of the Insurances or Compulsory Acquisition forthwith upon collection as may be provided for in the Mortgage and/or the Assignment of Insurances), the Borrower shall not be required to pay its indebtedness under this

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      Agreement earlier than the date which is one hundred and fifty (150) days after the Total Loss Date.
14.3   The provisions of Clause 11 shall apply mutatis mutandis to any prepayment pursuant to this Clause 14.
 
15.   CURRENCY OF PAYMENT
 
    The funds for payment of all sums due by the Borrower under this Agreement, shall be paid in Dollars or euro (in the case that the payment is due in euro) to the credit of:
  15.1.1   the account of BNP Paribas, Paris, Swift code: [**] [Confidential Treatment], account number [**] [Confidential Treatment] with BNP Paribas S.A., The Equitable Building, 787 Seventh Avenue, New York, New York NY 10019, Swift code: [**] [Confidential Treatment] , under the following reference: “BFI/LSI/BOCI Crédits Acheteurs — Commercial Loan Hull No C 33 dated            September 2006” in the case of Dollars; and
 
  15.1.2   BNP Paribas, Paris, Swift code: [**] [Confidential Treatment] , IBAN: [**] [Confidential Treatment], under the following reference: “BFI/LSI/BOCI Crédits Acheteurs - Commercial Loan Hull No C 33 dated            September 2006” in the case of euro.
      These sums must be credited before 11.00 a.m. New York time or 11.00 a.m. Paris time (in the case that the payment is in euro) in freely transferable and convertible currency. For each payment to be made, the Borrower shall notify the Agent on the third Business Day prior to the due payment date that it will issue instructions to its bank (which shall be named in such notification) to make the relevant payment.
16.   SECURITY
 
    All the Borrower’s payment obligations under this Agreement shall be secured by:
  16.1.1   the Guarantee to be signed within ten (10) Business Days of the date of this Agreement in favour of the Finance Parties;
 
  16.1.2   the Mortgage to be executed and registered in favour of the Finance Parties forthwith upon delivery of the Vessel; and
 
  16.1.3   the Assignment of Warranty Rights, the Assignment of Insurances, the Assignment of Earnings and the Assignment of Management Agreement to be executed in favour of the Finance Parties forthwith upon delivery of the Vessel.
17.   APPLICATION OF SUMS RECEIVED
 
    All sums received under this Agreement by the Agent, on behalf of the Lenders, or by any of the Lenders for any reason whatsoever will, without prejudice to complementary provisions of the Mortgage, be applied:
  17.1.1   in priority, to payments of any kind due or in arrears in the order of their due payment dates and first, to fees, charges and expenses, second, to interest payable pursuant to Clause 12, third, to interest payable pursuant to Clause 4, fourth, to the principal of the Loan payable pursuant to Clause 4 and, fifth, to any other sums due under this Agreement and, if relevant, pro rata to each of the Lenders; or

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  17.1.2   if no payments are in arrears or if these payments have been discharged as set out above, then and to sums remaining due under this Agreement and, if relevant, pro rata to each of the Lenders and in each case in inverse order of maturity, the interest being recalculated accordingly.
18.   CHANGES TO THE LENDERS
 
18.1   Assignments and transfers by the Lenders
 
    Subject to this Clause 18, a Lender (the “Existing Lender”) may:
  18.1.1   assign its rights; or
 
  18.1.2   transfer by novation its rights and obligations,
    to another bank or financial institution which is authorised by the French Authorities to enter into French export credits benefiting from the CIRR (the “New Lender”).
 
18.2   Conditions of assignment or transfer
  18.2.1   The consent of the Borrower is required for an assignment or transfer by an Existing Lender, unless the assignment or transfer is to another Lender or an Affiliate of a Lender.
 
  18.2.2   The consent of the Borrower to an assignment or transfer must not be unreasonably withheld or delayed.
 
  18.2.3   The assignment or transfer must be with respect to a minimum Commitment of [**] [Confidential Treatment] Dollars [**] [Confidential Treatment] or, if less, the Existing Lender’s full Commitment.
 
  18.2.4   An assignment will only be effective on:
  (a)   receipt by the Agent of written confirmation from the New Lender (in form and substance satisfactory to the Agent) that the New Lender will assume the same obligations to the other Finance Parties as it would have been under if it was an Original Lender; and
 
  (b)   performance by the Agent of all necessary “know your customer” or other similar checks under all applicable laws and regulations in relation to such assignment to a New Lender, the completion of which the Agent shall promptly notify to the Existing Lender and the New Lender.
  18.2.5   A transfer will only be effective if the procedure set out in Clause 18.5 is complied with.
 
  18.2.6   If:
  (a)   a Lender assigns or transfers its rights or obligations under the Security Documents or changes its Facility Office; and
 
  (b)   as a result of circumstances existing at the date the assignment, transfer or change occurs, an Obligor would be obliged to make a payment to the New Lender or Lender acting through its new Facility Office under Clause 8,

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      then the New Lender or Lender acting through its new Facility Office is only entitled to receive payment under that Clause to the same extent as the Existing Lender or Lender acting through its previous Facility Office would have been if the assignment, transfer or change had not occurred.
18.3   Assignment or transfer fee
 
    The New Lender shall, on the date upon which an assignment or transfer takes effect, pay to the Agent (for its own account) a fee of [**] [Confidential Treatment]. The New Lender shall also pay to the Agent, upon demand, all reasonable costs and expenses, duties and fees, including but without limitation legal costs and out of pocket expenses, incurred by the Agent or the Lenders in connection with any necessary amendment to or supplementing of the Transaction Documents or any of them or the Coface Insurance Policy as a consequence of the assignment or transfer.
 
18.4   Limitation of responsibility of Existing Lenders
  18.4.1   Unless expressly agreed to the contrary, an Existing Lender makes no representation or warranty and assumes no responsibility to a New Lender for:
  (a)   the legality, validity, effectiveness, adequacy or enforceability of the Security Documents or any other documents;
 
  (b)   the financial condition of any Obligor;
 
  (c)   the performance and observance by any Obligor of its obligations under the Security Documents or any other documents; or
 
  (d)   the accuracy of any statements (whether written or oral) made in or in connection with any Security Document or any other document,
      and any representations or warranties implied by law are excluded.
 
  18.4.2   Each New Lender confirms to the Existing Lender and the other Finance Parties that it:
  (a)   has made (and shall continue to make) its own independent investigation and assessment of the financial condition and affairs of each Obligor and its related entities in connection with its participation in this Agreement and has not relied exclusively on any information provided to it by the Existing Lender in connection with any Security Document; and
 
  (b)   will continue to make its own independent appraisal of the creditworthiness of each Obligor and its related entities whilst any amount is or may be outstanding under the Security Documents or any Commitment is in force.
  18.4.3   Nothing in any Security Document obliges an Existing Lender to:
  (a)   accept a re-transfer from a New Lender of any of the rights and obligations assigned or transferred under this Clause 18; or
 
  (b)   support any losses directly or indirectly incurred by the New Lender by reason of the non-performance by any Obligor of its obligations under the Security Documents or otherwise.

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18.5   Procedure for transfer
  18.5.1   Subject to the conditions set out in Clause 18.2 a transfer is effected in accordance with Clause 18.5.3 when the Agent executes an otherwise duly completed Transfer Certificate delivered to it by the Existing Lender and the New Lender. The Agent shall, subject to Clause 18.5.2, as soon as reasonably practicable after receipt by it of a duly completed Transfer Certificate appearing on its face to comply with the terms of this Agreement and delivered in accordance with the terms of this Agreement, execute that Transfer Certificate.
 
  18.5.2   The Agent shall only be obliged to execute a Transfer Certificate delivered to it by the Existing Lender and the New Lender once it is satisfied it has complied with all necessary “know your customer” or other similar checks under all applicable laws and regulations in relation to the transfer to such New Lender.
 
  18.5.3   On the Transfer Date:
  (a)   to the extent that in the Transfer Certificate the Existing Lender seeks to transfer by novation its rights and obligations under the Security Documents each of the Obligors and the Existing Lender shall be released from further obligations towards one another under the Security Documents and their respective rights against one another under the Security Documents shall be cancelled (being the “Discharged Rights and Obligations”);
 
  (b)   each of the Obligors and the New Lender shall assume obligations towards one another and/or acquire rights against one another which differ from the Discharged Rights and Obligations only insofar as that Obligor and the New Lender have assumed and/or acquired the same in place of that Obligor and the Existing Lender;
 
  (c)   the Agent, the Mandated Lead Arrangers, the New Lender and the other Lenders shall acquire the same rights and assume the same obligations between themselves as they would have acquired and assumed had the New Lender been an Original Lender with the rights and/or obligations acquired or assumed by it as a result of the transfer and to that extent the Agent, the Mandated Lead Arrangers and the Existing Lender shall each be released from further obligations to each other under the Security Documents; and
 
  (d)   the New Lender shall become a Party as a “Lender”.
18.6   Copy of Transfer Certificate to Borrower
 
    The Agent shall, as soon as reasonably practicable after it has executed a Transfer Certificate, send to the Borrower a copy of that Transfer Certificate.
 
18.7   Permitted disclosure
 
    Any Finance Party may disclose to any of its Affiliates and to the following other persons:
  18.7.1   any person to (or through) whom that Lender assigns or transfers (or may potentially assign or transfer) all or any of its rights and obligations under this Agreement;

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  18.7.2   any person with (or through) whom that Lender enters into (or may potentially enter into) any sub-participation in relation to, or any other transaction under which payments are to be made by reference to, this Agreement or any Obligor;
 
  18.7.3   any person to whom, and to the extent that, information is required to be disclosed by any applicable law or regulation;
 
  18.7.4   any other Finance Party, or any employee, officer, director or representative of such entity which needs to know such information or receive such document in the course of such person’s employ or duties;
 
  18.7.5   Coface, or any employee, officer, director or representative of such entity which needs to know such information or receive such document in the course of such person’s employ or duties;
 
  18.7.6   the Guarantor or any other member of the Group, or any employee, officer, director or representative of such entity which needs to know such information or receive such document in the course of such person’s employ or duties; or
 
  18.7.7   auditors, insurance and reinsurance brokers, insurers and reinsurers and professional advisers, including legal advisers, which need to know such information,
    any information about any Obligor, this Agreement and the other Security Documents as that Finance Party shall consider appropriate. Each of the Finance Parties may also disclose to the Builder, or any employee, officer, director or representative of the Builder which needs to know such information or receive such document in the course of such person’s employ or duties, such information about any Obligor, this Agreement and the other Security Documents as that Finance Party reasonably considers normal practice for a French export credit.
 
    Each of the Finance Parties acknowledges that all information received now or in the future from or on behalf of the Obligors under or pursuant to or in connection with the Transaction Documents or the Coface Insurance Policy (other than any information which is in the public domain other than as a result of a breach of this Clause) is confidential information and undertakes to advise this fact to any recipient of any such information under this Clause.
 
19.   CHANGES TO THE OBLIGORS
 
    No Obligor may assign any of its rights or transfer any of its rights or obligations under the Security Documents without the unanimous consent of the Lenders.
 
20.   ROLE OF THE AGENT AND THE MANDATED LEAD ARRANGERS
 
20.1   Appointment of the Agent
  20.1.1   Each other Finance Party appoints the Agent to act as its agent under and in connection with this Agreement and the other Security Documents and the Coface Insurance Policy.
 
  20.1.2   Each other Finance Party authorises the Agent to exercise the rights, powers, authorities and discretions specifically given to the Agent under or in connection with the Security Documents together with any other incidental rights, powers, authorities and discretions.

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20.2   Duties of the Agent
  20.2.1   The Agent shall promptly forward to a Party the original or a copy of any document which is delivered to the Agent for that Party by any other Party.
 
  20.2.2   Except where a Security Document specifically provides otherwise, the Agent is not obliged to review or check the adequacy, accuracy or completeness of any document it forwards to another Party.
 
  20.2.3   If the Agent receives notice from a Party referring to this Agreement, describing an Event of Default and stating that the circumstance described is an Event of Default, it shall promptly notify the other Finance Parties.
 
  20.2.4   If the Agent is aware of the non-payment of any principal, interest, commitment fee or other fee payable to a Finance Party (other than the Agent or a Mandated Lead Arranger) under this Agreement it shall promptly notify the other Finance Parties.
 
  20.2.5   The Agent’s duties under the Security Documents are solely administrative in nature.
20.3   Role of the Mandated Lead Arrangers
 
    None of the Mandated Lead Arrangers has any obligations of any kind to any other Party under or in connection with any Transaction Document or the Coface Insurance Policy.
 
20.4   No fiduciary duties
  20.4.1   Nothing in this Agreement constitutes the Agent or any of the Mandated Lead Arrangers as a trustee or fiduciary of any other person.
 
  20.4.2   Neither the Agent nor any of the Mandated Lead Arrangers shall be bound to account to any Lender for any sum or the profit element of any sum received by it for its own account.
20.5   Business with the Guarantor
 
    The Agent and each of the Mandated Lead Arrangers may accept deposits from, lend money to and generally engage in any kind of banking or other business with any Affiliate or Subsidiary of the Guarantor.
 
20.6   Rights and discretions of the Agent
  20.6.1   The Agent may rely on:
  (a)   any representation, notice or document believed by it to be genuine, correct and appropriately authorised; and
 
  (b)   any statement made by a director, authorised signatory or employee of any person regarding any matters which may reasonably be assumed to be within his knowledge or within his power to verify.
  20.6.2   The Agent may assume (unless it has received notice to the contrary in its capacity as agent for the Lenders) that:
  (a)   no Event of Default has occurred (unless it has actual knowledge of an Event of Default arising under Clause 13.2); and

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  (b)   any right, power, authority or discretion vested in any Party or the Lenders has not been exercised.
  20.6.3   The Agent may engage, pay for and rely on the advice or services of any lawyers, accountants, surveyors or other experts.
 
  20.6.4   The Agent may act in relation to the Security Documents through its personnel and agents.
 
  20.6.5   The Agent may disclose to any other Party any information it reasonably believes it has received as the Agent under this Agreement.
 
  20.6.6   Notwithstanding any other provision of any Security Document to the contrary, neither the Agent nor any of the Mandated Lead Arrangers is obliged to do or omit to do anything if it would or might in its reasonable opinion constitute a breach of any law or regulation or a breach of a fiduciary duty or duty of confidentiality.
20.7   Lenders’ instructions
  20.7.1   Unless a contrary indication appears in a Security Document, the Agent shall:
  (a)   exercise any right, power, authority or discretion vested in it as Agent in accordance with any instructions given to it by the Lenders (or, if so instructed by the Lenders, refrain from exercising any right, power, authority or discretion vested in it as the Agent); and
 
  (b)   not be liable for any act (or omission) if it acts (or refrains from taking any action) in accordance with an instruction of the Lenders.
  20.7.2   Unless a contrary indication appears in a Security Document, any instructions given by the Lenders will be binding on all the Finance Parties.
 
  20.7.3   The Agent may refrain from acting in accordance with the instructions of the Lenders until it has received such security as it may require for any cost, loss or liability (together with any associated value added tax) which it may incur in complying with the instructions.
 
  20.7.4   In the absence of instructions from the Lenders the Agent may act (or refrain from taking action) as it considers to be in the best interest of the Lenders.
 
  20.7.5   The Agent is not authorised to act on behalf of a Lender (without first obtaining that Lender’s consent) in any legal or arbitration proceedings relating to any Security Document.
20.8   Responsibility for documentation
 
    The Agent is not responsible for:
  20.8.1   the adequacy, accuracy and/or completeness of any information (whether oral or written) supplied by the Agent, a Mandated Lead Arranger, an Obligor or any other person given in or in connection with any Transaction Document or the Coface Insurance Policy; or
 
  20.8.2   is responsible for the legality, validity, effectiveness, adequacy or enforceability of any Transaction Document or the Coface Insurance Policy or any other agreement, arrangement or document entered into, made or executed in

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      anticipation of or in connection with any Transaction Document or the Coface Insurance Policy.
20.9   Exclusion of liability
  20.9.1   Without limiting Clause 20.9.2, the Agent will not be liable for any action taken by it under or in connection with any Security Document, unless directly caused by its gross negligence or wilful misconduct.
 
  20.9.2   No Party (other than the Agent) may take any proceedings against any officer, employee or agent of the Agent in respect of any claim it might have against the Agent or in respect of any act or omission of any kind by that officer, employee or agent in relation to any Security Document and any officer, employee or agent of the Agent may rely on this Clause.
 
  20.9.3   The Agent will not be liable for any delay (or any related consequences) in crediting an account with an amount required under the Security Documents to be paid by the Agent if the Agent has taken all necessary steps as soon as reasonably practicable to comply with the regulations or operating procedures of any recognised clearing or settlement system used by the Agent for that purpose.
 
  20.9.4   Nothing in this Agreement shall oblige the Agent or a Mandated Lead Arranger to carry out any “know your customer” or other checks in relation to any person on behalf of any Lender and each Lender confirms to the Agent and the Mandated Lead Arrangers that it is solely responsible for any such checks it is required to carry out and that it may not rely on any statement in relation to such checks made by the Agent or a Mandated Lead Arranger.
20.10   Lenders’ indemnity to the Agent
 
    Each Lender shall (in proportion to its share of the Total Commitments or, if the Total Commitments are then zero, to its share of the Total Commitments immediately prior to their reduction to zero) indemnify the Agent, within three (3) Business Days of demand, against any cost, loss or liability incurred by the Agent (otherwise than by reason of the Agent’s gross negligence or wilful misconduct) in acting as Agent under the Security Documents (unless the Agent has been reimbursed by an Obligor pursuant to a Security Document).
20.11   Resignation of the Agent
  20.11.1   The Agent may resign and appoint one of its Affiliates as successor by giving notice to the other Finance Parties and the Borrower.
 
  20.11.2   Alternatively the Agent may resign by giving notice to the other Finance Parties and the Borrower, in which case the Lenders (after consultation with the Borrower) may appoint a successor Agent.
 
  20.11.3   If the Lenders have not appointed a successor Agent in accordance with Clause 20.11.2 within thirty (30) days after notice of resignation was given, the Agent (after consultation with the Borrower) may appoint a successor Agent.
 
  20.11.4   The retiring Agent shall, at its own cost, make available to the successor Agent such documents and records and provide such assistance as the successor Agent may reasonably request for the purposes of performing its functions as Agent under the Security Documents.

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  20.11.5   The Agent’s resignation notice shall only take effect upon the appointment of a successor.
 
  20.11.6   Upon the appointment of a successor, the retiring Agent shall be discharged from any further obligation in respect of the Security Documents but shall remain entitled to the benefit of this Clause 20. Its successor and each of the other Parties shall have the same rights and obligations amongst themselves as they would have had if such successor had been an original Party.
 
  20.11.7   After consultation with Coface, the Lenders may, by notice to the Agent, require it to resign in accordance with Clause 20.11.2. In this event, the Agent shall resign in accordance with Clause 20.11.2.
20.12   Confidentiality
  20.12.1   In acting as agent for the Finance Parties, the Agent shall be regarded as acting through its agency division which shall be treated as a separate entity from any other of its divisions or departments.
 
  20.12.2   If information is received by another division or department of the Agent, it may be treated as confidential to that division or department and the Agent shall not be deemed to have notice of it.
20.13   Relationship with the Lenders
 
    The Agent may treat each Lender as a Lender, entitled to payments under this Agreement and acting through its Facility Office unless it has received not less than five (5) Business Days’ prior notice from that Lender to the contrary in accordance with the terms of this Agreement.
 
20.14   Credit appraisal by the Lenders
 
    Without affecting the responsibility of any Obligor for information supplied by it or on its behalf in connection with any Security Document, each Lender confirms to the Agent and each of the Mandated Lead Arrangers that it has been, and will continue to be, solely responsible for making its own independent appraisal and investigation of all risks arising under or in connection with any Security Document including but not limited to:
  20.14.1   the financial condition, status and nature of the Guarantor and each Subsidiary of the Guarantor;
 
  20.14.2   the legality, validity, effectiveness, adequacy or enforceability of any Security Document and any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Security Document;
 
  20.14.3   whether that Lender has recourse, and the nature and extent of that recourse, against any Party or any of its respective assets under or in connection with any Security Document, the transactions contemplated by the Security Documents or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Security Document; and
 
  20.14.4   the adequacy, accuracy and/or completeness of any information provided by the Agent, any Party or by any other person under or in connection with any Security Document, the transactions contemplated by the Security Documents

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      or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Security Document.
20.15   Deduction from amounts payable by the Agent
 
    If any Party owes an amount to the Agent under the Security Documents the Agent may, after giving notice to that Party, deduct an amount not exceeding that amount from any payment to that Party which the Agent would otherwise be obliged to make under the Security Documents and apply the amount deducted in or towards satisfaction of the amount owed. For the purposes of the Security Documents that Party shall be regarded as having received any amount so deducted.
 
21.   CONDUCT OF BUSINESS BY THE FINANCE PARTIES
 
21.1   No provision of this Agreement will:
  21.1.1   interfere with the right of any Finance Party to arrange its affairs (tax or otherwise) in whatever manner it thinks fit;
 
  21.1.2   oblige any Finance Party to investigate or claim any credit, relief, remission or repayment available to it or the extent, order and manner of any claim; or
 
  21.1.3   oblige any Finance Party to disclose any information relating to its affairs (tax or otherwise) or any computations in respect of tax.
22.   SHARING AMONG THE FINANCE PARTIES
 
22.1   Payments to Finance Parties
 
    If a Finance Party (a “Recovering Finance Party”) receives or recovers any amount from an Obligor other than in accordance with Clause 23 and applies that amount to a payment due under the Security Documents then:
  22.1.1   the Recovering Finance Party shall, within three (3) Business Days, notify details of the receipt or recovery to the Agent;
 
  22.1.2   the Agent shall determine whether the receipt or recovery is in excess of the amount the Recovering Finance Party would have been paid had the receipt or recovery been received or made by the Agent and distributed in accordance with Clause 17 and Clause 23), without taking account of any tax which would be imposed on the Agent in relation to the receipt, recovery or distribution; and
 
  22.1.3   the Recovering Finance Party shall, within three (3) Business Days of demand by the Agent, pay to the Agent an amount (the “Sharing Payment”) equal to such receipt or recovery less any amount which the Agent determines may be retained by the Recovering Finance Party as its share of any payment to be made, in accordance with Clause 17 and Clause 23.
22.2   Redistribution of payments
 
    The Agent shall treat the Sharing Payment as if it had been paid by the relevant Obligor and distribute it between the Finance Parties (other than the Recovering Finance Party) in accordance with Clause 17 and Clause 23.

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22.3   Recovering Finance Party’s rights
  22.3.1   On a distribution by the Agent under Clause 22.2, the Recovering Finance Party will, if possible under the relevant applicable laws, be subrogated to the rights of the Finance Parties which have shared in the redistribution.
 
  22.3.2   If and to the extent that the Recovering Finance Party is not able to rely on its rights under Clause 22.3.1, the relevant Obligor shall be liable to the Recovering Finance Party for a debt equal to the Sharing Payment which is immediately due and payable.
22.4   Reversal of redistribution
 
    If any part of the Sharing Payment received or recovered by a Recovering Finance Party becomes repayable and is repaid by that Recovering Finance Party, then:
  22.4.1   each Lender which has received a share of the relevant Sharing Payment pursuant to Clause 22.4 shall, upon request of the Agent, pay to the Agent for account of that Recovering Finance Party an amount equal to the appropriate part of its share of the Sharing Payment (together with an amount as is necessary to reimburse that Recovering Finance Party for its proportion of any interest on the Sharing Payment which that Recovering Finance Party is required to pay); and
 
  22.4.2   that Recovering Finance Party’s rights of subrogation in respect of any reimbursement shall be cancelled and the relevant Obligor will be liable to the reimbursing Finance Party for the amount so reimbursed.
22.5   Exceptions
  22.5.1   This Clause 22 shall not apply to the extent that the Recovering Finance Party would not, after making any payment pursuant to this Clause, have a valid and enforceable claim against the relevant Obligor.
 
  22.5.2   A Recovering Finance Party is not obliged to share with any other Finance Party any amount which the Recovering Finance Party has received or recovered as a result of taking legal or arbitration proceedings, if:
  (a)   it notified that other Finance Party of the legal or arbitration proceedings; and
 
  (b)   that other Finance Party had an opportunity to participate in those legal or arbitration proceedings but did not do so as soon as reasonably practicable having received notice and did not take separate legal or arbitration proceedings.
23.   PAYMENT MECHANICS
 
23.1   Payments to the Agent
  23.1.1   On each date on which an Obligor or a Lender is required to make a payment under a Security Document, that Obligor or Lender shall make the same available to the Agent (unless a contrary indication appears in a Security Document) for value on the due date at the time and in such funds specified by the Agent as being customary at the time for settlement of transactions in the relevant currency in the place of payment.

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  23.1.2   Payment shall be made to such account in the principal financial centre of the country of that currency (or, in relation to euro, in a principal financial centre in a Participating Member State or London) with such bank as the Agent specifies.
23.2   Distributions by the Agent
 
    Each payment received by the Agent under the Security Documents for another Party shall, subject to Clause 23.3, Clause 23.4 and Clause 20.15 be made available by the Agent as soon as practicable after receipt to the Party entitled to receive payment in accordance with this Agreement (in the case of a Lender, for the account of its Facility Office), to such account as that Party may notify to the Agent by not less than five (5) Business Days’ notice with a bank in the principal financial centre of the country of that currency (or, in relation to euro, in the principal financial centre of a Participating Member State or London).
 
23.3   Distributions to an Obligor
 
    The Agent may (with the consent of the Obligor or in accordance with Clause 13.7 apply any amount received by it for that Obligor in or towards payment (on the date and in the currency and funds of receipt) of any amount due from that Obligor under the Security Documents or in or towards purchase of any amount of any currency to be so applied.
 
23.4   Clawback
  23.4.1   Where a sum is to be paid to the Agent under the Security Documents for another Party, the Agent is not obliged to pay that sum to that other Party (or to enter into or perform any related exchange contract) until it has been able to establish to its satisfaction that it has actually received that sum.
 
  23.4.2   If the Agent pays an amount to another Party and it proves to be the case that the Agent had not actually received that amount, then the Party to whom that amount (or the proceeds of any related exchange contract) was paid by the Agent shall on demand refund the same to the Agent together with interest on that amount from the date of payment to the date of receipt by the Agent, calculated by the Agent to reflect its cost of funds.
23.5   No set-off by Obligors
 
    All payments to be made by an Obligor under the Security Documents shall be calculated and be made without (and free and clear of any deduction for) set-off or counterclaim.
 
23.6   Business Days
  23.6.1   Any payment which is due to be made on a day that is not a Business Day shall be made on the next Business Day in the same calendar month (if there is one) or the preceding Business Day (if there is not).
 
  23.6.2   During any extension of the due date for payment of any principal or unpaid sum under this Agreement interest is payable on the principal or unpaid sum at the rate payable on the original due date.
23.7   Currency of account
  23.7.1   Subject to Clauses 23.7.2 and 23.7.3 Dollars is the currency of account and payment for any sum from an Obligor under any Security Document.

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  23.7.2   Each payment in respect of costs, expenses or taxes shall be made in the currency in which the costs, expenses or taxes are incurred.
 
  23.7.3   Any amount expressed to be payable in a currency other than Dollars shall be paid in that other currency.
23.8   Change of currency
  23.8.1   Unless otherwise prohibited by law, if more than one currency or currency unit are at the same time recognised by the central bank of any country as the lawful currency of that country, then:
  (a)   any reference in the Security Documents to, and any obligations arising under the Security Documents in, the currency of that country shall be translated into, or paid in, the currency or currency unit of that country designated by the Agent (after consultation with the Lenders and the Borrower); and
 
  (b)   any translation from one currency or currency unit to another shall be at the official rate of exchange recognised by the central bank for the conversion of that currency or currency unit into the other, rounded up or down by the Agent (acting reasonably).
  23.8.2   If a change in any currency of a country occurs, this Agreement will, to the extent the Agent (acting reasonably and after consultation with the Lenders and the Borrower) specifies to be necessary, be amended to comply with any generally accepted conventions and market practice in the relevant interbank market and otherwise to reflect the change in currency.
24.   GOVERNING LAW
 
    This Agreement is governed by English law.
 
25.   ENFORCEMENT
 
25.1   Jurisdiction of English courts
 
    The courts of England have exclusive jurisdiction to settle any dispute arising out of or in connection with this Agreement (including a dispute regarding the existence, validity or termination of this Agreement) (a “Dispute”). Each Party agrees that the courts of England are the most appropriate and convenient courts to settle Disputes and accordingly no Party will argue to the contrary.
 
    This Clause 25.1 is for the benefit of the Finance Parties only. As a result, no Finance Party shall be prevented from taking proceedings relating to a Dispute in any other courts with jurisdiction. To the extent allowed by law, any Finance Party may take concurrent proceedings in any number of jurisdictions.
 
25.2   Service of process
 
    Without prejudice to any other mode of service allowed under any relevant law, the Borrower:
  25.2.1   irrevocably appoints Clifford Chance Secretaries Limited as its agent for service of process in relation to any proceedings before the English courts in connection with any Finance Document; and

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  25.2.2   agrees that failure by a process agent to notify the Borrower of the process will not invalidate the proceedings concerned.
26.   APPENDICES
 
    The appendices form an integral part of this Agreement.
 
27.   NOTICES
 
    Any notices, demands and service of process relating to this Agreement or its performance, shall be in writing and shall be validly addressed, delivered or served at the respective addresses below:
     
For the Borrower:
  c/o 7665 Corporate Center Drive
 
  Miami
 
  Florida 33126
 
  United States of America
 
  Facsimile: +1 305 436 4140 (Ms Bonnie Biumi) and +1 305
 
  436 4117 (Legal Department)
 
  Attention: Ms Bonnie Biumi and the Legal Department
 
   
For the Agent:
  BNP Paribas
 
  ECEP/Export Finance
 
  ACI: CHDESA1
 
  37 Place du Marché Saint-Honoré
 
  75031 Paris Cedex 01
 
  France
 
  Facsimile: +33 01 4316 8184
 
  Attention: Mrs Dominique Laplasse (Team Head)
 
   
For the Lenders:
  c/o the Agent
    or to such other address or numbers as each party may notify to the other. Notices shall be effective upon receipt as set forth above. Any communications by facsimile shall be confirmed by registered mail or recognized international courier service, but the communication shall be deemed received on the date of the facsimile transmission (or if that day is not a business day in the place where the facsimile is received, on the next business day in that place).
 
    Provided that for so long as no notice of acceleration has been issued pursuant to Clause 13.4, notices addressed to the Agent shall be deemed to have been addressed to the Lenders.
 
28.   MISCELLANEOUS
 
28.1   If any term of this Agreement becomes invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired.
 
28.2   No failure or delay on the part of the Lenders in exercising any right, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise thereof preclude any other or further exercise thereof by the Lenders or the exercise by the Lenders of any other right, power or privilege. The rights and remedies of the Lenders herein provided are cumulative and not exclusive of any rights or remedies provided by law.

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28.3   This Agreement shall not be capable of being modified otherwise than by an express modification in writing signed by the Borrower and the Lenders.
 
29.   COMING INTO FORCE
 
    This Agreement shall come into force on the date of its signature but the rights and obligations of the Borrower hereunder may be terminated by written notice from the Borrower to the Agent, such notice to be received not later than sixty (60) days prior to the Intended Delivery Date. Following service of such notice (which shall be irrevocable), the Borrower shall have no further right to draw down the Loan and the Borrower shall have no further obligations under this Agreement save in respect of fees, costs and expenses incurred under or in respect of this Agreement on or before the date on which the notice becomes effective or as a result of the service of the notice.
 
    Service by the Borrower of the written notice in accordance with the preceding paragraph shall constitute a condition subsequent to this Agreement.
     
Made in five (5) originals on the date before written.
   
 
   
F3 ONE, LTD.
  BNP PARIBAS
 
   
by: Bonnie Biumi
  by: J.D. Amsler          S. Ferdane
Bonnie Biumi  
  J.D. Amsler                S. Ferdane
 
   
its: Attorney-in-fact
  its: Authorized Signatories
 
   
CALYON
  HSBC FRANCE
 
   
by: Jerome Lebond
  by: Gilles Pirot          Erick Dadar
Jerome Lebond 
  Gilles Pirot                 Erick Dadar 
 
   
its: Attorney-in-fact
  its: Authorized Signatories
 
   
SOCIETE GENERALE
   
 
   
by: Isabella Seneca
   
Isabella Seneca 
   
 
   
its: Attorney-in-fact
   

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APPENDIX I
DOCUMENTS TO BE PRODUCED BY THE BUILDER TO BNP PARIBAS AS AGENT
    Certified Copy of the commercial invoice, duly executed by the Builder in favour of the Borrower and countersigned by the Borrower.
 
    Certified Copy of the Protocol of Delivery and Acceptance, duly executed by the Builder and the Borrower.
 
    Certified Copy of the declaration of warranty, duly executed by the Builder confirming that the Vessel is delivered to the Borrower free and clear of all encumbrances whatsoever.
 
    Certified Copy of the commercial invoice(s) corresponding to the Change Orders or any other similar document issued by the Builder stating the Change Order Amount, duly executed by the Builder in favour of the Borrower and countersigned by the Borrower.
 
    Acknowledgement of the notice of assignment of the Borrower’s rights under the post-delivery warranty given by the Builder under the Building Contract pursuant to the Assignment of Warranty Rights.
 
    Certified Copy of the power of attorney pursuant to which the authorised signatory of the Builder signed the documents referred to in this Appendix I and a specimen of his signature.

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APPENDIX II
THE ORIGINAL LENDERS AND THE MANDATED LEAD ARRANGERS
         
Name
  Registered Address   Registered Number with the
 
      Registry of Trade and
 
      Companies
 
       
BNP PARIBAS
  16 boulevard des Italiens,   662 042 449 (RCS Paris)
 
  75009 Paris,France    
 
       
CALYON
  9 quai du Président   304 187 701 (RCS Nanterre)
 
  Paul Doumer, 92920 Paris La    
 
  Défense Cedex, France    
 
       
HSBC FRANCE
  103 avenue des Champs   775 670 284 (RCS Paris)
 
  Elysées, 75419 Paris, Cedex    
 
  08, France    
 
       
SOCIETE GENERALE
  29 boulevard Haussmann,   552 120 222 (RCS Paris)
 
  75009 Paris, France    
 
       
each a French société anonyme
       

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APPENDIX III
FORM OF TRANSFER CERTIFICATE
To:      [       ] as Agent
From:    [The Existing Lender] (the “Existing Lender”) and [The New Lender] (the “New Lender”)
Dated:
F3 One, Ltd. — EUR662,905,320 Loan Agreement
dated            September 2006 (the
Agreement")
1.   We refer to the Agreement. This is a Transfer Certificate. Terms defined in the Agreement have the same meaning in this Transfer Certificate unless given a different meaning in this Transfer Certificate.
 
2.   We refer to Clause 18.5:
  (c)   The Existing Lender and the New Lender agree to the Existing Lender transferring to the New Lender by novation all or part of the Existing Lender’s Commitment, rights and obligations referred to in the Schedule in accordance with Clause 18.5.
 
  (d)   The proposed Transfer Date is [       ].
 
  (e)   The Facility Office and address, fax number and attention details for notices of the New Lender for the purposes of Clause 27 are set out in the Schedule.
3.   The New Lender expressly acknowledges the limitations on the Existing Lender’s obligations set out in Clause 18.4.3.
 
4.   This Transfer Certificate may be executed in any number of counterparts and this has the same effect as if the signatures on the counterparts were on a single copy of this Transfer Certificate.
 
5.   This Transfer Certificate is governed by English law.
THE SCHEDULE
Commitment/rights and obligations to be transferred
[insert relevant details]
[Facility Office address, fax number and attention details for notices and account details for payments]
             
 
  [Existing Lender]       [New Lender]
 
           
 
  By:       By:

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    This Transfer Certificate is accepted by the Agent and the Transfer Date is confirmed as [       ].
 
    [Agent]
 
    By:

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APPENDIX IV
FORM OF DRAWDOWN NOTICE
BNP Paribas
ECEP/Export Finance
ACI: CHDESA1
37 Place du Marché Saint-Honoré
75031 Paris Cedex 01
France
Date                     20[09][10]
Dear Sirs
Hull No. C33 Drawdown Notice
We refer to the loan agreement for hull no. C33 dated            September 2006 made between ourselves as borrower, yourselves, [], [] and [] as lenders and yourselves as agent (the “Agreement”). Terms defined in the Agreement shall have the same meaning in this Notice.
We hereby give you notice that pursuant to the Agreement and on [date of proposed drawdown] [**] [Confidential Treatment], we wish to draw down the Loan in the sum of the equivalent in Dollars of [        ] euro (EUR[        ]) upon the terms and subject to the conditions contained therein.
In accordance with the provisions of Clause 3.2, we hereby request you to advance the Loan by crediting the proceeds as follows:
[Details to be provided]
We confirm that at the date hereof the representations and warranties set out in Clause 9 of the Agreement are true and no Event of Default has occurred and remains unremedied.
Yours faithfully
for and on behalf of
F3 ONE, LTD.

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DATED 6th October 2006
NCL CORPORATION LTD.
(as guarantor)
- in favour of -
BNP PARIBAS
CALYON
HSBC FRANCE
and
SOCIETE GENERALE
(as lenders)
- and -
BNP PARIBAS
(as agent)
 
GUARANTEE
IN RESPECT OF THE OBLIGATIONS OF
F3 ONE, LTD.
 

 


 

CONTENTS
             
        Page
1
  Definitions and Construction     1  
2
  Guarantee and Indemnity     2  
3
  Survival of Guarantor’s Liability     3  
4
  Continuing Guarantee     4  
5
  Exclusion of the Guarantor’s Rights     5  
6
  Payments     6  
7
  Enforcement     7  
8
  Representations and Warranties     7  
9
  General Undertakings: Positive Covenants     10  
10
  General Undertakings: Negative Covenants     11  
11
  Financial Undertakings and Ownership and Control of the Guarantor     13  
12
  Discharge     18  
13
  Assignment and Transfer     18  
14
  Miscellaneous Provisions     19  
15
  Waiver of Immunity     20  
16
  Notices     20  
17
  Governing Law     21  
18
  Jurisdiction     21  
Schedule 1
  Quarterly Statement of Financial Covenants     24  
Schedule 2
  Particulars of Agent and Lenders     27  

 


 

DEED OF GUARANTEE AND INDEMNITY

Dated
the 6th day of October 2006
BY:
(1)   NCL CORPORATION LTD. being a company validly existing under the laws of Bermuda with registration number EC34678 and with its registered office at Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda as guarantor (the “Guarantor”);
IN FAVOUR OF:
(2)   BNP PARIBAS, CALYON, HSBC FRANCE AND SOCIETE GENERALE, whose details are more particularly set out in Schedule 2 as lenders (the “Lenders”); and
 
(3)   BNP PARIBAS, whose details are more particularly set out in Schedule 2 as agent (the “Agent” and collectively with the Lenders the “Beneficiaries”).
WHEREAS:
(A)   By a loan agreement dated 22 September 2006 (the “Loan Agreement”) made between (among others) (1) F3 One, Ltd. as borrower (the “Borrower”) (2) the Lenders and (3) the Agent, the Lenders have agreed, on the terms and conditions therein set out, to make available to the Borrower their participations in a loan facility of up to six hundred and sixty two million nine hundred and five thousand three hundred and twenty euro (EUR662,905,320) (the “Loan”) in order to assist the Borrower in financing part of the purchase price of the Vessel.
 
(B)   It is a condition precedent to the Beneficiaries performing their obligations under the Loan Agreement that the Guarantor enters into this Deed.
NOW THIS DEED WITNESSES:
1   Definitions and Construction
  1.1   In this Deed the following terms and expressions shall have the meanings set out below; in addition, terms and expressions not defined herein but whose meanings are defined in the Loan Agreement shall have the meanings set out therein.
 
      “Accounts” means the audited consolidated profit and loss account and balance sheet (including all additional information and notes thereto) of the Guarantor and its consolidated Subsidiaries together with the relative directors’ and auditors’ reports;
 
      “Event of Default” means any of the events specified in clause 13.2 of the Loan Agreement or specified as such in Clause 11;
 
      “Obligors” means the Borrower, the Guarantor and the Manager;
 
      “Office” means in respect of the Agent and each Lender its office at the address set out beneath its name in Schedule 2 or such other office as it shall from time to time select and notify through the Agent to the Borrower;

 


 

      “Outstanding Indebtedness” means all sums of any kind payable actually or contingently to the Finance Parties under or pursuant to the Loan Agreement or any Transaction Document (whether by way of repayment of principal, payment of interest or default interest, payment of any indemnity or counter-indemnity, reimbursement for fees, costs or expenses or otherwise howsoever); and
 
      “Process Agent” means Clifford Chance Secretaries Limited or any other person in England nominated by the Assignor and approved by the Agent to accept service of legal proceedings on its behalf under any of the Transaction Documents.
 
  1.2   In this Deed unless the context otherwise requires:
  1.2.1   clause headings are inserted for convenience of reference only and shall be ignored in the construction of this Deed;
 
  1.2.2   references to Clauses and to Schedules are to be construed as references to clauses of and schedules to this Deed unless otherwise stated and references to this Deed are to be construed as references to this Deed including its Schedules;
 
  1.2.3   references to (or to any specified provision of) this Deed or any other document shall be construed as references to this Deed, that provision or that document as from time to time amended, supplemented or novated;
 
  1.2.4   references to any Act or any statutory instrument shall be construed as references to that Act or that statutory instrument as from time to time re-enacted, amended or supplemented;
 
  1.2.5   references to any party to this Deed or any other document shall include reference to such party’s successors and permitted assigns and transferees;
 
  1.2.6   words importing the plural shall include the singular and vice versa;
 
  1.2.7   references to a person shall be construed as references to an individual, firm, company, corporation, unincorporated body of persons or any state or any agency thereof; and
 
  1.2.8   where any matter requires the approval or consent of the Lenders or the Agent such approval or consent shall not be deemed to have been given unless given in writing; where any matter is required to be acceptable to the Lenders or the Agent, the Lenders or the Agent (as the case may be) shall not be deemed to have accepted such matter unless its acceptance is communicated in writing; each of the Lenders and the Agent may give or withhold its consent, approval or acceptance at its unfettered discretion.
2   Guarantee and Indemnity
  2.1   In consideration of the Lenders agreeing at the request of the Guarantor to make the Loan available to the Borrower in accordance with the terms of the Loan Agreement, the payment by the Beneficiaries to the Guarantor of ten Dollars (USD 10) and other good and valuable consideration (the receipt and adequacy of which the Guarantor hereby acknowledges) the Guarantor:

2


 

  2.1.1   as primary obligor as and for its own debt and not merely as surety hereby undertakes to the Lenders to be responsible for and hereby guarantees to the Lenders:
  (a)   the due and punctual payment by the Borrower to the Lenders or the Agent (for itself and on behalf of the Lenders) (as the case may be) (as and when due by acceleration, demand or otherwise howsoever) of the Outstanding Indebtedness and every part thereof; and
 
  (b)   the due and punctual performance of all the obligations to be performed by each of the Obligors under or pursuant to the Loan Agreement and the other Security Documents; and
  2.1.2   unconditionally undertakes immediately on demand by the Agent from time to time to pay and/or perform its obligations under Clause 2.1.1.
  2.2   For the same consideration as referred to in Clause 2.1 the Guarantor (as a separate and independent obligation) unconditionally undertakes immediately on demand by the Agent from time to time to indemnify the Beneficiaries and hold each of them harmless in respect of:
  2.2.1   any loss incurred by the Beneficiaries as a result of the Loan Agreement and each other Security Document to which any of the Obligors is a party or any provision thereof becoming invalid, void, voidable or unenforceable for any reason whatsoever after execution hereof; and
 
  2.2.2   any loss or damage of any kind arising directly or indirectly from any failure on the part of any of the Obligors to perform any obligation to be performed by any of the Obligors under and pursuant to the Loan Agreement and each other Security Document to which any of the Obligors is a party.
3   Survival of Guarantor’s Liability
  3.1   The Guarantor’s liability to the Beneficiaries under this Deed shall not be discharged, impaired or otherwise affected by reason of any of the following events or circumstances (regardless of whether any such events or circumstances occur with or without the Guarantor’s knowledge or consent):
  3.1.1   any time, forbearance or other indulgence given or agreed by any of the Finance Parties to or with any of the Obligors or any other person in respect of any of their obligations under the Loan Agreement and each other Transaction Document to which any of the Obligors or that other person is a party; or
 
  3.1.2   any legal limitation, disability or incapacity relating to any of the Obligors; or
 
  3.1.3   any invalidity, irregularity, unenforceability, imperfection or avoidance of or any defect in any security granted by, or the obligations of any of the Obligors or any other person under, the Loan Agreement and each other Transaction Document to which any of the Obligors or that other person is

3


 

      a party or any amendment to or variation thereof or of any other document or security comprised therein; or
 
  3.1.4   any change in the name, constitution, memorandum of association or otherwise of any of the Obligors or the amalgamation or merger of any of the Obligors with any other corporate entity; or
 
  3.1.5   the liquidation, bankruptcy or dissolution (or proceedings analogous thereto) of any of the Obligors or any other person or the appointment of a receiver or administrative receiver or administrator or trustee or similar officer of any of the assets of any of the Obligors or any other person or the occurrence of any circumstances whatsoever affecting any Obligor’s or that other person’s liability to discharge its obligations under the Loan Agreement and each other Transaction Document to which it is a party; or
 
  3.1.6   any challenge, dispute or avoidance by any liquidator of any of the Obligors or any other person in respect of any claim by the Guarantor by right of subrogation in any such liquidation; or
 
  3.1.7   any release of any other Obligor or any other person or any renewal, exchange or realisation of any security or obligation provided under or by virtue of any of the Transaction Documents or the provision to any of the Finance Parties at any time of any further security for the obligations of the Borrower under any of the Transaction Documents; or
 
  3.1.8   the release of any co-guarantor and/or indemnitor who is now or may hereafter become under a joint and several liability with the Guarantor under this Deed or the release of any other guarantor, indemnitor or other third party obligor in respect of the obligations of any Obligor under any of the Transaction Documents; or
 
  3.1.9   any failure on the part of any of the Finance Parties (whether intentional or not) to take or perfect any security agreed to be taken under or in relation to any of the Transaction Documents or to enforce any of the Transaction Documents; or
 
  3.1.10   any other act, matter or thing (save for repayment in full of the Outstanding Indebtedness) which might otherwise constitute a legal or equitable discharge of any of the Guarantor’s obligations under this Deed.
  3.2   The Guarantor’s liability to the Beneficiaries under this Deed shall not be discharged by reason of any of the events or circumstances referred to in Clause 3.1 in so far as they relate to Coface.
4   Continuing Guarantee
  4.1   This Deed shall be:
  4.1.1   a continuing guarantee remaining in full force and effect until irrevocable payment in full has been received by the Beneficiaries of each and every part and the ultimate balance of the Outstanding Indebtedness in accordance with the Loan Agreement and each other Security Document to which any of the Obligors is a party; and

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  4.1.2   in addition to and not in substitution for or in derogation of any other security held by any of the Finance Parties from time to time in respect of the Outstanding Indebtedness or any part thereof.
  4.2   Any satisfaction of obligations by the Guarantor to the Beneficiaries or any discharge given by the Beneficiaries to the Guarantor or any other agreement reached between the Beneficiaries and the Guarantor in relation to this Deed shall be, and be deemed always to have been, void ab initio if any act satisfying any of the said obligations or on the faith of which any such discharge was given or any such agreement was entered into is subsequently avoided in whole or in part by or pursuant to any provision of any applicable law whatsoever.
 
  4.3   This Deed shall remain the property of the Beneficiaries and, notwithstanding that all monies and liabilities due or incurred by any of the Obligors to the Beneficiaries which are guaranteed hereunder shall have been paid or discharged, the Beneficiaries shall be entitled not to discharge this Deed or any security held by the Beneficiaries for the obligations of the Guarantor hereunder for such period as may in the reasonable opinion of the Beneficiaries be necessary or appropriate under any applicable insolvency law after the last of such monies and liabilities have been paid or discharged and in the event of bankruptcy, winding-up or any similar proceedings being commenced in respect of any of the Obligors or any other person, the Beneficiaries shall be at liberty not to discharge this Deed or any security held by the Beneficiaries for the obligations of the Guarantor hereunder for and during such further period as the Beneficiaries may determine at their sole discretion.
  5   Exclusion of the Guarantor’s Rights
  5.1   Until the obligations of the Obligors under the Loan Agreement and each other Security Document to which they are a party have been fully performed, the Guarantor shall not:
  5.1.1   be entitled to share in or succeed to or benefit from (by subrogation or otherwise) any rights which the Beneficiaries may have in respect of the Outstanding Indebtedness or any security therefor or all or any of the proceeds of such rights or security; or
 
  5.1.2   without the prior written consent of the Beneficiaries:
  (a)   exercise in respect of any amount paid by the Guarantor hereunder any right of indemnity, subrogation, contribution or any other right or remedy which it may have in respect thereof; or
 
  (b)   claim payment of any other monies for the time being due to the Guarantor or to which it may become entitled or exercise or enforce or benefit from any other right, remedy or security in respect thereof; or
 
  (c)   prove in a liquidation of any Obligor in competition with the Beneficiaries for any monies owing to the Guarantor by any other Obligor on any account whatsoever,

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      PROVIDED ALWAYS that if the Guarantor, in breach of this Clause, receives or recovers any monies pursuant to any such exercise, claim or proof, such monies shall be held by the Guarantor as trustee upon trust for the Beneficiaries to apply the same as if they were monies received or recovered by the Beneficiaries under this Deed.
6   Payments
  6.1   Each payment to be made by the Guarantor hereunder shall be made in immediately available funds in the currency in which such payment is due without set-off, counterclaim, deduction or retention of any kind by payment to such bank account or accounts as the Agent may from time to time notify to the Guarantor in writing.
 
      If the Guarantor is required by law to make such a payment subject to the deduction or withholding of Taxes, in which case the sum payable by the Guarantor in respect of which such deduction or withholding is required to be made shall be increased to the extent necessary to ensure that, after the making of such deduction or withholding, the Lenders receive and retain (free from any liability in respect of any such deduction or withholding) a net sum equal to the sum which they would have received and so retained had no such deduction or withholding been made or required to be made.
 
  6.2   Without prejudice to the provisions of Clause 6.1, if any Lender or the Agent on the Lenders’ behalf is required to make any payment on account of Tax (not being a tax imposed on the net income of its Office by the jurisdiction in which it is incorporated or in which its Office is located or any other tax existing and applicable on the date of this Deed under the laws of any jurisdiction) on or in relation to any sum received or receivable hereunder by such Lender or the Agent on the Lenders’ behalf (including, without limitation, any sum received or receivable under this Clause 6) or any liability in respect of any such payment is asserted, imposed, levied or assessed against such Lender or the Agent on the Lenders’ behalf, the Guarantor shall, upon demand of the Agent, indemnify such Lender or the Agent against such payment or liability, together with any interest, penalties and expenses payable or incurred in connection therewith, other than interest, penalties, and expenses that are otherwise imposed or asserted on account of the bad faith or wilful neglect of such Lender or the Agent.
 
      If any Lender proposes to make a claim under the provisions of this Clause 6.2 it shall certify to the Guarantor in reasonable detail within thirty (30) days (or such longer period as any Lender may reasonably require) after becoming aware of the event by reason of which it is entitled to make its claim or claims the basis of its claim or claims, such certificate to be conclusive, save for manifest error.
 
  6.3   The certificate of the Agent from time to time as to sums owed by any Obligor under the Security Documents and sums owed by the Guarantor hereunder shall, save for manifest error, be conclusive and binding for all purposes and prima facie evidence of the existence and extent of such debts in any legal action or proceedings arising in connection herewith.
 
  6.4   If the Guarantor makes any payment hereunder in respect of which it is required by law to make any deduction or withholding for Taxes, it shall pay the full amount to be deducted or withheld to the relevant taxation or other authority

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      within the time allowed for such payment under applicable law and shall deliver to the Agent within thirty (30) days after it has made such payment to the applicable authority any original receipt issued by such authority evidencing the payment to such authority of all amounts so required to be deducted or withheld from such payment.
 
      If an additional payment is made under Clause 6.1 and any Lender or the Agent on its behalf determines that it has received or been granted a credit against or relief of or calculated with reference to the deduction or withholding giving rise to such additional payment, such Lender or the Agent (as the case may be) shall, to the extent that it can do so without prejudice to the retention of the amount of such credit, relief, remission or repayment and provided that it has received the cash benefit of such credit, relief or remission, pay to the Guarantor such amount as such Lender or the Agent shall in its reasonable opinion have concluded to be attributable to the relevant deduction or withholding. Any such payment shall be conclusive evidence of the amount due to the Guarantor hereunder and shall be accepted by the Guarantor in full and final settlement of its rights of reimbursement hereunder in respect of such deduction or withholding. Nothing herein contained shall interfere with the right of any Lender and the Agent to arrange their respective tax affairs in whatever manner they think fit.
7   Enforcement
  7.1   The Beneficiaries shall not be obliged before taking steps to enforce this Deed to take any action whatsoever against any of the Obligors or any other person and the Guarantor hereby waives all such formalities or rights to which it would otherwise be entitled or which the Beneficiaries would otherwise first be required to satisfy or fulfil before proceeding or making demand against the Guarantor hereunder provided that the Beneficiaries shall not be entitled to enforce their rights under this Deed otherwise than in circumstances which would constitute an Event of Default.
8   Representations and Warranties
  8.1   Duration
  8.1.1   The representations and warranties in Clause 8.2 shall survive the execution of this Deed and shall be deemed to be repeated, with reference mutatis mutandis to the facts and circumstances subsisting, as if made on each day until each Obligor has no remaining obligations, actual or contingent, under or pursuant to the Loan Agreement or any of the other Security Documents.
 
  8.1.2   The representations and warranties in Clause 8.3 shall survive the execution of this Deed and shall be deemed to be repeated, with reference mutatis mutandis to the facts and circumstances subsisting, as if made on the date falling sixty (60) days before the Intended Delivery Date and thereafter on each day until each Obligor has no remaining obligations, actual or contingent, under or pursuant to the Loan Agreement or any of the other Security Documents.
  8.2   Continuing representations and warranties The Guarantor represents and warrants to the Beneficiaries that:

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  8.2.1   it is a limited liability exempt company, duly incorporated and validly existing under the laws of Bermuda, possessing perpetual corporate existence, the capacity to sue and be sued in its own name and the power to own its assets and carry on its business as it is now being conducted;
 
  8.2.2   The Guarantor is and shall remain, after the giving of this Deed, solvent in accordance with the laws of Bermuda and the United Kingdom and in particular with the provisions of the Insolvency Act 1986 (as from time to time amended) and the requirements thereof;
 
  8.2.3   it has the power to enter into and perform this Deed and all necessary corporate or other action has been taken to authorise the entry into and performance of this Deed;
 
  8.2.4   this Deed constitutes its legal, valid and binding obligations enforceable in accordance with its terms;
 
  8.2.5   the entry into and performance of this Deed and the transactions contemplated hereby do not and will not be a breach of or conflict with:
  (a)   any law or regulation or any official or judicial order; or
 
  (b)   its constitutional documents; or
 
  (c)   any agreement or document to which it is a party or which is binding upon it or any of its assets,
      nor result in the creation or imposition of any Encumbrance on any of its assets pursuant to the provisions of any such agreement or document;
 
  8.2.6   all authorisations, approvals, consents, licences, exemptions, filings, registrations, notarisations and other matters, official or otherwise, required in connection with the entry into, performance, validity and enforceability of this Deed and the transactions contemplated hereby have been obtained or effected and are in full force and effect;
 
  8.2.7   all information furnished by or on behalf of the Guarantor relating to the business and affairs of any member of the Group in connection with this Deed was and remains true and correct in all material respects and there are no other material facts or considerations the omission of which would render any such information misleading;
 
  8.2.8   the Guarantor has fully disclosed to the Lenders through the Agent all facts relating to the Group which it knows or should reasonably know and which might reasonably be expected to influence the Lenders in deciding whether or not to enter into the Loan Agreement;
 
  8.2.9   the Accounts for the financial year ended 31 December 2005 (which accounts have been prepared in accordance with GAAP) fairly represent the consolidated financial condition of the Guarantor as at 31 December 2005;

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  8.2.10   the claims of the Beneficiaries against the Guarantor under this Deed will rank at least pari passu with the claims of all other unsecured creditors of the Guarantor other than claims of such creditors to the extent that the same are statutorily preferred;
 
  8.2.11   subject to Clause 10.6, no member of the Group has taken any corporate action nor have any other steps been taken or legal proceedings been started or (to the best of the Guarantor’s knowledge and belief) threatened against any member of the Group for its winding-up and/or dissolution or for the appointment of a liquidator, administrator, receiver, administrative receiver trustee or similar officer of it or any or all of its assets or revenues nor has any member of the Group sought any other relief under any applicable insolvency or bankruptcy law;
 
  8.2.12   neither the Guarantor nor any of its assets enjoys any right of immunity from set-off, suit or execution in respect of its obligations under this Deed;
 
  8.2.13   all the shares in the Borrower and the Manager shall be legally and beneficially owned directly or indirectly by the Guarantor and such structure shall remain so throughout the Security Period. Further, no Event of Default has occurred under Clause 11.2 in respect of the ownership and/or control of the shares in the Guarantor; and
 
  8.2.14   it has reviewed and agrees to all the terms and conditions of the Loan Agreement and each other Security Document to which any Obligor is or is to be a party.
  8.3   Semi-continuing representations and warranties The Guarantor represents and warrants to the Beneficiaries that:
  8.3.1   no event has occurred and remains unremedied which constitutes a default under or in respect of any agreement or document to which the Guarantor is a party or by which it may be bound (including, inter alia, this Deed);
 
  8.3.2   no litigation, arbitration or administrative proceedings are current or pending or to its knowledge threatened, which might, if adversely determined, have a material adverse effect on the ability of the Guarantor to perform its obligations under this Deed, save as disclosed by the Guarantor in its most recent US Securities Exchange Commission filing;
 
  8.3.3   to the best of its knowledge, each of the Obligors has complied with all taxation laws in all jurisdictions in which it is subject to Taxation and has paid all Taxes due and payable by it including but without limitation any disputed Taxes unless a sufficient reserve has been made pending resolution of the dispute and no material claims are being asserted against any of the Obligors with respect to Taxes, which might, if such claims were successful, have a material adverse effect on the ability of that Obligor to perform its obligations under the Transaction Documents to which it is a party; and

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  8.3.4   the Guarantor does not have a place of business in any jurisdiction which would require this Deed to be filed or registered (if it had a place of business in that jurisdiction) to ensure the validity of this Deed.
9   General Undertakings: Positive Covenants
  9.1   The undertakings contained in this Clause 9 shall remain in full force and effect from the date of this Deed until the end of the Security Period.
 
  9.2   The Guarantor will provide to the Agent:
  9.2.1   as soon as practicable (and in any event within one hundred and twenty (120) days after the close of each of its financial years) a Certified Copy of its Accounts (commencing with the audited accounts made up to 31 December 2005);
 
  9.2.2   as soon as practicable (and in any event within sixty (60) days after the close of each quarter of each financial year) a copy of the unaudited consolidated accounts of the Guarantor for that quarter (commencing with the unaudited accounts made up to 30 June 2006);
 
  9.2.3   as soon as practicable (and in any event within one hundred and twenty (120) days after the close of each financial year), beginning with the year ending 31 December 2006, annual cash flow projections on a consolidated basis of the Guarantor showing on a monthly basis advance ticket sales (for at least twelve (12) months following the date of such statement) for the Group; and
 
  9.2.4   as soon as practicable (and in any event not later than 31 January of each financial year):
  (a)   a budget for the Group for such new financial year including a twelve (12) month liquidity budget for such new financial year; and
 
  (b)   updated financial projections of the Group for at least the next five (5) years and an outline of the assumptions supporting such budget and financial projections including but without limitation any scheduled drydrockings;
  9.2.5   on the date of this Deed, in the case of the first, on the date falling ninety (90) days before the Intended Delivery Date, in the case of the second, and otherwise as soon as practicable (and in any event within sixty (60) days after the close of each of the first three (3) quarters of its financial year and within one hundred and twenty (120) days after the close of each financial year) a statement signed by the Group’s chief financial officer in the form of Schedule 1 (commencing with the second quarter of the financial year ending 31 December 2006);
 
  9.2.6   promptly, such further information in its possession or control regarding its financial condition and operations and those of any company in the Group, including but without limitation a corporate structure chart for the

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      Group including details of the percentage of the shareholdings held, as the Agent may request for the benefit of the Finance Parties; and
  9.2.7   details of any material litigation, arbitration or administrative proceedings which affect any Obligor as soon as the same are instituted and served, or, to the knowledge of the Guarantor, threatened (and for this purpose proceedings shall be deemed to be material if they involve a claim in an amount exceeding [**] [Confidential Treatment] million Dollars [**] [Confidential Treatment] or the equivalent in another currency).
      All accounts required under this Clause 9.2 shall be prepared in accordance with GAAP and shall fairly represent the financial condition of the relevant company. In this Clause 9.2 “Group” shall have the meaning ascribed to it in Clause 11.4.
 
  9.3   Subject to the provisions of Clause 11.3, the Guarantor will procure that any dividends or other distributions and interest paid or payable in connection with such dividends or other distributions will be received by the Guarantor by way of dividend promptly.
 
  9.4   The Guarantor will keep proper books of record and account in which proper and correct entries shall be made of all financial transactions and the assets, liabilities and business of the Guarantor in accordance with GAAP.
 
  9.5   The Guarantor will notify the Agent of any Event of Default forthwith upon the Guarantor becoming aware of the occurrence thereof.
 
  9.6   The Guarantor will procure that all such authorisations, approvals, consents, licences and exemptions as may be required under any applicable law or regulation to enable it to perform its obligations under, and ensure the validity or enforceability of, this Deed are obtained and promptly renewed from time to time and will promptly furnish certified copies thereof to the Agent upon request and will procure that the terms of the same are complied with at all times.
 
  9.7   The Guarantor will do all such things as are necessary to maintain its corporate existence in good standing and will ensure that it has the right and is duly qualified to conduct its business as it is conducted in all applicable jurisdictions and will obtain and maintain all franchises and rights necessary for the conduct of its business.
10   General Undertakings: Negative Covenants
  10.1   The undertakings contained in this Clause 10 shall remain in full force from the date of this Deed until the end of the Security Period.
 
  10.2   Except with the prior written consent of the Agent (acting on the instructions of the Lenders in the case of a sale of the Vessel pursuant to Clause 10.2.1), the Guarantor will not, and will procure that no other member of the Group will, either in a single transaction or in a series of transactions whether related or not and whether voluntarily or involuntarily, agree to or actually sell, assign, abandon or otherwise transfer or dispose of all or any of its assets or any share or interest therein except that:

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  10.2.1   the Borrower may agree to sell the Vessel on the condition that contemporaneously with the completion of the sale the Loan is prepaid in accordance with the provisions of clause 11 of the Loan Agreement;
 
  10.2.2   the Borrower may let the Vessel on charter in accordance with the provisions of clause 10 of the Loan Agreement;
 
  10.2.3   disposals may be made in the ordinary course of trading of the disposing entity (excluding disposal of ships) including without limitation, the payment of cash as consideration for the purchase or acquisition of any asset or service or in the discharge of any obligation incurred for value in the ordinary course of trading;
 
  10.2.4   disposals may be made (other than by the Borrower) to another member of the Group;
 
  10.2.5   disposals of cash raised or borrowed may be made for the purposes for which such cash was raised or borrowed;
 
  10.2.6   disposals of assets in exchange for other assets comparable or superior as to type and value may be made; and
 
  10.2.7   a vessel owned by any member of the Group (other than the Borrower) may be sold provided such sale is on a willing seller willing buyer basis at or about market rate and at arm’s length subject always to the provisions of any loan documentation for the financing of such vessel.
  10.3   Except with the prior written consent of the Agent, the Guarantor will not, and will procure that no other member of the Group will, make any loan or advance or extend credit to any person, firm or corporation except in the ordinary course of business (in this Clause, “Group” shall exclude the Borrower).
 
  10.4   The Guarantor will not, and will procure that no other member of the Group will, issue or enter into any one (1) or more guarantee or indemnity or otherwise become directly or contingently liable for the obligations of any other person, firm or corporation without notifying the Agent promptly thereafter with full details of the amount(s) and the period(s) of the guarantee(s) or indemniteeies), if such is or are in excess of (in aggregate (if applicable)) the amount of [**] [Confidential Treatment] Dollars [**] [Confidential Treatment].
 
  10.5   Except with the prior written consent of the Agent, the Guarantor will not, and will procure that no other member of the Group will, make or threaten to make any substantial change in its business as presently conducted, or carry on any other business which is substantial in relation to its business as presently conducted so as to affect, in the reasonable opinion of the Agent, the ability of the Guarantor or the Borrower to perform its obligations under the Security Documents to which it is a party PROVIDED THAT any new leisure or hospitality venture embarked upon by any member of the Group shall not constitute a substantial change in its business (in this Clause, “Group” shall exclude the Borrower).
 
  10.6   The Guarantor and any other member of the Group may enter into any amalgamation, restructure, substantial reorganisation, merger, de-merger,

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      consolidation, winding-up, dissolution or anything analogous to the foregoing or acquire any equity, share capital or obligations of any corporation or other entity if such entry or acquisition would not:
  10.6.1   imperil the security created by any of the Security Documents or the Coface Insurance Policy;
 
  10.6.2   affect the ability of any Obligor duly to perform any of its obligations under any Security Document to which it may be a party at any time; or
 
  10.6.3   affect the ability of the Guarantor to comply with the financial undertakings contained in Clause 11,
      after any such amalgamation, restructure, substantial reorganisation, merger, de-merger, consolidation, winding-up, dissolution or anything analogous to the foregoing or acquisition of any equity, share capital or obligations of any corporation or other entity (in this Clause, “Group” shall exclude the Borrower).
  10.7   Except with the prior written consent of the Agent, the Guarantor will not alter its financial year end.
 
  10.8   The Guarantor has not taken and shall not take from any other Obligor any security or counter-security in respect of any of its obligations under this Deed PROVIDED ALWAYS that if the Guarantor, in breach of this Clause, takes any security or counter-security as aforesaid, such security shall be held by the Guarantor as trustee upon trust for the Beneficiaries.
11   Financial Undertakings and Ownership and Control of the Guarantor
  11.1   The Guarantor will ensure that for the financial quarter ending as at 30 June 2006, for the financial quarter ending immediately prior to or on the date falling ninety (90) days before the Intended Delivery Date and for each subsequent financial quarter:
  11.1.1   at all times the minimum Free Liquidity will be not less than [**] [Confidential Treatment] Dollars [**] [Confidential Treatment];
 
  11.1.2   either:
  (a)   as at the end of each financial quarter the ratio of Consolidated EBITDA to Consolidated Debt Service for the Group, computed for the period of the four (4) consecutive financial quarters ending at the end of the relevant financial quarter, shall not be less than [**] [Confidential Treatment] to [**] [Confidential Treatment]; or
 
  (b)   at all times during the period of twelve (12) months ending as at the end of the relevant financial quarter the Group has maintained a minimum Free Liquidity in an amount which is not less than [**] [Confidential Treatment] Dollars [**] [Confidential Treatment]; and
  11.1.3   as at the end of each financial quarter the ratio of Total Net Funded Debt to Total Capitalisation of the Group shall not exceed:

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  (a)   [**] [Confidential Treatment] to [**] [Confidential Treatment] for financial quarters ending on or before 31 December 2007; and
 
  (b)   [**] [Confidential Treatment] to [**] [Confidential Treatment] for each subsequent financial quarter.
      Amounts available for drawing under any revolving or other credit facilities of the Group which remain undrawn at the time of the relevant calculation shall not be counted as cash or indebtedness for the purposes of this ratio.
  11.2   It will be an Event of Default if:
  11.2.1   at any time when the ordinary share capital of the Guarantor is not publicly listed on an Approved Stock Exchange or at any time when a dividend is paid to the existing shareholders of the Guarantor by way of a share issue pursuant to a public offering on an Approved Stock Exchange, the Lim Family together or individually do not, directly or indirectly, control the Guarantor and beneficially own, directly or indirectly, at least fifty one per cent (51%) of the issued share capital of, and equity interest in, the Guarantor; or
 
  11.2.2   at any time following the listing of the ordinary share capital of the Guarantor on an Approved Stock Exchange:
  (a)   any individual or any Third Party:
  (i)   owns legally and/or beneficially and either directly or indirectly at least [**] [Confidential Treatment] per cent [**] [Confidential Treatment] of the ordinary share capital of the Guarantor; or
 
  (ii)   has the right or the ability to control either directly or indirectly the affairs of or the composition of the majority of the board of directors (or equivalent) of the Guarantor;
      and, at the same time as any of the events described in paragraphs (i) or (ii) of this Clause has occurred and remains unremedied, the Lim Family together or individually do not, directly or indirectly, beneficially own at least fifty one per cent (51%) of the issued share capital of, and equity interest in, the Guarantor; or
  (b)   the Guarantor ceases to be a listed company on an Approved Stock Exchange without the prior written consent of the Agent,
      (and, for the purpose of this Clause 11.2.2 “control” of any company, limited partnership or other legal entity (a “body corporate”) by a member of the Lim Family, means that one (1) or more members of the Lim Family has, directly or indirectly, the power to direct the management and policies of such a body corporate, whether through the ownership of more than fifty per cent (50%) of the issued voting capital of that body corporate or by contract, trust or other arrangement).

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  11.3   During any financial year of the Guarantor until the date on which the Guarantor becomes a listed company on an Approved Stock Exchange (on which date the restriction contained in this Clause 11.3 shall cease to apply), the Guarantor shall not and shall procure that no other member of the Group shall, pay any dividends or make any other distributions in respect of its share capital to any person or make any repayments of capital or payments of interest in respect of Financial Indebtedness to an Affiliate of the Guarantor (other than to the Guarantor and/or its wholly owned Subsidiaries) which during any financial year of the Guarantor in aggregate exceeds [**] [Confidential Treatment] per cent [**] [Confidential Treatment] of the Consolidated Net Income (if positive) of the Group for such financial year, PROVIDED HOWEVER THAT the Group shall not be entitled to pay any dividend or make any distribution in respect of any of its share capital or make any repayments of capital or payments of interest if an Event of Default has occurred and remains unremedied or would occur as a result of the payment of such dividend or the making of such distribution.
 
  11.4   In Clause 11.1, Clause 11.2, Clause 11.3 and Schedule 1:
   11.4.1   “Affiliate” means, with respect to any person, any other person controlling, controlled by or under common control with, such person and for purposes of this definition, “control” (including, with correlative meanings, the terms “controlling”, “controlled by” and “under common control with”), as applied to any person, means the possession, directly or indirectly, of the power to vote ten per cent (10%) or more of the securities having voting power for the election of directors of such person, or otherwise to direct or cause the direction of the management and policies of that person, whether through the ownership of voting securities or by contract or otherwise;
 
   11.4.2   “Approved Stock Exchange” means the New York Stock Exchange, NASDAQ or such other stock exchange in the United States of America as is approved in writing by the Agent;
 
   11.4.3   “Cash Balance” means, at any date of determination, the unencumbered and otherwise unrestricted cash and cash equivalents of the Group;
 
   11.4.4   “Consolidated Debt Service” means, for any relevant period, the sum (without double counting), determined in accordance with GAAP, of:
   (a)   the aggregate principal payable or paid during such period on any Indebtedness of any member of the Group, other than:
  (i)   principal of any such Indebtedness prepaid at the option of the relevant member of the Group;
 
  (ii)   principal of any such Indebtedness prepaid upon the sale or Total Loss of any vessel owned or leased under a capital lease by any member of the Group; and
 
  (iii)   balloon payments of any such Indebtedness payable during such period (and for the purpose of this paragraph (iii) a “balloon payment” shall not include any

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      scheduled repayment instalment of such Indebtedness which forms part of the balloon);
  (b)   Consolidated Interest Expense for such period;
 
  (c)   the aggregate amount of any dividend or distribution of present or future assets, undertakings, rights or revenues to any shareholder of any member of the Group (other than the Guarantor or one of its wholly owned Subsidiaries) or any distribution in respect of share capital during such period (“Distributions”); and
 
  (d)   all rent under any capital lease obligations by which the Guarantor or any consolidated Subsidiary is bound which are payable or paid during such period and the portion of any debt discount that must be amortised in such period,
      as calculated in accordance with GAAP and derived from the then latest unaudited consolidated accounts of the Guarantor delivered to the Agent in the case of any period ending at the end of any of the first three (3) financial quarters of each financial year of the Guarantor and the then latest Accounts delivered to the Agent in the case of the final quarter of each such financial year;
 
  11.4.5   “Consolidated EBITDA” means, for any relevant period, the aggregate of:
  (a)   Consolidated Net Income from the Guarantor’s operations for such period; and
 
  (b)   the aggregate amounts deducted in determining Consolidated Net Income for such period in respect of gains and losses from the sale of assets or reserves relating thereto, Consolidated Interest Expense, depreciation and amortisation, impairment charges and any other non-cash charges and deferred income tax expense for such period;
  11.4.6   “Consolidated Interest Expense” means, for any relevant period, the consolidated interest expense (excluding capitalised interest) of the Group for such period;
 
  11.4.7   “Consolidated Net Income” means, for any relevant period, the consolidated net income (or loss) of the Group for such period as determined in accordance with GAAP;
 
  11.4.8   “Free Liquidity” means, at any date of determination, the aggregate of the Cash Balance and any amounts freely available for drawing under any revolving or other credit facilities of the Group, which remains undrawn, could be drawn for general working capital purposes or other general corporate purposes and would not, if drawn, be repayable within six (6) months;

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  11.4.9   “Group” means, for the purposes of this Clause 11, the Guarantor, its Subsidiaries and any other entity which is required to be consolidated in the Guarantor’s accounts in accordance with GAAP;
 
  11.4.10   “Indebtedness” means Financial Indebtedness (whether present or future, actual or contingent, long-term or short-term, secured or unsecured) in respect of:
  (a)   moneys borrowed or raised;
 
  (b)   the advance or extension of credit (including interest and other charges on or in respect of any of the foregoing);
 
  (c)   the amount of any liability in respect of leases which, in accordance with GAAP, are capital leases;
 
  (d)   the amount of any liability in respect of the purchase price for assets or services payment of which is deferred for a period in excess of one hundred and eighty (180) days;
 
  (e)   all reimbursement obligations whether contingent or not in respect of amounts paid under a letter of credit or similar instrument; and
 
  (f)   (without double counting) any guarantee of Financial Indebtedness falling within paragraphs (a) to (e) above;
      PROVIDED THAT the following shall not constitute Indebtedness:
  (i)   loans and advances made by other members of the Group which are subordinated to the rights of the Finance Parties;
 
  (ii)   loans and advances made by the Guarantor’s parent company which are subordinated to the rights of the Finance Parties; and
 
  (iii)   any liabilities of the Guarantor or any other member of the Group to a counterparty under any master agreement relating to the interest or currency exchange transactions of a non-speculative nature.
  11.4.11   “Lim Family” means:
  (a)   Tan Sri Lim Goh Tong;
 
  (b)   his spouse;
 
  (c)   his direct lineal descendants;
 
  (d)   the personal estate of any of the above persons; and
 
  (e)   any trust created for the benefit of one or more of the above persons and their estates;
  11.4.12   “Third Party” means any person or group of persons acting in concert (as the expression “acting in concert” is defined in the City Code on

17


 

      Take-overs and Mergers) who or which is not a member of the Lim Family;
 
  11.4.13   “Total Capitalisation” means, at any date of determination, Total Net Funded Debt plus the consolidated stockholders’ equity of the Group at such date determined in accordance with GAAP and derived from the then latest unaudited and consolidated accounts of the Guarantor delivered to the Agent in the case of the first three (3) quarters of each financial year and the then latest Accounts delivered to the Agent in the case of the final quarter of each financial year;
 
  11.4.14   “Total Net Funded Debt” means, as at any relevant date:
  (a)   Indebtedness of the Group; and
 
  (b)   the amount of any Indebtedness of any person which is not a member of the Group but which is guaranteed by a member of the Group as at such date;
      less an amount equal to any Cash Balance as at such date.
  11.5   Save as specified in Clause 11.1.2, the ratios referred to in Clause 11.1 will be measured on a quarterly basis by reference to the consolidated accounts of the Guarantor.
12   Discharge
  12.1   Subject to Clause 4.3, following the irrevocable repayment or payment to the Lenders or the Agent (for itself and on behalf of the Lenders) of all the Outstanding Indebtedness the Beneficiaries will at the Guarantor’s request return this Deed to the Guarantor and shall, at the request and cost of the Guarantor, transfer to the Guarantor such rights as the Beneficiaries may at such time have in the security for the Outstanding Indebtedness and to the proceeds of any such rights or security.
13   Assignment and Transfer
  13.1   This Deed shall be binding upon and enure to the benefit of the Beneficiaries and their successors and permitted assigns and transferees.
 
  13.2   The Guarantor shall not be entitled to assign or transfer all or any part of its rights, benefits or obligations under this Deed.
 
  13.3   The Lenders and/or the Agent may transfer their respective rights hereunder to any person to whom their respective rights and obligations under the Loan Agreement are transferred in accordance with the Loan Agreement.
 
  13.4   Any Finance Party may disclose to any of its Affiliates and to the following other persons:
  (a)   any person to (or through) whom that Lender assigns or transfers (or may potentially assign or transfer) all or any of its rights and obligations under this Deed;

18


 

  (b)   any person with (or through) whom that Lender enters into (or may potentially enter into) any sub-participation in relation to, or any other transaction under which payments are to be made by reference to, this Deed or any Obligor;
 
  (c)   any person to whom, and to the extent that, information is required to be disclosed by any applicable law or regulation;
 
  (d)   any other Finance Party, or any employee, officer, director or representative of such entity which needs to know such information or receive such document in the course of such person’s employ or duties;
 
  (e)   Coface, or any employee, officer, director or representative of such entity which needs to know such information or receive such document in the course of such person’s employ or duties;
 
  (f)   the Guarantor or any other member of the Group, or any employee, officer, director or representative of such entity which needs to know such information or receive such document in the course of such person’s employ or duties; or
 
  (g)   auditors, insurance and reinsurance brokers, insurers and reinsurers and professional advisers, including legal advisers, which need to know such information,
      any information about any Obligor, this Deed and the other Security Documents as that Finance Party shall consider appropriate. Each of the Finance Parties may also disclose to the Builder, or any employee, officer, director or representative of the Builder which needs to know such information or receive such document in the course of such person’s employ or duties, such information about any Obligor, this Deed and the other Security Documents as that Finance Party reasonably considers normal practice for a French export credit.
 
      Each of the Finance Parties acknowledges that all information received now or in the future from or on behalf of the Obligors under or pursuant to or in connection with the Transaction Documents or the Coface Insurance Policy (other than any information which is in the public domain other than as a result of a breach of this Clause) is confidential information and undertakes to advise this fact to any recipient of any such information under this Clause.
 
  13.5   A person (including any body of persons) who is not a party to this Deed has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce any term of this Deed but this does not affect any right or remedy of a third party which exists or is available apart from that Act.
14   Miscellaneous Provisions
  14.1   No failure to exercise and no delay in exercising on the part of the Beneficiaries or any of the other Finance Parties any right or remedy under this Deed or under any other of the Security Documents shall operate as a waiver thereof, nor shall any single or partial exercise of any right or remedy preclude any other or further exercise thereof or the exercise of any other right or remedy. No waiver by the

19


 

      Beneficiaries or any of the other Finance Parties shall be effective unless it is in writing.
 
  14.2   The rights and remedies of the Finance Parties provided herein and in the other Security Documents are cumulative and not exclusive of any rights or remedies provided by law.
 
  14.3   If any provision of this Deed or the Loan Agreement or any other Security Document to which any Obligor is a party is prohibited or unenforceable in any jurisdiction, such prohibition or unenforceability shall not invalidate the remaining provisions hereof or thereof or affect the validity or enforceability of such provision in any other jurisdiction.
 
  14.4   Time is of the essence in respect of all of the obligations of the Guarantor under this Deed.
15   Waiver of Immunity
  15.1   The Guarantor irrevocably and unconditionally:
  15.1.1   waives any right of immunity which it or its assets now has or may hereafter acquire in relation to any legal proceedings (including, but without limitation, actions in rem and/or in personam) brought against it or its assets by the Beneficiaries in relation to this Deed; and
 
  15.1.2   consents generally in respect of any such proceedings to the giving of any relief including, without limitation, the issue of any process in connection with such proceedings and the making, enforcement or execution against any property whatsoever (irrespective of its use or intended use) of any order or judgment which may be made or given in such proceedings.
16   Notices
  16.1   Each notice, demand or other communication to be made under this Deed shall be made in writing which, unless otherwise stated, includes telefax.
 
  16.2   Any notice, demand or other communication to be made or delivered by the Agent to the Guarantor pursuant to this Deed shall (unless the Guarantor has by fifteen (15) days’ written notice to the Agent specified another address) be made or delivered to the Guarantor at 7665 Corporation Center Drive, Miami, Florida 33126, United States of America marked for the attention of Ms Bonnie Biumi (telefax no. + 1 305 436 4140) and the Legal Department (telefax no. +1 305 436 4117) and shall be deemed to have been made or delivered (in the case of telefax) when transmission of such telefax communication has been completed or (in the case of any letter) when delivered to the aforesaid address or (as the case may be) five (5) days after being deposited in the post first class postage prepaid in an envelope addressed to it at that address. Any notice, demand or other communication to be made or delivered by the Guarantor to the Agent pursuant to this Deed shall (unless the Agent has by fifteen (15) days’ written notice to the Guarantor specified another address) be made or delivered to the Agent (for itself and on behalf of the Lenders) at its office for the time being which is at present at BNP Paribas, ECEP/Export Finance, ACI:CHDESA1, 37 Place du Marché Saint- Honoré, 75031 Paris Cedex 01, France marked for the attention of

20


 

      Mrs Dominique Laplasse (telefax no. +33 1 43 16 81 84) and shall be deemed to have been made or delivered (in the case of telefax) when transmission of such telefax communication has been completed or (in the case of any letter) when delivered to the aforesaid address or (as the case may be) five (5) days after being deposited in the post first class postage prepaid in an envelope addressed to it at that address.
  16.3   Each notice, demand or other communication made or delivered by one (1) party to the other pursuant to this Deed shall be in the English language or accompanied by a certified English translation.
17   Governing Law
 
    This Deed shall be governed by and construed in accordance with the laws of England.
 
18   Jurisdiction
  18.1   The courts of England have exclusive jurisdiction to settle any dispute arising out of or in connection with this Deed (including a dispute regarding the existence, validity or termination of this Deed) (a “Dispute”). Each party to this Deed agrees that the courts of England are the most appropriate and convenient courts to settle Disputes and accordingly no party will argue to the contrary.
 
      This Clause 18.1 is for the benefit of the Beneficiaries only. As a result, such party shall not be prevented from taking proceedings relating to a Dispute in any other courts with jurisdiction. To the extent allowed by law, such party may take concurrent proceedings in any number of jurisdictions.
 
  18.2   The Guarantor may not, without the Agent’s prior written consent, terminate the appointment of the Process Agent; if the Process Agent resigns or its appointment ceases to be effective, the Guarantor shall within fourteen (14) days appoint a company which has premises in London and has been approved by the Agent to act as the Guarantor’s process agent with unconditional authority to receive and acknowledge service on behalf of the Guarantor of all process or other documents connected with proceedings in the English courts which relate to this Deed.
 
  18.3   For the purpose of securing its obligations under Clause 18.2, the Guarantor irrevocably agrees that, if it for any reason fails to appoint a process agent within the period specified in Clause 18.2, the Agent may appoint any person (including a company controlled by or associated with the Agent or any Lender) to act as the Guarantor’s process agent in England with the unconditional authority described in Clause 18.2.
 
  18.4   No neglect or default by a process agent appointed or designated under this Clause (including a failure by it to notify the Guarantor of the service of any process or to forward any process to the Guarantor) shall invalidate any proceedings or judgment.
 
  18.5   The Guarantor appoints in the case of the courts of England the Process Agent to receive, for and on its behalf service of process in England of any legal proceedings with respect to this Deed.

21


 

  18.6   A judgment relating to this Deed which is given or would be enforced by an English court shall be conclusive and binding on the Guarantor and may be enforced without review in any other jurisdiction.
 
  18.7   Nothing in this Clause shall exclude or limit any right which the Beneficiaries may have (whether under the laws of any country, an international convention or otherwise) with regard to the bringing of proceedings, the service of process, the recognition or enforcement of a judgment or any similar or related matter in any jurisdiction.
 
  18.8   In this Clause “judgment” includes order, injunction, declaration and any other decision or relief made or granted by a court.
IN WITNESS whereof this Deed of Guarantee and Indemnity has been executed by the parties hereto on the day first written above.
                 
SIGNED SEALED and DELIVERED as a DEED
        )     Colin Veitch
for and on behalf of
        )      
NCL CORPORATION LTD.
        )      
acting by COLIN VEITCH
        )      
its duly appointed attorney-in-fact
        )      
in the presence of:
  PAUL ALAN TURNER     )      
 
  PAUL ALAN TURNER     )      
 
  SOLICITOR, CLIFFORD CHANCE LLP     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Signature Illegible
for and on behalf of
        )      
BNP PARIBAS
        )      
as a Lender Sandrine FERDANE
        )      
acting by Jean-Daniel AMSLER
        )      
its duly appointed AUTHORIZED SIGNATORIES
        )      
in the presence of:
  Jean Philippe POIRIER     )      
 
  MANAGER, BNPPARIBAS     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Signature Illegible
for and on behalf of
        )      
CALYON
        )      
acting by Jerome LEBLOND
        )      
its duly appointed attorney-in-fact
        )      
in the presence of:
  Jean Philippe POIRIER     )      
 
  MANAGER, BNPPARIBAS     )      

22


 

                 
SIGNED SEALED and DELIVERED as a DEED
        )               
for and on behalf of
        )              
HSBC FRANCE GILLES PINOT
        )              
acting by ERICK RADAT
        )     Signature Illegible         
its duly appointed Authorized Signatories
        )              
in the presence of:
  Jean Philippe POIRIER     )              
 
  MANAGER, BNPPARIBAS                    
SIGNED SEALED and DELIVERED as a DEED
        )              
for and on behalf of
        )              
SOCIETE GENERALE
        )              
acting by Isabelle GUILLOU
        )     Signature Illegible         
its duly appointed AUTHORIZED SIGNATORY
                        
Global Head of Export Finance
  Export Finance     )              
in the presence of:
  Jean Philippe POIRIER     )              
 
  MANAGER, BNPPARIBAS                    
SIGNED SEALED and DELIVERED as a DEED
        )              
for and on behalf of
        )              
BNP PARAIBAS
        )              
as the Agent Sandrine FERDANE
        )     Signature Illegible         
acting by Jean-Daniel AMSLER
        )              
its duly appointed AUTHORIZED SIGNATORIES
        )            
in the presence of:
  Jean Philippe POIRIER     )              
 
  MANAGER, BNPPARIBAS                    

23


 

Schedule 1
Quarterly Statement of Financial Covenants
TO:     BNP PARIBAS
            ECEP/Export Finance
            ACI:CHDESA 1
            37 Place du Marché Saint-Honoré
            75031 Paris Codex 01
            France
            
            Attn: Mrs Dominique Laplasse
            
            (as the Agent (as such term is defined in the Guarantee (as hereinafter defined))
We refer to clause 11 of the guarantee dated 2006 (as amended, varied and/or supplemented from time to time the “Guarantee”) issued by us in favour of the Beneficiaries. Terms defined in the Guarantee, whether by reference to the Loan Agreement (as therein defined) or otherwise, shall have the same meanings herein.
We hereby certify the amounts set out in the attached schedule as at the last day of the financial quarter ending #20[ ] for NCL Corporation Ltd. (the “Guarantor”) and its subsidiaries on a consolidated basis. We also hereby certify that the Guarantor is in compliance with all the financial covenants set out in clauses 11.1 and 11.3 of the Guarantee and that no Event of Default has occurred and remains unremedied.
NCL CORPORATION LTD.
                                                            
By: [            ]
Chief Financial Officer
Dated:            20[ ]

24


 

Schedule
Statement of Financial Covenants as of [    ] 20[ ] (in USD’000)
             
Clause (of            
Guarantee       as of [ ]   Required Covenants
11.1.1/
  Free Liquidity   A   A>[**] [Confidential Treatment]
11.1.2(b)**
          (11.1.1)**
 
           
 
          A>[**] [Confidential Treatment]
 
          (11.1.2(b))**
 
           
11.1.2(a)
  Consolidated EBITDA:   B   >[**] [Confidential Treatment]
 
           
 
  Consolidated Debt Service   C    
 
           
11.1.3
  Total Net Funded Debt:   D   <[**] [Confidential Treatment] up to
31 December 2007
<[**] [Confidential Treatment] thereafter
 
           
 
  Total Capitalisation   E    
                 
 
  Consolidated EBITDA            
 
  Consolidated Net Income (loss)     x      
(Deduct)/Add:
  (Gain)/Loss on sale of assets or reserves     x      
Add:
  Consolidated Interest Expense     x      
Add:
  Depreciation and amortisation of assets     x      
Add:
  Impairment charges     x      
(Deduct)/Add:
  Other non-recurring charges (gains)     x      
Add:
  Deferred income tax expense     x      
 
             
 
  Consolidated EBITDA     x     B
 
             
 
  Consolidated Debt Service            
 
  Principal paid/payable (excluding balloon payments, voluntary     x      
 
  prepayments/repayments on sale/total loss of an NCLC Fleet            
 
  vessel)            
Add:
  Consolidated Interest Expense     x      
 
  Distributions     x      
 
  Rent under capitalised leases     x      
 
             
 
  Consolidated Debt Service     x     C
 
             
 
  Total Net Funded Debt            
 
  Indebtedness     x      
Add:
  Guarantees of non-NCLC Group members’
obligations
    x      
 
             
 
        x      
 
             
Deduct:
  Cash Balance     (x )    
 
             
 
  Total Net Funded Debt     (x )   D
 
             
 
  Total Capitalisation            
 
  Total Net Funded Debt     x      
Add:
  Consolidated stockholders’ equity     x      
 
             
 
  Total Capitalisation     x     E
 
             

25


 

For and on behalf of NCL CORPORATION LTD.
                                                            
[            ]
I, [       ], the officer primarily responsible for the financial management of the Group, hereby declare that, to the best of knowledge and belief, the above Statement of Financial Covenants as of [ ] 20[ ], in my opinion, is true and correct.
                                                            
[            ]
Chief Financial Officer
NCL CORPORATION LTD.
Dated:            20[ ]
 
**   Evidence satisfactory to the Agent of A at all times during the relevant period shall be provided together with this statement

26


 

Schedule 2
Particulars of Agent and Lenders
         
        Registered Number with
        the Registry of Trade and
Name   Registered Address   Companies
BNP PARIBAS
(as Agent and Lender)
  16 boulevard des Italiens,
75009 Paris, France
  662 042 449 (RCS Paris)
 
       
CALYON
(as Lender)
  9 quai du President Paul
Doumer, 92920 Paris La
Defense Cedex, France
  304 187 701 (RCS Nanterre)
 
       
HSBC FRANCE
(as Lender)
  103 avenue des Champs
Elysees, 75419 Paris,
Cedex 08, France
  775 670 284 (RCS Paris)
 
       
SOCIETE GENERALE
(as Lender)
  29 boulevard Haussmann,
75009 Paris, France
  552 120 222 (RCS Paris)
 
       
each a French société anonyme
       

27

EX-4.34 11 g05791exv4w34.htm EX-4.34 SYNDICATE LOAN FACILITY/HULL D33 EX-4.34 Syndicate Loan Facility/Hull D33
 

Exhibit 4.34
[Confidential Treatment]
     
 
   
DATED 22 SEPTEMBER 2006
F3 TWO, LTD.
as Borrower
BNP PARIBAS
as Agent
BNP PARIBAS, CALYON, HSBC FRANCE AND SOCIETE GENERALE
as Mandated Lead Arrangers and Lenders
 
LOAN AGREEMENT
Hull No. D33
EUR662,905,320
 


 

CONTENTS
             
Clause       Page  
1.
  DEFINITIONS AND CONSTRUCTION     2  
 
           
2.
  AVAILABILITY OF THE LOAN     9  
 
           
3.
  DRAWING     9  
 
           
4.
  REPAYMENT OF LOAN AND PAYMENT OF INTEREST     15  
 
           
5.
  CLAIMS OR DEFENCES MAY NOT BE OPPOSED TO THE LENDERS     15  
 
           
6.
  COFACE PREMIUM     15  
 
           
7.
  FEES     16  
 
           
8.
  TAXES, INCREASED COSTS, COSTS AND RELATED CHARGES     17  
 
           
9.
  REPRESENTATIONS AND WARRANTIES     19  
 
           
10.
  UNDERTAKINGS     24  
 
           
11.
  PREPAYMENT     38  
 
           
12.
  INTEREST ON LATE PAYMENTS     38  
 
           
13.
  ACCELERATION - EVENTS OF DEFAULT     39  
 
           
14.
  MANDATORY PREPAYMENT     44  
 
           
15.
  CURRENCY OF PAYMENT     44  
 
           
16.
  SECURITY     45  
 
           
17.
  APPLICATION OF SUMS RECEIVED     45  
 
           
18.
  CHANGES TO THE LENDERS     45  
 
           
19.
  CHANGES TO THE OBLIGORS     49  
 
           
20.
  ROLE OF THE AGENT AND THE MANDATED LEAD ARRANGERS     49  
 
           
21.
  CONDUCT OF BUSINESS BY THE FINANCE PARTIES     53  
 
           
22.
  SHARING AMONG THE FINANCE PARTIES     54  
 
           
23.
  PAYMENT MECHANICS     55  
 
           
24.
  GOVERNING LAW     57  
 
           
25.
  ENFORCEMENT     57  
 
           
26.
  APPENDICES     57  
 
           
27.
  NOTICES     57  
 
           
28.
  MISCELLANEOUS     58  
 
           
29.
  COMING INTO FORCE     58  

 


 

THIS LOAN AGREEMENT (the “Agreement”) is entered into this day of September 2006
BETWEEN:
(1)   F3 TWO, LTD., a company incorporated in and existing under the laws of Bermuda with registration number EC38768 and with its registered office at Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda (the “Borrower”);
 
(2)   THE SEVERAL BANKS, particulars of which are set out in Appendix II as lenders (the “Original Lenders”);
 
(3)   THE SEVERAL BANKS, particulars of which are set out in Appendix II as mandated lead arrangers (the “Mandated Lead Arrangers”); and
 
(4)   BNP PARIBAS as agent for the lenders (the “Agent”).
WHEREAS:
(A)   A shipbuilding contract was signed as of 7 September 2006 (the “Building Contract”), between the Borrower and Aker Yards S.A. (the “Builder”) for the design, construction and delivery of a two thousand one hundred (2,100) passenger cabin cruise vessel having hull no. D33, specification hull no. [**] [Confidential Treatment] dated 7 September 2006, to be ready for delivery on 31 May 2010 (the “Vessel”).
 
(B)   The contract price of the Vessel is seven hundred and thirty five million euro (EUR735,000,000) (subject to adjustment in accordance with the terms of the Building Contract) (the “Contract Price”), payable at the times and in the manner specified in the Building Contract. The terms of payment of the Contract Price are as follows:
  (i)   [**] [Confidential Treatment] payable within three (3) Working Days (as defined in the Building Contract) after the Effective Date (as defined in the Building Contract);
 
  (ii)   [**] [Confidential Treatment] payable on first steel cutting but not before [**] [Confidential Treatment];
 
  (iii)   [**] [Confidential Treatment] payable on completion of keel laying but not before [**] [Confidential Treatment];
 
  (iv)   [**] [Confidential Treatment] payable on the date the Vessel is launched into the water at the yard of the Builder but not before [**] [Confidential Treatment]; and
 
  (v)   the remainder payable upon delivery and acceptance of the vessel.
(C)   The Contract Price may be increased or decreased from time to time with respect to certain modifications to the Building Contract, the plans or the specification (the “Change Orders”).
 
(D)   The Lenders agree to make available to the Borrower a loan facility on the terms and conditions set out herein for the purpose of assisting the Borrower to finance part of the Contract Price (including the amount of the Change Orders) and the related Coface Premium.

 


 

NOW THEREFORE, it is agreed as follows:
1.   DEFINITIONS AND CONSTRUCTION
 
1.1   Definitions
 
    In this Agreement (including the Recitals) and the Appendices (all of which form an integral part of this Agreement) the following expressions shall have the meanings set out opposite them below.
 
    “Affiliate” means, with respect to any person, any other person controlling, controlled by or under common control with, such person and for purposes of this definition, “control” (including, with correlative meanings, the terms “controlling”, “controlled by” and “under common control with”), as applied to any person, means the possession, directly or indirectly, of the power to vote ten per cent. (10%) or more of the securities having voting power for the election of directors of such person, or otherwise to direct or cause the direction of the management and policies of that person, whether through the ownership of voting securities or by contract of otherwise.
 
    “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).
 
    “Assignment of Earnings” means an assignment to be entered into between the Borrower and the Finance Parties and to be in the agreed form.
 
    “Assignment of Insurances” means an assignment to be entered into between the Borrower, the Manager, if applicable, and the Finance Parties and to be in the agreed form.
 
    “Assignment of Management Agreement” means an assignment to be entered into between the Borrower and the Finance Parties and to be in the agreed form.
 
    “Assignment of Warranty Rights” means an assignment to be entered into between the Borrower and the Finance Parties with respect to the Borrower’s rights under the post-delivery warranty given by the Builder under the Building Contract.
 
    “Availability Termination Date” means the date falling [**] [Confidential Treatment]  days (being the period stipulated in article 9, clause 2.1(i)(b) of the Building Contract) after [**] [Confidential Treatment].
 
    “Building Contract” means that certain contract entered into between the Borrower and the Builder dated as of 7 September 2006, as from time to time amended, in respect of the design, construction and delivery of the Vessel.
 
    “Builder” means Aker Yards S.A., a company incorporated in France and having its principal office at Avenue Bourdelle — B.P. 90180, 44613 Saint-Nazaire Cedex, France, Republic of France.
 
    “Business Day” means a full day on which commercial banks are open for business and dealing in deposits in New York and Paris.
 
    “Certified Copy” means, in relation to any document delivered or issued by or on behalf of any company, a copy of such document certified as a true, complete and up-to-date copy of the original by any of the directors or the secretary or assistant secretary or any attorney-in-fact for the time being of that company.

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    “Change Order Amount” means the cost of the Change Orders.
 
    “Change Orders” means those certain change orders to the specifications of the Vessel as may be agreed to from time to time by the Borrower and the Builder, the net cost of which is payable at delivery.
 
    “CIRR” (Commercial Interest Reference Rate) means four point eight nine per cent. (4.89%) per annum being the fixed rate in force for medium and long term export credits in euro according to the Organisation for Economic Co-operation and Development rules as determined by the competent French Authorities.
 
    “Coface” means Compagnie Française d’Assurance pour le Commerce Extérieur a French société anonyme with its registered office at 12 Cours Michelet, La Défense, 92800 Puteaux, France, registered with the Registry of Commerce and Companies of Nanterre under number 552 069 791.
 
    “Coface Insurance Policy” means the insurance policy in respect of this Agreement to be issued by Coface for the benefit of the Lenders, in form and substance satisfactory to the Agent and the Lenders.
 
    “Coface Premium” means the amount payable by the Borrower to Coface through the Agent on the Delivery Date in respect of the Coface Insurance Policy which shall be [**] [Confidential Treatment] of the Total Financed Contract Price.
 
    “Commitment” means:
  (a)   in relation to an Original Lender, [**] [Confidential Treatment] of the Maximum Loan Amount and the amount of any other Commitment transferred to it under this Agreement; and
 
  (b)   in relation to any other Lender, the amount of any Commitment transferred to it under this Agreement,
    to the extent not increased, cancelled, reduced or transferred by it under this Agreement.
 
    “Compulsory Acquisition” means requisition for title or other compulsory acquisition of the Vessel including her capture, seizure, detention or confiscation or expropriation but excluding any requisition for hire by or on behalf of any government or governmental authority or agency or by any persons acting or purporting to act on behalf of any such government or governmental authority or agency.
 
    “Contract Price” means the total price payable by the Borrower to the Builder for the Vessel in accordance with the Building Contract being, as at the date of the Building Contract, seven hundred and thirty five million euro (EUR735,000,000).
 
    “Delivery Date” means the date and time stated in the Protocol of Delivery and Acceptance.
 
    “Document of Compliance” means a document issued to the Vessel’s operator as evidence of its compliance with the requirements of the ISM Code.
 
    “Dollar” and “USD” mean the lawful currency of the United States of America.
 
    “Drawdown Date” means the date on which the Loan is drawn down and applied in accordance with Clause 2.

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    “Drawdown Notice” means the drawdown notice and certificate duly executed by the Borrower substantially in the form of Appendix IV.
 
    “Earnings” means, in respect of the Vessel, (whether earned or to be earned) any and all freights, hire, fares and passage monies, proceeds of requisition (other than proceeds of Compulsory Acquisition), rebates and commissions, all earnings deriving from contracts of employment, demurrage, charterparties, contracts of affreightment, pooling agreements and joint ventures, compensation, remuneration for salvage and towage services, damages howsoever arising and detention monies, damages for breach of any charterparty or other contract for the employment of the Vessel, any amounts payable in consideration of the termination or variation of any charterparty or other such contract and any other earnings whatsoever due or to become due to the Borrower.
 
    “Encumbrance” means any mortgage, charge, pledge, lien, assignment, hypothecation, title retention, preferential right or trust arrangement or any other security agreement or arrangement.
 
    “EONIA” means the weighted average overnight rate calculated by the European Central Bank on all overnight unsecured lending transactions carried out in the euro area interbank money market and reported by the panel of reference banks selected for the calculation of the EONIA. This annual rate is published on page 247 of the Bridge/Telerate server or any other page as may replace such page, by the Banking Federation of the European Union prior to the start of operations on the TARGET Day following its reporting to the European Central Bank (D+1) by the reference banks.
 
    “euro” and “EUR” means the single currency of the Participating Member States.
 
    “Event of Default” means any one of the events specified in Clause 13.2.
 
    “Facility Office” means the office or offices notified by a Lender to the Agent in writing on or before the date it becomes a Lender (or, following that date, by not less than five (5) Business Days’ written notice) as the office or offices through which it will perform its obligations under this Agreement.
 
    “Financed Contract Price” means the lesser of five hundred and eighty eight million euro (EUR588,000,000) and eighty per cent. (80%) of the Contract Price less the Change Order Amount.
 
    “Financed Change Order Amount” means the lesser of fifty eight million eight hundred thousand euro (EUR58,800,000) and eighty per cent. (80%) of the Change Order Amount.
 
    “Finance Party” means the Agent, a Mandated Lead Arranger or a Lender and its successors in title, permitted assignees and permitted transferees.
 
    “Financial Indebtedness” means any obligation for the payment or repayment of money, whether as principal or as surety and whether present or future, actual or contingent.
 
    “French Authorities” means the Direction Générale du Trésor et de la Politique Economique of the French Ministry of Economy and Finance, any successors thereto, or any other authority in or of the French Republic having jurisdiction over and responsibility for the provision, management or regulation of the terms, conditions and issuance of export credits in or for the French Republic including (inter alia) such entities to whom authority in respect of extension or administration of export financing matters have been delegated, such as Coface.

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    “GAAP” means generally accepted accounting principles in the United States of America consistently applied (or, if not consistently applied, accompanied by details of the inconsistencies) including, without limitation, those set forth in the opinion and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board.
 
    “Group” means the Guarantor and its Subsidiaries.
 
    “Guarantee” means the guarantee of the obligations of the Borrower under this Agreement to be signed by the Guarantor and to be in the agreed form.
 
    “Guarantor” means NCL Corporation Ltd., a company incorporated in and existing under the laws of Bermuda with registration number EC34678 and with its registered office at Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda.
 
    “IAPPC” means a valid international air pollution prevention certificate for the Vessel issued under Annex VI.
 
    “Insurances” means all policies and contracts of insurance and entries of the Vessel in a protection and indemnity or war risks association which are effected in respect of the Vessel, her freights, disbursements, profits or otherwise and all benefits, including all claims and returns of premiums thereunder and shall also include all compensation payable by virtue of Compulsory Acquisition.
 
    “Intended Delivery Date” means 16 November 2009 (the date on which the Vessel will be ready for delivery pursuant to the Building Contract as at the date of this Agreement) or any other date notified by the Borrower to the Agent in accordance with Clause 27 as being the date on which the Vessel will be ready for delivery pursuant to the Building Contract.
 
    “ISM Code” means the International Management Code for the Safe Operation of Ships and for Pollution Prevention adopted by the International Maritime Organisation.
 
    “ISPS Code” means the International Ship and Port Facility Security Code adopted by the International Maritime Organisation.
 
    “Lender” means:
  (a)   any Original Lender; and
 
  (b)   any bank or financial institution which has become a Party in accordance with Clause 18,
    which in each case has not ceased to be a Party in accordance with the terms of this Agreement.
 
    “Loan” means the aggregate of the amount of the Total Financed Contract Price paid to the Builder pursuant to Clause 2.1.1 and the amount of the Coface Premium reimbursed to the Agent pursuant to Clause 2.1.2 as such amount may be increased or decreased pursuant to the terms of this Agreement or (as the context may require) the amount thereof for the time being drawn down and outstanding hereunder.
 
    “Management Agreement” means the management agreement entered or to be entered into between the Borrower and the Manager with respect to the Vessel.

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    “Manager” means NCL (Bahamas) Ltd., a company incorporated in and existing under the laws of Bermuda with registration number EC34680 and with its registered office at Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda.
 
    “Maritime Registry” means the maritime registry which the Borrower will specify to the Lenders no later than three (3) months before the Intended Delivery Date, being that of the Bahamas or such other registry as the Lenders may in their discretion agree.
 
    “Maximum Loan Amount” means the amount of six hundred and sixty two million nine hundred and five thousand three hundred and twenty euro (EUR662,905,320).
 
    “Mortgage” means the first priority mortgage and, if applicable, deed of covenants collateral thereto over the Vessel in favour of the Finance Parties, to be granted as provided for in Clause 16 and to be in the agreed form.
 
    “Obligors” means the Borrower, the Guarantor and the Manager.
 
    “Participating Member State” means any member state of the European Union that adopts or has adopted the euro as its lawful currency in accordance with legislation of the European Union relating to Economic and Monetary Union.
 
    “Party” means a party to this Agreement.
 
    “Permitted Liens” means:
  (a)   any Encumbrance created by or pursuant to the Security Documents; and
 
  (b)   liens on the Vessel up to an aggregate amount at any time not exceeding ten million Dollars (USD10,000,000) for current crew’s wages and salvage and liens incurred in the ordinary course of trading the Vessel; and
    in the case of the Manager in respect of paragraph (d) only and in the case of the Guarantor:
  (c)   any deposits or pledges to secure the performance of bids, tenders, bonds or contracts;
 
  (d)   any other Encumbrance notified by any of the Obligors to the Agent prior to the date hereof;
 
  (e)   any Encumbrance in respect of existing Financial Indebtedness of a person which becomes a Subsidiary of the Guarantor or is merged with or into the Guarantor or any of its Subsidiaries;
 
  (f)   liens on assets leased, acquired or upgraded after the date hereof or assets newly constructed or converted after the date hereof provided that (i) such liens secure Financial Indebtedness otherwise permitted under this Agreement (ii) such liens are incurred within one (1) year following such lease, acquisition, upgrade, construction or conversion and (iii) the Financial Indebtedness secured by such liens does not exceed the cost of such upgrade or the cost of such assets acquired or leased;
 
  (g)   statutory and other similar liens arising in the ordinary course of business unrelated to Financial Indebtedness and securing obligations not yet delinquent or which are being contested in good faith by appropriate proceedings and for which adequate reserves have been established; and

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  (h)   liens arising out of the existence of judgments or awards in respect of the Guarantor or any of its Subsidiaries,
    provided that the aggregate amount of all cash and the fair market value of all other property subject to such liens as are described in paragraphs (f) to (h) above does not exceed twenty five million Dollars (USD25,000,000).
 
    “Protocol of Delivery and Acceptance” means the protocol of delivery and acceptance of the Vessel to be signed by the Borrower and the Builder in accordance with article 7, clause 1.3(i) of the Building Contract.
 
    “Safety Management Certificate” means a document issued to the Vessel as evidence that the Vessel’s operator and its shipboard management operate in accordance with an approved Safety Management System.
 
    “Safety Management System” means a structured and documented system enabling the personnel of the Vessel’s operator to implement effectively the safety and environmental protection policy of that Vessel operator.
 
    “Security Documents” means this Agreement, the Guarantee, the Mortgage, the Assignment of Warranty Rights, the Assignment of Insurances, the Assignment of Earnings, the Assignment of Management Agreement and all such other documents as may be executed at any time in favour of the Finance Parties or any of them as security for the obligations of the Borrower and the other Obligors whether executed pursuant to the express provisions of this Agreement or otherwise howsoever.
 
    “Security Period” means the period beginning on the Drawdown Date and ending on the date on which the amounts outstanding under this Agreement and under each of the other Security Documents are finally paid or repaid in full.
 
    “Subsidiary” means, with respect to the Guarantor, any company or corporation of which more than fifty per cent. (50%) of the outstanding share capital having ordinary voting power to elect a majority of the board of directors of such company or corporation (irrespective of whether at the time share capital of any other class or classes of such company or corporation shall or might have voting power upon the occurrence of any contingency) is at the time directly or indirectly owned by the Guarantor, by the Guarantor and one or more other Subsidiaries of the Guarantor, or by one or more other Subsidiaries of the Guarantor.
 
    “TARGET” (Trans-European Automated Real-time Gross settlement Express Transfer) means the European real time gross settlement system managed by the European Central Bank and linking the real time gross settlement systems of the Member States of the European Union.
 
    “TARGET Day” means the day when the TARGET (Trans-European Automated Real-Time Gross settlement Express Transfer) system is open.
 
    “Taxes” means all present and future income and other taxes, levies, imposts, deductions, compulsory liens and withholdings whatsoever together with interest thereon and penalties with respect thereto, if any, and any payments made on or in respect thereof and “Taxation” shall be construed accordingly.
 
    “Termination Date” means the date falling [**] [Confidential Treatment] years after the Delivery Date.

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    “Total Commitments” means the aggregate of the Commitments, being six hundred and sixty two million nine hundred and five thousand three hundred and twenty euro (EUR662,905,320).
 
    “Total Financed Contract Price” means the aggregate of:
  (a)   the Financed Contract Price; and
 
  (b)   the Financed Change Order Amount.
    “Total Loss” means the actual or constructive or compromised or agreed or arranged total loss or the Compulsory Acquisition of the Vessel, including any such total loss as may arise during a requisition for hire.
 
    “Total Loss Date” means:
  (a)   in the case of an actual total loss of the Vessel, the actual date on which the Vessel was lost or, if such date is not known, the date on which the Vessel was last reported; or
 
  (b)   in the case of a constructive total loss of the Vessel, or in the case of a compromised or arranged total loss of the Vessel, the date of the event giving rise to the claim for such constructive total loss or to the claim for a compromised or arranged total loss; or
 
  (c)   in the case of a Compulsory Acquisition on the date of the Compulsory Acquisition.
    “Transaction Documents” means the Security Documents, the Building Contract, the Drawdown Notice, the Management Agreement and any other material document now or hereafter issued in connection with the documents or the transaction referred to in this Agreement.
 
    “Transfer Certificate” means a certificate substantially in the form set out in Appendix III or any other form agreed between the Agent and the Borrower.
 
    “Transfer Date” means, in relation to a transfer, 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.
    “Vessel” means the passenger cruise vessel referred to in Recital (A) of this Agreement and more specially described in the Building Contract, and, to the extent the context permits, includes all manuals, logs and technical records relating to the said vessel.
 
1.2   Construction
 
    References in this Agreement to a document “in the agreed form” are to the form of the relevant document which is attached to the security letter of the same date as this Agreement or to such other form as the parties hereto may from time to time agree, subject to modification in accordance with the provisions of the security letter.
 
    A person who is not a Party has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce or to enjoy the benefit of any term of this Agreement.

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    A provision of law including but without limitation a regulation is a reference to that provision or regulation as amended or re-enacted from time to time and a regulation includes any regulation, rule, official directive, request or guideline (whether or not having the force of law) of any governmental, intergovernmental or supranational body, agency, department or regulatory, self-regulatory or other authority or organisation.
 
2.   AVAILABILITY OF THE LOAN
 
2.1   Commitment
 
    Each of the Lenders shall (in proportion to its share of the Total Commitments) make available to the Borrower a loan in a maximum amount of six hundred and two million six hundred and forty one thousand two hundred euro (EUR602,641,200) intended to:
  2.1.1   be paid to the Builder up to a maximum amount of five hundred and eighty eight million euro (EUR588,000,000) corresponding to eighty per cent. (80%) of the Contract Price of the Vessel prior to any Change Order;
 
  2.1.2   reimburse the Agent up to an amount of fourteen million six hundred and forty one thousand two hundred euro (EUR14,641,200) corresponding to one hundred per cent. (100%) of the related Coface Premium payable to Coface.
    In the event that the Contract Price for the Vessel prior to any Change Order increases pursuant to the terms of the Building Contract, the Lenders agree, if the Borrower so requests in the Drawdown Notice, to increase the maximum amount of the Loan by:
  2.1.3   up to an amount of fifty eight million eight hundred thousand euro (EUR58,800,000) (being ten per cent. (10%) of the Financed Contract Price) to pay to the Builder up to eighty per cent. (80%) of the Change Order Amount; and
 
  2.1.4   up to an amount of [**] [Confidential Treatment] to reimburse the Agent [**] [Confidential Treatment] per cent. [**] [Confidential Treatment] of the related Coface Premium payable to Coface.
2.2   Purpose
 
    The Loan may only be used to pay for goods and services of French origin. However, within the limits and under the conditions fixed by the French Authorities, this may be extended to cover goods and services incorporated in deliveries made by the Builder and originating from countries other than the Borrower’s country and France, which have been sub-contracted by the Builder and therefore remain under the Builder’s responsibility.
 
3.   DRAWING
 
3.1   Conditions precedent
 
    The Borrower may only draw under the Loan when the following conditions have been fulfilled to the satisfaction of the Lenders and provided no Event of Default shall have occurred and remains unremedied or be likely to occur:
  3.1.1   No later than the date of this Agreement:
  (a)   Receipt by the Agent of an opinion of legal counsel to the Lenders as to Bermudan law, together with the corporate documentation of the Borrower supporting the opinion, including but without limitation the

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      Memorandum of Association and Bye-laws as filed with the competent authorities and a certificate of a competent officer of the Borrower containing specimen signatures of the persons authorised to sign the documents on behalf of the Borrower, to the effect that:
  (i)   the Borrower has been duly organized and is validly existing as a company under the laws of Bermuda;
 
  (ii)   this Agreement falls within the scope of the Borrower’s corporate purpose as defined by its Memorandum of Association and Bye-laws;
 
  (iii)   the Borrower’s representatives were at the date of this Agreement fully empowered to sign this Agreement;
 
  (iv)   either all administrative requirements applicable to the Borrower (whether in Bermuda or elsewhere) concerning the transfer of funds abroad and acquisitions of euro to meet its obligations hereunder have been complied with, or that there are no such requirements; and
 
  (v)   this Agreement is the legal, valid and binding obligations of the Borrower enforceable in accordance with their terms (containing such exceptions as are standard for opinions of this type).
  (b)   Receipt by the Agent of an opinion of legal counsel to the Agent as to English law confirming that the obligations of the Borrower under this Agreement are legally valid and binding obligations enforceable by the relevant Finance Parties in the English courts.
 
  (c)   Receipt by the Agent of a Certified Copy of the executed Building Contract.
 
  (d)   Receipt by the Agent of a confirmation from Clifford Chance Secretaries Limited that it will act for the Borrower as agent for service of process in England in respect of this Agreement.
3.1.2   No later than ten (10) Business Days after the date of this Agreement:
  (a)   Receipt by the Agent of an opinion of legal counsel to the Lenders as to Bermudan law, together with the corporate documentation of the Guarantor supporting the opinion, including but without limitation the Memorandum of Association and Bye-laws as filed with the competent authorities and a certificate of a competent officer of the Guarantor containing specimen signatures of the persons authorised to sign the documents on behalf of the Guarantor, to the effect that:
  (i)   the Guarantor has been duly organized and is validly existing as a company under the laws of Bermuda;
 
  (ii)   the Guarantee falls within the scope of the Guarantor’s corporate purpose as defined by its Memorandum of Association and Bye-laws;
 
  (iii)   the Guarantor’s representative was at the date of the Guarantee fully empowered to sign the Guarantee;

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  (iv)   either all administrative requirements applicable to the Guarantor (whether in Bermuda or elsewhere) concerning the transfer of funds abroad and acquisitions of euro to meet its obligations under the Guarantee have been complied with, or that there are no such requirements; and
 
  (v)   the Guarantee is the legal, valid and binding obligations of the Guarantor enforceable in accordance with their terms (containing such exceptions as are standard for opinions of this type).
  (b)   Receipt by the Agent of the executed Guarantee and a statement confirming that the Guarantor is in compliance with its obligations under clauses 11.1 and 11.3 of the Guarantee. The statement shall be signed by the chief financial officer of the Group (as such term is defined in clause 11.4 of the Guarantee), be in the form of schedule 1 to the Guarantee and be for the financial quarter ending 30 June 2006.
 
  (c)   Receipt by the Agent of an opinion of legal counsel to the Agent as to English law confirming that the obligations of the Guarantor under the Guarantee are legally valid and binding obligations enforceable by the relevant Finance Parties in the English courts.
 
  (d)   Receipt by the Agent of a confirmation from Clifford Chance Secretaries Limited that it will act for the Guarantor as agent for service of process in England in respect of the Guarantee.
3.1.3   No later than three (3) months before the Intended Delivery Date, receipt by the Agent of notification from the Borrower of its preferred Maritime Registry.
 
3.1.4   On the date falling ninety (90) days before the Intended Delivery Date and on each subsequent date prior to the Drawdown Date on which a statement in the form of schedule 1 to the Guarantee is to be received by the Agent pursuant to clause 9.2.5 of the Guarantee, receipt by the Agent of a statement confirming that the Guarantor is in compliance with its obligations under clauses 11.1 and 11.3 of the Guarantee. The statement shall be signed by the chief financial officer of the Group (as such term is defined in clause 11.4 of the Guarantee), be in the form of schedule 1 to the Guarantee and be for the last financial quarter in respect of which the Guarantor is obliged to provide such a statement pursuant to clause 9.2.5 of the Guarantee.
 
3.1.5   No later than sixty (60) days before the Intended Delivery Date, receipt by the Agent of notification from the Borrower of the Intended Delivery Date.
 
3.1.6   No later than ten (10) Business Days before the Intended Delivery Date, receipt by the Agent of insurance documents in form and substance satisfactory to the Lenders confirming that the Insurances have been effected and will be in full force and effect on the Delivery Date.
 
3.1.7   No later than five (5) Business Days before the Intended Delivery Date, receipt by the Agent of:
  (a)   the Drawdown Notice from the Borrower, signed by a duly authorised signatory of the Borrower, specifying the amount of the Loan to be drawn down;

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  (b)   a Certified Copy of each of the Change Orders and of the power of attorney pursuant to which the authorised signatory of the Borrower signed the Drawdown Notice and a specimen of his signature; and
 
  (c)   a copy of the notice of delivery given by the Builder to the Borrower pursuant to and in accordance with article 7, clause 1.1 of the Building Contract.
3.1.8   No later than the Delivery Date:
  (a)   Receipt by the Agent of a legal opinion of counsel to the Lenders as to Bermudan law together with the corporate documentation of the Borrower and the Manager supporting such opinions, including but without limitation, in the case of the Manager, the Memorandum of Association and Bye-laws as filed with the competent authorities and a certificate of a competent officer of the Borrower and the Manager containing specimen signatures of the persons authorised to sign the documents on behalf of the Borrower and the Manager, confirming that:
  (i)   the Lenders may continue to rely on the legal opinion given pursuant to Clause 3.1.1(a)(i);
 
  (ii)   the Mortgage, the Assignment of Warranty Rights, the Assignment of Insurances, the Assignment of Earnings and the Assignment of Management Agreement fall within the scope of the Borrower’s corporate purpose as defined by its Memorandum of Association and Bye-laws and are binding on it;
 
  (iii)   the Assignment of Insurances (if applicable) and the acknowledgement of the notice of assignment of the Management Agreement fall within the scope of the Manager’s corporate purpose as defined by its Memorandum of Association and Bye-laws and are binding on it; and
 
  (iv)   the Borrower’s representatives are fully empowered to sign the Protocol of Delivery and Acceptance, the Mortgage, the Assignment of Warranty Rights, the Assignment of Insurances, the Assignment of Earnings and the Assignment of Management Agreement and the Manager’s representatives are fully empowered to sign the Assignment of Insurances (if applicable) and the acknowledgement of the notice of assignment of the Management Agreement.
  (b)   Receipt by the Agent of evidence of payment to the Builder of:
  (i)   the four (4) pre-delivery instalments of the Contract Price; and
 
  (ii)   any other part of the Contract Price as at the Delivery Date not being financed hereunder.
  (c)   Evidence that:
  (i)   the Vessel is at least provisionally registered in the name of the Borrower in the Maritime Registry;
 
  (ii)   title to the Vessel is held by the Borrower free of all Encumbrances other than any maritime lien in respect of crew’s wages and trade debts arising out of equipment, consumable and other stores placed

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      On board the Vessel prior to or concurrently with delivery, none of which is overdue;
 
  (iii)   the Mortgage has been duly registered in the Maritime Registry and constitutes a first priority security interest over the Vessel and that all taxes and fees payable to the Maritime Registry in respect of the Vessel have been paid in full.
  (d)   Receipt by the Agent of a Certified Copy of a classification certificate (or interim classification certificate) showing the Vessel to be classed in accordance with Clause 9.4.3.
 
  (e)   Receipt by the Agent of duly executed originals of the Mortgage, the Assignment of Warranty Rights, the Assignment of Insurances, the Assignment of Earnings and the Assignment of Management Agreement together with relevant notices of assignment and the acknowledgement of the notice of assignment of the Management Agreement.
 
  (f)   Receipt by the Agent of all amounts which are due and payable hereunder by the Borrower on or prior to the Delivery Date.
 
  (g)   Receipt by the Agent of a legal opinion of counsel to the Lenders as to the law of the Maritime Registry confirming:
  (i)   the valid registration of the Vessel in the Maritime Registry; and
 
  (ii)   the Mortgage over the Vessel has been validly registered in the Maritime Registry.
  (h)   Receipt by the Agent of an opinion of legal counsel to the Agent as to English law confirming that the obligations of the Borrower under the deed of covenants constituting part of the Mortgage (if applicable), the Assignment of Warranty Rights, the Assignment of Insurances, the Assignment of Earnings and the Assignment of Management Agreement are legally valid and binding obligations enforceable by the relevant Finance Parties in the English courts.
 
  (i)   Receipt by the Agent of a certificate from the Borrower, signed by an authorised representative of the Borrower, attesting that the representations and warranties contained in Clause 9 are true and correct as of the Delivery Date in consideration of the facts and circumstances existing as of the Delivery Date.
 
  (j)   Receipt by the Agent of the documents mentioned in Appendix I.
 
  (k)   Receipt by the Agent of a Certified Copy of the executed Management Agreement.
 
  (l)   Receipt by the Agent of a Certified Copy of the carrier initiative agreement executed pursuant to Clause 10.16, any current certificate of financial responsibility in respect of the Vessel issued under OPA, a valid Safety Management Certificate (or interim Safety Management Certificate) issued to the Vessel in respect of its management by the Manager pursuant to the ISM Code, a valid Document of Compliance (or interim Document of Compliance) issued to the Manager in respect of ships of the same type as the Vessel pursuant to the ISM Code, a valid

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      International Ship Security Certificate issued to the Vessel in accordance with the ISPS Code and a valid IAPPC issued to the Vessel in accordance with Annex VI.
 
  (m)   Receipt by the Agent of a Certified Copy of the power of attorney pursuant to which the authorised signatory(ies) of the Borrower signed the documents referred to in this Clause 3.1.6 and to which the Borrower is a party and a specimen of his or their signature(s).
 
  (n)   Receipt by the Agent of a confirmation from Clifford Chance Secretaries Limited that it will act for each of the relevant Obligors as agent for service of process in England in respect of the deed of covenants constituting part of the Mortgage (if applicable), the Assignment of Warranty Rights, the Assignment of Insurances, the Assignment of Earnings and the Assignment of Management Agreement.
 
  (o)   The Coface Insurance Policy documentation relating to the transactions contemplated by this Agreement has been received by the Agent and remains in full force and effect, the Agent having notified the Borrower of the issue of the Coface Insurance Policy in form and substance satisfactory to the Lenders as soon as practicable after its issue.
3.2   Borrower’s irrevocable payment instructions
 
    The Lenders shall not be obliged to fulfil their obligation to make the Loan available other than by paying the Builder the Total Financed Contract Price (or (as the context may require) the amount thereof drawn down) on behalf of and in the name of the Borrower and by reimbursing the Agent for the related Coface Premium.
 
    The Borrower hereby instructs the Lenders in accordance with this Clause 3.2:
  3.2.1   to pay to the Builder:
  (a)   the amount in euro remaining due under the Building Contract up to an amount equal to the lesser of five hundred and eighty eight million euro (EUR588,000,000) and eighty per cent. (80%) of the Contract Price of the Vessel prior to any Change Order; and
 
  (b)   subject to Clause 2.2, the amount in euro up to the lesser of fifty eight million eight hundred thousand euro (EUR58,800,000) and eighty per cent. (80%) of the Change Order Amount capped at [**] per cent. [**] of the Financed Contract Price; and
  3.2.2   to reimburse the Agent, by drawing under the Loan, the related Coface Premium.
    The payment instruction contained in this Clause 3.2 is irrevocable.
 
    Subject to Clause 3.1, payment will be made to the Builder by a single advance in euro on the Delivery Date of the Vessel during usual banking hours in the French Republic to the Builder’s account as specified by the Builder in accordance with the Building Contract after receipt and verification by the Agent of the documents provided under Appendix I.
 
    Verification of the documents provided under Appendix I shall be limited to checking their apparent compliance as defined in the Uniform Customs and Practices for Documentary Credits — ICC Publication 500 (UCP 500 latest revision).

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The Borrower expressly acknowledges that the payment terms set out in this Clause may only be modified with the agreement of the Builder, the Agent, the Lenders and the Borrower in the case of Clause 3.2.1 and with the agreement of the Agent, the Lenders and the Borrower in the case of Clause 3.2.2.
Drawing may not be made under this Agreement (and the Loan shall not be available) after the earlier of the Delivery Date and the Availability Termination Date.
However, the Lenders will use their best efforts to agree to a postponement of the Availability Termination Date upon application by the Borrower accompanied by an explanation in reasonable detail of the reason for the delay in the Intended Delivery Date beyond the Availability Termination Date. The Borrower acknowledges that any such postponement is subject to the prior written approval of Coface.
4.   REPAYMENT OF LOAN AND PAYMENT OF INTEREST
The Borrower shall repay to the Lenders the principal amount of the Loan drawn down under this Agreement together with interest on the Loan at the CIRR from the Drawdown Date by twenty four (24) consecutive equal half yearly instalments. The first instalment of principal and interest shall be due six (6) months after the Delivery Date and the final instalment shall be due on the Termination Date together with all other sums due under this Agreement. The interest shall be calculated on the actual number of days elapsed divided by three hundred and sixty (360).
The amount of each instalment of principal and interest will be calculated by the Agent following the Drawdown Date. The Agent shall deliver to the Borrower and the Lenders as soon as practicable following such calculation and in any event no later than ten (10) Business Days after the Drawdown Date, a repayment schedule setting out the dates and the amounts of the instalments up to and including the Termination Date.
The repayment schedule shall be sent by fax and, in the case of the Borrower, by international express courier.
In the absence of manifest error, the repayment schedule will constitute an unconditional and irrevocable undertaking by the Borrower to pay the Lenders the amounts of principal and interest set out therein.
The Borrower reserves the right to inform the Agent within ten (10) Business Days of receipt of the repayment schedule by courier if it contains a material error and to request its correction.
5.   CLAIMS OR DEFENCES MAY NOT BE OPPOSED TO THE LENDERS
The Borrower may not escape liability under the terms of this Agreement by opposing to the Lenders claims or defences of any kind whatsoever arising under the Building Contract, and in particular from its performance, or from any other relationship between the Borrower and the Builder.
6.   COFACE PREMIUM
The Coface Premium is due and payable on or prior to the Drawdown Date and proportionally to the amount of the Loan drawn down under this Agreement. A minimum non-refundable premium, being one thousand five hundred and fifteen euro (EUR1,515), shall be paid to Coface upon signature of the Coface Insurance Policy. Otherwise, no Coface Premium is due if the Loan is not drawn down. Except as

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otherwise stated below in the case of a prepayment, the Coface Premium is not refundable for any reason whatsoever.
The Borrower has requested and the Lenders have agreed to finance [**] [Confidential Treatment] per cent. [**] [Confidential Treatment] of the Coface Premium payable under this Agreement in accordance with Clauses 2.1.2 and 2.1.4 up to the amount of [**] [Confidential Treatment].
Consequently, the Borrower hereby irrevocably instructs the Agent to pay the Coface Premium to Coface on the Borrower’s behalf and the financing of such payment shall be made by drawing under the Loan in accordance with Clauses 2.1.2 and 2.1.4 of this Agreement. Notwithstanding any other provision of this Agreement, the Borrower acknowledges that the obligation of the Borrower to reimburse the Lenders for the full amount of the Coface Premium referred to in this Agreement as and when it arises is absolute and unconditional.
The Coface Premium financed by the Loan will be repayable in any event by the Borrower to the Lenders in the manner specified in Clause 4 and under any and all circumstances including but without limitation in the event of prepayment or acceleration of the Loan.
If the Loan is prepaid in whole or in part by the Borrower and if no amounts are then due and unpaid by the Borrower to the Finance Parties, the Agent will, on receipt from Coface, refund to the Borrower the portion of the Coface Premium reimbursed by Coface. If there is an amount due and unpaid by the Borrower to the Finance Parties, the Agent shall apply any amount received from Coface in accordance with Clause 17.
Any refund of the Coface Premium will not exceed eighty per cent. (80%) of the amount of the Coface Premium for the period from the prepayment date to the Termination Date.
7.   FEES
The following fees shall be paid to the Agent by the Borrower as required hereunder:
  7.1.1   For the Mandated Lead Arrangers, an arrangement fee equal to [**] [Confidential Treatment] of the Maximum Loan Amount payable:
  (a)   as to [**] [Confidential Treatment] per cent. [**] [Confidential Treatment] of such fee amount within ten (10) Business Days after the date of this Agreement; and
 
  (b)   unless this Agreement is terminated pursuant to Clause 29, as to [**] [Confidential Treatment] per cent. [**] [Confidential Treatment] of such fee amount on the first anniversary of the date of this Agreement.
  7.1.2   For the Lenders, a commitment fee for the period from the date of this Agreement to the Delivery Date of the Vessel, or the date of receipt by the Agent of the written termination notice sent by the Borrower as described in Clause 29, whichever is the earliest, computed at the rate of:
  (a)   [**] [Confidential Treatment] per cent. [**] [Confidential Treatment]%) per annum for the first two (2) years after the date of this Agreement; and
 
  (b)   [**] [Confidential Treatment] two per cent. [**] [Confidential Treatment] %) per annum thereafter.
This commitment fee shall be calculated on the undrawn amount of the Maximum Loan Amount and paid in arrears on the date falling six (6) months after the date of this Agreement and on each date falling at the end of each

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following consecutive six (6) month period, with the exception of the commitment fee due in respect of the last period, which shall be paid on the Drawdown Date, or the date of receipt by the Agent of the written termination notice sent by the Borrower as described in Clause 29, whichever is the earliest. The commitment fee shall be calculated on the actual number of days elapsed divided by three hundred and sixty (360).
  7.1.3   For the Agent, an annual agency fee of [**] [Confidential Treatment] shall be paid within ten (10) Business Days of the date of this Agreement and, unless this Agreement is terminated pursuant to Clause 29, on or before each anniversary date thereof until total repayment of the Loan.
8.   TAXES, INCREASED COSTS, COSTS AND RELATED CHARGES
 
8.1   All Taxes legally payable in France as a consequence of the signature or performance of this Agreement shall be paid by the Lenders.
 
8.2   All Taxes legally payable outside France (other than taxes payable by each of the Lenders on its overall net income) as a consequence of the signature or performance of this Agreement shall be paid by the Borrower. In consequence, all payments of principal and interest, interest on late payments, compensation, costs, fees and related charges, due in connection with this Agreement shall be made without any deduction or withholding in respect of Taxes. The Borrower therefore hereby agrees expressly that if for any reason full payment of the above amounts is not made, it will immediately pay the Lenders the sums necessary to compensate exactly the effect of the deductions or withholdings made in respect of Taxes. If the Borrower fails to perform this obligation, the Lenders shall be entitled, in accordance with Clause 13, either not to make available the Loan or, as the case may require, to require immediate repayment of the Loan.
If an additional payment is made under this Clause and any Lender or the Agent on its behalf determines that it has received or been granted a credit against or relief of or calculated with reference to the deduction or withholding giving rise to such additional payment, such Lender or the Agent (as the case may be) shall, to the extent that it can do so without prejudice to the retention of the amount of such credit, relief, remission or repayment and provided that it has received the cash benefit of such credit, relief or remission, pay to the Borrower such amount as such Lender or the Agent shall in its reasonable opinion have concluded to be attributable to the relevant deduction or withholding. Any such payment shall be conclusive evidence of the amount due to the Borrower hereunder and shall be accepted by the Borrower in full and final settlement of its rights of reimbursement hereunder in respect of such deduction or withholding. Nothing herein contained shall interfere with the right of any Lender and the Agent to arrange their respective tax affairs in whatever manner they think fit.
8.3   If after the date of this Agreement by reason of:
  8.3.1   any change in law or in its interpretation or administration; and/or
 
  8.3.2   compliance with any request from or requirement of any central bank or other fiscal, monetary or other authority including but without limitation the Basle Committee on Banking Regulations and Supervisory Practices whether or not having the force of law:
  (a)   any of the Lenders incurs a cost as a result of its performing its obligations under this Agreement and/or its advancing its Commitment hereunder; or

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  (b)   there is any increase in the cost to any of the Lenders of funding or maintaining all or any of the advances comprised in a class of advances formed by or including its Commitment advanced or to be advanced by it hereunder; or
 
  (c)   any of the Lenders incurs a cost as a result of its having entered into and/or its assuming or maintaining its commitment under this Agreement; or
 
  (d)   any of the Lenders becomes liable to make any payment on account of Tax or otherwise (other than Tax on its overall net income) on or calculated by reference to the amount of its Commitment advanced or to be advanced hereunder and/or any sum received or receivable by it hereunder; or
 
  (e)   any of the Lenders suffers any decrease in its rate of return as a result of any changes in the requirements relating to capital ratios, monetary control ratios, the payment of special deposits, liquidity costs or other similar requirements affecting that Lender,
then the Borrower shall from time to time on demand pay to the Agent for the account of the relevant Lender or Lenders amounts sufficient to indemnify the relevant Lender or Lenders against, as the case may be, such cost, such increased cost (or such proportion of such increased cost as is in the reasonable opinion of the relevant Lender or Lenders attributable to the funding or maintaining of its or their Commitment(s) hereunder) or such liability.
A Lender affected by any provision of this Clause 8.3 shall promptly inform the Agent after becoming aware of the relevant change and its possible results (which notice shall be conclusive evidence of the relevant change and its possible results) and the Agent shall, as soon as reasonably practicable thereafter, notify the Borrower of the change and its possible results. Without affecting the Borrower’s obligations under this Clause 8.3 and in consultation with the Agent, the affected Lender will then take all such reasonable steps as may be open to it to mitigate the effect of the change (for example (if then possible) by changing its Facility Office or transferring some or all of its rights and obligations under this Agreement to another financial institution reasonably acceptable to the Borrower and the Agent). The reasonable costs of mitigating the effect of any such change shall be borne by the Borrower save where such costs are of an internal administrative nature and are not incurred in dealings by any Lender with third parties.
8.4   The Borrower undertakes to pay to the Agent, upon demand, all reasonable costs and expenses, duties and fees, including but without limitation agreed legal costs, out of pocket expenses and travel costs, incurred by the Mandated Lead Arrangers and the Original Lenders in connection with the negotiation, preparation and execution of all agreements, guarantees, security agreements and related documents entered into, or to be entered into, for the purpose of the transaction contemplated hereby as well as all costs and expenses, duties and fees incurred by the Lenders in connection with the registration, filing, enforcement or discharge of the said guarantees or security agreements, including without limitation the fees and expenses of legal advisers and insurance experts, the cost of registration and discharge of security interests and the related travel and out of pocket expenses; the Borrower further undertakes to pay to the Agent all costs, expenses, duties and fees incurred by the Lenders in connection with any variation of this Agreement and the related documents, guarantees and security agreements, any supplements thereto and waiver given in relation thereto, in connection with the enforcement or preservation of any rights under this Agreement and/or the related guarantees and security agreements, including in each case the fees and expenses of legal advisers, and in connection with the

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    consultations or proceedings made necessary by the acts of, or failure to act on the part of, the Borrower.
8.5   The Borrower undertakes to pay to the Agent, upon demand, any reasonable costs necessarily incurred by the Lenders in funding the Loan in the event that the Delivery Date is later than the Intended Delivery Date unless the Borrower has given the Agent at least three (3) Business Days’ notification of such delay in the Delivery Date.
9.   REPRESENTATIONS AND WARRANTIES
 
9.1   Duration
  9.1.1   The representations and warranties in Clause 9.2 are made on the date of this Agreement and shall be deemed to be repeated, with reference mutatis mutandis to the facts and circumstances subsisting, as if made on each day until the Borrower has no remaining obligations, actual or contingent, under or pursuant to this Agreement or any of the other Security Documents.
 
  9.1.2   The representations and warranties in Clause 9.3 are made on the date of this Agreement and shall be deemed to be repeated, with reference mutatis mutandis to the facts and circumstances subsisting, as if made on the date falling sixty (60) days before the Intended Delivery Date and thereafter on each day until the Borrower has no remaining obligations, actual or contingent, under or pursuant to this Agreement or any of the other Security Documents.
 
  9.1.3   The representations and warranties in Clause 9.4 are made on the Delivery Date and shall be deemed to be repeated, with reference mutatis mutandis to the facts and circumstances subsisting, as if made thereafter on each day until the Borrower has no remaining obligations, actual or contingent, under or pursuant to this Agreement or any of the other Security Documents.
9.2   Continuing representations and warranties
  The Borrower represents and warrants to each of the Lenders that:
  9.2.1   Status
Each Obligor is a company duly organised, constituted and validly existing under the laws of the country of its incorporation, possessing perpetual corporate existence, the capacity to sue and be sued in its own name and the power to own and charge its assets and carry on its business as it is now being conducted.
  9.2.2   Powers and authority
Each of the Obligors has the power to enter into and perform this Agreement and those of the other Security Documents to which it is a party and the transactions contemplated hereby and thereby and has taken all necessary action to authorise the entry into and performance of this Agreement and such other Security Documents and such transactions.
  9.2.3   Legal validity
This Agreement and each other Transaction Document constitutes (or will constitute when executed) legal, valid and binding obligations of each Obligor expressed to be a party thereto enforceable in accordance with their respective

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terms and in entering into this Agreement and borrowing the Loan, the Borrower is acting on its own account.
  9.2.4   Non-conflict with laws
The entry into and performance of this Agreement and the other Transaction Documents and the transactions contemplated hereby and thereby do not and will not conflict with:
  (a)   any law or regulation or any official or judicial order; or
 
  (b)   the constitutional documents of any Obligor; or
 
  (c)   any agreement or document to which any Obligor is a party or which is binding upon such Obligor or any of its assets,
nor result in the creation or imposition of any Encumbrance on an Obligor or its assets pursuant to the provisions of any such agreement or document, except for Permitted Liens.
  9.2.5   Consents
Except for:
  (a)   the filing of those Security Documents to be filed with the Registrar of Companies in Bermuda; and
 
  (b)   the registration of the Mortgage through the relevant authority of the Maritime Registry,
all authorisations, approvals, consents, licences, exemptions, filings, registrations, notarisations and other matters, official or otherwise, required in connection with the entry into, performance, validity and enforceability of this Agreement and each of the other Transaction Documents to which any Obligor is a party and the transactions contemplated thereby have been obtained or effected and are in full force and effect except authorisations, approvals, consents, licences, exemptions, filings and registrations required in the normal day to day course of the operation of the Vessel and not already obtained by the Borrower.
  9.2.6   Accuracy of information
All information furnished by any Obligor relating to the business and affairs of any Obligor in connection with this Agreement and the other Transaction Documents was and remains true and correct in all material respects and there are no other material facts or considerations the omission of which would render any such information misleading.
  9.2.7   Full disclosure
Each Obligor has fully disclosed to the Agent all facts relating to each Obligor which it knows or should reasonably know and which might reasonably be expected to influence the Lenders in deciding whether or not to enter into this Agreement.

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  9.2.8   Pari passu or priority status
The claims of the Finance Parties against the Borrower under this Agreement will rank at least pari passu with the claims of all unsecured creditors of the Borrower (other than claims of such creditors to the extent that they are statutorily preferred) and in priority to the claims of any creditor of the Borrower who is also an Obligor.
  9.2.9   Solvency
The Borrower is and shall remain, after the advance to it of the Loan, solvent in accordance with the laws of Bermuda and the United Kingdom and in particular with the provisions of the Insolvency Act 1986 (as from time to time amended) and the requirements thereof.
  9.2.10   Winding-up, etc.
Subject to clause 10.6 of the Guarantee, neither the Borrower nor any other Obligor has taken any corporate action nor have any other steps been taken or legal proceedings been started or (to the best of its knowledge and belief) threatened against any of them for the reorganisation, winding-up, dissolution or for the appointment of a liquidator, administrator, receiver, administrative receiver, trustee or similar officer of any of them or any or all of their assets or revenues nor has it sought any other relief under any applicable insolvency or bankruptcy law.
  9.2.11   Accounts
The consolidated audited accounts of the Guarantor for the period ending on 31 December 2005 (which accounts have been prepared in accordance with GAAP) fairly represent the financial condition of the Guarantor as shown in such audited accounts.
  9.2.12   No immunity
None of the Obligors nor any of their respective assets enjoys any right of immunity (sovereign or otherwise) from set-off, suit or execution in respect of their obligations under this Agreement or any of the other Transaction Documents or by any relevant or applicable law.
  9.2.13   Ownership of shares
All the shares in the Borrower and the Manager shall be legally and beneficially owned directly or indirectly by the Guarantor and such structure shall remain so throughout the Security Period. Further, no Event of Default has occurred under clause 11.2 of the Guarantee in respect of the ownership and/or control of the shares in the Guarantor.
  9.2.14   Completeness of documents
The copies of the Building Contract, the Management Agreement and any other relevant third party agreements including but without limitation the copies of any documents in respect of the Insurances delivered to the Agent are true and complete copies of each such document constituting valid and binding obligations of the parties thereto enforceable in accordance with their respective terms and, subject to Clauses 10.14 and 10.25, no amendments thereto or variations thereof have been agreed nor has any action been taken by the parties

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thereto which would in any way render such document inoperative or unenforceable.
  9.2.15   Money laundering
Any borrowing by the Borrower under this Agreement, and the performance of its obligations under this Agreement and the other Transaction Documents, will be for its own account and will not involve any breach by it of any law or regulatory measure relating to “money laundering” as defined in Article 1 of the Directive (91/308/EEC) of the Council of the European Communities.
9.3   Semi-continuing representations and warranties
The Borrower represents and warrants to each of the Lenders that:
  9.3.1   No default
No event has occurred which constitutes a default under or in respect of any Transaction Document to which any Obligor or the Builder is a party or by which any Obligor or the Builder may be bound (including (inter alia) this Agreement) and no event has occurred which constitutes a default under or in respect of any agreement or document to which any Obligor is a party or by which any Obligor may be bound to an extent or in a manner which might have a material adverse effect on the ability of that Obligor to perform its obligations under the Transaction Documents to which it is a party.
  9.3.2   No encumbrances
None of the assets or rights of any Obligor is subject to any Encumbrance except Permitted Liens.
  9.3.3   Litigation
No litigation, arbitration or administrative proceedings are current or pending or, to its knowledge, threatened, which might, if adversely determined, have a material adverse effect on the ability of an Obligor to perform its obligations under the Transaction Documents to which it is a party, save as disclosed by the Guarantor in its most recent US Securities Exchange Commission filing.
  9.3.4   Tax liabilities
To the best of its knowledge, each of the Obligors has complied with all taxation laws in all jurisdictions in which it is subject to Taxation and has paid all Taxes due and payable by it including but without limitation any disputed Taxes unless a sufficient reserve has been made pending resolution of the dispute and no material claims are being asserted against any of the Obligors with respect to Taxes, which might, if such claims were successful, have a material adverse effect on the ability of that Obligor to perform its obligations under the Transaction Documents to which it is a party.
  9.3.5   Ownership of assets
Each member of the Group has good and marketable title to all its assets which are reflected in the audited accounts referred to in Clause 9.2.11.

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  9.3.6   Place of business
None of the Obligors has a place of business in any jurisdiction (except as already disclosed) which requires any of the Security Documents to be filed or registered in that jurisdiction to ensure the validity of the Security Documents to which it is a party.
  9.3.7   Environment
Each of the Obligors:
  (a)   is in compliance with all applicable federal, state, local, foreign and international laws, regulations, conventions and agreements relating to pollution prevention or protection of human health or the environment (including, without limitation, ambient air, surface water, ground water, navigable waters, water of the contiguous zone, ocean waters and international waters), including without limitation, laws, regulations, conventions and agreements relating to:
  (i)   emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants, wastes, toxic substances, hazardous materials, oil, hazard substances, petroleum and petroleum products and by-products (“Materials of Environmental Concern”); or
 
  (ii)   the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Materials of Environmental Concern (such laws, regulations, conventions and agreements the “Environmental Laws”);
  (b)   has all permits, licences, approvals, rulings, variances, exemptions, clearances, consents or other authorisations required under applicable Environmental Laws (“Environmental Approvals”) and is in compliance with all Environmental Approvals required to operate its business as presently conducted or as reasonably anticipated to be conducted;
 
  (c)   has not received any notice, claim, action, cause of action, investigation or demand by any other person, alleging potential liability for, or a requirement to incur, investigatory costs, clean-up costs, response and/or remedial costs (whether incurred by a governmental entity or otherwise), natural resources damages, property damages, personal injuries, attorney’s fees and expenses or fines or penalties, in each case arising out of, based on or resulting from:
  (i)   the presence or release or threat of release into the environment of any Material of Environmental Concern at any location, whether or not owned by such person; or
 
  (ii)   circumstances forming the basis of any violation, or alleged violation, of any Environmental Law or Environmental Approval (“Environmental Claim”); and
there are no circumstances that may prevent or interfere with such full compliance in the future.

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There is no material Environmental Claim pending or threatened against any of the Obligors.
There are no past or present actions, activities, circumstances, conditions, events or incidents, including, without limitation, the release, emission, discharge or disposal of any Material of Environmental Concern, that could form the basis of any Environmental Claim against any of the Obligors.
9.4   Representations on the Delivery Date
The Borrower further represents and warrants to each of the Lenders that on the Delivery Date the Vessel will be:
  9.4.1   in its absolute and unencumbered ownership save as contemplated by the Security Documents;
 
  9.4.2   at least provisionally registered in its name under the laws and flag of the Maritime Registry;
 
  9.4.3   classed with the highest classification available for a vessel of its type free of all recommendations and qualifications with Det Norske Veritas;
 
  9.4.4   operationally seaworthy and in compliance with all relevant provisions, regulations and requirements (statutory or otherwise) applicable to ships registered under the laws and flag of the Maritime Registry;
 
  9.4.5   in compliance with the ISM Code, the ISPS Code and Annex VI;
 
  9.4.6   insured in accordance with the provisions of Clause 10.20 and in compliance with the requirements therein in respect of such insurances; and
 
  9.4.7   managed by the Manager on and subject to the terms set out in the Management Agreement.
10.   UNDERTAKINGS
 
10.1   Duration
  10.1.1   The undertakings in Clauses 10.2, 10.3, 10.4, 10.5, 10.6, 10.7, 10.8, 10.9, 10.10, 10.11, 10.13, 10.15, 10.17, 10.23, 10.24 and 10.25 shall remain in full force and effect until the Borrower has no remaining obligations, actual or contingent, under or pursuant to this Agreement or any of the other Security Documents.
 
  10.1.2   The undertakings in Clauses 10.12, 10.14, 10.16, 10.18, 10.19, 10.20, 10.21 and 10.22 shall apply with effect from, and shall remain in full force and effect after, the date falling sixty (60) days before the Intended Delivery Date until the Borrower has no remaining obligations, actual or contingent, under or pursuant to this Agreement or any of the other Security Documents.
10.2   Information
 
    The Borrower will provide to the Agent for the benefit of the Lenders (or will procure the provision of):
  10.2.1   as soon as practicable (and in any event within one hundred and twenty (120) days after the close of each of its financial years) a Certified Copy of its unaudited accounts for that year and a Certified Copy of the audited accounts of

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      the Guarantor and its consolidated Subsidiaries for that year (commencing with accounts made up to 31 December in the year in which the Drawdown Date occurs in the case of the Borrower and with accounts made up to 31 December 2005 in the case of the consolidated accounts of the Guarantor);
 
  10.2.2   as soon as practicable (and in any event within sixty (60) days of the end of each quarter of each financial year) a copy of the unaudited consolidated accounts of the Guarantor for that quarter (commencing with unaudited accounts made up to 30 June 2006);
 
  10.2.3   promptly, such further information in its possession or control regarding its financial condition and operations and those of any company in the Group as the Agent may request for the benefit of the Finance Parties; and
 
  10.2.4   details of any material litigation, arbitration or administrative proceedings which affect any Obligor as soon as the same are instituted and served, or, to the knowledge of the Borrower, threatened (and for this purpose proceedings shall be deemed to be material if they involve a claim in an amount exceeding [**] [Confidential Treatment] Dollars or the equivalent in another currency).
 
      All accounts required under this Clause 10.2 shall be prepared in accordance with GAAP and shall fairly represent the financial condition of the relevant company. In this Clause 10.2 and in Clause 9.3.5 “Group” shall have the meaning ascribed to it in clause 11.4 of the Guarantee.
10.3   Notification of default
 
    The Borrower will notify the Agent of any Event of Default forthwith upon becoming aware of the occurrence thereof. Upon the Agent’s request from time to time the Borrower will issue a certificate stating whether any Obligor is aware of the occurrence of any Event of Default.
10.4   Consents and registrations
 
    The Borrower will procure that (and will promptly furnish Certified Copies to the Agent on the request of the Agent of) all such authorisations, approvals, consents, licences and exemptions as may be required under any applicable law or regulation to enable it or any Obligor to perform its obligations under, and ensure the validity or enforceability of, each of the Transaction Documents are obtained and promptly renewed from time to time and will procure that the terms of the same are complied with at all times. Insofar as such filings or registrations have not been completed on or before the Drawdown Date the Borrower will procure the filing or registration within applicable time limits of each Security Document which requires filing or registration together with all ancillary documents required to preserve the priority and enforceability of the Security Documents.
10.5   Negative pledge
 
    The Borrower will not create or permit to subsist any Encumbrance on the whole or any part of its present or future assets, except for the following:
  10.5.1   Encumbrances created with the prior consent of the Lenders; or
 
  10.5.2   Permitted Liens.

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10.6   Disposals
 
    Except with the prior consent of all the Lenders, the Borrower shall not, either in a single transaction or in a series of transactions whether related or not and whether voluntarily or involuntarily, sell, transfer, lease or otherwise dispose of any of its assets except in the case of items being replaced or renewed provided that the net impact is not a reduction in the value of the Vessel.
10.7   Change of business
 
    Except with the prior consent of the Agent, the Borrower shall not make or threaten to make any substantial change in its business as presently conducted, namely that of a single ship owning company for the Vessel, or carry on any other business which is substantial in relation to its business as presently conducted so as to affect, in the opinion of the Agent, the Borrower’s ability to perform its obligations hereunder and the Borrower will procure that the other Obligors continue, throughout the Security Period, to perform their current business activities.
10.8   Mergers
 
    Except with the prior consent of the Lenders, the Borrower will not enter into any amalgamation, restructure, substantial reorganisation, merger, de-merger or consolidation or anything analogous to the foregoing nor will it acquire any equity, share capital or obligations of any corporation or other entity.
10.9   Maintenance of status and franchises
 
    The Borrower will do all such things as are necessary to maintain its corporate existence in good standing and will ensure that it has the right and is duly qualified to conduct its business as it is conducted in all applicable jurisdictions and will obtain and maintain all franchises and rights necessary for the conduct of its business.
10.10   Financial records
 
    The Borrower will keep proper books of record and account, in which proper and correct entries shall be made of all financial transactions and the assets, liabilities and business of the Borrower in accordance with GAAP.
10.11   Financial indebtedness and subordination of indebtedness
  10.11.1   Otherwise than in the ordinary course of business as owner of the Vessel, except as contemplated by this Agreement and except any loan, advance or credit extended by the Guarantor or any member of the Group which is a wholly owned Subsidiary of the Guarantor, the Borrower will not create, incur, assume or allow to exist any financial indebtedness, enter into any finance lease or undertake any material capital commitment (including but not limited to the purchase of any capital asset).
 
  10.11.2   The Borrower shall procure that any and all indebtedness (and in particular with any other Obligor) is at all times fully subordinated to the Security Documents and the obligations of the Borrower hereunder. Upon the occurrence of an Event of Default, the Borrower shall not make any repayments of principal, payments of interest or of any other costs, fees, expenses or liabilities arising from or representing such indebtedness. In this Clause “fully subordinated” shall mean that any claim of the lender against the Borrower in relation to such indebtedness shall rank after and be in all respects subordinate to all of the

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      rights and claims of the Finance Parties under this Agreement and the other Security Documents and that the lender shall not take any steps to enforce its rights to recover any monies owing to it by the Borrower and in particular but without limitation the lender will not institute any legal or quasi-legal proceedings under any jurisdiction at any time against the Vessel, her Earnings or Insurances or the Borrower and it will not compete with the Finance Parties or any of them in a liquidation or other winding-up or bankruptcy of the Borrower or in any proceedings in connection with the Vessel, her Earnings or Insurances.
10.12   Pooling of earnings and charters
 
    The Borrower will not enter into in respect of the Vessel, nor permit to exist:
  10.12.1   any pooling agreement or other arrangement for the sharing of any of the Earnings or the expenses of the Vessel except with a member of the Group and provided that it does not adversely affect the rights of the Finance Parties under the Assignment of Earnings in the reasonable opinion of the Agent; or
 
  10.12.2   any demise or bareboat charter; or
 
  10.12.3   any charter whereunder two (2) months’ charterhire (or the equivalent thereof) is payable in advance in respect of the Vessel; or
 
  10.12.4   any charter of the Vessel or contract of affreightment or employment which, with the exercise of options for extension, could be for a period longer than thirteen (13) months; or
 
  10.12.5   any charter of the Vessel or contract of affreightment or employment whereunder the hire payable is below approximately the market rate prevailing when the Vessel’s letting or employment is fixed,
 
  but if, with the prior written consent of the Agent, the Borrower enters into in respect of the Vessel a charter with a company outside the Group, the Borrower hereby undertakes to execute in favour of the Finance Parties an assignment of such charter and the Earnings therefrom such assignment to be in substantially the form of the Assignment of Earnings and as required by the Agent provided however that the Borrower may in respect of the Vessel enter into a bareboat charter in form approved by the Agent with any company which is a member of the Group provided that if so requested by the Agent and without limitation:
  10.12.6   any such bareboat charterer shall enter into such deeds (including but not limited to a subordination and assignment deed), agreements and indemnities as the Agent shall in its sole discretion require prior to entering into the bareboat charter with the Borrower; and
 
  10.12.7   the Borrower shall assign the benefit of any such bareboat charter and its interest in the Insurances to the Finance Parties by way of further security for the Borrower’s obligations under the Security Documents.
10.13   Loans and guarantees by the Borrower
 
    Otherwise than in the ordinary course of business as owner of the Vessel, the Borrower will not make any loan or advance or extend credit to any person, firm or corporation or issue or enter into any guarantee or indemnity or otherwise become directly or contingently liable for the obligations of any other person, firm or corporation.

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10.14   Management and employment
 
    Except with the prior consent of the Agent, the Borrower will not:
  10.14.1   permit any person other than the Manager to be the manager of, including providing crewing services to, the Vessel;
 
  10.14.2   permit any amendment to be made to the terms of the Management Agreement unless the amendment is advised by the Borrower’s tax counsel or is deemed necessary by the parties thereto to reflect the prevailing circumstances but provided that the amendment does not imperil the security to be provided pursuant to the Security Documents or adversely affect the ability of any Obligor to perform its obligations under the Transaction Documents; or
 
  10.14.3   permit the Vessel to be employed other than within the NCL or NCL America brand (as applicable).
10.15   Acquisition of shares
 
    The Borrower will not acquire any equity, share capital, assets or obligations of any corporation or other entity or permit its shares to be held other than directly or indirectly by the Guarantor.
10.16   Trading with the United States of America
 
    The Borrower shall in respect of the Vessel take all reasonable precautions to prevent any infringements of the Anti-Drug Abuse Act of 1986 of the United States of America (as the same may be amended and/or re-enacted from time to time hereafter) or any similar legislation applicable to the Vessel in any other jurisdiction in which the Vessel shall trade (a “Relevant Jurisdiction”) where the Vessel trades in the territorial waters of the United States of America or a Relevant Jurisdiction and, for this purpose, the Borrower shall, inter alia, enter into a “Carrier Initiative Agreement” with the United States’ Customs Service (if such is possible) and procure that the same (or a similar agreement in a Relevant Jurisdiction) is maintained in full force and effect and its obligations thereunder performed by it in respect of the Vessel throughout any period of United States of America (including coastal waters over which it claims jurisdiction) or Relevant Jurisdiction related trading.
10.17   Further assurance
 
    The Borrower will, from time to time on being required to do so by the Agent, do or procure the doing of all such acts and/or execute or procure the execution of all such documents in a form satisfactory to the Agent as the Agent may reasonably consider necessary for giving full effect to any of the Transaction Documents or the Coface Insurance Policy or securing to the Finance Parties the full benefit of the rights, powers and remedies conferred upon the Finance Parties or any of them in any such Transaction Document.
10.18   Valuation of the Vessel
  10.18.1   The Borrower will from time to time (but at intervals no more frequently than annually at the Borrower’s expense unless an Event of Default has occurred and remains unremedied) within thirty (30) days of receiving any request to that effect from the Agent, procure that the Vessel is valued by an independent reputable shipbroker or shipvaluer experienced in valuing cruise ships appointed by the Borrower and approved by the Agent (which approval shall

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      not be unreasonably withheld or delayed and such valuation to be made with or without taking into account the benefit or otherwise of any fixed employment relating to the Vessel as the Agent may require).
 
  10.18.2   If the Borrower does not accept the valuation obtained pursuant to Clause 10.18.1 (the “First Valuation”) it may (at its own expense) within five (5) Business Days of receipt of the First Valuation obtain a second valuation (the “Second Valuation”) from another independent reputable shipbroker or shipvaluer experienced in valuing cruise ships appointed by the Borrower and approved by the Agent which approval shall not be unreasonably withheld or delayed.
 
  10.18.3   If the Second Valuation exceeds the First Valuation by a margin of no less than ten per cent. (10%) of the First Valuation the Borrower may at its expense forthwith upon receipt of the Second Valuation request the shipbrokers and/or shipvaluers appointed pursuant to Clauses 10.18.1 and 10.18.2 to obtain a third valuation (the “Third Valuation”) from a further independent reputable shipbroker or shipvaluer experienced in valuing cruise ships approved by the Agent such approval not to be unreasonably withheld or delayed. Subject to the Third Valuation being made available within five (5) Business Days of the date of the Second Valuation, the valuation of the Vessel will be determined on the basis of the average of the three valuations so obtained. If the Third Valuation is not made available within the aforementioned time limit, the Vessel shall be valued on the basis of the average of the First Valuation and the Second Valuation.
 
  10.18.4   The Borrower shall procure that forthwith upon the issuance of any valuation obtained pursuant to this Clause 10.18 a copy thereof is sent directly to the Agent for review.
10.19   Earnings
 
    The Borrower will procure that the Earnings (if any) are paid in full without set off and free and clear of and without deduction for any taxes levies duties imposts charges fees restrictions or conditions of any nature whatsoever.
10.20   Insurances
 
    The Borrower covenants with the Finance Parties and undertakes:
  10.20.1   from the Delivery Date until the end of the Security Period to insure the Vessel in its name and keep the Vessel insured on an agreed value basis for an amount in the currency in which the Loan is denominated approved by the Agent but not being less than the greater of:
  (a)   one hundred and twenty five per cent. (125%) of the amount of the Loan; and
 
  (b)   the full market and commercial value of the Vessel determined in accordance with Clause 10.18 from time to time
through internationally recognised independent first class insurance companies, underwriters, war risks and protection and indemnity associations acceptable to the Agent in each instance on terms and conditions approved by the Agent including as to deductibles but at least in respect of:

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  (i)   fire and marine risks including but without limitation hull and machinery and all other risks customarily and usually covered by first-class and prudent shipowners in the London insurance markets under English marine policies or Agent-approved policies containing the ordinary conditions applicable to similar vessels;
 
  (ii)   war risks and war risks (protection and indemnity) up to the insured amount;
 
  (iii)   excess risks that is to say the proportion of claims for general average and salvage charges and under the running down clause not recoverable in consequence of the value at which the Vessel is assessed for the purpose of such claims exceeding the insured value;
 
  (iv)   protection and indemnity risks with full standard coverage as offered by first-class protection and indemnity associations and up to the highest limit of liability available (for oil pollution risk the highest limit currently available is one billion Dollars (USD1,000,000,000) and this to be increased if reasonably requested by the Agent and the increase is possible in accordance with the standard protection and indemnity cover for vessels of its type and is compatible with prudent insurance practice for first class cruise shipowners or operators in waters where the Vessel trades from time to time from the Delivery Date until the end of the Security Period);
 
  (v)   when and while the Vessel is laid-up, in lieu of hull insurance, normal port risks; and
 
  (vi)   such other risks as the Agent may from time to time reasonably require;
and in any event in respect of those risks and at those levels covered by first class and prudent owners and/or financiers in the international market in respect of similar tonnage provided that if any of such insurances are also effected in the name of any other person (other than the Borrower and/or a Finance Party) such person shall if so required by the Agent execute a first priority assignment of its interest in such insurances in favour of the Finance Parties in similar terms mutatis mutandis to the Assignment of Insurances;
10.20.2   to agree that the Agent shall take out mortgagee interest insurance on such conditions as the Agent may reasonably require and mortgagee interest insurance for pollution risks as from time to time agreed each for an amount in the currency in which the Loan is denominated of one hundred and ten per cent. (110%) of the amount of the Loan, the Borrower having no interest or entitlement in respect of such policies; the Borrower shall upon demand of the Agent reimburse the Agent for the costs of effecting and/or maintaining any such insurance(s) and the Agent hereby undertakes to use its reasonable endeavours to match the premium level that the Borrower would have paid if the Borrower itself had arranged such cover on such conditions (as demonstrated to the reasonable satisfaction of the Agent);
 
10.20.3   if the Vessel shall trade in the United States of America and/or the Exclusive Economic Zone of the United States of America (the “EEZ”) as such term is defined in the US Oil Pollution Act 1990 (“OPA”), to comply strictly with the requirements of OPA and any similar legislation which may from time to time be enacted in any jurisdiction in which the Vessel presently trades or may or will trade at any time during the existence of this Agreement and in particular

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    before such trade is commenced and during the entire period during which such trade is carried on:
  (a)   to pay any additional premiums required to maintain protection and indemnity cover for oil pollution up to the limit available to it for the Vessel in the market;
 
  (b)   to make all such quarterly or other voyage declarations as may from time to time be required by the Vessel’s protection and indemnity association and to comply with all obligations in order to maintain such cover, and promptly to deliver to the Agent copies of such declarations;
 
  (c)   to submit the Vessel to such additional periodic, classification, structural or other surveys which may be required by the Vessel’s protection and indemnity insurers to maintain cover for such trade and promptly to deliver to the Agent copies of reports made in respect of such surveys;
 
  (d)   to implement any recommendations contained in the reports issued following the surveys referred to in Clause 10.20.4(c) within the time limit specified therein and to provide evidence satisfactory to the Agent that the protection and indemnity insurers are satisfied that this has been done;
 
  (e)   in particular strictly to comply with the requirements of any applicable law, convention, regulation, proclamation or order with regard to financial responsibility for liabilities imposed on the Borrower or the Vessel with respect to pollution by any state or nation or political subdivision thereof, including but not limited to OPA, and to provide the Agent on demand with such information or evidence as it may reasonably require of such compliance;
 
  (f)   to procure that the protection and indemnity insurances do not contain a clause excluding the Vessel from trading in waters of the United States of America and the EEZ or any other provision analogous thereto and to provide the Agent with evidence that this is so; and
 
  (g)   strictly to comply with any operational or structural regulations issued from time to time by any relevant authorities under OPA so that at all times the Vessel falls within the provisions which limit strict liability under OPA for oil pollution;
  10.20.4   to give notice forthwith of any assignment of its interest in the Insurances to the relevant brokers, insurance companies, underwriters and/or associations in the form approved by the Agent;
 
  10.20.5   to execute and deliver all such documents and do all such things as may be necessary to confer upon the Finance Parties legal title to the Insurances in respect of the Vessel and to procure that the interest of the Finance Parties is at all times filed with all slips, cover notes, policies and certificates of entry and to procure (a) that a loss payable clause in the form approved by the Agent shall be filed with all the hull, machinery and equipment and war risks policies in respect of the Vessel and (b) that a loss payable clause in the form approved by the Agent shall be endorsed upon the protection and indemnity certificates of entry in respect of the Vessel;

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  10.20.6   to procure that each of the relevant brokers and associations furnishes the Agent with a letter of undertaking in such form as may be required by the Agent and waives any lien for premiums or calls except in relation to premiums or calls solely attributable to the Vessel;
 
  10.20.7   punctually to pay all premiums, calls, contributions or other sums payable in respect of the Insurances on the Vessel and to produce all relevant receipts when so required by the Agent;
 
  10.20.8   to renew each of the Insurances on the Vessel at least five (5) days before the expiry thereof and to give immediate notice to the Agent of such renewal and to procure that the relevant brokers or associations shall promptly confirm in writing to the Agent that such renewal is effected it being understood by the Borrower that any failure to renew the Insurances on the Vessel at least five (5) days before the expiry thereof or to give or procure the relevant notices of such renewal shall constitute an Event of Default;
 
  10.20.9   to arrange for the execution of such guarantees as may from time to time be required by any protection and indemnity and/or war risks association;
 
  10.20.10   to furnish the Agent from time to time on request with full information about all Insurances maintained on the Vessel and the names of the offices, companies, underwriters, associations or clubs with which such Insurances are placed;
 
  10.20.11   not to agree to any variation in the terms of any of the Insurances on the Vessel without the prior approval of the Agent nor to do any act or voluntarily suffer or permit any act to be done whereby any Insurances shall or may be rendered invalid, void, voidable, suspended, defeated or unenforceable and not to suffer or permit the Vessel to engage in any voyage nor to carry any cargo not permitted under any of the Insurances without first obtaining the consent of the insurers or reinsurers concerned and complying with such requirements as to payment of extra premiums or otherwise as the insurers or reinsurers may impose;
 
  10.20.12   not without the prior written consent of the Agent to settle, compromise or abandon any claim in respect of any of the Insurances on the Vessel other than a claim of less than ten million Dollars (USD10,000,000) or the equivalent in any other currency and not being a claim arising out of a Total Loss;
 
  10.20.13   promptly to furnish the Agent with full information regarding any casualties or other accidents or damage to the Vessel involving an amount in excess of [**] [Confidential Treatment] Dollars [**] [Confidential Treatment];
 
  10.20.14   to apply or ensure the appliance of all such sums receivable in respect of the Insurances on the Vessel for the purpose of making good the loss and fully repairing all damage in respect whereof the insurance monies shall have been received;
 
  10.20.15   that in the event of it making default in insuring and keeping insured the Vessel as hereinbefore provided then the Agent may (but shall not be bound to) insure the Vessel or enter the Vessel in such manner and to such extent as the Agent in its discretion thinks fit and in such case all the cost of effecting and maintaining such insurance together with interest thereon at the Interest Rate shall be paid on demand by the Borrower to the Agent; and

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  10.20.16   to agree that the Agent shall be entitled from time to time (but at intervals no more frequently than annually at the Borrower’s expense up to an amount of ten thousand euro (EUR10,000) annually, except in the case that the Delivery Date and any renewal or amendment of the Insurances to be assigned to the Finance Parties pursuant to the Assignment of Insurances fall within one (1) year of each other or such Insurances are amended within one (1) year of the Delivery Date or their renewal (as the case may be)) to instruct independent reputable insurance advisers for the purpose of obtaining any advice or information regarding any matter concerning the Insurances which the Agent shall at its sole discretion deem necessary, it being hereby specifically agreed that it shall reimburse the Agent on demand for all reasonable costs and expenses incurred by the Agent in connection with the instruction of such advisers as aforesaid.
10.21   Operation and maintenance of the Vessel
 
    From the Delivery Date until the end of the Security Period at its own expense the Borrower will:
  10.21.1   keep the Vessel in a good and efficient state of repair so as to maintain it to the highest classification notation available for the Vessel of its age and type free of all recommendations and qualifications with Det Norske Veritas. On the Delivery Date and annually thereafter, it will furnish to the Agent a statement by such classification society that such classification notation is maintained. It will comply with all recommendations, regulations and requirements (statutory or otherwise) from time to time applicable to the Vessel and shall have on board as and when required thereby valid certificates showing compliance therewith and shall procure that all repairs to or replacements of any damaged, worn or lost parts or equipment are carried out (both as regards workmanship and quality of materials) so as not to diminish the value or class of the Vessel. It will not make any substantial modifications or alterations to the Vessel or any part thereof which would reduce the market and commercial value of the Vessel determined in accordance with Clause 10.18 without the prior consent of the Agent;
 
  10.21.2   submit the Vessel to continuous survey in respect of its machinery and hull and such other surveys as may be required for classification purposes and, if so required by the Agent, supply to the Agent copies in English of the survey reports;
 
  10.21.3   permit surveyors or agents appointed by the Agent to board the Vessel at all reasonable times to inspect its condition or satisfy themselves as to repairs proposed or already carried out and afford all proper facilities for such inspections;
 
  10.21.4   comply, or procure that the Manager will comply, with the ISM Code (as the same may be amended from time to time) or any replacement of the ISM Code (as the same may be amended from time to time) and in particular, without prejudice to the generality of the foregoing, as and when required to do so by the ISM Code and at all times thereafter:
  (a)     hold, or procure that the Manager holds, a valid Document of Compliance duly issued to the Borrower or the Manager (as the case may be) pursuant to the ISM Code and a valid Safety Management Certificate duly issued to the Vessel pursuant to the ISM Code;

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  (b)   provide the Agent with copies of any such Document of Compliance and Safety Management Certificate as soon as the same are issued; and
 
  (c)   keep, or procure that there is kept, on board the Vessel a copy of any such Document of Compliance and the original of any such Safety Management Certificate;
  10.21.5   comply, or procure that the Manager will comply, with the ISPS Code (as the same may be amended from time to time) or any replacement of the ISPS Code (as the same may be amended from time to time) and in particular, without prejudice to the generality of the foregoing, as and when required to do so by the ISPS Code and at all times thereafter:
  (a)     keep, or procure that there is kept, on board the Vessel the original of the International Ship Security Certificate; and
 
  (b)     keep, or procure that there is kept, on board the Vessel a copy of the ship security plan prepared pursuant to the ISPS Code;
  10.21.6   comply with Annex VI (as the same may be amended from time to time) or any replacement of Annex VI (as the same may be amended from time to time) and in particular, without limitation, to:
  (a)     procure that the Vessel’s master and crew are familiar with, and that the Vessel complies with, Annex VI; and
 
  (b)     maintain for the Vessel throughout the Security Period a valid and current IAPPC and provide a copy to the Agent; and
 
  (c)     notify the Agent immediately in writing of any actual or threatened withdrawal, suspension, cancellation or modification of the IAPPC;
  10.21.7   not employ the Vessel or permit its employment in any trade or business which is forbidden by any applicable law or is otherwise illicit or in carrying illicit or prohibited goods or in any manner whatsoever which may render it liable to condemnation in a prize court or to destruction, seizure or confiscation or that may expose the Vessel to penalties. In the event of hostilities in any part of the world (whether war be declared or not) it will not employ the Vessel or permit its employment in carrying any contraband goods;
 
  10.21.8   promptly provide the Agent with (a) all information which the Agent may reasonably require regarding the Vessel, its employment, earnings, position and engagements (b) particulars of all towages and salvages and (c) copies of all charters and other contracts for its employment and otherwise concerning it;
 
  10.21.9   give notice to the Agent promptly and in reasonable detail upon the Borrower or any other Obligor becoming aware of:
  (a)     accidents to the Vessel involving repairs the cost of which will or is likely to exceed [**] [Confidential Treatment] Dollars [**] [Confidential Treatment];
 
  (b)     the Vessel becoming or being likely to become a Total Loss;
 
  (c)     any recommendation or requirement made by any insurer or classification society or by any competent authority which is not complied with, or cannot be complied with, within any time limit relating thereto and that

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might reasonably affect the maintenance of either the Insurances or the classification of the Vessel;
  (d)   any writ or claim served against or any arrest of the Vessel or the exercise of any lien or purported lien on the Vessel, her Earnings or Insurances;
 
  (e)   the Vessel ceasing to be registered under the flag of the Maritime Registry or anything which is done or not done whereby such registration may be imperilled;
 
  (f)   it becoming impossible or unlawful for it to fulfil any of its obligations under the Security Documents; and
 
  (g)   anything done or permitted or not done in respect of the Vessel by any person which is likely to imperil the security created by the Security Documents;
  10.21.10   promptly pay and discharge all debts, damages and liabilities, taxes, assessments, charges, fines, penalties, tolls, dues and other outgoings in respect of the Vessel and keep proper books of account in respect thereof provided always that the Borrower shall not be obliged to compromise any debts, damages and liabilities as aforesaid which are being contested in good faith subject always that full details of any such contested debt, damage or liability which, either individually or in aggregate exceeds [**] [Confidential Treatment] Dollars [**] [Confidential Treatment] shall forthwith be provided to the Agent. As and when the Agent may so require the Borrower will make such books available for inspection on behalf of the Agent and provide evidence satisfactory to the Agent that the wages and allotments and the insurance and pension contributions of the master and crew are being regularly paid, that all deductions of crew’s wages in respect of any tax liability are being properly accounted for and that the master has no claim for disbursements other than those incurred in the ordinary course of trading on the voyage then in progress or completed prior to such inspection;
 
  10.21.11   maintain the type of the Vessel as at the Delivery Date and not put the Vessel into the possession of any person without the prior consent of the Agent for the purpose of work being done on it in an amount exceeding or likely to exceed [**] [Confidential Treatment] Dollars [**] [Confidential Treatment] unless such person shall first have given to the Agent a written undertaking addressed to the Agent in terms satisfactory to the Agent agreeing not to exercise a lien on the Vessel or her Earnings for the cost of such work or for any other reason;
 
  10.21.12   promptly pay and discharge all liabilities which have given rise, or may give rise, to liens or claims enforceable against the Vessel under the laws of all countries to whose jurisdiction the Vessel may from time to time be subject and in particular the Borrower hereby agrees to indemnify and hold the Finance Parties, their successors, assigns, directors, officers, shareholders, employees and agents harmless from and against any and all claims, losses, liabilities, damages, expenses (including attorneys, fees and expenses and consultant fees) and injuries of any kind whatsoever asserted against the Finance Parties, with respect to or as a result of the presence, escape, seepage, spillage, release, leaking, discharge or migration from the Vessel or other properties owned or operated by the Borrower of any hazardous substance, including without limitation, any claims asserted or arising under any applicable environmental, health and safety laws, codes and ordinances, and all rules and regulations

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      promulgated thereunder of all governmental agencies, regardless of whether or not caused by or within the control of the Borrower subject to the following:
  (a)   it is the parties’ understanding that the Finance Parties do not now, have never and do not intend in the future to exercise any operational control or maintenance over the Vessel or any other properties and operations owned or operated by the Borrower, nor in the past, presently, or intend in the future to, maintain an ownership interest in the Vessel or any other properties owned or operated by the Borrower except as may arise upon enforcement of the Lenders’ rights under the Mortgage;
 
  (b)   the indemnity and hold harmless contained in this Clause 10.21.12 shall not extend to the Finance Parties in their capacity as equity investors in the Borrower or as an owner of any property or interest as to which the Borrower is also owner but only to their capacity as lenders, holders of security interests or beneficiaries of security interests; and
 
  (c)   unless and until an Event of Default shall have occurred and without prejudice to the right of each Lender to be indemnified pursuant to this Clause 10.21.12:
  (i)   each Lender will, if it is reasonably practicable to do so, notify the Borrower upon receiving a claim in respect of which the relevant Lender is or may become entitled to an indemnity under this Clause 10.21.12;
 
  (ii)   subject to the prior written approval of the relevant Lender which the Lender shall have the right to withhold, the Borrower will be entitled to take, in the name of the relevant Lender, such action as the Borrower may see fit to avoid, dispute, resist, appeal, compromise or defend any such claims, losses, liabilities, damages, expenses and injuries as are referred to above in this Clause 10.21.12 or to recover the same from any third party, subject to the Borrower first ensuring that the relevant Lender is secured to its reasonable satisfaction against all expenses thereby incurred or to be incurred; and
 
  (iii)   the relevant Lender will, to the extent that it is reasonably practicable to do so, seek the approval of the Borrower (such approval not to be unreasonably withheld or delayed) before making any admission of liability, agreement or compromise with a third party, or any payment to a third party, in respect of such claims, losses, liabilities, damages, expenses and injuries as are referred to above in this Clause 10.21.12 and, to the extent that the Borrower is entitled to take action in accordance with sub-clause (ii) above and subject to the Borrower first ensuring that the relevant Lender is secured to its reasonable satisfaction against all expenses thereby incurred or to be incurred, the relevant Lender will provide such information, assistance and other co-operation as the Borrower may reasonably request in connection with such action,
provided always that the Borrower shall not be obliged to compromise any liabilities as aforesaid which are being contested in good faith subject always that full details of any such contested liabilities which, either individually or in aggregate, exceed [**] [Confidential Treatment] Dollars [**] [Confidential Treatment] shall be

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forthwith provided to the Agent. If the Vessel is arrested or detained for any reason it will procure its immediate release by providing bail or taking such other steps as the circumstances may require;
  10.21.13   give to the Agent at such times as it may from time to time reasonably require a certificate, duly signed on its behalf, as to the total amount of any debts, damages and liabilities relating to the Vessel and details of such of those debts, damages and liabilities as are over a certain amount to be specified by the Agent at the relevant time and, if so required by the Agent, forthwith discharge such of those debts, damages and liabilities as the Agent shall require other than those being contested in good faith; and
 
  10.21.14   maintain the registration of the Vessel under and fly the flag of the Maritime Registry and not do or permit anything to be done whereby such registration may be forfeited or imperilled.
10.22   Dividends
 
    Subject to the provisions of clause 11.3 of the Guarantee, the Borrower will procure that any dividends or other distributions and interest paid or payable in connection with such dividends or other distributions will be received promptly by the Guarantor directly or indirectly from the Borrower’s shareholder (if such shareholder is not the Guarantor) by way of dividend.
 
10.23   Irrevocable payment instructions
 
    The Borrower shall not modify, revoke or withhold the payment instructions set out in Clause 3.2 without the agreement of the Builder (in the case of Clause 3.2.1 only), the Agent and the Lenders .
 
10.24   “Know your customer” checks
 
    If:
  10.24.1   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;
 
  10.24.2   any change in the status of a Borrower after the date of this Agreement; or
 
  10.24.3   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 Clause 10.24.3, 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 any Lender (for itself or, in the case of the event described in Clause 10.24.3, on behalf of any prospective New Lender) in order for the Agent, such Lender or, in the case of the event described in Clause 20.6.1(c), 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.

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10.25   Building Contract
The Borrower shall not substantially modify the Building Contract, directly or indirectly, if, by reason of regulations which apply to a Lender, such modification would make such Lender’s Commitment impossible to fulfil or would change the substance or form of its Commitment. The Borrower may, therefore, submit to the Lenders any proposals for modification which, in its opinion, might have such a consequence, and the Lenders will indicate in a timely manner whether the modification proposed will allow the Loan to be maintained.
On or about the last day of each successive period of three (3) months commencing on the date of this Agreement and on the date of the Drawdown Notice, the Borrower undertakes to provide the Agent with a copy of any Change Order entered into during that three (3) month or other period. The Borrower also undertakes to notify the Agent of any change in the Intended Delivery Date as soon as practicable after the change has occurred.
11.   PREPAYMENT
11.1   The Borrower may prepay all or part of the Loan (but if in part being an amount that reduces the Loan by a minimum amount of one (1) repayment instalment of principal of the Loan together with interest thereon) without penalty provided the prepayment is made on the relevant interest payment date and one (1) month’s prior written notice indicating the intended date of prepayment is given to the Agent, but compensation shall be payable to the Lenders in the sum of:
  11.1.1   the difference (if positive), calculated by the Lenders, between the actual cost for the Lenders of the funding for the Loan and the rate of interest for the monies to be invested by the Lenders, applied to the amounts so prepaid for the period from said prepayment until the next interest prepayment date (if prepayment does not occur on an interest payment date). Details of any such calculation shall be supplied to the Borrower by the Lenders; and
 
  11.1.2   the charges (if any) imposed on the Lenders by the French Authorities (funding or breakage costs of the French Authority in charge of monitoring the CIRR).
11.2   Any prepayment of the whole of the Loan shall be made together with all other sums due under this Agreement.
 
11.3   Amounts prepaid shall be applied in accordance with Clause 17.
 
11.4   Amounts prepaid may not be reborrowed.
 
12.   INTEREST ON LATE PAYMENTS
 
12.1   Without prejudice to the provisions of Clause 13 and without this Clause in any way constituting a waiver of terms of payment, all sums due by the Borrower under this Agreement will automatically bear interest on a day to day basis from the date when they are payable until the date of actual payment at a rate per annum equal to the higher of:
  12.1.1   EONIA plus [**] [Confidential Treatment] per cent. [**]; [Confidential Treatment] and
 
  12.1.2   the CIRR plus [**] [Confidential Treatment] per cent. [**] [Confidential Treatment].
Such interest will itself bear interest at the above rate if it is due for an entire year.

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13.   ACCELERATION — EVENTS OF DEFAULT
 
13.1   If any one of the Events of Default set out in Clause 13.2 occurs and remains unremedied:
  13.1.1   if the Loan has not been drawn down, no drawing under the Loan may be requested from the Lenders; or
 
  13.1.2   if the Loan has already been drawn down, the Lenders may require immediate payment of the outstanding principal amount of the Loan (including but without limitation the amount representing the financed Coface Premium) together with all other sums due under this Agreement:
13.2   The following are the Events of Default referred to in Clause 13.1:
  13.2.1   Non-payment
The Borrower or any other Obligor does not pay on the due date any amount of principal or interest of the Loan (provided however that if any such amount is not paid when due solely by reason of some error or omission on the part of the bank or banks through whom the relevant funds are being transmitted no Event of Default shall occur for the purposes of this Clause 13.2.1 until the expiry of three (3) Business Days following the date on which such payment is due), or within three (3) Business Days of the due date any other amount payable by it under any Security Document to which it may at any time be a party including but without limitation any amount payable by the Guarantor under the Guarantee, at the place and in the currency in which it is expressed to be payable.
  13.2.2   Breach of other obligations
  (a)   Any Obligor fails to comply with any provision of any Security Document and in particular but without limitation any failure by the Guarantor to comply with the provisions of Clauses 9 (General Undertakings: Positive Covenants), 10 (General Undertakings: Negative Covenants) and/or 11 (Financial Undertakings and Ownership and Control of the Guarantor) of the Guarantee or there is any breach in the sole opinion of the Agent of any of the Transaction Documents.
 
      If the Loan has already been drawn down, an Event of Default shall not have arisen if the failure (if in the opinion of the Agent in its sole discretion it is capable of remedy) has been remedied within a period of thirty (30) days from the date of its occurrence, if the failure was known to that Obligor, or from the date the relevant Obligor is notified by the Agent of the failure, if the failure was not known to that Obligor, unless in any such case as aforesaid the Agent in its sole discretion considers that the failure is or could reasonably be expected to become materially prejudicial to the interests, rights or position of the Lenders; or
 
  (b)   If there is a repudiation or termination of any Transaction Document or if any of the parties thereto becomes entitled to terminate or repudiate any of them and evidences an intention so to do.

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13.2.3   Misrepresentation
Any representation, warranty or statement made or repeated in, or in connection with, any Transaction Document or the Coface Insurance Policy or in any accounts, certificate, statement or opinion delivered by or on behalf of any Obligor thereunder or in connection therewith is materially incorrect when made or would, if repeated at any time hereafter by reference to the facts subsisting at such time, no longer be materially correct.
13.2.4   Cross default
  (a)   Any event of default occurs under any financial contract or financial document relating to any Financial Indebtedness of any member of the Group;
 
  (b)   Any such Financial Indebtedness or any sum payable in respect thereof is not paid when due (after the expiry of any applicable grace period(s)) whether by acceleration or otherwise;
 
  (c)   Any Encumbrance over any assets of any member of the Group becomes enforceable;
 
  (d)   Any other Financial Indebtedness of any member of the Group is not paid when due or is or becomes capable of being declared due prematurely by reason of default or any security for the same becomes enforceable by reason of default;
provided that:
  (i)   No Event of Default will arise if the relevant Financial Indebtedness is not accelerated or, if it is accelerated but, in aggregate, the Financial Indebtedness is less than twenty five million Dollars (USD25,000,000); and
 
  (ii)   Financial Indebtedness being contested by the Borrower in good faith will be disregarded for a period of one hundred and fifty (150) days from its occurrence if full details of the dispute are submitted to the Agent forthwith upon its occurrence. If the dispute remains unresolved for a period of more than one hundred and fifty (150) days from its occurrence, this Clause 13.2.4(ii) shall not apply to that Financial Indebtedness.
13.2.5   Winding-up
Subject to clause 10.6 of the Guarantee, any order is made or an effective resolution passed or other action taken for the suspension of payments or reorganisation, dissolution, termination of existence, liquidation, winding-up or bankruptcy of any member of the Group.
13.2.6   Moratorium or arrangement with creditors
A moratorium in respect of all or any debts of any member of the Group or a composition or an arrangement with creditors of any member of the Group or any similar proceeding or arrangement by which the assets of any member of the Group are submitted to the control of its creditors is applied for, ordered or declared or any member of the Group commences negotiations with any one or more of its creditors with a view to the general readjustment or rescheduling of all or a significant part of its Financial Indebtedness.

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13.2.7   Appointment of liquidators etc.
A liquidator, trustee, administrator, receiver, administrative receiver, manager or similar officer is appointed in respect of any member of the Group or in respect of all or any substantial part of the assets of any member of the Group and in any such case such appointment is not withdrawn within thirty (30) days (the “Grace Period”) unless the Agent considers in its sole discretion that the interest of the Lenders might reasonably be expected to be adversely affected in which event the Grace Period shall not apply.
13.2.8   Insolvency
Any member of the Group becomes or is declared insolvent or is unable, or admits in writing its inability, to pay its debts as they fall due or becomes insolvent within the terms of any applicable law.
13.2.9   Legal process
Any distress, execution, attachment or other process affects the whole or any substantial part of the assets of any member of the Group and remains undischarged for a period of twenty one (21) days or any uninsured judgment in excess of [**] [Confidential Treatment] Dollars [**] [Confidential Treatment] following final appeal remains unsatisfied for a period of thirty (30) days in the case of a judgment made in the United States of America and otherwise for a period of sixty (60) days provided that no Event of Default shall be deemed to have occurred unless the distress, execution, attachment or other process adversely affects any Obligor’s ability to meet any of its material obligations under this Agreement or the other Security Documents or cause to occur any of the events specified in Clauses 13.2.5 to 13.2.8 (the determination of which shall be in the Agent’s sole discretion).
13.2.10   Analogous events
Anything analogous to or having a substantially similar effect to any of the events specified in Clauses 13.2.5 to 13.2.9 shall occur under the laws of any applicable jurisdiction.
13.2.11   Cessation of business
Subject to clause 10.6 of the Guarantee, any member of the Group ceases to carry on all or a substantial part of its business.
13.2.12   Revocation of consents
Any authorisation, approval, consent, licence, exemption, filing, registration or notarisation or other requirement necessary to enable any Obligor to comply with any of its obligations under any of the Transaction Documents is materially adversely modified, revoked or withheld or does not remain in full force and effect and within ninety (90) days of the date of its occurrence such event is not remedied to the satisfaction of the Agent and the Agent considers in its sole discretion that such failure is or might be expected to become materially prejudicial to the interests, rights or position of the Lenders provided that the Borrower shall not be entitled to the aforesaid ninety (90) day period if the modification, revocation or withholding of the authorisation, approval or consent is due to an act or omission of any Obligor and the Agent is satisfied in

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its sole discretion that the Lenders’ interests might reasonably be expected to be materially adversely affected.
13.2.13   Unlawfulness
At any time it is unlawful or impossible for any Obligor to perform any of its material (to the Finance Parties or any of them) obligations under any Transaction Document to which it is a party or it is unlawful or impossible for the Finance Parties or any Lender to exercise any of their or its rights under any of the Transaction Documents, provided that no Event of Default shall be deemed to have occurred where:
  (a)   the unlawfulness or impossibility preventing any Obligor from performing its obligations (other than its payment obligations under this Agreement, the other Transaction Documents) is cured within a period of twenty one (21) days of the occurrence of the event giving rise to the unlawfulness or impossibility and the relevant Obligor within the aforesaid period, performs its obligation(s) (except where the unlawfulness or impossibility adversely affects any Obligor’s payment obligations under this Agreement, the other Transaction Documents (the determination of which shall be in the Agent’s sole discretion) in which case the following provisions of this Clause 13.2.13 shall not apply); and/or
 
  (b)   where a Finance Party was aware of the default and could, in its sole discretion, mitigate the consequences of the unlawfulness or impossibility. The reasonable costs of mitigating the consequences of the unlawfulness or impossibility shall be borne by the Borrower save where such costs are of an internal administrative nature and are not incurred in dealings by the Finance Party with third parties.
13.2.14   Insurances
The Borrower fails to insure the Vessel in the manner specified in Clause 10.20 or fails to renew the Insurances at least five (5) days prior to the date of expiry thereof and produce prompt confirmation of such renewal to the Agent.
13.2.15   Disposals
If the Borrower or any other member of the Group shall have concealed, removed, or permitted to be concealed or removed, any part of its property, with intent to hinder, delay or defraud its creditors or any of them, or made or suffered a transfer of any of its property which may be fraudulent under any bankruptcy, fraudulent conveyance or similar law; or shall have made any transfer of its property to or for the benefit of a creditor with the intention of preferring such creditor over any other creditor.
13.2.16   Prejudice to security
Anything is done or suffered or omitted to be done by any Obligor which in the reasonable opinion of the Agent would or might be expected to imperil the security created by any of the Security Documents.
13.2.17   Material adverse change
Any material adverse change in the business, assets or financial condition of any Obligor occurs which in the reasonable opinion of the Agent would or

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might reasonably be expected to affect the ability of that Obligor duly to perform any of its material obligations under any Security Document to which it may at any time be a party. For the purposes of this Clause 13.2.17 and without prejudice to the generality of the expression “material obligations” any payment obligations of any Obligor shall be deemed material.
13.2.18   Governmental intervention
The authority of any member of the Group in the conduct of its business is wholly or substantially curtailed by any seizure or intervention by or on behalf of any authority and within ninety (90) days of the date of its occurrence any such seizure or intervention is not relinquished or withdrawn and the Agent reasonably considers that the relevant occurrence is or might be expected to become materially prejudicial to the interests, rights or position of the Lenders provided that the Borrower shall not be entitled to the aforesaid ninety (90) day period if the seizure or intervention executed by any authority is due to an act or omission of any member of the Group and the Agent is satisfied, in its sole discretion, that the Lenders’ interest might reasonably be expected to be materially adversely affected.
13.3   If at any time during the period commencing on the day after the date of this Agreement and ending on the date falling sixty (60) days before the Intended Delivery Date (the “Limited Period") any event should occur that would constitute an Event of Default, the Agent shall not be entitled to serve a notice under Clause 13.4 unless during the Limited Period:
  13.3.1   there is a failure by an Obligor to perform any material obligation under the Transaction Documents on the relevant due date or within any applicable grace period, including but without limitation if the Guarantor fails to provide to the Agent the statement referred to in Clause 3.1.4 in the manner described in that Clause; or
 
  13.3.2   the relevant event would imperil the security created by the Guarantee. In no event shall the provisions of this Clause 13.3 be interpreted as a waiver of the Agent’s right to serve a notice under Clause 13.4 in respect of any Event of Default which has occurred and remains unremedied on the date falling sixty (60) days before the Intended Delivery Date.
13.4   Notice of any Event of Default and/or of the acceleration of the payment of the principal of the Loan, interest thereon and all other sums due under this Agreement shall be given by the Agent in accordance with Clause 27.
 
13.5   In no event shall any delay in exercising the Lenders’ right to require advance repayment be interpreted as a waiver of this right.
 
13.6   Furthermore, in case of such accelerated repayment following an Event of Default, the Borrower shall be liable to pay to the Agent, in addition to the Coface Premium pursuant to Clause 6, compensation calculated as provided for in Clause 11.
 
13.7   Following an Event of Default and for so long as the same remains unremedied, the Borrower irrevocably authorises the Agent and the Lenders to apply any credit balance to which the Borrower is entitled upon any account of the Borrower with any branch of any of the Agent and the Lenders in or towards satisfaction of any sum due to the Agent or any Lender hereunder but unpaid, and to combine any accounts of the Borrower for this purpose. If such set-off requires a credit balance in a currency other than the required

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    currency to be transferred to an account maintained in connection herewith the transfer shall be effected by crediting to the account in question the amount of the required currency which the Agent or the Lender (as the case may be) could obtain by exchanging such currency for the required currency at the rate of exchange at which its Facility Office would, at the opening of business on the date on which the combination is effected, have sold the currency of that credit balance for the required currency for immediate delivery.
13.8   In the event that the accelerated amount is received by the Agent before the date of normal maturity of the accelerated interest payments, the Borrower shall, subject to no sums remaining due to the Lenders from the Borrower, be entitled to refund of interest for the actual number of days between the date on which the Lenders received the amount and the normal date for payment of such amount.
14.   MANDATORY PREPAYMENT
 
14.1   Subject to Clause 14.2, the Borrower shall forthwith prepay the outstanding principal amount of the Loan (including but without limitation the amount representing the financed Coface Premium) together with all other sums due under this Agreement if:
  14.1.1   the Vessel shall become a Total Loss; or
 
  14.1.2   if the Coface Insurance Policy is modified, suspended, terminated or rescinded unless caused by the wilful misconduct or gross negligence of a Finance Party.
14.2   However, if the Vessel shall become a Total Loss (but without prejudice to the Lenders’ rights to receive the proceeds of the Insurances or Compulsory Acquisition forthwith upon collection as may be provided for in the Mortgage and/or the Assignment of Insurances), the Borrower shall not be required to pay its indebtedness under this Agreement earlier than the date which is one hundred and fifty (150) days after the Total Loss Date.
 
14.3   The provisions of Clause 11 shall apply mutatis mutandis to any prepayment pursuant to this Clause 14.
 
15.   CURRENCY OF PAYMENT
The funds for payment of all sums due by the Borrower under this Agreement, shall be paid in Dollars or euro (in the case that the payment is due in euro) to the credit of:
  15.1.1   BNP Paribas, Paris, Swift code: [**] [Confidential Treatment], IBAN: [**] [Confidential Treatment], under the following reference: “BFI/LSI/BOCI Crédits Acheteurs - Commercial Loan Hull No D 33 dated            September 2006” in the case of euro; and
 
  15.1.2   the account of BNP Paribas, Paris, Swift code: [**] [Confidential Treatment], account number [**] [Confidential Treatment] with BNP Paribas S.A., The Equitable Building, 787 Seventh Avenue, New York, New York NY 10019, Swift code: [**] [Confidential Treatment], under the following reference: “BFI/LSI/BOCI Crédits Acheteurs — Commercial Loan Hull No D 33 dated            September 2006” in the case of Dollars.
These sums must be credited before 11.00 a.m. New York time or 11.00 a.m. Paris time (in the case that the payment is in euro) in freely transferable and convertible currency. For each payment to be made, the Borrower shall notify the Agent on the third

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Business Day prior to the due payment date that it will issue instructions to its bank (which shall be named in such notification) to make the relevant payment.
16.   SECURITY
All the Borrower’s payment obligations under this Agreement shall be secured by:
  16.1.1   the Guarantee to be signed within ten (10) Business Days of the date of this Agreement in favour of the Finance Parties;
 
  16.1.2   the Mortgage to be executed and registered in favour of the Finance Parties forthwith upon delivery of the Vessel; and
 
  16.1.3   the Assignment of Warranty Rights, the Assignment of Insurances, the Assignment of Earnings and the Assignment of Management Agreement to be executed in favour of the Finance Parties forthwith upon delivery of the Vessel.
17.   APPLICATION OF SUMS RECEIVED
All sums received under this Agreement by the Agent, on behalf of the Lenders, or by any of the Lenders for any reason whatsoever will, without prejudice to complementary provisions of the Mortgage, be applied:
  17.1.1   in priority, to payments of any kind due or in arrears in the order of their due payment dates and first, to fees, charges and expenses, second, to interest payable pursuant to Clause 12, third, to interest payable pursuant to Clause 4, fourth, to the principal of the Loan payable pursuant to Clause 4 and, fifth, to any other sums due under this Agreement and, if relevant, pro rata to each of the Lenders; or
 
  17.1.2   if no payments are in arrears or if these payments have been discharged as set out above, then and to sums remaining due under this Agreement and, if relevant, pro rata to each of the Lenders and in each case in inverse order of maturity, the interest being recalculated accordingly.
18.   CHANGES TO THE LENDERS
 
18.1   Assignments and transfers by the Lenders
Subject to this Clause 18, a Lender (the “Existing Lender") may:
  18.1.1   assign its rights; or
 
  18.1.2   transfer by novation its rights and obligations,
to another bank or financial institution which is authorised by the French Authorities to enter into French export credits benefiting from the CIRR (the “New Lender").
18.2   Conditions of assignment or transfer
  18.2.1   The consent of the Borrower is required for an assignment or transfer by an Existing Lender, unless the assignment or transfer is to another Lender or an Affiliate of a Lender.
 
  18.2.2   The consent of the Borrower to an assignment or transfer must not be unreasonably withheld or delayed.

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  18.2.3   The assignment or transfer must be with respect to a minimum Commitment of [**] [Confidential Treatment] Dollars [**] [Confidential Treatment] or, if less, the Existing Lender’s full Commitment.
 
  18.2.4   An assignment will only be effective on:
  (a)   receipt by the Agent of written confirmation from the New Lender (in form and substance satisfactory to the Agent) that the New Lender will assume the same obligations to the other Finance Parties as it would have been under if it was an Original Lender; and
 
  (b)   performance by the Agent of all necessary “know your customer” or other similar checks under all applicable laws and regulations in relation to such assignment to a New Lender, the completion of which the Agent shall promptly notify to the Existing Lender and the New Lender.
  18.2.5   A transfer will only be effective if the procedure set out in Clause 18.5 is complied with.
 
  18.2.6   If:
  (a)   a Lender assigns or transfers its rights or obligations under the Security Documents or changes its Facility Office; and
 
  (b)   as a result of circumstances existing at the date the assignment, transfer or change occurs, an Obligor would be obliged to make a payment to the New Lender or Lender acting through its new Facility Office under Clause 8,
then the New Lender or Lender acting through its new Facility Office is only entitled to receive payment under that Clause to the same extent as the Existing Lender or Lender acting through its previous Facility Office would have been if the assignment, transfer or change had not occurred.
18.3   Assignment or transfer fee
The New Lender shall, on the date upon which an assignment or transfer takes effect, pay to the Agent (for its own account) a fee of [**] [Confidential Treatment]. The New Lender shall also pay to the Agent, upon demand, all reasonable costs and expenses, duties and fees, including but without limitation legal costs and out of pocket expenses, incurred by the Agent or the Lenders in connection with any necessary amendment to or supplementing of the Transaction Documents or any of them or the Coface Insurance Policy as a consequence of the assignment or transfer.
18.4   Limitation of responsibility of Existing Lenders
  18.4.1   Unless expressly agreed to the contrary, an Existing Lender makes no representation or warranty and assumes no responsibility to a New Lender for:
  (a)   the legality, validity, effectiveness, adequacy or enforceability of the Security Documents or any other documents;
 
  (b)   the financial condition of any Obligor;
 
  (c)   the performance and observance by any Obligor of its obligations under the Security Documents or any other documents; or

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  (d)   the accuracy of any statements (whether written or oral) made in or in connection with any Security Document or any other document,
and any representations or warranties implied by law are excluded.
  18.4.2   Each New Lender confirms to the Existing Lender and the other Finance Parties that it:
  (a)   has made (and shall continue to make) its own independent investigation and assessment of the financial condition and affairs of each Obligor and its related entities in connection with its participation in this Agreement and has not relied exclusively on any information provided to it by the Existing Lender in connection with any Security Document; and
 
  (b)   will continue to make its own independent appraisal of the creditworthiness of each Obligor and its related entities whilst any amount is or may be outstanding under the Security Documents or any Commitment is in force.
  18.4.3   Nothing in any Security Document obliges an Existing Lender to:
  (a)   accept a re-transfer from a New Lender of any of the rights and obligations assigned or transferred under this Clause 18; or
 
  (b)   support any losses directly or indirectly incurred by the New Lender by reason of the non-performance by any Obligor of its obligations under the Security Documents or otherwise.
18.5   Procedure for transfer
  18.5.1   Subject to the conditions set out in Clause 18.2 a transfer is effected in accordance with Clause 18.5.3 when the Agent executes an otherwise duly completed Transfer Certificate delivered to it by the Existing Lender and the New Lender. The Agent shall, subject to Clause 18.5.2, as soon as reasonably practicable after receipt by it of a duly completed Transfer Certificate appearing on its face to comply with the terms of this Agreement and delivered in accordance with the terms of this Agreement, execute that Transfer Certificate.
 
  18.5.2   The Agent shall only be obliged to execute a Transfer Certificate delivered to it by the Existing Lender and the New Lender once it is satisfied it has complied with all necessary “know your customer” or other similar checks under all applicable laws and regulations in relation to the transfer to such New Lender.
 
  18.5.3   On the Transfer Date:
  (a)   to the extent that in the Transfer Certificate the Existing Lender seeks to transfer by novation its rights and obligations under the Security Documents each of the Obligors and the Existing Lender shall be released from further obligations towards one another under the Security Documents and their respective rights against one another under the Security Documents shall be cancelled (being the “Discharged Rights and Obligations”);
 
  (b)   each of the Obligors and the New Lender shall assume obligations towards one another and/or acquire rights against one another which differ from the Discharged Rights and Obligations only insofar as that Obligor

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    and the New Lender have assumed and/or acquired the same in place of that Obligor and the Existing Lender;
 
  (c)   the Agent, the Mandated Lead Arrangers, the New Lender and the other Lenders shall acquire the same rights and assume the same obligations between themselves as they would have acquired and assumed had the New Lender been an Original Lender with the rights and/or obligations acquired or assumed by it as a result of the transfer and to that extent the Agent, the Mandated Lead Arrangers and the Existing Lender shall each be released from further obligations to each other under the Security Documents; and
 
  (d)   the New Lender shall become a Party as a “Lender”.
18.6   Copy of Transfer Certificate to Borrower
The Agent shall, as soon as reasonably practicable after it has executed a Transfer Certificate, send to the Borrower a copy of that Transfer Certificate.
18.7   Permitted disclosure
Any Finance Party may disclose to any of its Affiliates and to the following other persons:
  18.7.1   any person to (or through) whom that Lender assigns or transfers (or may potentially assign or transfer) all or any of its rights and obligations under this Agreement;
 
  18.7.2   any person with (or through) whom that Lender enters into (or may potentially enter into) any sub-participation in relation to, or any other transaction under which payments are to be made by reference to, this Agreement or any Obligor;
 
  18.7.3   any person to whom, and to the extent that, information is required to be disclosed by any applicable law or regulation;
 
  18.7.4   any other Finance Party, or any employee, officer, director or representative of such entity which needs to know such information or receive such document in the course of such person’s employ or duties;
 
  18.7.5   Coface, or any employee, officer, director or representative of such entity which needs to know such information or receive such document in the course of such person’s employ or duties;
 
  18.7.6   the Guarantor or any other member of the Group, or any employee, officer, director or representative of such entity which needs to know such information or receive such document in the course of such person’s employ or duties; or
 
  18.7.7   auditors, insurance and reinsurance brokers, insurers and reinsurers and professional advisers, including legal advisers, which need to know such information,
any information about any Obligor, this Agreement and the other Security Documents as that Finance Party shall consider appropriate. Each of the Finance Parties may also disclose to the Builder, or any employee, officer, director or representative of the Builder which needs to know such information or receive such document in the course of such person’s employ or duties, such information about any Obligor, this Agreement and the

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other Security Documents as that Finance Party reasonably considers normal practice for a French export credit.
Each of the Finance Parties acknowledges that all information received now or in the future from or on behalf of the Obligors under or pursuant to or in connection with the Transaction Documents or the Coface Insurance Policy (other than any information which is in the public domain other than as a result of a breach of this Clause) is confidential information and undertakes to advise this fact to any recipient of any such information under this Clause.
19.   CHANGES TO THE OBLIGORS
No Obligor may assign any of its rights or transfer any of its rights or obligations under the Security Documents without the unanimous consent of the Lenders.
20.   ROLE OF THE AGENT AND THE MANDATED LEAD ARRANGERS
 
20.1   Appointment of the Agent
  20.1.1   Each other Finance Party appoints the Agent to act as its agent under and in connection with this Agreement and the other Security Documents and the Coface Insurance Policy.
 
  20.1.2   Each other Finance Party authorises the Agent to exercise the rights, powers, authorities and discretions specifically given to the Agent under or in connection with the Security Documents together with any other incidental rights, powers, authorities and discretions.
20.2   Duties of the Agent
  20.2.1   The Agent shall promptly forward to a Party the original or a copy of any document which is delivered to the Agent for that Party by any other Party.
 
  20.2.2   Except where a Security Document specifically provides otherwise, the Agent is not obliged to review or check the adequacy, accuracy or completeness of any document it forwards to another Party.
 
  20.2.3   If the Agent receives notice from a Party referring to this Agreement, describing an Event of Default and stating that the circumstance described is an Event of Default, it shall promptly notify the other Finance Parties.
 
  20.2.4   If the Agent is aware of the non-payment of any principal, interest, commitment fee or other fee payable to a Finance Party (other than the Agent or a Mandated Lead Arranger) under this Agreement it shall promptly notify the other Finance Parties.
 
  20.2.5   The Agent’s duties under the Security Documents are solely administrative in nature.
20.3   Role of the Mandated Lead Arrangers
None of the Mandated Lead Arrangers has any obligations of any kind to any other Party under or in connection with any Transaction Document or the Coface Insurance Policy.

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20.4   No fiduciary duties
  20.4.1   Nothing in this Agreement constitutes the Agent or any of the Mandated Lead Arrangers as a trustee or fiduciary of any other person.
 
  20.4.2   Neither the Agent nor any of the Mandated Lead Arrangers shall be bound to account to any Lender for any sum or the profit element of any sum received by it for its own account.
20.5   Business with the Guarantor
The Agent and each of the Mandated Lead Arrangers may accept deposits from, lend money to and generally engage in any kind of banking or other business with any Affiliate or Subsidiary of the Guarantor.
20.6   Rights and discretions of the Agent
  20.6.1   The Agent may rely on:
  (a)   any representation, notice or document believed by it to be genuine, correct and appropriately authorised; and
 
  (b)   any statement made by a director, authorised signatory or employee of any person regarding any matters which may reasonably be assumed to be within his knowledge or within his power to verify.
  20.6.2   The Agent may assume (unless it has received notice to the contrary in its capacity as agent for the Lenders) that:
  (a)   no Event of Default has occurred (unless it has actual knowledge of an Event of Default arising under Clause 13.2); and
 
  (b)   any right, power, authority or discretion vested in any Party or the Lenders has not been exercised.
  20.6.3   The Agent may engage, pay for and rely on the advice or services of any lawyers, accountants, surveyors or other experts.
 
  20.6.4   The Agent may act in relation to the Security Documents through its personnel and agents.
 
  20.6.5   The Agent may disclose to any other Party any information it reasonably believes it has received as the Agent under this Agreement.
 
  20.6.6   Notwithstanding any other provision of any Security Document to the contrary, neither the Agent nor any of the Mandated Lead Arrangers is obliged to do or omit to do anything if it would or might in its reasonable opinion constitute a breach of any law or regulation or a breach of a fiduciary duty or duty of confidentiality.
20.7   Lenders’ instructions
  20.7.1   Unless a contrary indication appears in a Security Document, the Agent shall:
  (a)   exercise any right, power, authority or discretion vested in it as Agent in accordance with any instructions given to it by the Lenders (or, if so

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      instructed by the Lenders, refrain from exercising any right, power, authority or discretion vested in it as the Agent); and
 
  (b)   not be liable for any act (or omission) if it acts (or refrains from taking any action) in accordance with an instruction of the Lenders.
  20.7.2   Unless a contrary indication appears in a Security Document, any instructions given by the Lenders will be binding on all the Finance Parties.
 
  20.7.3   The Agent may refrain from acting in accordance with the instructions of the Lenders until it has received such security as it may require for any cost, loss or liability (together with any associated value added tax) which it may incur in complying with the instructions.
 
  20.7.4   In the absence of instructions from the Lenders the Agent may act (or refrain from taking action) as it considers to be in the best interest of the Lenders.
 
  20.7.5   The Agent is not authorised to act on behalf of a Lender (without first obtaining that Lender’s consent) in any legal or arbitration proceedings relating to any Security Document.
20.8   Responsibility for documentation
The Agent is not responsible for:
  20.8.1   the adequacy, accuracy and/or completeness of any information (whether oral or written) supplied by the Agent, a Mandated Lead Arranger, an Obligor or any other person given in or in connection with any Transaction Document or the Coface Insurance Policy; or
 
  20.8.2   is responsible for the legality, validity, effectiveness, adequacy or enforceability of any Transaction Document or the Coface Insurance Policy or any other agreement, arrangement or document entered into, made or executed in anticipation of or in connection with any Transaction Document or the Coface Insurance Policy.
20.9   Exclusion of liability
  20.9.1   Without limiting Clause 20.9.2, the Agent will not be liable for any action taken by it under or in connection with any Security Document, unless directly caused by its gross negligence or wilful misconduct.
 
  20.9.2   No Party (other than the Agent) may take any proceedings against any officer, employee or agent of the Agent in respect of any claim it might have against the Agent or in respect of any act or omission of any kind by that officer, employee or agent in relation to any Security Document and any officer, employee or agent of the Agent may rely on this Clause.
 
  20.9.3   The Agent will not be liable for any delay (or any related consequences) in crediting an account with an amount required under the Security Documents to be paid by the Agent if the Agent has taken all necessary steps as soon as reasonably practicable to comply with the regulations or operating procedures of any recognised clearing or settlement system used by the Agent for that purpose.
 
  20.9.4   Nothing in this Agreement shall oblige the Agent or a Mandated Lead Arranger to carry out any “know your customer” or other checks in relation to any person

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      on behalf of any Lender and each Lender confirms to the Agent and the Mandated Lead Arrangers that it is solely responsible for any such checks it is required to carry out and that it may not rely on any statement in relation to such checks made by the Agent or a Mandated Lead Arranger.
20.10   Lenders’ indemnity to the Agent
Each Lender shall (in proportion to its share of the Total Commitments or, if the Total Commitments are then zero, to its share of the Total Commitments immediately prior to their reduction to zero) indemnify the Agent, within three (3) Business Days of demand, against any cost, loss or liability incurred by the Agent (otherwise than by reason of the Agent’s gross negligence or wilful misconduct) in acting as Agent under the Security Documents (unless the Agent has been reimbursed by an Obligor pursuant to a Security Document).
20.11   Resignation of the Agent
  20.11.1   The Agent may resign and appoint one of its Affiliates as successor by giving notice to the other Finance Parties and the Borrower.
 
  20.11.2   Alternatively the Agent may resign by giving notice to the other Finance Parties and the Borrower, in which case the Lenders (after consultation with the Borrower) may appoint a successor Agent.
 
  20.11.3   If the Lenders have not appointed a successor Agent in accordance with Clause 20.11.2 within thirty (30) days after notice of resignation was given, the Agent (after consultation with the Borrower) may appoint a successor Agent.
 
  20.11.4   The retiring Agent shall, at its own cost, make available to the successor Agent such documents and records and provide such assistance as the successor Agent may reasonably request for the purposes of performing its functions as Agent under the Security Documents.
 
  20.11.5   The Agent’s resignation notice shall only take effect upon the appointment of a successor.
 
  20.11.6   Upon the appointment of a successor, the retiring Agent shall be discharged from any further obligation in respect of the Security Documents but shall remain entitled to the benefit of this Clause 20. Its successor and each of the other Parties shall have the same rights and obligations amongst themselves as they would have had if such successor had been an original Party.
 
  20.11.7   After consultation with Coface, the Lenders may, by notice to the Agent, require it to resign in accordance with Clause 20.11.2. In this event, the Agent shall resign in accordance with Clause 20.11.2.
20.12   Confidentiality
  20.12.1   In acting as agent for the Finance Parties, the Agent shall be regarded as acting through its agency division which shall be treated as a separate entity from any other of its divisions or departments.
 
  20.12.2   If information is received by another division or department of the Agent, it may be treated as confidential to that division or department and the Agent shall not be deemed to have notice of it.

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20.13   Relationship with the Lenders
The Agent may treat each Lender as a Lender, entitled to payments under this Agreement and acting through its Facility Office unless it has received not less than five (5) Business Days’ prior notice from that Lender to the contrary in accordance with the terms of this Agreement.
20.14   Credit appraisal by the Lenders
Without affecting the responsibility of any Obligor for information supplied by it or on its behalf in connection with any Security Document, each Lender confirms to the Agent and each of the Mandated Lead Arrangers that it has been, and will continue to be, solely responsible for making its own independent appraisal and investigation of all risks arising under or in connection with any Security Document including but not limited to:
  20.14.1   the financial condition, status and nature of the Guarantor and each Subsidiary of the Guarantor;
 
  20.14.2   the legality, validity, effectiveness, adequacy or enforceability of any Security Document and any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Security Document;
 
  20.14.3   whether that Lender has recourse, and the nature and extent of that recourse, against any Party or any of its respective assets under or in connection with any Security Document, the transactions contemplated by the Security Documents or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Security Document; and
 
  20.14.4   the adequacy, accuracy and/or completeness of any information provided by the Agent, any Party or by any other person under or in connection with any Security Document, the transactions contemplated by the Security Documents or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Security Document.
20.15   Deduction from amounts payable by the Agent
If any Party owes an amount to the Agent under the Security Documents the Agent may, after giving notice to that Party, deduct an amount not exceeding that amount from any payment to that Party which the Agent would otherwise be obliged to make under the Security Documents and apply the amount deducted in or towards satisfaction of the amount owed. For the purposes of the Security Documents that Party shall be regarded as having received any amount so deducted.
21.   CONDUCT OF BUSINESS BY THE FINANCE PARTIES
21.1   No provision of this Agreement will:
  21.1.1   interfere with the right of any Finance Party to arrange its affairs (tax or otherwise) in whatever manner it thinks fit;
 
  21.1.2   oblige any Finance Party to investigate or claim any credit, relief, remission or repayment available to it or the extent, order and manner of any claim; or
 
  21.1.3   oblige any Finance Party to disclose any information relating to its affairs (tax or otherwise) or any computations in respect of tax.

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22.   SHARING AMONG THE FINANCE PARTIES
 
22.1   Payments to Finance Parties
If a Finance Party (a “Recovering Finance Party”) receives or recovers any amount from an Obligor other than in accordance with Clause 23 and applies that amount to a payment due under the Security Documents then:
  22.1.1   the Recovering Finance Party shall, within three (3) Business Days, notify details of the receipt or recovery to the Agent;
 
  22.1.2   the Agent shall determine whether the receipt or recovery is in excess of the amount the Recovering Finance Party would have been paid had the receipt or recovery been received or made by the Agent and distributed in accordance with Clause 17 and Clause 23), without taking account of any tax which would be imposed on the Agent in relation to the receipt, recovery or distribution; and
 
  22.1.3   the Recovering Finance Party shall, within three (3) Business Days of demand by the Agent, pay to the Agent an amount (the “Sharing Payment”) equal to such receipt or recovery less any amount which the Agent determines may be retained by the Recovering Finance Party as its share of any payment to be made, in accordance with Clause 17 and Clause 23.
22.2   Redistribution of payments
The Agent shall treat the Sharing Payment as if it had been paid by the relevant Obligor and distribute it between the Finance Parties (other than the Recovering Finance Party) in accordance with Clause 17 and Clause 23.
22.3   Recovering Finance Party’s rights
  22.3.1   On a distribution by the Agent under Clause 22.2, the Recovering Finance Party will, if possible under the relevant applicable laws, be subrogated to the rights of the Finance Parties which have shared in the redistribution.
 
  22.3.2   If and to the extent that the Recovering Finance Party is not able to rely on its rights under Clause 22.3.1, the relevant Obligor shall be liable to the Recovering Finance Party for a debt equal to the Sharing Payment which is immediately due and payable.
22.4   Reversal of redistribution
If any part of the Sharing Payment received or recovered by a Recovering Finance Party becomes repayable and is repaid by that Recovering Finance Party, then:
  22.4.1   each Lender which has received a share of the relevant Sharing Payment pursuant to Clause 22.4 shall, upon request of the Agent, pay to the Agent for account of that Recovering Finance Party an amount equal to the appropriate part of its share of the Sharing Payment (together with an amount as is necessary to reimburse that Recovering Finance Party for its proportion of any interest on the Sharing Payment which that Recovering Finance Party is required to pay); and
 
  22.4.2   that Recovering Finance Party’s rights of subrogation in respect of any reimbursement shall be cancelled and the relevant Obligor will be liable to the reimbursing Finance Party for the amount so reimbursed.

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22.5   Exceptions
  22.5.1   This Clause 22 shall not apply to the extent that the Recovering Finance Party would not, after making any payment pursuant to this Clause, have a valid and enforceable claim against the relevant Obligor.
 
  22.5.2   A Recovering Finance Party is not obliged to share with any other Finance Party any amount which the Recovering Finance Party has received or recovered as a result of taking legal or arbitration proceedings, if:
  (a)   it notified that other Finance Party of the legal or arbitration proceedings; and
 
  (b)   that other Finance Party had an opportunity to participate in those legal or arbitration proceedings but did not do so as soon as reasonably practicable having received notice and did not take separate legal or arbitration proceedings.
23.   PAYMENT MECHANICS
 
23.1   Payments to the Agent
  23.1.1   On each date on which an Obligor or a Lender is required to make a payment under a Security Document, that Obligor or Lender shall make the same available to the Agent (unless a contrary indication appears in a Security Document) for value on the due date at the time and in such funds specified by the Agent as being customary at the time for settlement of transactions in the relevant currency in the place of payment.
 
  23.1.2   Payment shall be made to such account in the principal financial centre of the country of that currency (or, in relation to euro, in a principal financial centre in a Participating Member State or London) with such bank as the Agent specifies.
23.2   Distributions by the Agent
Each payment received by the Agent under the Security Documents for another Party shall, subject to Clause 23.3, Clause 23.4 and Clause 20.15 be made available by the Agent as soon as practicable after receipt to the Party entitled to receive payment in accordance with this Agreement (in the case of a Lender, for the account of its Facility Office), to such account as that Party may notify to the Agent by not less than five (5) Business Days’ notice with a bank in a principal financial centre in a Participating Member State or London (or, in the case of any other currency, in the principal financial centre of the country of that currency).
23.3   Distributions to an Obligor
The Agent may (with the consent of the Obligor or in accordance with Clause 13.7 apply any amount received by it for that Obligor in or towards payment (on the date and in the currency and funds of receipt) of any amount due from that Obligor under the Security Documents or in or towards purchase of any amount of any currency to be so applied.
23.4   Clawback
  23.4.1   Where a sum is to be paid to the Agent under the Security Documents for another Party, the Agent is not obliged to pay that sum to that other Party (or to

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      enter into or perform any related exchange contract) until it has been able to establish to its satisfaction that it has actually received that sum.
 
  23.4.2   If the Agent pays an amount to another Party and it proves to be the case that the Agent had not actually received that amount, then the Party to whom that amount (or the proceeds of any related exchange contract) was paid by the Agent shall on demand refund the same to the Agent together with interest on that amount from the date of payment to the date of receipt by the Agent, calculated by the Agent to reflect its cost of funds.
23.5   No set-off by Obligors
All payments to be made by an Obligor under the Security Documents shall be calculated and be made without (and free and clear of any deduction for) set-off or counterclaim.
23.6   Business Days
  23.6.1   Any payment which is due to be made on a day that is not a Business Day shall be made on the next Business Day in the same calendar month (if there is one) or the preceding Business Day (if there is not).
 
  23.6.2   During any extension of the due date for payment of any principal or unpaid sum under this Agreement interest is payable on the principal or unpaid sum at the rate payable on the original due date.
23.7   Currency of account
  23.7.1   Subject to Clauses 23.7.2 and 23.7.3 euro is the currency of account and payment for any sum from an Obligor under any Security Document.
 
  23.7.2   Each payment in respect of costs, expenses or taxes shall be made in the currency in which the costs, expenses or taxes are incurred.
 
  23.7.3   Any amount expressed to be payable in a currency other than euro shall be paid in that other currency.
23.8   Change of currency
  23.8.1   Unless otherwise prohibited by law, if more than one currency or currency unit are at the same time recognised by the central bank of any country as the lawful currency of that country, then:
  (a)   any reference in the Security Documents to, and any obligations arising under the Security Documents in, the currency of that country shall be translated into, or paid in, the currency or currency unit of that country designated by the Agent (after consultation with the Lenders and the Borrower); and
 
  (b)   any translation from one currency or currency unit to another shall be at the official rate of exchange recognised by the central bank for the conversion of that currency or currency unit into the other, rounded up or down by the Agent (acting reasonably).
  23.8.2   If a change in any currency of a country occurs, this Agreement will, to the extent the Agent (acting reasonably and after consultation with the Lenders and the Borrower) specifies to be necessary, be amended to comply with any

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      generally accepted conventions and market practice in the relevant interbank market and otherwise to reflect the change in currency.
24.   GOVERNING LAW
This Agreement is governed by English law.
25.   ENFORCEMENT
25.1   Jurisdiction of English courts
The courts of England have exclusive jurisdiction to settle any dispute arising out of or in connection with this Agreement (including a dispute regarding the existence, validity or termination of this Agreement) (a “Dispute”). Each Party agrees that the courts of England are the most appropriate and convenient courts to settle Disputes and accordingly no Party will argue to the contrary.
This Clause 25.1 is for the benefit of the Finance Parties only. As a result, no Finance Party shall be prevented from taking proceedings relating to a Dispute in any other courts with jurisdiction. To the extent allowed by law, any Finance Party may take concurrent proceedings in any number of jurisdictions.
25.2   Service of process
Without prejudice to any other mode of service allowed under any relevant law, the Borrower:
  25.2.1   irrevocably appoints Clifford Chance Secretaries Limited as its agent for service of process in relation to any proceedings before the English courts in connection with any Finance Document; and
 
  25.2.2   agrees that failure by a process agent to notify the Borrower of the process will not invalidate the proceedings concerned.
26.   APPENDICES
The appendices form an integral part of this Agreement.
27.   NOTICES
Any notices, demands and service of process relating to this Agreement or its performance, shall be in writing and shall be validly addressed, delivered or served at the respective addresses below:
     
For the Borrower:
  c/o 7665 Corporate Center Drive
 
  Miami
 
  Florida 33126
 
  United States of America
 
  Facsimile: +1 305 436 4140 (Ms Bonnie Biumi) and
+1 305 436 4117 (Legal Department)
 
  Attention: Ms Bonnie Biumi and the Legal Department

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For the Agent:
  BNP Paribas
 
  ECEP/Export Finance
 
  ACI: CHDESA1
 
  37 Place du Marché Saint-Honoré
 
  75031 Paris Cedex 01
 
  France
 
  Facsimile: +33 01 4316 8184
 
  Attention: Mrs Dominique Laplasse (Team Head)
 
   
For the Lenders:
  c/o the Agent
or to such other address or numbers as each party may notify to the other. Notices shall be effective upon receipt as set forth above. Any communications by facsimile shall be confirmed by registered mail or recognized international courier service, but the communication shall be deemed received on the date of the facsimile transmission (or if that day is not a business day in the place where the facsimile is received, on the next business day in that place).
Provided that for so long as no notice of acceleration has been issued pursuant to Clause 13.4, notices addressed to the Agent shall be deemed to have been addressed to the Lenders.
28.   MISCELLANEOUS
 
28.1   If any term of this Agreement becomes invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired.
 
28.2   No failure or delay on the part of the Lenders in exercising any right, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise thereof preclude any other or further exercise thereof by the Lenders or the exercise by the Lenders of any other right, power or privilege. The rights and remedies of the Lenders herein provided are cumulative and not exclusive of any rights or remedies provided by law.
 
28.3   This Agreement shall not be capable of being modified otherwise than by an express modification in writing signed by the Borrower and the Lenders.
 
29.   COMING INTO FORCE
This Agreement shall come into force on the date of its signature but the rights and obligations of the Borrower hereunder may be terminated by written notice from the Borrower to the Agent, such notice to be received not later than sixty (60) days prior to the Intended Delivery Date. Following service of such notice (which shall be irrevocable), the Borrower shall have no further right to draw down the Loan and the Borrower shall have no further obligations under this Agreement save in respect of fees, costs and expenses incurred under or in respect of this Agreement on or before the date on which the notice becomes effective or as a result of the service of the notice.
Service by the Borrower of the written notice in accordance with the preceding paragraph shall constitute a condition subsequent to this Agreement.

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Made in five (5) originals on the date before written.
     
Made in five (5) originals on the date before written.
   
 
   
F3 ONE, LTD.
  BNP PARIBAS
 
   
by: Bonnie Biumi
  by: J.D. Amsler          S. Ferdane
Bonnie Biumi  
  J.D. Amsler                S. Ferdane
 
   
its: Attorney-in-fact
  its: Authorized Signatories
 
   
CALYON
  HSBC FRANCE
 
   
by: Jerome Lebond
  by: Gilles Pirot          Erick Dadat
Jerome Lebond 
  Gilles Pirot                 Erick Dadat 
 
   
its: Attorney-in-fact
  its: Authorized Signatories
 
   
SOCIETE GENERALE
   
 
   
by: Isabella Seneca
   
Isabella Seneca 
   
 
   
its: Attorney-in-fact
   

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APPENDIX I
DOCUMENTS TO BE PRODUCED BY THE BUILDER TO BNP PARIBAS AS AGENT
Certified Copy of the commercial invoice, duly executed by the Builder in favour of the Borrower and countersigned by the Borrower.
Certified Copy of the Protocol of Delivery and Acceptance, duly executed by the Builder and the Borrower.
Certified Copy of the declaration of warranty, duly executed by the Builder confirming that the Vessel is delivered to the Borrower free and clear of all encumbrances whatsoever.
Certified Copy of the commercial invoice(s) corresponding to the Change Orders or any other similar document issued by the Builder stating the Change Order Amount, duly executed by the Builder in favour of the Borrower and countersigned by the Borrower.
Acknowledgement of the notice of assignment of the Borrower’s rights under the post-delivery warranty given by the Builder under the Building Contract pursuant to the Assignment of Warranty Rights.
Certified Copy of the power of attorney pursuant to which the authorised signatory of the Builder signed the documents referred to in this Appendix I and a specimen of his signature.

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APPENDIX II
THE ORIGINAL LENDERS AND THE MANDATED LEAD ARRANGERS
         
Name   Registered Address   Registered Number with the
        Registry of Trade and
        Companies
BNP PARIBAS
  16 boulevard des
Italiens, 75009 Paris,
France
  662 042 449 (RCS Paris)
 
       
CALYON
  9 quai du Président
Paul Doumer, 92920
Paris La Défense
Cedex, France
  304 187 701 (RCS Nanterre)
 
       
HSBC FRANCE
  103 avenue des Champs
Elysées, 75419 Paris,
Cedex 08, France
  775 670 284 (RCS Paris)
 
       
SOCIETE GENERALE
  29 boulevard
Haussmann, 75009
Paris, France
  552 120 222 (RCS Paris)
 
       
each a French société anonyme
       

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APPENDIX III
FORM OF TRANSFER CERTIFICATE
     
To:
  [  ] as Agent
 
   
From:
  [The Existing Lender] (the “Existing Lender”) and [The New Lender] (the “New Lender”)
 
   
Dated:
   
F3 Two, Ltd. — EUR662,905,320 Loan Agreement
dated            September 2006 (the
Agreement)
1.   We refer to the Agreement. This is a Transfer Certificate. Terms defined in the Agreement have the same meaning in this Transfer Certificate unless given a different meaning in this Transfer Certificate.
 
2.   We refer to Clause 18.5:
  (c)   The Existing Lender and the New Lender agree to the Existing Lender transferring to the New Lender by novation all or part of the Existing Lender’s Commitment, rights and obligations referred to in the Schedule in accordance with Clause 18.5.
 
  (d)   The proposed Transfer Date is [ ].
 
  (e)   The Facility Office and address, fax number and attention details for notices of the New Lender for the purposes of Clause 27 are set out in the Schedule.
3.   The New Lender expressly acknowledges the limitations on the Existing Lender’s obligations set out in Clause 18.4.3.
 
4.   This Transfer Certificate may be executed in any number of counterparts and this has the same effect as if the signatures on the counterparts were on a single copy of this Transfer Certificate.
 
5.   This Transfer Certificate is governed by English law.
THE SCHEDULE
Commitment/rights and obligations to be transferred
[insert relevant details]
[Facility Office address, fax number and attention details for notices and account details for
payments
]
     
[Existing Lender]
  [New Lender]
 
   
By:
  By:

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This Transfer Certificate is accepted by the Agent and the Transfer Date is confirmed as [ ].
[Agent]
By:

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APPENDIX IV
FORM OF DRAWDOWN NOTICE
BNP Paribas
ECEP/Export Finance
ACI: CHDESA1
37 Place du Marché Saint-Honoré
75031 Paris Cedex 01
France
Date       20[09][10]
Dear Sirs
Hull No. C33 Drawdown Notice
We refer to the loan agreement for hull no. C33 dated            September 2006 made between ourselves as borrower, yourselves, [], [] and [] as lenders and yourselves as agent (the “Agreement”). Terms defined in the Agreement shall have the same meaning in this Notice.
We hereby give you notice that pursuant to the Agreement and on [date of proposed drawdown] 20[09][10], we wish to draw down the Loan in the sum of the equivalent in Dollars of [ ] euro (EUR[ ]) upon the terms and subject to the conditions contained therein.
In accordance with the provisions of Clause 3.2, we hereby request you to advance the Loan by crediting the proceeds as follows:
[Details to be provided]
We confirm that at the date hereof the representations and warranties set out in Clause 9 of the Agreement are true and no Event of Default has occurred and remains unremedied.
Yours faithfully
for and on behalf of
F3 TWO, LTD.

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DATED 6th October 2006
NCL CORPORATION LTD.
(as guarantor)
- in favour of -
BNP PARIBAS
CALYON
HSBC FRANCE
and
SOCIETE GENERALE
(as lenders)
- and -
BNP PARIBAS
(as agent)
 
GUARANTEE
IN RESPECT OF THE OBLIGATIONS OF
F3 TWO, LTD.
 
     

 


 

CONTENTS
             
        Page
1  
Definitions and Construction
    1  
2  
Guarantee and Indemnity
    2  
3  
Survival of Guarantor’s Liability
    3  
4  
Continuing Guarantee
    4  
5  
Exclusion of the Guarantor’s Rights
    5  
6  
Payments
    6  
7  
Enforcement
    7  
8  
Representations and Warranties
    7  
9  
General Undertakings: Positive Covenants
    10  
10  
General Undertakings: Negative Covenants
    11  
11  
Financial Undertakings and Ownership and Control of the Guarantor
    13  
12  
Discharge
    18  
13  
Assignment and Transfer
    18  
14  
Miscellaneous Provisions
    19  
15  
Waiver of Immunity
    20  
16  
Notices
    20  
17  
Governing Law
    21  
18  
Jurisdiction
    21  
Schedule 1  
Quarterly Statement of Financial Covenants
    24  
Schedule 2  
Particulars of Agent and Lenders
    27  

 


 

DEED OF GUARANTEE AND INDEMNITY
Dated the 6th day of October 2006
BY:
(1)   NCL CORPORATION LTD. being a company validly existing under the laws of Bermuda with registration number EC34678 and with its registered office at Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda as guarantor (the “Guarantor”);
IN FAVOUR OF:
(2)   BNP PARIBAS, CALYON, HSBC FRANCE AND SOCIETE GENERALE, whose details are more particularly set out in Schedule 2 as lenders (the “Lenders”); and
 
(3)   BNP PARIBAS, whose details are more particularly set out in Schedule 2 as agent (the “Agent” and collectively with the Lenders the “Beneficiaries”).
WHEREAS:
(A)   By a loan agreement dated 22 September 2006 (the “Loan Agreement”) made between (among others) (1) F3 Two, Ltd. as borrower (the “Borrower”) (2) the Lenders and (3) the Agent, the Lenders have agreed, on the terms and conditions therein set out, to make available to the Borrower their participations in a loan facility of up to six hundred and sixty two million nine hundred and five thousand three hundred and twenty euro (EUR 662,905,320) (the “Loan”) in order to assist the Borrower in financing part of the purchase price of the Vessel.
(B)   It is a condition precedent to the Beneficiaries performing their obligations under the Loan Agreement that the Guarantor enters into this Deed.
NOW THIS DEED WITNESSES:
1   Definitions and Construction
  1.1   In this Deed the following terms and expressions shall have the meanings set out below; in addition, terms and expressions not defined herein but whose meanings are defined in the Loan Agreement shall have the meanings set out therein.
 
      “Accounts” means the audited consolidated profit and loss account and balance sheet (including all additional information and notes thereto) of the Guarantor and its consolidated Subsidiaries together with the relative directors’ and auditors’ reports;
 
      “Event of Default” means any of the events specified in clause 13.2 of the Loan Agreement or specified as such in Clause 11;
 
      “Obligors” means the Borrower, the Guarantor and the Manager;
 
      “Office” means in respect of the Agent and each Lender its office at the address set out beneath its name in Schedule 2 or such other office as it shall from time to time select and notify through the Agent to the Borrower;

 


 

      “Outstanding Indebtedness” means all sums of any kind payable actually or contingently to the Finance Parties under or pursuant to the Loan Agreement or any Transaction Document (whether by way of repayment of principal, payment of interest or default interest, payment of any indemnity or counter-indemnity, reimbursement for fees, costs or expenses or otherwise howsoever); and
 
      “Process Agent” means Clifford Chance Secretaries Limited or any other person in England nominated by the Assignor and approved by the Agent to accept service of legal proceedings on its behalf under any of the Transaction Documents.
  1.2   In this Deed unless the context otherwise requires:
  1.2.1   clause headings are inserted for convenience of reference only and shall be ignored in the construction of this Deed;
 
  1.2.2   references to Clauses and to Schedules are to be construed as references to clauses of and schedules to this Deed unless otherwise stated and references to this Deed are to be construed as references to this Deed including its Schedules;
 
  1.2.3   references to (or to any specified provision of) this Deed or any other document shall be construed as references to this Deed, that provision or that document as from time to time amended, supplemented or novated;
 
  1.2.4   references to any Act or any statutory instrument shall be construed as references to that Act or that statutory instrument as from time to time re-enacted, amended or supplemented;
 
  1.2.5   references to any party to this Deed or any other document shall include reference to such party’s successors and permitted assigns and transferees;
 
  1.2.6   words importing the plural shall include the singular and vice versa;
 
  1.2.7   references to a person shall be construed as references to an individual, firm, company, corporation, unincorporated body of persons or any state or any agency thereof; and
 
  1.2.8   where any matter requires the approval or consent of the Lenders or the Agent such approval or consent shall not be deemed to have been given unless given in writing; where any matter is required to be acceptable to the Lenders or the Agent, the Lenders or the Agent (as the case may be) shall not be deemed to have accepted such matter unless its acceptance is communicated in writing; each of the Lenders and the Agent may give or withhold its consent, approval or acceptance at its unfettered discretion.
2   Guarantee and Indemnity
  2.1   In consideration of the Lenders agreeing at the request of the Guarantor to make the Loan available to the Borrower in accordance with the terms of the Loan Agreement, the payment by the Beneficiaries to the Guarantor of ten Dollars (USD 10) and other good and valuable consideration (the receipt and adequacy of which the Guarantor hereby acknowledges) the Guarantor:

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  2.1.1   as primary obligor as and for its own debt and not merely as surety hereby undertakes to the Lenders to be responsible for and hereby guarantees to the Lenders:
  (a)   the due and punctual payment by the Borrower to the Lenders or the Agent (for itself and on behalf of the Lenders) (as the case may be) (as and when due by acceleration, demand or otherwise howsoever) of the Outstanding Indebtedness and every part thereof; and
 
  (b)   the due and punctual performance of all the obligations to be performed by each of the Obligors under or pursuant to the Loan Agreement and the other Security Documents; and
  2.1.2   unconditionally undertakes immediately on demand by the Agent from time to time to pay and/or perform its obligations under Clause 2.1.1.
  2.2   For the same consideration as referred to in Clause 2.1 the Guarantor (as a separate and independent obligation) unconditionally undertakes immediately on demand by the Agent from time to time to indemnify the Beneficiaries and hold each of them harmless in respect of:
  2.2.1   any loss incurred by the Beneficiaries as a result of the Loan Agreement and each other Security Document to which any of the Obligors is a party or any provision thereof becoming invalid, void, voidable or unenforceable for any reason whatsoever after execution hereof; and
 
  2.2.2   any loss or damage of any kind arising directly or indirectly from any failure on the part of any of the Obligors to perform any obligation to be performed by any of the Obligors under and pursuant to the Loan Agreement and each other Security Document to which any of the Obligors is a party.
3   Survival of Guarantor’s Liability
  3.1   The Guarantor’s liability to the Beneficiaries under this Deed shall not be discharged, impaired or otherwise affected by reason of any of the following events or circumstances (regardless of whether any such events or circumstances occur with or without the Guarantor’s knowledge or consent):
  3.1.1   any time, forbearance or other indulgence given or agreed by any of the Finance Parties to or with any of the Obligors or any other person in respect of any of their obligations under the Loan Agreement and each other Transaction Document to which any of the Obligors or that other person is a party; or
 
  3.1.2   any legal limitation, disability or incapacity relating to any of the Obligors; or
 
  3.1.3   any invalidity, irregularity, unenforceability, imperfection or avoidance of or any defect in any security granted by, or the obligations of any of the Obligors or any other person under, the Loan Agreement and each other Transaction Document to which any of the Obligors or that other person is

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      a party or any amendment to or variation thereof or of any other document or security comprised therein; or
 
  3.1.4   any change in the name, constitution, memorandum of association or otherwise of any of the Obligors or the amalgamation or merger of any of the Obligors with any other corporate entity; or
 
  3.1.5   the liquidation, bankruptcy or dissolution (or proceedings analogous thereto) of any of the Obligors or any other person or the appointment of a receiver or administrative receiver or administrator or trustee or similar officer of any of the assets of any of the Obligors or any other person or the occurrence of any circumstances whatsoever affecting any Obligor’s or that other person’s liability to discharge its obligations under the Loan Agreement and each other Transaction Document to which it is a party; or
 
  3.1.6   any challenge, dispute or avoidance by any liquidator of any of the Obligors or any other person in respect of any claim by the Guarantor by right of subrogation in any such liquidation; or
 
  3.1.7   any release of any other Obligor or any other person or any renewal, exchange or realisation of any security or obligation provided under or by virtue of any of the Transaction Documents or the provision to any of the Finance Parties at any time of any further security for the obligations of the Borrower under any of the Transaction Documents; or
 
  3.1.8   the release of any co-guarantor and/or indemnitor who is now or may hereafter become under a joint and several liability with the Guarantor under this Deed or the release of any other guarantor, indemnitor or other third party obligor in respect of the obligations of any Obligor under any of the Transaction Documents; or
 
  3.1.9   any failure on the part of any of the Finance Parties (whether intentional or not) to take or perfect any security agreed to be taken under or in relation to any of the Transaction Documents or to enforce any of the Transaction Documents; or
 
  3.1.10   any other act, matter or thing (save for repayment in full of the Outstanding Indebtedness) which might otherwise constitute a legal or equitable discharge of any of the Guarantor’s obligations under this Deed.
  3.2   The Guarantor’s liability to the Beneficiaries under this Deed shall not be discharged by reason of any of the events or circumstances referred to in Clause 3.1 in so far as they relate to Coface.
4   Continuing Guarantee
  4.1   This Deed shall be:
  4.1.1   a continuing guarantee remaining in full force and effect until irrevocable payment in full has been received by the Beneficiaries of each and every part and the ultimate balance of the Outstanding Indebtedness in accordance with the Loan Agreement and each other Security Document to which any of the Obligors is a party; and

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  4.1.2   in addition to and not in substitution for or in derogation of any other security held by any of the Finance Parties from time to time in respect of the Outstanding Indebtedness or any part thereof.
  4.2   Any satisfaction of obligations by the Guarantor to the Beneficiaries or any discharge given by the Beneficiaries to the Guarantor or any other agreement reached between the Beneficiaries and the Guarantor in relation to this Deed shall be, and be deemed always to have been, void ab initio if any act satisfying any of the said obligations or on the faith of which any such discharge was given or any such agreement was entered into is subsequently avoided in whole or in part by or pursuant to any provision of any applicable law whatsoever.
 
  4.3   This Deed shall remain the property of the Beneficiaries and, notwithstanding that all monies and liabilities due or incurred by any of the Obligors to the Beneficiaries which are guaranteed hereunder shall have been paid or discharged, the Beneficiaries shall be entitled not to discharge this Deed or any security held by the Beneficiaries for the obligations of the Guarantor hereunder for such period as may in the reasonable opinion of the Beneficiaries be necessary or appropriate under any applicable insolvency law after the last of such monies and liabilities have been paid or discharged and in the event of bankruptcy, winding-up or any similar proceedings being commenced in respect of any of the Obligors or any other person, the Beneficiaries shall be at liberty not to discharge this Deed or any security held by the Beneficiaries for the obligations of the Guarantor hereunder for and during such further period as the Beneficiaries may determine at their sole discretion.
5   Exclusion of the Guarantor’s Rights
  5.1   Until the obligations of the Obligors under the Loan Agreement and each other Security Document to which they are a party have been fully performed, the Guarantor shall not:
  5.1.1   be entitled to share in or succeed to or benefit from (by subrogation or otherwise) any rights which the Beneficiaries may have in respect of the Outstanding Indebtedness or any security therefor or all or any of the proceeds of such rights or security; or
 
  5.1.2   without the prior written consent of the Beneficiaries:
  (a)   exercise in respect of any amount paid by the Guarantor hereunder any right of indemnity, subrogation, contribution or any other right or remedy which it may have in respect thereof; or
 
  (b)   claim payment of any other monies for the time being due to the Guarantor or to which it may become entitled or exercise or enforce or benefit from any other right, remedy or security in respect thereof; or
 
  (c)   prove in a liquidation of any Obligor in competition with the Beneficiaries for any monies owing to the Guarantor by any other Obligor on any account whatsoever,

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      PROVIDED ALWAYS that if the Guarantor, in breach of this Clause, receives or recovers any monies pursuant to any such exercise, claim or proof, such monies shall be held by the Guarantor as trustee upon trust for the Beneficiaries to apply the same as if they were monies received or recovered by the Beneficiaries under this Deed.
6   Payments
  6.1   Each payment to be made by the Guarantor hereunder shall be made in immediately available funds in the currency in which such payment is due without set-off, counterclaim, deduction or retention of any kind by payment to such bank account or accounts as the Agent may from time to time notify to the Guarantor in writing.
 
      If the Guarantor is required by law to make such a payment subject to the deduction or withholding of Taxes, in which case the sum payable by the Guarantor in respect of which such deduction or withholding is required to be made shall be increased to the extent necessary to ensure that, after the making of such deduction or withholding, the Lenders receive and retain (free from any liability in respect of any such deduction or withholding) a net sum equal to the sum which they would have received and so retained had no such deduction or withholding been made or required to be made.
 
  6.2   Without prejudice to the provisions of Clause 6.1, if any Lender or the Agent on the Lenders’ behalf is required to make any payment on account of Tax (not being a tax imposed on the net income of its Office by the jurisdiction in which it is incorporated or in which its Office is located or any other tax existing and applicable on the date of this Deed under the laws of any jurisdiction) on or in relation to any sum received or receivable hereunder by such Lender or the Agent on the Lenders’ behalf (including, without limitation, any sum received or receivable under this Clause 6) or any liability in respect of any such payment is asserted, imposed, levied or assessed against such Lender or the Agent on the Lenders’ behalf, the Guarantor shall, upon demand of the Agent, indemnify such Lender or the Agent against such payment or liability, together with any interest, penalties and expenses payable or incurred in connection therewith, other than interest, penalties, and expenses that are otherwise imposed or asserted on account of the bad faith or wilful neglect of such Lender or the Agent.
 
      If any Lender proposes to make a claim under the provisions of this Clause 6.2 it shall certify to the Guarantor in reasonable detail within thirty (30) days (or such longer period as any Lender may reasonably require) after becoming aware of the event by reason of which it is entitled to make its claim or claims the basis of its claim or claims, such certificate to be conclusive, save for manifest error.
 
  6.3   The certificate of the Agent from time to time as to sums owed by any Obligor under the Security Documents and sums owed by the Guarantor hereunder shall, save for manifest error, be conclusive and binding for all purposes and prima facie evidence of the existence and extent of such debts in any legal action or proceedings arising in connection herewith.
 
  6.4   If the Guarantor makes any payment hereunder in respect of which it is required by law to make any deduction or withholding for Taxes, it shall pay the full amount to be deducted or withheld to the relevant taxation or other authority

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      within the time allowed for such payment under applicable law and shall deliver to the Agent within thirty (30) days after it has made such payment to the applicable authority any original receipt issued by such authority evidencing the payment to such authority of all amounts so required to be deducted or withheld from such payment.
 
      If an additional payment is made under Clause 6.1 and any Lender or the Agent on its behalf determines that it has received or been granted a credit against or relief of or calculated with reference to the deduction or withholding giving rise to such additional payment, such Lender or the Agent (as the case may be) shall, to the extent that it can do so without prejudice to the retention of the amount of such credit, relief, remission or repayment and provided that it has received the cash benefit of such credit, relief or remission, pay to the Guarantor such amount as such Lender or the Agent shall in its reasonable opinion have concluded to be attributable to the relevant deduction or withholding. Any such payment shall be conclusive evidence of the amount due to the Guarantor hereunder and shall be accepted by the Guarantor in full and final settlement of its rights of reimbursement hereunder in respect of such deduction or withholding. Nothing herein contained shall interfere with the right of any Lender and the Agent to arrange their respective tax affairs in whatever manner they think fit.
7   Enforcement
  7.1   The Beneficiaries shall not be obliged before taking steps to enforce this Deed to take any action whatsoever against any of the Obligors or any other person and the Guarantor hereby waives all such formalities or rights to which it would otherwise be entitled or which the Beneficiaries would otherwise first be required to satisfy or fulfil before proceeding or making demand against the Guarantor hereunder provided that the Beneficiaries shall not be entitled to enforce their rights under this Deed otherwise than in circumstances which would constitute an Event of Default.
8   Representations and Warranties
  8.1   Duration
  8.1.1   The representations and warranties in Clause 8.2 shall survive the execution of this Deed and shall be deemed to be repeated, with reference mutatis mutandis to the facts and circumstances subsisting, as if made on each day until each Obligor has no remaining obligations, actual or contingent, under or pursuant to the Loan Agreement or any of the other Security Documents.
 
  8.1.2   The representations and warranties in Clause 8.3 shall survive the execution of this Deed and shall be deemed to be repeated, with reference mutatis mutandis to the facts and circumstances subsisting, as if made on the date falling sixty (60) days before the Intended Delivery Date and thereafter on each day until each Obligor has no remaining obligations, actual or contingent, under or pursuant to the Loan Agreement or any of the other Security Documents.
  8.2   Continuing representations and warranties The Guarantor represents and warrants to the Beneficiaries that:

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  8.2.1   it is a limited liability exempt company, duly incorporated and validly existing under the laws of Bermuda, possessing perpetual corporate existence, the capacity to sue and be sued in its own name and the power to own its assets and carry on its business as it is now being conducted;
 
  8.2.2   The Guarantor is and shall remain, after the giving of this Deed, solvent in accordance with the laws of Bermuda and the United Kingdom and in particular with the provisions of the Insolvency Act 1986 (as from time to time amended) and the requirements thereof;
 
  8.2.3   it has the power to enter into and perform this Deed and all necessary corporate or other action has been taken to authorise the entry into and performance of this Deed;
 
  8.2.4   this Deed constitutes its legal, valid and binding obligations enforceable in accordance with its terms;
 
  8.2.5   the entry into and performance of this Deed and the transactions contemplated hereby do not and will not be a breach of or conflict with:
  (a)   any law or regulation or any official or judicial order; or
 
  (b)   its constitutional documents; or
 
  (c)   any agreement or document to which it is a party or which is binding upon it or any of its assets,
      nor result in the creation or imposition of any Encumbrance on any of its assets pursuant to the provisions of any such agreement or document;
 
  8.2.6   all authorisations, approvals, consents, licences, exemptions, filings, registrations, notarisations and other matters, official or otherwise, required in connection with the entry into, performance, validity and enforceability of this Deed and the transactions contemplated hereby have been obtained or effected and are in full force and effect;
 
  8.2.7   all information furnished by or on behalf of the Guarantor relating to the business and affairs of any member of the Group in connection with this Deed was and remains true and correct in all material respects and there are no other material facts or considerations the omission of which would render any such information misleading;
 
  8.2.8   the Guarantor has fully disclosed to the Lenders through the Agent all facts relating to the Group which it knows or should reasonably know and which might reasonably be expected to influence the Lenders in deciding whether or not to enter into the Loan Agreement;
 
  8.2.9   the Accounts for the financial year ended 31 December 2005 (which accounts have been prepared in accordance with GAAP) fairly represent the consolidated financial condition of the Guarantor as at 31 December 2005;

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  8.2.10   the claims of the Beneficiaries against the Guarantor under this Deed will rank at least pari passu with the claims of all other unsecured creditors of the Guarantor other than claims of such creditors to the extent that the same are statutorily preferred;
 
  8.2.11   subject to Clause 10.6, no member of the Group has taken any corporate action nor have any other steps been taken or legal proceedings been started or (to the best of the Guarantor’s knowledge and belief) threatened against any member of the Group for its winding-up and/or dissolution or for the appointment of a liquidator, administrator, receiver, administrative receiver, trustee or similar officer of it or any or all of its assets or revenues nor has any member of the Group sought any other relief under any applicable insolvency or bankruptcy law;
 
  8.2.12   neither the Guarantor nor any of its assets enjoys any right of immunity from set-off, suit or execution in respect of its obligations under this Deed;
 
  8.2.13   all the shares in the Borrower and the Manager shall be legally and beneficially owned directly or indirectly by the Guarantor and such structure shall remain so throughout the Security Period. Further, no Event of Default has occurred under Clause 11.2 in respect of the ownership and/or control of the shares in the Guarantor; and
 
  8.2.14   it has reviewed and agrees to all the terms and conditions of the Loan Agreement and each other Security Document to which any Obligor is or is to be a party.
  8.3   Semi-continuing representations and warranties The Guarantor represents and warrants to the Beneficiaries that:
  8.3.1   no event has occurred and remains unremedied which constitutes a default under or in respect of any agreement or document to which the Guarantor is a party or by which it may be bound (including, inter alia, this Deed);
 
  8.3.2   no litigation, arbitration or administrative proceedings are current or pending or to its knowledge threatened, which might, if adversely determined, have a material adverse effect on the ability of the Guarantor to perform its obligations under this Deed, save as disclosed by the Guarantor in its most recent US Securities Exchange Commission filing;
 
  8.3.3   to the best of its knowledge, each of the Obligors has complied with all taxation laws in all jurisdictions in which it is subject to Taxation and has paid all Taxes due and payable by it including but without limitation any disputed Taxes unless a sufficient reserve has been made pending resolution of the dispute and no material claims are being asserted against any of the Obligors with respect to Taxes, which might, if such claims were successful, have a material adverse effect on the ability of that Obligor to perform its obligations under the Transaction Documents to which it is a party; and

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  8.3.4   the Guarantor does not have a place of business in any jurisdiction which would require this Deed to be filed or registered (if it had a place of business in that jurisdiction) to ensure the validity of this Deed.
9   General Undertakings: Positive Covenants
  9.1   The undertakings contained in this Clause 9 shall remain in full force and effect from the date of this Deed until the end of the Security Period.
 
  9.2   The Guarantor will provide to the Agent:
  9.2.1   as soon as practicable (and in any event within one hundred and twenty (120) days after the close of each of its financial years) a Certified Copy of its Accounts (commencing with the audited accounts made up to 31 December 2005);
 
  9.2.2   as soon as practicable (and in any event within sixty (60) days after the close of each quarter of each financial year) a copy of the unaudited consolidated accounts of the Guarantor for that quarter (commencing with the unaudited accounts made up to 30 June 2006);
 
  9.2.3   as soon as practicable (and in any event within one hundred and twenty (120) days after the close of each financial year), beginning with the year ending 31 December 2006, annual cash flow projections on a consolidated basis of the Guarantor showing on a monthly basis advance ticket sales (for at least twelve (12) months following the date of such statement) for the Group; and
 
  9.2.4   as soon as practicable (and in any event not later than 31 January of each financial year):
  (a)   a budget for the Group for such new financial year including a twelve (12) month liquidity budget for such new financial year; and
 
  (b)   updated financial projections of the Group for at least the next five (5) years and an outline of the assumptions supporting such budget and financial projections including but without limitation any scheduled drydrockings;
  9.2.5   on the date of this Deed, in the case of the first, on the date falling ninety (90) days before the Intended Delivery Date, in the case of the second, and otherwise as soon as practicable (and in any event within sixty (60) days after the close of each of the first three (3) quarters of its financial year and within one hundred and twenty (120) days after the close of each financial year) a statement signed by the Group’s chief financial officer in the form of Schedule 1 (commencing with the second quarter of the financial year ending 31 December 2006);
 
  9.2.6   promptly, such further information in its possession or control regarding its financial condition and operations and those of any company in the Group, including but without limitation a corporate structure chart for the

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      Group including details of the percentage of the shareholdings held, as the Agent may request for the benefit of the Finance Parties; and
 
  9.2.7   details of any material litigation, arbitration or administrative proceedings which affect any Obligor as soon as the same are instituted and served, or, to the knowledge of the Guarantor, threatened (and for this purpose proceedings shall be deemed to be material if they involve a claim in an amount exceeding [**] [Confidential Treatment] Dollars [**] [Confidential Treatment] or the equivalent in another currency).
      All accounts required under this Clause 9.2 shall be prepared in accordance with GAAP and shall fairly represent the financial condition of the relevant company. In this Clause 9.2 “Group” shall have the meaning ascribed to it in Clause 11.4.
 
  9.3   Subject to the provisions of Clause 11.3, the Guarantor will procure that any dividends or other distributions and interest paid or payable in connection with such dividends or other distributions will be received by the Guarantor by way of dividend promptly.
 
  9.4   The Guarantor will keep proper books of record and account in which proper and correct entries shall be made of all financial transactions and the assets, liabilities and business of the Guarantor in accordance with GAAP.
 
  9.5   The Guarantor will notify the Agent of any Event of Default forthwith upon the Guarantor becoming aware of the occurrence thereof.
 
  9.6   The Guarantor will procure that all such authorisations, approvals, consents, licences and exemptions as may be required under any applicable law or regulation to enable it to perform its obligations under, and ensure the validity or enforceability of, this Deed are obtained and promptly renewed from time to time and will promptly furnish certified copies thereof to the Agent upon request and will procure that the terms of the same are complied with at all times.
 
  9.7   The Guarantor will do all such things as are necessary to maintain its corporate existence in good standing and will ensure that it has the right and is duly qualified to conduct its business as it is conducted in all applicable jurisdictions and will obtain and maintain all franchises and rights necessary for the conduct of its business.
10   General Undertakings: Negative Covenants
  10.1   The undertakings contained in this Clause 10 shall remain in full force from the date of this Deed until the end of the Security Period.
 
  10.2   Except with the prior written consent of the Agent (acting on the instructions of the Lenders in the case of a sale of the Vessel pursuant to Clause 10.2.1), the Guarantor will not, and will procure that no other member of the Group will, either in a single transaction or in a series of transactions whether related or not and whether voluntarily or involuntarily, agree to or actually sell, assign, abandon or otherwise transfer or dispose of all or any of its assets or any share or interest therein except that:

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  10.2.1   the Borrower may agree to sell the Vessel on the condition that contemporaneously with the completion of the sale the Loan is prepaid in accordance with the provisions of clause 11 of the Loan Agreement;
 
  10.2.2   the Borrower may let the Vessel on charter in accordance with the provisions of clause 10 of the Loan Agreement;
 
  10.2.3   disposals may be made in the ordinary course of trading of the disposing entity (excluding disposal of ships) including without limitation, the payment of cash as consideration for the purchase or acquisition of any asset or service or in the discharge of any obligation incurred for value in the ordinary course of trading;
 
  10.2.4   disposals may be made (other than by the Borrower) to another member of the Group;
 
  10.2.5   disposals of cash raised or borrowed may be made for the purposes for which such cash was raised or borrowed;
 
  10.2.6   disposals of assets in exchange for other assets comparable or superior as to type and value may be made; and
 
  10.2.7   a vessel owned by any member of the Group (other than the Borrower) may be sold provided such sale is on a willing seller willing buyer basis at or about market rate and at arm’s length subject always to the provisions of any loan documentation for the financing of such vessel.
  10.3   Except with the prior written consent of the Agent, the Guarantor will not, and will procure that no other member of the Group will, make any loan or advance or extend credit to any person, firm or corporation except in the ordinary course of business (in this Clause, “Group” shall exclude the Borrower).
 
  10.4   The Guarantor will not, and will procure that no other member of the Group will, issue or enter into any one (1) or more guarantee or indemnity or otherwise become directly or contingently liable for the obligations of any other person, firm or corporation without notifying the Agent promptly thereafter with full details of the amount(s) and the period(s) of the guarantee(s) or indemnity(ies), if such is or are in excess of (in aggregate (if applicable)) the amount of [**] [Confidential Treatment] Dollars [**] [Confidential Treatment].
 
  10.5   Except with the prior written consent of the Agent, the Guarantor will not, and will procure that no other member of the Group will, make or threaten to make any substantial change in its business as presently conducted, or carry on any other business which is substantial in relation to its business as presently conducted so as to affect, in the reasonable opinion of the Agent, the ability of the Guarantor or the Borrower to perform its obligations under the Security Documents to which it is a party PROVIDED THAT any new leisure or hospitality venture embarked upon by any member of the Group shall not constitute a substantial change in its business (in this Clause, “Group” shall exclude the Borrower).
 
  10.6   The Guarantor and any other member of the Group may enter into any amalgamation, restructure, substantial reorganisation,merger, de-merger,

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      consolidation, winding-up, dissolution or anything analogous to the foregoing or acquire any equity, share capital or obligations of any corporation or other entity if such entry or acquisition would not:
  10.6.1   imperil the security created by any of the Security Documents or the Coface Insurance Policy;
 
  10.6.2   affect the ability of any Obligor duly to perform any of its obligations under any Security Document to which it may be a party at any time; or
 
  10.6.3   affect the ability of the Guarantor to comply with the financial undertakings contained in Clause 11,
      after any such amalgamation, restructure, substantial reorganisation, merger, de-merger, consolidation, winding-up, dissolution or anything analogous to the foregoing or acquisition of any equity, share capital or obligations of any corporation or other entity (in this Clause, “Group” shall exclude the Borrower).
 
  10.7   Except with the prior written consent of the Agent, the Guarantor will not alter its financial year end.
 
  10.8   The Guarantor has not taken and shall not take from any other Obligor any security or counter-security in respect of any of its obligations under this Deed PROVIDED ALWAYS that if the Guarantor, in breach of this Clause, takes any security or counter-security as aforesaid, such security shall be held by the Guarantor as trustee upon trust for the Beneficiaries.
11   Financial Undertakings and Ownership and Control of the Guarantor
  11.1   The Guarantor will ensure that for the financial quarter ending as at 30 June 2006, for the financial quarter ending immediately prior to or on the date falling ninety (90) days before the Intended Delivery Date and for each subsequent financial quarter:
   11.1.1   at all times the minimum Free Liquidity will be not less than [**] [Confidential Treatment] Dollars [**] [Confidential Treatment];
 
   11.1.2   either:
  (a)   as at the end of each financial quarter the ratio of Consolidated EBITDA to Consolidated Debt Service for the Group, computed for the period of the four (4) consecutive financial quarters ending at the end of the relevant financial quarter, shall not be less than [**] [Confidential Treatment] to [**] [Confidential Treatment]; or
 
  (b)   at all times during the period of twelve (12) months ending as at the end of the relevant financial quarter the Group has maintained a minimum Free Liquidity in an amount which is not less than [**] [Confidential Treatment] Dollars [**] [Confidential Treatment]; and
   11.1.3   as at the end of each financial quarter the ratio of Total Net Funded Debt to Total Capitalisation of the Group shall not exceed:

13


 

  (a)   [**] [Confidential Treatment] to [**] [Confidential Treatment] for financial quarters ending on or before 31 December 2007; and
 
  (b)   [**] [Confidential Treatment] to [**] [Confidential Treatment] for each subsequent financial quarter.
      Amounts available for drawing under any revolving or other credit facilities of the Group which remain undrawn at the time of the relevant calculation shall not be counted as cash or indebtedness for the purposes of this ratio.
11.2   It will be an Event of Default if:
  11.2.1   at any time when the ordinary share capital of the Guarantor is not publicly listed on an Approved Stock Exchange or at any time when a dividend is paid to the existing shareholders of the Guarantor by way of a share issue pursuant to a public offering on an Approved Stock Exchange, the Lim Family together or individually do not, directly or indirectly, control the Guarantor and beneficially own, directly or indirectly, at least fifty one per cent (51%) of the issued share capital of, and equity interest in, the Guarantor; or
 
  11.2.2   at any time following the listing of the ordinary share capital of the Guarantor on an Approved Stock Exchange:
  (a)   any individual or any Third Party:
  (i)   owns legally and/or beneficially and either directly or indirectly at least [**] [Confidential Treatment] per cent [**] [Confidential Treatment] of the ordinary share capital of the Guarantor; or
 
  (ii)   has the right or the ability to control either directly or indirectly the affairs of or the composition of the majority of the board of directors (or equivalent) of the Guarantor;
      and, at the same time as any of the events described in paragraphs (i) or (ii) of this Clause has occurred and remains unremedied, the Lim Family together or individually do not, directly or indirectly, beneficially own at least fifty one per cent (51%) of the issued share capital of, and equity interest in, the Guarantor; or
  (b)   the Guarantor ceases to be a listed company on an Approved Stock Exchange without the prior written consent of the Agent,
      (and, for the purpose of this Clause 11.2.2 “control” of any company, limited partnership or other legal entity (a “body corporate”) by a member of the Lim Family, means that one (1) or more members of the Lim Family has, directly or indirectly, the power to direct the management and policies of such a body corporate, whether through the ownership of more than fifty per cent (50%) of the issued voting capital of that body corporate or by contract, trust or other arrangement).

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11.3   During any financial year of the Guarantor until the date on which the Guarantor becomes a listed company on an Approved Stock Exchange (on which date the restriction contained in this Clause 11.3 shall cease to apply), the Guarantor shall not and shall procure that no other member of the Group shall, pay any dividends or make any other distributions in respect of its share capital to any person or make any repayments of capital or payments of interest in respect of Financial Indebtedness to an Affiliate of the Guarantor (other than to the Guarantor and/or its wholly owned Subsidiaries) which during any financial year of the Guarantor in aggregate exceeds [**] [Confidential Treatment] per cent [**] [Confidential Treatment] of the Consolidated Net Income (if positive) of the Group for such financial year, PROVIDED HOWEVER THAT the Group shall not be entitled to pay any dividend or make any distribution in respect of any of its share capital or make any repayments of capital or payments of interest if an Event of Default has occurred and remains unremedied or would occur as a result of the payment of such dividend or the making of such distribution.
 
11.4   In Clause 11.1, Clause 11.2, Clause 11.3 and Schedule 1:
  11.4.1   “Affiliate” means, with respect to any person, any other person controlling, controlled by or under common control with, such person and for purposes of this definition, “control” (including, with correlative meanings, the terms “controlling”, “controlled by” and “under common control with”), as applied to any person, means the possession, directly or indirectly, of the power to vote ten per cent (10%) or more of the securities having voting power for the election of directors of such person, or otherwise to direct or cause the direction of the management and policies of that person, whether through the ownership of voting securities or by contract or otherwise;
 
  11.4.2   “Approved Stock Exchange” means the New York Stock Exchange, NASDAQ or such other stock exchange in the United States of America as is approved in writing by the Agent;
 
  11.4.3   “Cash Balance” means, at any date of determination, the unencumbered and otherwise unrestricted cash and cash equivalents of the Group;
 
  11.4.4   “Consolidated Debt Service” means, for any relevant period, the sum (without double counting), determined in accordance with GAAP, of:
  (a)   the aggregate principal payable or paid during such period on any Indebtedness of any member of the Group, other than:
  (i)   principal of any such Indebtedness prepaid at the option of the relevant member of the Group;
 
  (ii)   principal of any such Indebtedness prepaid upon the sale or Total Loss of any vessel owned or leased under a capital lease by any member of the Group; and
 
  (iii)   balloon payments of any such Indebtedness payable during such period (and for the purpose of this paragraph (iii) a “balloon payment” shall not include any

15


 

  scheduled repayment instalment of such Indebtedness which forms part of the balloon);
  (b)   Consolidated Interest Expense for such period;
  (c)   the aggregate amount of any dividend or distribution of present or future assets, undertakings, rights or revenues to any shareholder of any member of the Group (other than the Guarantor or one of its wholly owned Subsidiaries) or any distribution in respect of share capital during such period (“Distributions”); and
 
  (d)   all rent under any capital lease obligations by which the Guarantor or any consolidated Subsidiary is bound which are payable or paid during such period and the portion of any debt discount that must be amortised in such period,
      as calculated in accordance with GAAP and derived from the then latest unaudited consolidated accounts of the Guarantor delivered to the Agent in the case of any period ending at the end of any of the first three (3) financial quarters of each financial year of the Guarantor and the then latest Accounts delivered to the Agent in the case of the final quarter of each such financial year;
  11.4.5   “Consolidated EBITDA” means, for any relevant period, the aggregate of:
  (a)   Consolidated Net Income from the Guarantor’s operations for such period; and
 
  (b)   the aggregate amounts deducted in determining Consolidated Net Income for such period in respect of gains and losses from the sale of assets or reserves relating thereto, Consolidated Interest Expense, depreciation and amortisation, impairment charges and any other non-cash charges and deferred income tax expense for such period;
  11.4.6   “Consolidated Interest Expense” means, for any relevant period, the consolidated interest expense (excluding capitalised interest) of the Group for such period;
 
  11.4.7   “Consolidated Net Income” means, for any relevant period, the consolidated net income (or loss) of the Group for such period as determined in accordance with GAAP;
 
  11.4.8   “Free Liquidity” means, at any date of determination, the aggregate of the Cash Balance and any amounts freely available for drawing under any revolving or other credit facilities of the Group, which remains undrawn, could be drawn for general working capital purposes or other general corporate purposes and would not, if drawn, be repayable within six (6) months;

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  11.4.9   “Group” means, for the purposes of this Clause 11, the Guarantor, its Subsidiaries and any other entity which is required to be consolidated in the Guarantor’s accounts in accordance with GAAP;
 
  11.4.10   “Indebtedness” means Financial Indebtedness (whether present or future, actual or contingent, long-term or short-term, secured or unsecured) in respect of:
  (a)   moneys borrowed or raised;
 
  (b)   the advance or extension of credit (including interest and other charges on or in respect of any of the foregoing);
 
  (c)   the amount of any liability in respect of leases which, in accordance with GAAP, are capital leases;
 
  (d)   the amount of any liability in respect of the purchase price for assets or services payment of which is deferred for a period in excess of one hundred and eighty (180) days;
 
  (e)   all reimbursement obligations whether contingent or not in respect of amounts paid under a letter of credit or similar instrument; and
 
  (f)   (without double counting) any guarantee of Financial Indebtedness falling within paragraphs (a) to (e) above;
      PROVIDED THAT the following shall not constitute Indebtedness:
  (i)   loans and advances made by other members of the Group which are subordinated to the rights of the Finance Parties;
 
  (ii)   loans and advances made by the Guarantor’s parent company which are subordinated to the rights of the Finance Parties; and
 
  (iii)   any liabilities of the Guarantor or any other member of the Group to a counterparty under any master agreement relating to the interest or currency exchange transactions of a non-speculative nature.
  11.4.11   “Lim Family” means:
  (a)   Tan Sri Lim Goh Tong;
 
  (b)   his spouse;
 
  (c)   his direct lineal descendants;
 
  (d)   the personal estate of any of the above persons; and
 
  (e)   any trust created for the benefit of one or more of the above persons and their estates;
  11.4.12   “Third Party” means any person or group of persons acting in concert (as the expression “acting in concert” is defined in the City Code on

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      Take-overs and Mergers) who or which is not a member of the Lim Family;
  11.4.13   “Total Capitalisation” means, at any date of determination, Total Net Funded Debt plus the consolidated stockholders’ equity of the Group at such date determined in accordance with GAAP and derived from the then latest unaudited and consolidated accounts of the Guarantor delivered to the Agent in the case of the first three (3) quarters of each financial year and the then latest Accounts delivered to the Agent in the case of the final quarter of each financial year;
 
  11.4.14   “Total Net Funded Debt” means, as at any relevant date:
  (a)   Indebtedness of the Group; and
 
  (b)   the amount of any Indebtedness of any person which is not a member of the Group but which is guaranteed by a member of the Group as at such date;
      less an amount equal to any Cash Balance as at such date.
  11.5   Save as specified in Clause 11.1.2, the ratios referred to in Clause 11.1 will be measured on a quarterly basis by reference to the consolidated accounts of the Guarantor.
12   Discharge
  12.1   Subject to Clause 4.3, following the irrevocable repayment or payment to the Lenders or the Agent (for itself and on behalf of the Lenders) of all the Outstanding Indebtedness the Beneficiaries will at the Guarantor’s request return this Deed to the Guarantor and shall, at the request and cost of the Guarantor, transfer to the Guarantor such rights as the Beneficiaries may at such time have in the security for the Outstanding Indebtedness and to the proceeds of any such rights or security.
13   Assignment and Transfer
  13.1   This Deed shall be binding upon and enure to the benefit of the Beneficiaries and their successors and permitted assigns and transferees.
 
  13.2   The Guarantor shall not be entitled to assign or transfer all or any part of its rights, benefits or obligations under this Deed.
 
  13.3   The Lenders and/or the Agent may transfer their respective rights hereunder to any person to whom their respective rights and obligations under the Loan Agreement are transferred in accordance with the Loan Agreement.
 
  13.4   Any Finance Party may disclose to any of its Affiliates and to the following other persons:
  (a)   any person to (or through) whom that Lender assigns or transfers (or may potentially assign or transfer) all or any of its rights and obligations under this Deed;

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  (b)   any person with (or through) whom that Lender enters into (or may potentially enter into) any sub-participation in relation to, or any other transaction under which payments are to be made by reference to, this Deed or any Obligor;
 
  (c)   any person to whom, and to the extent that, information is required to be disclosed by any applicable law or regulation;
 
  (d)   any other Finance Party, or any employee, officer, director or representative of such entity which needs to know such information or receive such document in the course of such person’s employ or duties;
 
  (e)   Coface, or any employee, officer, director or representative of such entity which needs to know such information or receive such document in the course of such person’s employ or duties;
 
  (f)   the Guarantor or any other member of the Group, or any employee, officer, director or representative of such entity which needs to know such information or receive such document in the course of such person’s employ or duties; or
 
  (g)   auditors, insurance and reinsurance brokers, insurers and reinsurers and professional advisers, including legal advisers, which need to know such information,
      any information about any Obligor, this Deed and the other Security Documents as that Finance Party shall consider appropriate. Each of the Finance Parties may also disclose to the Builder, or any employee, officer, director or representative of the Builder which needs to know such information or receive such document in the course of such person’s employ or duties, such information about any Obligor, this Deed and the other Security Documents as that Finance Party reasonably considers normal practice for a French export credit.
 
      Each of the Finance Parties acknowledges that all information received now or in the future from or on behalf of the Obligors under or pursuant to or in connection with the Transaction Documents or the Coface Insurance Policy (other than any information which is in the public domain other than as a result of a breach of this Clause) is confidential information and undertakes to advise this fact to any recipient of any such information under this Clause.
  13.5   A person (including any body of persons) who is not a party to this Deed has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce any term of this Deed but this does not affect any right or remedy of a third party which exists or is available apart from that Act.
14   Miscellaneous Provisions
  14.1   No failure to exercise and no delay in exercising on the part of the Beneficiaries or any of the other Finance Parties any right or remedy under this Deed or under any other of the Security Documents shall operate as a waiver thereof, nor shall any single or partial exercise of any right or remedy preclude any other or further exercise thereof or the exercise of any other right or remedy. No waiver by the

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      Beneficiaries or any of the other Finance Parties shall be effective unless it is in writing.
  14.2   The rights and remedies of the Finance Parties provided herein and in the other Security Documents are cumulative and not exclusive of any rights or remedies provided by law.
 
  14.3   If any provision of this Deed or the Loan Agreement or any other Security Document to which any Obligor is a party is prohibited or unenforceable in any jurisdiction, such prohibition or unenforceability shall not invalidate the remaining provisions hereof or thereof or affect the validity or enforceability of such provision in any other jurisdiction.
 
  14.4   Time is of the essence in respect of all of the obligations of the Guarantor under this Deed.
15   Waiver of Immunity
  15.1   The Guarantor irrevocably and unconditionally:
  15.1.1   waives any right of immunity which it or its assets now has or may hereafter acquire in relation to any legal proceedings (including, but without limitation, actions in rem and/or in personam) brought against it or its assets by the Beneficiaries in relation to this Deed; and
 
  15.1.2   consents generally in respect of any such proceedings to the giving of any relief including, without limitation, the issue of any process in connection with such proceedings and the making, enforcement or execution against any property whatsoever (irrespective of its use or intended use) of any order or judgment which may be made or given in such proceedings.
16   Notices
  16.1   Each notice, demand or other communication to be made under this Deed shall be made in writing which, unless otherwise stated, includes telefax.
 
  16.2   Any notice, demand or other communication to be made or delivered by the Agent to the Guarantor pursuant to this Deed shall (unless the Guarantor has by fifteen (15) days’ written notice to the Agent specified another address) be made or delivered to the Guarantor at 7665 Corporation Center Drive, Miami, Florida 33126, United States of America marked for the attention of Ms Bonnie Biumi (telefax no. +1 305 436 4140) and the Legal Department (telefax no. +1 305 436 4117) and shall be deemed to have been made or delivered (in the case of telefax) when transmission of such telefax communication has been completed or (in the case of any letter) when delivered to the aforesaid address or (as the case may be) five (5) days after being deposited in the post first class postage prepaid in an envelope addressed to it at that address. Any notice, demand or other communication to be made or delivered by the Guarantor to the Agent pursuant to this Deed shall (unless the Agent has by fifteen (15) days’ written notice to the Guarantor specified another address) be made or delivered to the Agent (for itself and on behalf of the Lenders) at its office for the time being which is at present at BNP Paribas, ECEP/Export Finance, ACI:CHDESAl, 37 Place du Marche Saint-Honore, 75031 Paris Cedex 01, France marked for the attention of

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      Mrs Dominique Laplasse (telefax no. +33 1 43 16 81 84) and shall be deemed to have been made or delivered (in the case of telefax) when transmission of such telefax communication has been completed or (in the case of any letter) when delivered to the aforesaid address or (as the case may be) five (5) days after being deposited in the post first class postage prepaid in an envelope addressed to it at that address.
  16.3   Each notice, demand or other communication made or delivered by one (1) party to the other pursuant to this Deed shall be in the English language or accompanied by a certified English translation.
17   Governing Law
    This Deed shall be governed by and construed in accordance with the laws of England.
18   Jurisdiction
  18.1   The courts of England have exclusive jurisdiction to settle any dispute arising out of or in connection with this Deed (including a dispute regarding the existence, validity or termination of this Deed) (a “Dispute”). Each party to this Deed agrees that the courts of England are the most appropriate and convenient courts to settle Disputes and accordingly no party will argue to the contrary.

This Clause 18.1 is for the benefit of the Beneficiaries only. As a result, such party shall not be prevented from taking proceedings relating to a Dispute in any other courts with jurisdiction. To the extent allowed by law, such party may take concurrent proceedings in any number of jurisdictions.
 
  18.2   The Guarantor may not, without the Agent’s prior written consent, terminate the appointment of the Process Agent; if the Process Agent resigns or its appointment ceases to be effective, the Guarantor shall within fourteen (14) days appoint a company which has premises in London and has been approved by the Agent to act as the Guarantor’s process agent with unconditional authority to receive and acknowledge service on behalf of the Guarantor of all process or other documents connected with proceedings in the English courts which relate to this Deed.
 
  18.3   For the purpose of securing its obligations under Clause 18.2, the Guarantor irrevocably agrees that, if it for any reason fails to appoint a process agent within the period specified in Clause 18.2, the Agent may appoint any person (including a company controlled by or associated with the Agent or any Lender) to act as the Guarantor’s process agent in England with the unconditional authority described in Clause 18.2.
 
  18.4   No neglect or default by a process agent appointed or designated under this Clause (including a failure by it to notify the Guarantor of the service of any process or to forward any process to the Guarantor) shall invalidate any proceedings or judgment.
 
  18.5   The Guarantor appoints in the case of the courts of England the Process Agent to receive, for and on its behalf service of process in England of any legal proceedings with respect to this Deed.

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  18.6   A judgment relating to this Deed which is given or would be enforced by an English court shall be conclusive and binding on the Guarantor and may be enforced without review in any other jurisdiction.
 
  18.7   Nothing in this Clause shall exclude or limit any right which the Beneficiaries, may have (whether under the laws of any country, an international convention or otherwise) with regard to the bringing of proceedings, the service of process, the recognition or enforcement of a judgment or any similar or related matter in any jurisdiction.
 
  18.8   In this Clause “judgment” includes order, injunction, declaration and any other decision or relief made or granted by a court.
IN WITNESS whereof this Deed of Guarantee and Indemnity has been executed by the parties hereto on the day first written above.
                 
SIGNED SEALED and DELIVERED as a DEED
        )     Colin Veitch 
for and on behalf of
        )      
NCL CORPORATION LTD.
        )      
acting by Colin Veitch
        )      
its duly appointed attorney-in-fact
        )      
in the presence of:
  Paul Alan Turner     )      
 
  PAUL ALAN TURNER     )      
 
  SOLICITOR, CLIFFORD CHANCE LLP            
SIGNED SEALED and DELIVERED as a DEED
        )     Signature Illegible 
for and on behalf of
        )      
BNP PARIBAS
        )      
as a Lender Sandrine FERDANE
        )      
acting by Jean-Daniel AMSLER
        )      
its duly appointed AUTHORIZED SIGNATORIES
        )      
in the presence of:
  Jean Philippe POIRIER     )      
 
  MANAGER, BNP PARIBAS            
SIGNED SEALED and DELIVERED as a DEED
        )     Signature Illegible 
for and on behalf of
        )      
CALYON
        )      
acting by Jerome LEBLOND
        )      
its duly appointed attorney-in-fact
        )      
in the presence of:
  Jean Philippe POIRIER     )      
 
  MANAGER, BNP PARIBAS            

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SIGNED SEALED and DELIVERED as a DEED
        )     Signature Illegible 
for and on behalf of
        )      
HSBC FRANCE Gilles PINOT
        )      
acting by Erick DADAT
        )      
its duly appointed Authorized Signatories
        )      
in the presence of:
  Jean Philippe POIRIER     )      
 
  MANAGER, BNP PARIBAS     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Signature Illegible 
for and on behalf of
        )      
SOCIETE GENERALE Isabella GUILLOU
        )      
acting by Deputy Global Head of Export Finance
        )      
its duly appointed Authorized Signatory
        )      
in the presence of:
  Jean Philippe POIRIER     )      
 
  MANAGER, BNP PARIBAS     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Signature Illegible 
for and on behalf of
        )      
BNP PARIBAS
        )      
as the Agent Sandrine FERDANE
        )      
acting by Jean-Daniel AMSLER
        )      
its duly appointed AUTHORIZED SIGNATORIES
        )      
in the presence of:
  Jean Philippe POIRIER     )      
 
  MANAGER, BNP PARIBAS     )      

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Schedule 1
Quarterly Statement of Financial Covenants
     
TO:
  BNP PARIBAS
 
  ECEP/Export Finance
 
  ACI:CHDESA1
 
  37 Place du Marché Saint-Honoré
 
  75031 Paris Cedex 01
 
  France
 
   
 
  Attn: Mrs Dominique Laplasse
 
   
 
  (as the Agent (as such term is defined in the Guarantee (as hereinafter defined))
We refer to clause 11 of the guarantee dated 2006 (as amended, varied and/or supplemented from time to time the “Guarantee”) issued by us in favour of the Beneficiaries. Terms defined in the Guarantee, whether by reference to the Loan Agreement (as therein defined) or otherwise, shall have the same meanings herein.
We hereby certify the amounts set out in the attached schedule as at the last day of the financial quarter ending           20 [ ] for NCL Corporation Ltd. (the “Guarantor”) and its subsidiaries on a consolidated basis. We also hereby certify that the Guarantor is in compliance with all the financial covenants set out in clauses 11.1 and 11.3 of the Guarantee and that no Event of Default has occurred and remains unremedied.
NCL CORPORATION LTD.
     
 
By: [
               ]
   
Chief Financial Officer
   
 
   
Dated:                    20[  ]
   

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Schedule
Statement of Financial Covenants as of [  ] 20[  ] (in USD’000)
             
Clause (of            
Guarantee)       As of []   Required Covenants
11.1.1/
  Free Liquidity   A   A>[**] [Confidential Treatment]
11.1.2(b)** [Confidential Treatment]
          (11.1.1)** [Confidential Treatment]
 
          A>[**] [Confidential Treatment]
 
          (11.1.2(b))** [Confidential Treatment]
11.1.2(a)
  Consolidated EBITDA:   B   >[**] [Confidential Treatment]
 
           
 
  Consolidated Debt Service   C    
 
           
11.1.3
  Total Net Funded Debt:   D   <[**] [Confidential Treatment] up to
 
          31 December 2007<[**] [Confidential Treatment] thereafter
 
           
 
  Total Capitalisation   E    
 
           
 
  Consolidated EBITDA        
 
  Consolidated Net Income (loss)       x
(Deduct)/Add:
  (Gain)/Loss on sale of assets or reserves       x
Add:
  Consolidated Interest Expense       x
Add:
  Depreciation and amortisation of assets       x
Add:
  Impairment charges       x
(Deduct)/Add:
  Other non-recurring charge (gain)       x
Add:
  Deferred income tax expense       x
 
  Consolidated EBITDA       x          B
 
  Consolidated Debt Service        
 
  Principal paid/payable (excluding balloon        
 
  payments, voluntary prepayments/repayments       x
 
  on sale/total loss of an NCLC Fleet Vessel)        
Add:
  Consolidated Interest Expense       x
 
  Distributions       x
 
  Rent under capitalised leases       x
 
  Consolidated Debt Service       x          C
 
  Total Net Funded Debt        
 
  Indebtedness       x
Add:
  Guarantees of non-NCLC Group members’ obligations        
 
          x
 
           
Deduct:
  Cash Balance       (x)
 
  Total Net Funded Debt       (x)       D
 
  Total Capitalisation        
 
  Total Net Funded Debt       x
Add:
  Consolidated stockholders’ equity       x
 
  Total Capitalisation       x          E

25


 

For and on behalf of NCL CORPORATION LTD.
     
 
[
               ]
   
I, [      ], the officer primarily responsible for the financial management of the Group, hereby declare that, to the best of knowledge and belief, the above Statement of Financial Covenants as of [  ] 20[ ], in my opinion, is true and correct.
     
 
[
               ]
   
Chief Financial Officer
   
NCL CORPORATION LTD.
   
 
Dated:
  20[  ]
 
**   Evidence satisfactory to the Agent of A at all times during the relevant period shall be provided together with this statement

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Schedule 2
Particulars of Agent and Lenders
         
Name   Registered Address   Registered Number with the
        Registry of Trade and
        Companies
BNP PARIBAS
  16 boulevard des Italiens,   662 042 449 (RCS Paris)
(as Agent and Lender)
  75009 Paris, France    
 
       
CALYON
  9 quai du Président Paul   304 187 701 (RCS Nanterre)
(as Lender)
  Doumer, 92920 Paris La Défense
Cedex, France
   
 
       
HSBC FRANCE
  103 avenue des Champs   775 670 284 (RCS Paris)
(as Lender)
  Elysées, 75419 Paris, Cedex 08,
France
   
 
       
SOCIETE GENERALE
  29 boulevard Haussmann,   552 120 222 (RCS Paris)
(as Lender)
  75009 Paris, France    
 
       
each a French société anonyme    

27

EX-4.35 12 g05791exv4w35.htm EX-4.35 REVOLVING CREDIT FACILITY EX-4.35 Revolving Credit Facility
 

Exhibit 4.35
[Confidential Treatment]
DATED 22 DECEMBER 2006
NCL CORPORATION LTD.
(as borrower)
DnB NOR BANK ASA
CITIBANK N.A.
COMMERZBANK AKTIENGESELLSCHAFT
KfW
NORDEA BANK NORGE ASA
NORDDEUTSCHE LANDESBANK GIROZENTRALE
(as mandated lead arrangers)
THE SEVERAL BANKS
particulars of which are set out in Schedule 1
(as original lenders)
DnB NOR BANK ASA
(as agent)
 
UP TO USD610,000,000
REVOLVING LOAN FACILITY AGREEMENT
 
[**] [Confidential Treatment]

 


 

CONTENTS
                     
                Page
1   Definitions and Construction     1  
 
    1.1     Definitions     1  
 
    1.2     Construction     15  
 
    1.3     Agent     16  
 
    1.4     Third Party rights     16  
 
                   
2   The Facility     16  
 
    2.1     Availability     16  
 
    2.2     Purpose and Application     17  
 
    2.3     Advance of a Revolving Credit Facility Drawing to the Borrower     17  
 
    2.4     Advance of a Swingline Facility Drawing to the Borrower     17  
 
    2.5     Break costs     18  
 
    2.6     Conditions of drawdown     18  
 
    2.7     Several obligations of the Lenders     19  
 
    2.8     Lender’s failure to perform     19  
 
    2.9     Fulfilment of conditions after drawdown     19  
 
                   
3   Repayment, Reduction, Cancellation and Prepayment of the Facility     19  
 
    3.1     Repayment     19  
 
    3.2     Scheduled reductions of Commitments to the Facility     20  
 
    3.3     Sale or Total Loss of a Vessel: mandatory cancellation     20  
 
    3.4     Amounts payable on prepayment     20  
 
    3.5     Notice of prepayment     21  
 
    3.6     Voluntary cancellation of Commitments     21  
 
    3.7     Additional partial cancellation     22  
 
    3.8     Prepayment during Term     22  
 
    3.9     Mandatory cancellation in case of illegality     22  
 
    3.10     Voluntary cancellation following imposition of Substitute Basis     23  
 
    3.11     Cancellation in case of Total Loss of a Vessel     23  
 
    3.12     Cancellation in case of sale of a Vessel     23  
 
                   
4   Interest     24  
 
    4.1     Payment of interest     24  
 
    4.2     Selection and duration of Interest Periods     24  
 
    4.3     No notice and unavailability     24  
 
    4.4     Extension and shortening of Interest Periods     24  
 
    4.5     Interest Rate     25  
 
    4.6     Bank basis     25  
 
    4.7     Default interest     25  
 
                   
5   Swingline Facility     26  
 
    5.1     Swingline Lender’s participation     26  
 
    5.2     Relationship with the Revolving Credit Facility     26  
 
    5.3     Reallocation     26  

 


 

                     
                Page
6   Substitute Basis of Funding     27  
 
    6.1     Market disturbance     27  
 
    6.2     Suspension of drawdown     28  
 
    6.3     Certificates of Substitute Basis     28  
 
    6.4     Review     28  
 
                   
7   Payments     29  
 
    7.1     Place for payment     29  
 
    7.2     Deductions and grossing-up     29  
 
    7.3     Production of receipts for Taxes     30  
 
    7.4     Currency of account     30  
 
    7.5     Money of account     30  
 
    7.6     Accounts     31  
 
    7.7     Earnings     31  
 
    7.8     Continuing security     31  
 
    7.9     Mitigation     32  
 
                   
8   Yield Protection and Force Majeure     32  
 
    8.1     Increased costs     32  
 
    8.2     Force Majeure     33  
 
                   
9   Representations and Warranties     34  
 
    9.1     Duration     34  
 
    9.2     Representations and warranties     34  
 
                   
10   Undertakings     39  
 
    10.1     Duration     39  
 
    10.2     Information     39  
 
    10.3     Financial Undertakings     40  
 
    10.4     Dividends     41  
 
    10.5     Notification of default     41  
 
    10.6     Consents and registrations     41  
 
    10.7     Negative pledge     42  
 
    10.8     Disposals     42  
 
    10.9     Purchases     42  
 
    10.10     Change of name or business     42  
 
    10.11     Mergers     43  
 
    10.12     Maintenance of status and franchises     43  
 
    10.13     Financial records     44  
 
    10.14     Subordination of indebtedness     44  
 
    10.15     Guarantees     44  
 
    10.16     Further assurance     44  
 
    10.17
10.18
    Valuation of the Vessels
Marginal security
    44
45
 
 
    10.19     No dealings with Master Agreements     45  
 
    10.20     Financial year end     46  
 
    10.21     Maintenance and insurance     46  
 
    10.22     Vessels     46  

 


 

                     
                Page
11   Rights of the Agent and the Lenders     46  
 
    11.1     No derogation of rights     46  
 
    11.2     Enforcement of remedies     46  
 
                   
12   Default     47  
 
    12.1     Events of default     47  
 
    12.2     Acceleration     52  
 
    12.3     Default indemnity     53  
 
    12.4     Set off     53  
 
    12.5     Master Agreement rights     54  
 
                   
13   Application of Funds     54  
 
    13.1     Total Loss proceeds/proceeds of sale     54  
 
    13.2     General funds/Event of Default monies     55  
 
    13.3     Application of proceeds of Insurances     56  
 
    13.4     Suspense account     56  
 
                   
14   Fees     57  
 
    14.1     Commitment fee     57  
 
    14.2     Other fees     57  
 
15
  Expenses     57  
 
    15.1     Initial expenses     57  
 
    15.2     Enforcement expenses     57  
 
    15.3     Stamp duties     57  
 
                   
16   Waivers, Remedies Cumulative     58  
 
    16.1     No waiver     58  
 
    16.2     Remedies cumulative     58  
 
    16.3     Severability     58  
 
    16.4     Time of essence     58  
 
                   
17   Counterparts     58  
 
                   
18   Changes to the Lenders     58  
 
    18.1     Assignments and transfers by the Lenders     58  
 
    18.2     Conditions of assignment or transfer     59  
 
    18.3     Assignment or transfer fee     60  
 
    18.4     Limitation of responsibility of Existing Lenders     60  
 
    18.5     Procedure for transfer     60  
 
    18.6     Copy of Transfer Certificate to Borrower     61  
 
    18.7     Disclosure of information     61  
 
    18.8     Borrower’s co-operation     62  
 
                   
19   Changes to the Borrower     62  
 
                   
20   Reference Banks and Agent     62  
 
    20.1     Reference Banks     62  
 
    20.2     Decision making     62  

 


 

                     
                Page
 
    20.3     The Agent     64  
 
    20.4     Retirement and replacement of the Agent     68  
 
                   
21   Notices     69  
 
    21.1     Mode of communication     69  
 
    21.2     Address     69  
 
    21.3     Telefax communication     69  
 
    21.4     Electronic mail     70  
 
    21.5     Receipt     71  
 
    21.6     Language     71  
 
                   
22   Governing Law     71  
 
                   
23   Waiver of Immunity     71  
 
                   
24   Jurisdiction     71  
 
                   
Schedule 1 Particulars of Agent, Mandated Lead Arrangers and Original Lenders     75  
 
                   
Schedule 2 Notice of Drawdown     79  
 
                   
Schedule 3 Conditions Precedent     81  
 
                   
Schedule 4 Confidentiality Undertaking     86  
 
                   
Schedule 5 Transfer Certificate     89  
 
                   
Schedule 6 Quarterly Statement of Financial Covenants     94  

 


 

FACILITY AGREEMENT
Dated 22 December 2006
BETWEEN:
(1)   NCL CORPORATION LTD. a company organised and existing under the laws of Bermuda with its registered office at Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda as borrower (the “Borrower”);
 
(2)   THE SEVERAL BANKS particulars of which are set out in Schedule 1 as mandated lead arrangers and underwriters (collectively the “Mandated Lead Arrangers” and each individually a “Mandated Lead Arranger”);
 
(3)   THE SEVERAL BANKS particulars of which are set out in Schedule 1 as lenders (collectively the “Original Lenders” and each individually an “Original Lender” and including, unless the context otherwise requires, the Swingline Lender); and
 
(4)   DnB NOR BANK ASA of Stranden 21, NO-0021 Oslo, Norway as agent (the “Agent”).
WHEREAS:
The Mandated Lead Arrangers have arranged for a syndicate of international banks and/or financial institutions to provide a revolving credit facility of up to six hundred and ten million Dollars (USD610,000,000), including a swingline facility of up to twenty million Dollars (USD20,000,000), to the Borrower on the terms and subject to the conditions set out in this Agreement, in the case of the revolving credit facility, to refinance all existing indebtedness related to the Vessels and for general corporate purposes for the Borrower and its Subsidiaries and, in the case of the swingline facility, for general short term corporate purposes of the Borrower.
NOW IT IS HEREBY AGREED as follows:
1   Definitions and Construction
  1.1   Definitions
 
      In this Agreement:
 
      Accounts” means the audited consolidated profit and loss account and balance sheet (including all additional information and notes thereto) of the Borrower and its consolidated Subsidiaries together with the auditors’ report;
 
      Advance Date”, in relation to any Drawing, means the date on which that Drawing is advanced to the Borrower pursuant to Clause 2.3 or Clause 2.4 and applied in accordance with the relevant part of Clause 2.2;
 
      Affiliate” means, with respect to any person, any other person controlling, controlled by or under common control with, such person and for purposes of this definition, “control” (including, with correlative meanings, the terms “controlling”, “controlled by” and “under common control with”), as applied to any person, means the possession, directly or indirectly, of the power to vote ten per cent (10%) or more of the securities having voting power for the election of directors of such person, or otherwise to direct or cause the direction of the

 


 

      management and policies of that person, whether through the ownership of voting securities or by contract or otherwise;
 
      Agreement” means this agreement;
 
      Applicable Margin” means, in respect of a Drawing or the commitment fee payable pursuant to Clause 14.1, the rate per annum set out in the table below determined on the Quotation Date for the relevant Interest Period in the case of a Drawing and on the relevant payment date in respect of the said commitment fee based on the ratio of Total Funded Debt to Consolidated EBITDA for the period of the four (4) consecutive financial quarters ending at the end of the previous financial quarter for which the Agent has received, or should have received, accounts:
     
Total Funded Debt :   Applicable Margin
Consolidated EBITDA    
[**] [Confidential Treatment]
  One point five per cent (1.50%)
[**] [Confidential Treatment]
  [**] [Confidential Treatment]
[**] [Confidential Treatment]
  [**] [Confidential Treatment]
[**] [Confidential Treatment]
  [**] [Confidential Treatment]
      PROVIDED THAT the highest rate appearing in the table above shall apply if the accounts required to determine the Applicable Margin have not been received by the Agent;
 
      Approved Stock Exchange” means the New York Stock Exchange, NASDAQ or such other stock exchange in the United States of America as is approved in writing by the Agent (acting on the instructions of the Majority Lenders);
 
      Associated Company” in relation to any company, means any company which is a Subsidiary or Holding Company of that company or the majority of whose shares are beneficially owned by the same person or persons as own the majority of the shares of that company;
 
      Availability Period” means the period beginning on the Signing Date and ending one (1) month before the Final Maturity Date;
 
      Available Commitment” means, in relation to a Lender, the amount of its Commitment in respect of the Revolving Credit Facility or the Swingline Facility (as the case may be) less the amount of its Contribution to the Revolving Credit Facility or the Swingline Facility (as the case may be);
 
      Business Day” means any day on which banks and financial markets in London, Oslo, Frankfurt am Main and New York are open for the transaction of business of the nature contemplated by this Agreement;
 
      Cash Balance” means, at any date of determination, the unencumbered and otherwise unrestricted cash and cash equivalents of the NCLC Group;

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      Certified Copy” means, in relation to any document delivered or issued by or on behalf of any company, a copy of such document certified as a true, complete and up-to-date copy of the original by any of the directors or the secretary or assistant secretary or an attorney-in-fact for the time being of that company;
 
      Charges” means the two (2) valid and effective first priority shares charges one (1) to be executed in respect of each of the Owners by the Shareholder as holder (legally and beneficially) of all the authorised and issued shares in the relevant Owner in favour of the Agent such charges to be in the form and on the terms and conditions agreed between the Lenders and the Borrower and as specified in paragraph 24 of Schedule 3;
 
      Commitment” means, as to each Original Lender and the Swingline Lender, the sums set out opposite its name in Schedule 1 as the amount respectively of the Revolving Credit Facility and the Swingline Facility which, subject to the terms of this Agreement, it is obliged to advance to the Borrower under Clause 2 (or, where the context so admits, such amount which any successor in title, assignee or transferee (including any Transferee) of any Original Lender or Lender or the Swingline Lender shall be obliged to advance to the Borrower under Clause 2, following the assumption of all or any portion of such liability from any Original Lender or Lender or the Swingline Lender hereunder) in each case as such amount may be reduced, cancelled or terminated under this Agreement;
 
      Commitment Period” means the period beginning on the Signing Date and ending on the earlier of the last day of the Availability Period and the date on which the Facility is cancelled hereunder;
 
      Compulsory Acquisition” means requisition for title or other compulsory acquisition of a Vessel including its capture, seizure, detention or confiscation or expropriation but excluding any requisition for hire by or on behalf of any government or governmental authority or agency or by any persons acting or purporting to act on behalf of any such government or governmental authority or agency;
 
      Confidentiality Undertaking” means the undertaking to be entered into relating to the release of financial information pertaining to the NCLC Group by the Agent or any Lender to a potential Transferee or assignee such undertaking to be in the form of Schedule 4;
 
      Confirmation” means a Confirmation exchanged or deemed to be exchanged between a Lender or its Affiliate (as the case may be) and the Borrower as contemplated by the relevant Master Agreement;
 
      Consolidated Debt Service” means, for any relevant period, the sum (without double counting), determined in accordance with US GAAP, of:
  (i)   the aggregate principal payable or paid during such period on any Indebtedness for Borrowed Money of any member of the NCLC Group, other than:
  (a)   principal of any such Indebtedness for Borrowed Money prepaid at the option of the relevant member of the NCLC Group;
 

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  (b)   principal of any such Indebtedness for Borrowed Money prepaid upon the sale or Total Loss of any vessel owned or leased under a capital lease by any member of the NCLC Group; and
 
  (c)   balloon payments of any such Indebtedness for Borrowed Money payable during such period (and for the purpose of this paragraph (c) a “balloon payment” shall not include any scheduled repayment instalment of such Indebtedness for Borrowed Money which forms part of the balloon);
(ii)   Consolidated Interest Expense for such period;
 
(iii)   the aggregate amount of any dividend or distribution of present or future assets, undertakings, rights or revenues to any shareholder of any member of the NCLC Group (other than the Borrower or one of its wholly owned Subsidiaries) or any distribution in respect of share capital during such period (“Distributions”); and
 
(iv)   all rent under any capital lease obligations by which the Borrower or any consolidated Subsidiary is bound which are payable or paid during such period and the portion of any debt discount that must be amortised in such period,
as calculated in accordance with US GAAP and derived from the then latest unaudited consolidated accounts of the NCLC Group delivered to the Agent in the case of any period ending at the end of any of the first three (3) financial quarters of each financial year of the Borrower and the then latest Accounts delivered to the Agent in the case of the final quarter of each such financial year;
Consolidated EBITDA” means, for any relevant period, the aggregate of:
(i)   Consolidated Net Income from the Borrower’s operations for such period; and
 
(ii)   the aggregate amounts deducted in determining Consolidated Net Income for such period in respect of gains and losses from the sale of assets or reserves relating thereto, Consolidated Interest Expense, depreciation and amortisation, impairment charges and any other non-cash charges and deferred income tax expense for such period;
Consolidated Interest Expense” means, for any relevant period, the consolidated interest expense (excluding capitalised interest) of the NCLC Group for such period;
Consolidated Net Income” means, for any relevant period, the consolidated net income (or loss) of the NCLC Group for such period as determined in accordance with US GAAP;
Contribution” means, as to each Original Lender and the Swingline Lender, the portion of the sums set out opposite its name in Schedule 1 or any substitute schedule for Schedule 1 advanced to the Borrower and for the time being outstanding;

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Co-ordination Deeds” means the two (2) co-ordination deeds one (1) to be executed by each of the Owners in relation to (among other things) the mortgages registered or to be registered over its Vessel including the relevant Mortgage such deed to be in the form and on the terms and conditions agreed between the Lenders and the Borrower and as specified in paragraph 21.7 of Schedule 3;
Credit Support Document” means any document described as such in a Master Agreement and any other document referred to in any such document which has the effect of creating security in favour of the Agent or the Lenders;
Credit Support Provider” means any person (other than the Borrower) described as such in a Master Agreement;
Disclosure Letter” means the letter so designated, given by the Borrower and acknowledged by the Agent on the Signing Date and containing details of any material litigation, arbitration or administrative proceedings affecting any Obligor which have been instituted and served, or, to the knowledge of the Borrower, threatened (and for this purpose proceedings shall be deemed to be material if they involve a claim in an amount exceeding [**] [Confidential Treatment] Dollars [**] [Confidential Treatment] or the equivalent in another currency);
Dollars” and “USD” means the lawful currency of the United States of America;
Drawdown Notice” means a notice to be given by the Borrower to the Agent pursuant to Clause 2.3.1 or Clause 2.4.1;
Drawing” means a Revolving Credit Facility Drawing or a Swingline Facility Drawing;
Earnings” means, in respect of a Vessel, (whether earned or to be earned) any and all freights, hire, fares and passage monies, proceeds of requisition (other than proceeds of Compulsory Acquisition), rebates and commissions, all earnings deriving from contracts of employment, demurrage, charterparties, contracts of affreightment, pooling agreements and joint ventures, compensation, remuneration for salvage and towage services, damages howsoever arising and detention monies, damages for breach of any charterparty or other contract for the employment of that Vessel, any amounts payable in consideration of the termination or variation of any charterparty or other such contract and any other earnings whatsoever due or to become due to the relevant Owner;
Earnings Assignments” means, pursuant to the Co-ordination Deeds, the two (2) valid and effective first legal assignments of the Earnings of the Vessels (together with the notices thereof and the acknowledgements) one (1) to be executed by each of the Owners in respect of its Vessel in favour of the Agent such assignments, notices and acknowledgements to be in the form and on the terms and conditions agreed between the Lenders and the Borrower and as specified in paragraph 21.4 of Schedule 3;
Encumbrance” means any mortgage, charge, pledge, lien, assignment, hypothecation, title retention, preferential right or trust arrangement or any other security agreement or arrangement;
Event of Default” means any of the events specified in Clause 12;

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Facility” means the facility granted hereunder in the amount of the aggregate of the Maximum Revolving Credit Facility Amount and the Maximum Swingline Facility Amount or (as the context may require) the amount thereof for the time being advanced and outstanding under this Agreement;
Final Maturity Date” means the date falling eighty four (84) months from the Signing Date or such other date as is determined by the provisions of Clause 3;
Finance Parties” means the Mandated Lead Arrangers, the Lenders and the Agent and “Finance Party” means any one of them;
Financial Indebtedness” means any obligation for the payment or repayment of money, whether as principal or as surety and whether present or future, actual or contingent;
Force Majeure” means, in relation to the Agent or any Lender, any event or circumstance which is beyond the reasonable control of such party, which cannot be foreseen or if foreseeable which is unavoidable, which occurs after the Signing Date and which prevents that party from performing any of its obligations under this Agreement;
Free Liquidity” means, at any date of determination, the aggregate of the Cash Balance and any amounts freely available for drawing under the Facility or any other revolving or other credit facilities of the NCLC Group, which remain undrawn, could be drawn for general working capital purposes or other general corporate purposes and would not, if drawn, be repayable within six (6) months;
Guarantees” means the two (2) joint and several guarantees one (1) to be executed by each of the Owners in favour of the Agent such guarantees to be in the form and on the terms and conditions agreed between the Lenders and the Borrower and as specified in paragraph 23 of Schedule 3;
Holding Company” has the meaning defined in the United Kingdom Companies Act 1985, Section 736 as substituted by the United Kingdom Companies Act 1989, Section 144;
Indebtedness for Borrowed Money” means Financial Indebtedness (whether present or future, actual or contingent, long-term or short-term, secured or unsecured) in respect of:
(i)   moneys borrowed or raised;
 
(ii)   the advance or extension of credit (including interest and other charges on or in respect of any of the foregoing);
 
(iii)   the amount of any liability in respect of leases which, in accordance with US GAAP, are capital leases;
 
(iv)   the amount of any liability in respect of the purchase price for assets or services payment of which is deferred for a period in excess of one hundred and eighty (180) days;

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(v)   all reimbursement obligations whether contingent or not in respect of amounts paid under a letter of credit or similar instrument; and
 
(vi)   (without double counting) any guarantee of Financial Indebtedness falling within paragraphs (i) to (v) above;
PROVIDED THAT the following shall not constitute Indebtedness for Borrowed Money:
(a)   loans and advances made by other members of the NCLC Group which are subordinated to the rights of the Lenders;
 
(b)   loans and advances made by Star Cruises Limited which are subordinated to the rights of the Lenders; and
 
(c)   any Master Agreement Liabilities and any similar liabilities of the Borrower or any other member of the NCLC Group to a counterparty under any other master agreement relating to interest or currency exchange transactions of a non-speculative nature;
Insurance Assignments” means, pursuant to the Co-ordination Deeds, the two (2) valid and effective first legal assignments of the Insurances of the Vessels (together with the notices thereof) one (1) to be executed by each of the Owners in respect of its Vessel in favour of the Agent such assignments and notices to be in the form and on the terms and conditions agreed between the Lenders and the Borrower and as specified in paragraph 21.5 of Schedule 3;
Insurances” means all policies and contracts of insurance and entries of a Vessel in a protection and indemnity or war risks association which are effected in respect of that Vessel, her freights, disbursements, profits or otherwise and all benefits, including all claims and returns of premiums thereunder and shall also include all compensation payable by virtue of Compulsory Acquisition;
Interest Payment Date” means the last day of each Interest Period and if an Interest Period is longer than six (6) months’ duration the date falling at the end of each successive period of six (6) months during such Interest Period from its commencement;
Interest Period” means each period ascertained in accordance with Clause 4.2, Clause 4.7 or Clause 5.3;
Interest Rate” means the rate of interest applicable to a Drawing calculated in accordance with Clause 4.5, Clause 4.7, Clause 5.3 or Clause 6.3;
LIBOR” means with respect to any Interest Period with respect to a Revolving Credit Facility Drawing the rate of interest (expressed as an annual rate) determined by the Agent to be:
(i)   the offered rate for deposits in Dollars for a period equivalent to such Interest Period which appears on the Reuters BBA Page LIBOR 01 at or about 11.00 a.m. London time on the Quotation Date; or

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(ii)   if no rate is provided for the respective Interest Period on the Reuters BBA Page LIBOR 01, the interpolated rate per annum for deposits in Dollars in an amount approximately equal to the Revolving Credit Facility Drawing as calculated by the Agent, such interpolated rate to be based on the Reuters BBA Page LIBOR 01 PROVIDED THAT LIBOR for periods of less than one (1) week will be ascertained under sub-section (iii) below;
OR (if Reuters BBA Page LIBOR 01 is discontinued or if the Agent is unable to make the said determination due to technical breakdown in the relevant system or the Interest Period is less than one (1) week)
(iii)   the arithmetic mean (rounded upwards, if necessary, to the nearest one-sixteenth of one per cent (1/16%)) of the rates per annum notified to the Agent by each of the Reference Banks as the rate at which deposits in Dollars in an amount approximately equal to the Revolving Credit Facility Drawing are offered to such Reference Bank by leading banks in the London Interbank Market at such Reference Bank’s request at or about 11.00 a.m. London time on the Quotation Date for a period equal to the Interest Period and for delivery on the first Business Day thereof;
Lender” means:
(i)   any Original Lender; and
 
(ii)   any bank, financial institution, trust, fund or other entity which has become a party to this Agreement in accordance with Clause 18,
which in each case has not ceased to be a party to this Agreement in accordance with the terms of this Agreement;
Lending Branch” means in respect of the Agent and each Original Lender its office at the address set out beneath its name in Schedule 1 or such other office as it shall from time to time select and notify through the Agent to the Borrower and the Agent;
Lim Family” means:
(i)   Tan Sri Lim Goh Tong;
 
(ii)   his spouse;
 
(iii)   his direct lineal descendants;
 
(iv)   the personal estate of any of the above persons; and
 
(v)   any trust created for the benefit of one or more of the above persons and their estates;
Majority Lenders” means:
(a)   if a Drawing has not then been advanced, a Lender or Lenders whose Commitments aggregate more than sixty seven per cent (67%) of the aggregate total of the Commitments (or, if the aggregate total of the

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    Commitments have been reduced to zero, aggregated more than sixty seven per cent (67%) of the aggregate total of the Commitments immediately prior to the reduction); or
 
(b)   at any other time, a Lender or Lenders whose Contributions to the Facility aggregate more than sixty seven per cent (67%) of the Facility then outstanding;
Management Agreements” means the agreements entered into between the Owners and the Manager in respect of the Vessels providing for the commercial and technical management and crewing of the Vessels such agreements to be in the form and on the terms and conditions agreed between the Agent and the Borrower and as specified in paragraph 21.2 of Schedule 3;
Management Agreement Assignments” means the two (2) valid and effective first legal assignments of the Management Agreements (together with the notices thereof and the acknowledgements) one (1) to be executed by each of the Owners in respect of its Vessel in favour of the Agent such assignments, notices and acknowledgements to be in the form and on the terms and conditions agreed between the Lenders and the Borrower and as specified in paragraph 21.6 of Schedule 3;
Manager” means NCL (Bahamas) Ltd. a company organised and existing under the laws of Bermuda with its registered office at Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda, the company providing commercial and technical management and crewing services for the Vessels pursuant to the Management Agreements;
Mandatory Cost” means the cost imputed to a Lender of compliance with the mandatory liquid asset requirements of any central bank or other fiscal, monetary or other authority;
Master Agreement” means any ISDA Master Agreement (or any other form of master agreement relating to interest or currency exchange transactions of a non-speculative nature) entered into between a Lender or its Affiliate and the Borrower before the Signing Date in relation to the obligations of the Borrower under this Agreement, including each Schedule to any Master Agreement and each Confirmation exchanged under any Master Agreement;
Master Agreement Liabilities” means, at any relevant time, all liabilities of the Borrower to a Lender or its Affiliate (as the case may be) under the relevant Master Agreement, whether actual or contingent, present or future;
Material Adverse Effect” means a material adverse effect on (i) the validity or enforceability of any of the Security Documents or the rights or remedies of the Lenders or their Affiliates (as the case may be) thereunder (ii) the ability of any Obligor to perform its obligations under any of the Security Documents or (iii) the business, operations, condition (financial or otherwise) or prospects of the Borrower, either of the Owners or the NCLC Group taken as a whole;
Maturity Date” in relation to a Drawing means the last day of its Term;

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Maximum Facility Amount” means the aggregate of the Maximum Tranche Amount in respect of each of Tranche 1 and Tranche 2 (subject to Clause 2.6 and paragraph 36 of Schedule 3), as reduced from time to time pursuant to Clause 3;
Maximum Revolving Credit Facility Amount” means the Maximum Facility Amount, as reduced from time to time pursuant to Clause 3 and by the Swingline Facility;
Maximum Swingline Facility Amount” means twenty million Dollars (USD20,000,000), subject to Clause 3;
Maximum Tranche Amount” means five hundred and ten million Dollars (USD510,000,000), in the case of Tranche 1, and one hundred million Dollars (USD100,000,000), in the case of Tranche 2;
month” means a period starting on one day in a calendar month and ending on the numerically corresponding day in the next calendar month save that, where any such period would otherwise end on a day which is not a Business Day, it shall end on the next Business Day, unless that day falls in the calendar month succeeding that in which it would otherwise have ended, in which case it shall end on the preceding Business Day PROVIDED THAT, if a period starts on the last Business Day in a calendar month or if there is no numerically corresponding day in the month in which that period ends, that period shall end on the last Business Day in that later month;
Mortgages” means, pursuant to the Co-ordination Deeds, the two (2) first priority statutory Bahamian ship mortgages and deeds of covenants collateral thereto one (1) to be granted by each of the Owners over its Vessel in each case in favour of the Agent as security pursuant hereto and to the Master Agreements such mortgages and deeds of covenants to be in the forms and on the terms and conditions agreed between the Lenders and the Borrower and as specified in paragraph 21.3 of Schedule 3;
NCLC Fleet” means the vessels owned by the companies in the NCLC Group;
NCLC Group” means the Borrower and its wholly owned Subsidiaries provided that for the purposes of the definitions of “Cash Balance”, “Consolidated Debt Service”, “Consolidated Interest Expense”, “Consolidated Net Income”, “Total Capitalisation”, “Total Funded Debt” and “Total Net Funded Debt” in this Clause 1.1, Clause 10.2 and Clause 10.3 “NCLC Group” means the Borrower, its Subsidiaries and any other entity which is required to be consolidated in the Borrower’s accounts in accordance with US GAAP;
Norwegian Dawn” means Norwegian Dawn Limited of International House, Castle Hill, Victoria Road, Douglas, Isle of Man IM2 4RB, British Isles;
Norwegian Sun” means Norwegian Sun Limited a company organised and existing under the laws of Bermuda with its registered office at Canon’s Court, 22 Victoria Street, Hamilton HM 12, Bermuda;
Obligors” means the Borrower, the Owners, the Shareholder, the Manager, any other Credit Support Provider and any other party from time to time to any of the Security Documents excluding the Agent and the Lenders;

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Outstanding Indebtedness” means all sums of any kind payable actually or contingently to the Agent or the Lenders under or pursuant to this Agreement or any other Transaction Document (whether by way of repayment of principal, payment of interest or default interest, payment of any indemnity or counter indemnity, reimbursement for fees, costs or expenses or otherwise howsoever) and any Master Agreement Liabilities;
Owners” means Norwegian Sun and Norwegian Dawn;
Permitted Liens” means (i) any Encumbrance created by or pursuant to the Security Documents (ii) liens on a Vessel up to an aggregate amount at any time not exceeding fifteen million Dollars (USD15,000,000) for current crew’s wages and salvage and liens incurred in the ordinary course of trading a Vessel (iii) any deposits or pledges to secure the performance of bids, tenders, bonds or contracts (iv) any other Encumbrance notified by any of the Obligors to the Agent prior to the Signing Date (v) any Encumbrance in respect of existing Financial Indebtedness of a person which becomes a Subsidiary of the Borrower or is merged with or into the Borrower or any of its Subsidiaries (vi) liens on assets leased, acquired or upgraded after the Signing Date or assets newly constructed or converted after the Signing Date provided that (a) such liens secure Financial Indebtedness otherwise permitted under this Agreement (b) such liens are incurred within one (1) year following such lease, acquisition, upgrade, construction or conversion and (c) the Financial Indebtedness secured by such liens does not exceed the cost of such upgrade or the cost of such assets acquired or leased (vii) statutory and other similar liens arising in the ordinary course of business unrelated to Financial Indebtedness and securing obligations not yet delinquent or which are being contested in good faith by appropriate proceedings and for which adequate reserves have been established and (viii) liens arising out of the existence of judgments or awards in respect of the Borrower or any of its Subsidiaries, provided that the aggregate amount of all cash and the fair market value of all other property subject to such liens as are described in paragraphs (vi) to (viii) above does not exceed fifteen million Dollars (USD15,000,000);
Possible Event of Default” means any event which, with the giving of notice, passage of time or occurrence of any other event, would constitute an Event of Default;
Process Agent” means Clifford Chance Secretaries Limited whose registered office is presently at 10 Upper Bank Street, London E14 5JJ or any other person in England nominated by the Borrower or any other Obligor and approved by the Agent as agent to accept service of legal proceedings on their behalf under any of the Security Documents;
Quotation Date” means, in relation to any Interest Period, the day on which quotations would ordinarily be given in the interbank eurocurrency market for Dollar deposits for delivery on the first day of that Interest Period PROVIDED THAT if such quotation date is not a Business Day the quotation date shall be the preceding Business Day;
Reduction Dates” means, subject to the provisions of Clause 3, (i) the date falling thirty six (36) months after the Signing Date and (ii) the last day of each of the [**] [Confidential Treatment] consecutive periods of [**] [Confidential Treatment] months the first of such periods

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commencing on the date falling thirty six (36) months after the Signing Date and the [**] [Confidential Treatment] such period terminating [**] [Confidential Treatment] years thereafter;
Reference Banks” means the principal London offices (if any) of the Mandated Lead Arrangers;
Renewal Date”, in relation to any Revolving Credit Facility Drawing, means a date on which that Drawing is extended by any Renewal Notice for such Drawing;
Renewal Notice” means a notice to be given by the Borrower to the Agent to extend the period of a Term;
Reuters BBA Page LIBOR 01” means the display currently designated as Reuters BBA Page LIBOR 01, which includes London Interbank Offered Rates of four (4) major banks, which are members of the International Swaps and Derivatives Association, Inc., and the British Bankers’ Association overnight rate for Dollars, or such other service as may be nominated by the British Bankers’ Association as the information vendor for displaying the London Interbank Offered Rates of major banks in the London Interbank Market;
Revolving Credit Facility” means the revolving credit facility made available under this Agreement as described in Clause 2 or (as the context may require) the principal amount thereof for the time being advanced and outstanding under this Agreement;
Revolving Credit Facility Drawing” means any amount of the Revolving Credit Facility advanced by the Lenders to the Borrower pursuant to Clause 2.3;
Same Day Funds” means Dollar funds settled through the New York Clearing House Interbank Payments System or such other funds for payment in Dollars as the Agent shall specify by notice to the Borrower as being customary at the time for the settlement of international transactions in New York of the type contemplated by this Agreement;
Security Documents” means this Agreement, the Charges, the Mortgages, the Guarantees, the Earnings Assignments, the Insurance Assignments, the Management Agreement Assignments, the Master Agreements, the Co-ordination Deeds and any other Credit Support Documents, the fee letter referred to in Clause 14.2 and any other fee letter in relation to the Facility and all such other documents as may be executed at any time in favour of the Agent or any of the other Finance Parties as security for the obligations of the Borrower and/or the other Obligors whether executed pursuant to the express provisions of this Agreement or otherwise howsoever;
Security Period” means the period beginning on the first Advance Date and ending on the date on which the amounts outstanding under this Agreement and under each of the other Security Documents are finally and irrevocably repaid and/or cancelled in full;
Shareholder” means NCL International, Ltd. a company organised and existing under the laws of Bermuda with its registered office at Milner House, 18 Parliament Street, Hamilton HM 12, Bermuda;

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Signing Date” means the date of this Agreement;
Subsidiary” has the meaning defined in the United Kingdom Companies Act 1985, Section 736 as substituted by the United Kingdom Companies Act 1989, Section 144;
Substitute Basis” means an alternative basis for maintaining a Drawing certified by the Agent pursuant to Clause 6.3.1;
Suspension Notice” means a notice given by the Agent to the Borrower pursuant to Clause 6.1;
Swingline Facility” means the swingline loan facility made available under this Agreement as described in Clause 2 or (as the context may require) the principal amount thereof for the time being advanced and outstanding under this Agreement which swingline loan facility is part of the Revolving Credit Facility;
Swingline Facility Drawing” means any amount of the Swingline Facility advanced by the Swingline Lender to the Borrower pursuant to Clause 2.4;
Swingline Lender” means:
(i)   DnB NOR Bank ASA; or
 
(ii)   any other person that becomes a Swingline Lender after the Signing Date in accordance with Clause 18,
which in each case has not ceased to be a party to this Agreement in accordance with the terms of this Agreement;
Taxes” means all present and future income and other taxes, levies, duties, imposts, charges, deductions, compulsory liens and withholdings whatsoever together with interest thereon and penalties with respect thereto, if any, and any payments made on or in respect thereof and “Taxation” shall be construed accordingly;
Term” means, in relation to a Drawing, the last day of the Interest Period in respect of that Drawing as specified in the Drawdown Notice for such Drawing and, in the case of a Revolving Credit Facility Drawing, as extended by any Renewal Notice for such Revolving Credit Facility Drawing PROVIDED THAT no Event of Default or Possible Event of Default has occurred before the relevant Renewal Date and the renewal of such Revolving C redit Facility Drawing would not constitute an Event of Default or a Possible Event of Default and, in the case of any Drawing, PROVIDED THAT the Term shall not extend beyond the Final Maturity Date;
Third Party” means any person or group of persons acting in concert (as the expression “acting in concert” is defined in the City Code on Take-overs and Mergers) who or which is not a member of the Lim Family;
Total Capitalisation” means, at any date of determination, Total Net Funded Debt plus the consolidated stockholders’ equity of the NCLC Group at such date determined in accordance with US GAAP and derived from the then latest

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unaudited and consolidated accounts of the NCLC Group delivered to the Agent in the case of the first three (3) quarters of each financial year and the then latest Accounts delivered to the Agent in the case of the final quarter of each financial year;
Total Funded Debt” means, as at any relevant date, Total Net Funded Debt excluding Indebtedness for Borrowed Money related to vessels under construction for a member of the NCLC Group;
Total Loss” means any actual or constructive or arranged or agreed or compromised total loss or Compulsory Acquisition of a Vessel;
Total Net Funded Debt” means, as at any relevant date:
  (i)   Indebtedness for Borrowed Money of the NCLC Group; and
 
  (ii)   the amount of any Indebtedness for Borrowed Money of any person which is not a member of the NCLC Group but which is guaranteed by a member of the NCLC Group as at such date;
less an amount equal to any Cash Balance as at such date;
Tranche 1” means, of the Revolving Credit Facility, the relevant Maximum Tranche Amount or (as the context may require) the principal amount thereof for the time being advanced and outstanding under this Agreement;
Tranche 2” means, of the Revolving Credit Facility, the relevant Maximum Tranche Amount or (as the context may require) the principal amount thereof for the time being advanced and outstanding under this Agreement;
Transaction” means a transaction entered into between a Lender or its Affiliate (as the case may be) and the Borrower governed by the relevant Master Agreement;
Transaction Documents” means the Security Documents, the Drawdown Notices, the Renewal Notices, the Management Agreements and any other material document now or hereafter issued in connection with the documents or the transaction herein referred to;
Transfer Certificate” means the certificate attached hereto as Schedule 5;
Transfer Date” means, in relation to any Transfer Certificate, the date specified in such Transfer Certificate as the date for the making of the transfer or, where such transfer is specified as being subject to the fulfilment of certain conditions, the date on which the Agent receives a certificate from the Lender making the transfer confirming that all such conditions have been fulfilled;
Transferee” means any reputable bank acceptable to the Agent which becomes a party to this Agreement as a Lender pursuant to Clause 18;
US GAAP” means generally accepted accounting principles in the United States of America consistently applied (or, if not consistently applied, accompanied by details of the inconsistencies) including, without limitation, those set forth in the opinion and pronouncements of the Accounting Principles Board of the American

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Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board; and
Vessels” means the following vessels, and everything now or in the future belonging to them on board and ashore, currently registered under the respective flags set out below in the ownership of the respective Owners set out below and “Vessel” means either one of them:
                 
Name   Flag   Berths   Owner
“NORWEGIAN DAWN”
  Bahamas     2,220     Norwegian Dawn Limited
 
               
“NORWEGIAN SUN”
  Bahamas     1,940     Norwegian Sun Limited
  1.2   Construction
In this Agreement unless the context otherwise requires:
  1.2.1   clause headings are inserted for convenience of reference only and shall be ignored in the construction of this Agreement;
 
  1.2.2   references to Clauses and to Schedules are to be construed as references to clauses of and schedules to this Agreement unless otherwise stated and references to this Agreement are to be construed as references to this Agreement including its Schedules;
 
  1.2.3   references to (or to any specified provision of) this Agreement or any other document shall be construed as references to this Agreement, that provision or that document as from time to time amended, supplemented and/or novated;
 
  1.2.4   references to any Act or any statutory instrument shall be construed as references to that Act or that statutory instrument as from time to time re-enacted, amended or supplemented;
 
  1.2.5   references to any party to this Agreement or any other document shall include reference to such party’s successors and permitted assigns;
 
  1.2.6   words importing the plural shall include the singular and vice versa;
 
  1.2.7   references to a person shall be construed as references to an individual, firm, company, corporation, unincorporated body of persons or any state or any agency thereof;
 
  1.2.8   where any matter requires the approval or consent of the Agent such approval or consent shall not be deemed to have been given unless given in writing; where any matter is required to be acceptable to the Agent shall not be deemed to have accepted such matter unless its acceptance is communicated in writing; the Agent may give or withhold its consent, approval or acceptance at its unfettered discretion; and

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  1.2.9   a certificate by the Agent as to any amount due or calculation made hereunder shall be conclusive except for manifest error.
  1.3   Agent
The Agent has been appointed by the Lenders as agent under Clause 20.3 and (unless the context otherwise requires) references herein to the Agent shall be construed as references to itself and the Lenders. The Borrower shall only communicate with the Lenders under this Agreement and the other Security Documents through the Agent and as hereinafter referred to.
  1.4   Third Party rights
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.
  2   The Facility
  2.1   Availability
  2.1.1   The Lenders grant to the Borrower the Facility which is of a revolving nature. The Revolving Credit Facility and the Swingline Facility shall be available to the Borrower during the Availability Period subject to the provisions of Clause 2.2, Clause 2.3 and Clause 2.4. Each Drawing shall be repaid on its Maturity Date. However, a Term of a Revolving Credit Facility Drawing may be extended to the end of the succeeding Interest Period in respect of that Drawing by the giving of a Renewal Notice by the Borrower to the Agent not later than 9.00 a.m. London time four (4) Business Days prior to the commencement of the relevant Interest Period.
 
  2.1.2   Each Lender shall advance its Contribution to a Revolving Credit Facility Drawing in the proportion which its Commitment for the time being bears to the other Commitments of the Lenders to the Revolving Credit Facility.
 
  2.1.3   None of the Agent or any other Lender shall be liable for any failure or delay on the part of any Lender in making any advance hereunder nor shall the Agent have any obligation to seek to procure additional Lenders in the event of such a failure PROVIDED THAT if any Lender should fail to advance its Contribution to an advance hereunder, that Lender and the Agent will take all reasonable steps to mitigate the effect of that failure. Notwithstanding the aforesaid proviso, no Lender shall be obliged to increase its Contribution hereunder in respect of the failure by any other Lender to fund any Contribution.
 
  2.1.4   The Swingline Lender shall advance its Contribution to a Swingline Facility Drawing in the proportion which its Commitment for the time being bears to the other Commitments of the Lenders to the Swingline Facility.
 
  2.1.5   The Swingline Lender shall advance its Contribution to each Swingline Facility Drawing through its Lending Branch in New York.

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  2.2   Purpose and Application
  2.2.1   The Borrower shall apply or procure the application of the Revolving Credit Facility in refinance of all existing indebtedness relating to the Vessels and for general corporate purposes for the Borrower and its Subsidiaries.
 
  2.2.2   The Borrower shall apply or procure the application of the Swingline Facility for general short term corporate purposes of the Borrower PROVIDED THAT a Swingline Facility Drawing may not be applied in repayment or prepayment of another Swingline Facility Drawing.
  2.3   Advance of a Revolving Credit Facility Drawing to the Borrower
The Borrower shall only draw down a Revolving Credit Facility Drawing if:
  2.3.1   the Agent receives notice of the Borrower’s request for the Revolving Credit Facility Drawing by not later than 9.00 a.m. London time four (4) Business Days prior to the Advance Date in the form of Schedule 2;
 
  2.3.2   the Advance Date proposed is a Business Day within the relevant Availability Period;
 
  2.3.3   the Revolving Credit Facility Drawing is in a minimum amount of ten million Dollars (USD10,000,000);
 
  2.3.4   on any Advance Date not more than [**] [Confidential Treatment] Revolving Credit Facility Drawings will be outstanding;
 
  2.3.5   the drawdown of the Revolving Credit Facility Drawing would not result in the amount of the Facility exceeding the Maximum Facility Amount on the Advance Date;
 
  2.3.6   no Event of Default or Possible Event of Default has occurred before the relevant Advance Date and such drawing would not constitute an Event of Default or a Possible Event of Default;
 
  2.3.7   the representations and warranties set out in Clause 9 and each of the other Security Documents are correct on the relevant Advance Date;
 
  2.3.8   no event or circumstance has occurred which the Majority Lenders believe has had or reasonably believe will have a Material Adverse Effect; and
 
  2.3.9   it is then lawful for each of the Lenders to make available its relevant Contribution to the Revolving Credit Facility Drawing.
  2.4   Advance of a Swingline Facility Drawing to the Borrower
The Borrower shall only draw down a Swingline Drawing if:
  2.4.1   the Swingline Lender receives notice of the Borrower’s request for the Swingline Facility Drawing by 10.00 a.m. New York time on the Advance

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      Date in the form of Schedule 2 (only one Swingline Facility Drawing may be requested in each such notice);
  2.4.2   the Advance Date proposed is a Business Day within the Availability Period;
 
  2.4.3   the Swingline Facility Drawing is in a minimum amount of two million Dollars (USD2,000,000);
 
  2.4.4   on any Advance Date not more than [**] [Confidential Treatment] Swingline Facility Drawings will be outstanding;
 
  2.4.5   the drawdown of the Swingline Facility Drawing would not result in the amount of the Swingline Facility exceeding the Maximum Swingline Facility Amount on the Advance Date;
 
  2.4.6   the drawdown of the Swingline Facility Drawing would not result in the amount of the Facility exceeding the Maximum Facility Amount on the Advance Date;
 
  2.4.7   no Event of Default or Possible Event of Default has occurred before the relevant Advance Date and such drawing would not constitute an Event of Default or a Possible Event of Default;
 
  2.4.8   the representations and warranties set out in Clause 9 and each of the other Security Documents are correct on the relevant Advance Date;
 
  2.4.9   no event or circumstance has occurred which the Majority Lenders believe has had or reasonably believe will have a Material Adverse Effect; and
 
  2.4.10   it is then lawful for the Swingline Lender to make available its relevant Contribution to the Swingline Facility Drawing.
  2.5   Break costs
If for any reason a Drawing is not advanced to the Borrower hereunder after the relevant Drawdown Notice has been given to the Agent pursuant to Clause 2.3 or Clause 2.4, the Borrower will pay to the Agent for the account of the relevant Lenders such amount as the Agent may certify as necessary to compensate the relevant Lenders (other than any Lender whose default has caused the Drawing not to be drawn down) for any loss (including any losses under any Master Agreements) or expense on account of funds borrowed, contracted for or utilised in order to fund their Contributions to the Drawing. Each Lender shall supply to the Agent a certificate of break costs which in the absence of manifest error shall be conclusive as to the amounts due.
  2.6   Conditions of drawdown
The Agent shall not be under any obligation to advance a Drawing hereunder until all the documents and evidence referred to in the relevant part of Schedule 3 are in the possession of the Agent in form and substance satisfactory to the Agent.

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  2.7   Several obligations of the Lenders
The obligations and rights of each Lender hereunder are several and if for any reason the Borrower receives an amount greater than the aggregate of the Contributions to the Drawing, the Borrower forthwith upon the demand of the Agent shall pay to the Agent (for the account of those Lenders whose Contributions were exceeded) the amount certified by the Agent as representing the excess of the amount paid to the Borrower over the due and proper amount of the Contributions of the Lenders actually received by the Agent.
  2.8   Lender’s failure to perform
Subject to Clause 2.1.3, the failure by a Lender to perform its obligations hereunder shall not affect the obligations of the Borrower towards any other party hereto nor shall any such other party be liable for the failure by such Lender to perform its obligations hereunder.
  2.9   Fulfilment of conditions after drawdown
If the Lenders, acting unanimously, decide (or the Agent in accordance with Clause 20 decides) to permit the advance of a Drawing to the Borrower hereunder without the Agent having received all of the documents or evidence referred to in the relevant part or parts of Schedule 3, the Borrower will nevertheless deliver the remaining documents or evidence to the Agent within such period as the Agent may stipulate and the advance of the Drawing shall not be construed as a waiver of the Agent’s right to receive the documents or evidence as aforesaid nor shall this provision impose on the Agent or the Lenders any obligation to permit the advance of the Drawing in the absence of any of such documents or evidence.
  3   Repayment, Reduction, Cancellation and Prepayment of the Facility
  3.1   Repayment
The Borrower shall repay each Drawing on its Maturity Date. If a Drawing (the “new Drawing”) is to be made on a day on which another Drawing (the “maturing Drawing”) is due to be repaid then, subject to the terms of this Agreement:
  3.1.1   the maturing Drawing shall be deemed to have been repaid on its Maturity Date either in whole (if the new Drawing is equal to or greater than the maturing Drawing) or in part (if the new Drawing is less than the maturing Drawing); and
 
  3.1.2   to the extent that the maturing Drawing is so deemed to have been repaid, the principal amount of the new Drawing to be made on such date shall be deemed to have been credited to the account of the Borrower by the Agent on behalf of the Lenders in accordance with the terms of this Agreement and the Lenders shall only be obliged to make available to the Borrower pursuant to Clause 2.3 or Clause 2.4 a principal amount equal to the amount by which the new Drawing exceeds the maturing Drawing.
On the Final Maturity Date, all outstanding Drawings and other sums (if any) then owing under this Agreement shall in any event be repaid or paid in full.

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  3.2   Scheduled reductions of Commitments to the Facility
  3.2.1   Subject to the second paragraph of this Clause 3.2.1, on each of the Reduction Dates the Maximum Facility Amount as at the Signing Date shall be reduced by [**] [Confidential Treatment] Dollars [**] [Confidential Treatment].
 
      The Borrower shall pay to the Agent all accrued interest on the reduction amount to that Reduction Date. Amounts repaid by the Borrower pursuant to this Clause 3.2.1 shall not be available for reborrowing.
  3.2.2   Without prejudice to any other provision of this Agreement, the Commitments to the Facility shall be reduced to zero on the Final Maturity Date.
 
  3.2.3   The Maximum Swingline Facility Amount shall not be reduced prior to the Final Maturity Date save to the extent that the aggregate of the Available Commitments does not exceed the Maximum Swingline Facility Amount.
  3.3   Sale or Total Loss of a Vessel: mandatory cancellation
If at any time during the Security Period a Vessel is sold or is or becomes a Total Loss, the Commitments to the Facility shall be reduced by an amount equal to (x) the sum of (i) the then aggregate amount of the Drawings plus (ii) the aggregate of the Available Commitments multiplied by (y) a fraction, the numerator of which is the market value of that Vessel as assessed in accordance with the provisions of Clause 10.17 and the denominator of which is the aggregate of the market value of the Vessels as assessed in accordance with the provisions of Clause 10.17 on the date on which the proceeds of such sale or Total Loss are made available.
  3.4   Amounts payable on prepayment
Any prepayment of a Drawing or the Facility under this Clause 3 shall be made together with:
  3.4.1   accrued interest on the amount to be prepaid to the date of such prepayment (calculated in respect of any period during which a Substitute Basis has applied by virtue of Clause 6.3, at the rate per annum more particularly described in Clause 6.2);
 
  3.4.2   any additional amounts payable under Clause 7.2 and Clause 8.1;
 
  3.4.3   costs certified by the Agent as necessary to compensate the Lenders for the cost of repaying fixed deposits borrowed to fund any part of any Drawing or the Facility which is prepaid before the relevant Maturity Date or the fixed term by reference to which the relevant Interest Rate has been ascertained; and
 
  3.4.4   all other sums payable by the Borrower to the relevant Lender under this Agreement including, without limitation, any accrued commitment fee payable under Clause 14.1.

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  3.5   Notice of prepayment
No voluntary prepayment of a Drawing may be effected under this Clause 3 unless the Borrower shall have given the Agent at least four (4) Business Days’ notice (such notice to be received not later than 9.00 a.m. London time on that day), in the case of a Revolving Credit Facility Drawing, and at least one (1) Business Days’ notice (such notice to be received not later than 9.00 a.m. New York time on that day), in the case of a Swingline Facility Drawing, of its intention to make such prepayment. Every notice of prepayment shall be effective only on actual receipt by the Agent, shall be irrevocable, shall specify the amount to be prepaid and shall oblige the Borrower to make such prepayment on the date specified. Unless and to the extent that the Commitments to the Facility are cancelled or reduced on or with effect from the date of any such prepayment, amounts prepaid may be re-drawn under this Agreement. The Borrower may not prepay any Drawing or any part thereof save as expressly provided in this Agreement.
The Drawing(s) to be wholly or partially prepaid pursuant to Clause 3.2.1 and Clause 3.8 shall be selected by the Borrower by not fewer than four (4) Business Days’ notice (such notice to be received not later than 9.00 a.m. London time on that day), in the case of a Revolving Credit Facility Drawing, and at least one (1) Business Days’ notice (such notice to be received not later than 9.00 a.m. New York time on that day), in the case of a Swingline Facility Drawing, to the Agent, which shall be irrevocable. The Borrower shall not be permitted to make any selection pursuant to this Clause which would result in partial prepayment of more than one (1) Drawing. If the Borrower fails to give notice to the Agent selecting the Drawing(s) to be prepaid, the Borrower shall be deemed to have selected to prepay first any Drawings having an Interest Period ending on the Reduction Date in question or the Final Maturity Date. If there are no such Drawings or the aggregate amount of the Drawing(s) having an Interest Period ending on the Reduction Date in question or the Final Maturity Date either exceeds or falls short of the amount required to be prepaid, the Borrower shall prepay, in full or in part, the Drawing(s) selected by the Agent.
  3.6   Voluntary cancellation of Commitments
The Borrower may at any time during the Availability Period by notice to the Agent (effective only on actual receipt) cancel with effect from a date not less than four (4) Business Days (such notice to be received not later than 9.00 a.m. London time on that day) after the receipt by the Agent of such notice the whole or any part (being a minimum amount of [**] [Confidential Treatment] Dollars [**] [Confidential Treatment] but not more than the Available Commitments of all of the Lenders to the Facility as at such date) of the total of the Available Commitments to the Facility as at such date of all the Lenders. Any such notice of cancellation, once given, shall be irrevocable and upon such cancellation taking effect the Commitment of each of the Lenders to the Facility shall be permanently reduced proportionately and the Borrower shall on the date designated in its notice prepay such amount of the outstanding Drawings as will ensure that immediately thereafter the aggregate amount of the Drawings will not exceed the Commitments to the Facility as so reduced by virtue of the Borrower’s cancellation.

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  3.7   Additional partial cancellation
The Borrower may also at any time during the Availability Period by notice to the Agent (effective only on actual receipt) cancel with effect from a date not less than four (4) Business Days (such notice to be received not later than 9.00 a.m. London time on that day) after receipt by the Agent of such notice the whole but not part only, but without prejudice to its obligations under Clause 7.2 and Clause 8.1, of the Commitment to the Facility of any Lender to which the Borrower shall have become obliged to pay additional amounts under Clause 7.2 or Clause 8.1. Upon any notice of such prepayment being given, the Commitment of the relevant Lender to the Facility shall be reduced to zero and the Borrower shall be obliged to prepay the Contribution of such Lender to the Facility on such date.
  3.8   Prepayment during Term
The Borrower may at any time by notice to the Agent (effective only on actual receipt) prepay the whole or, in the case of a Revolving Credit Facility Drawing, any part (being a minimum amount of [**] [Confidential Treatment] Dollars [**] [Confidential Treatment] or such lesser amount as is acceptable to the Agent) of any Drawing prior to its Maturity Date on not less than four (4) Business Days’ notice (such notice to be received not later than 9.00 a.m. London time on that day), in the case of a Revolving Credit Facility Drawing, and on not less than one (1) Business Days’ notice (such notice to be received not later than 9.00 a.m. New York time on that day), in the case of a Swingline Facility Drawing (whether or not any part of the Commitment to the Facility is also being cancelled on such date pursuant to any provision of this Agreement) and the Borrower shall when making such prepayment, make such prepayment together with any amounts as referred to in Clause 3.4.
  3.9   Mandatory cancellation in case of illegality
If any change in, or in the interpretation or application of, any law, regulation or treaty shall make it unlawful in any jurisdiction applicable to any of the Lenders for that Lender to make available or maintain its Contribution to the Facility or to give effect to its obligations as contemplated hereby, the Agent may, by notice thereof to the Borrower, declare that the relevant Lender’s obligations shall be terminated forthwith whereupon (if any of the Facility has then been advanced) the Borrower shall prepay forthwith to the relevant Lender its Contribution to the Facility together with interest thereon to the date of such prepayment and all other amounts due to such Lender under Clause 3.4 and under the Security Documents (or, if permitted by the relevant law, regulation or treaty, at the end of the then current Interest Period).
A Lender affected by any provision of this Clause 3.9 shall promptly inform the Agent after becoming aware of the relevant change and the Agent shall, as soon as reasonably practicable thereafter, notify the Borrower of the change and its possible results. Without affecting the Borrower’s obligations under this Clause 3.9 and in consultation with the Agent, the affected Lender will then take all such reasonable steps as may be open to it to mitigate the effect of the change (for example (and if then possible) by changing its Lending Branch or transferring some or all of its rights and obligations under this Agreement to another financial institution reasonably acceptable to the Borrower and the Agent). The reasonable

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costs of mitigating the effect of any such change shall be borne by the Borrower save where such costs are of an internal administrative nature and are not incurred in dealings by any Lender with third parties.
  3.10   Voluntary cancellation following imposition of Substitute Basis
The Borrower may notify the Agent within ten (10) Business Days of the receipt of a certificate from the Agent of a Substitute Basis under Clause 6.3 whether or not it wishes to cancel the Facility or the relevant part thereof, in which event the Borrower shall forthwith cancel the Facility or such relevant part thereof and prepay such amount of the outstanding Drawings as will ensure that immediately thereafter the aggregate of the amount of the Drawings will not exceed the Commitments to the Facility or relevant part thereof as so reduced by virtue of the Borrower’s cancellation.
  3.11   Cancellation in case of Total Loss of a Vessel
If a Vessel is or becomes a Total Loss, then the Borrower will, within thirty (30) days thereof or, if the Agent is satisfied in its sole discretion acting reasonably that the Total Loss is adequately covered by the Insurances and that the relevant insurance proceeds will be payable to the Agent on behalf of the Lenders within one hundred and fifty (150) days thereof, by no later than the date which is one hundred and fifty (150) days after the date of the event giving rise to such Total Loss cancel and prepay the Facility in accordance with Clause 3.3 and Clause 13.1.
For the purposes of this Clause 3.11, a Total Loss shall be deemed to have occurred:
  3.11.1   if it consists of an actual loss, at noon Greenwich Mean Time on the actual date of loss or, if that is not known, on the date on which the Vessel was last heard of;
 
  3.11.2   if it consists of a Compulsory Acquisition, at noon Greenwich Mean Time on the date on which the requisition is expressed to take effect by the person requisitioning the Vessel; or
 
  3.11.3   if it consists of a constructive or compromised or arranged or agreed total loss or damage to the Vessel rendering repair impracticable or uneconomical or rendering the Vessel permanently unfit for normal use, at noon Greenwich Mean Time on the date on which notice claiming the loss of the Vessel is given to its insurers.
  3.12   Cancellation in case of sale of a Vessel
If a Vessel is sold by the relevant Owner with the prior consent of the Majority Lenders (which consent is not to be unreasonably withheld or delayed), then the Borrower will concurrent with completion of the sale cancel and prepay the relevant amount in accordance with Clause 3.3 and Clause 13.1. Subject to Clause 3.4, prepayment of the relevant amount consequent upon the permitted sale of the relevant Vessel shall absolve the Borrower from any liability to pay prepayment fees or costs other than legal, registration or other costs incurred in relation to the release and discharge of the Security Documents.

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  4   Interest
  4.1   Payment of interest
The Borrower shall pay interest on each Drawing at the Interest Rate applicable for each Interest Period in respect thereof which interest shall be payable in arrears on each Interest Payment Date.
  4.2   Selection and duration of Interest Periods
  4.2.1   The Borrower may give notice to the Agent to be received by the Agent not later than 9.00 a.m. London time four (4) Business Days prior to the commencement of each Interest Period in respect of a Revolving Credit Facility Drawing, specifying whether that Interest Period is to be of one (1) month’s or three (3) or six (6) months’ duration or of such other period as the Borrower and all the Lenders may agree PROVIDED THAT no more than three (3) Interest Periods of one (1) month’s duration may be requested in any one (1) calendar year in respect of the Revolving Credit Facility. Interest Periods shall commence, in the case of the first in respect of a Revolving Credit Facility Drawing, on the relevant Advance Date and, in the case of Interest Periods other than the first, on the expiry of the preceding Interest Period. Each Interest Period shall, subject to the following provisions of this Clause 4, be of a duration selected by the Borrower as above PROVIDED THAT the final Interest Period in respect of a Revolving Credit Facility Drawing shall end on the Maturity Date of that Revolving Credit Facility Drawing.
 
  4.2.2   The Borrower may give notice to the Swingline Lender with a copy to the Agent, to be received by the Swingline Lender and the Agent not later than 10.00 a.m. New York time on the Advance Date in respect of a Swingline Facility Drawing, specifying whether that Interest Period is to be of one (1), two (2), three (3), four (4) or five (5) Business Days’ duration. Interest Periods shall commence on the relevant Advance Date. Each Interest Period shall, subject to the following provisions of this Clause 4, be of a duration selected by the Borrower as above PROVIDED THAT no Interest Period in respect of a Swingline Facility Drawing shall end after the Final Maturity Date.
  4.3   No notice and unavailability
If the Borrower fails to select an Interest Period in accordance with Clause 4.2 or the Agent certifies that deposits for the period selected by the Borrower are not available to each of the Lenders in the ordinary course of business in the relevant interbank eurocurrency market to fund the Drawing, the Borrower shall be deemed to have selected an Interest Period of three (3) months (or such other period as the Agent may in its sole discretion decide).
  4.4   Extension and shortening of Interest Periods
  4.4.1   If an Interest Period would otherwise end on a day which is not a Business Day, the Interest Period shall be extended until the next following Business Day unless the next following Business Day falls in the next

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calendar month in which case the Interest Period will be shortened to expire on the preceding Business Day.
  4.4.2   If an Interest Period commences on the last Business Day in a month and if there is no day in the month in which the Interest Period will end which corresponds numerically to the day on which it begins, the Interest Period shall end on the last Business Day in that month.
  4.5   Interest Rate
  4.5.1   Subject to Clause 4.7, Clause 5.3 and Clause 6, the rate of interest applicable to a Revolving Credit Facility Drawing during an Interest Period shall be the rate per annum which is the sum of LIBOR, the Applicable Margin and Mandatory Costs.
 
  4.5.2   Subject to Clause 4.7 and Clause 6, the rate of interest applicable to a Swingline Facility Drawing during an Interest Period shall be the rate per annum which is the sum of the British Bankers’ Association overnight rate for Dollars which appears on the Reuters BBA Page LIBOR 01 at or about 11.00 a.m. London time on the Advance Date, the aggregate of the Applicable Margin and [**] [Confidential Treatment] per cent [**] [Confidential Treatment] and Mandatory Costs.
  4.6   Bank basis
Interest, commitment fee and any other payments hereunder or under the fee letter referred to in Clause 14.2 or any other fee letter of an annual nature shall accrue from day to day and be computed on the basis of a year of three hundred and sixty (360) days and for the actual number of days elapsed.
  4.7   Default interest
If the Borrower fails to pay on the due date any sum due under this Agreement or any of the other Security Documents to which it may at any time be a party, the Borrower shall, without affecting any other remedy of the Agent or the Lenders, on demand pay interest on such sum from the due date to the actual date of payment (as well after as before judgment). Such interest shall accrue on a daily basis at the higher of the Interest Rate fixed for the latest Interest Period and the rate computed by the Agent and certified by the Agent to the Borrower as being the aggregate of (a) the Applicable Margin (plus [**] [Confidential Treatment] if the relevant Interest Period is in respect of a Swingline Facility Drawing or an Unpaid Amount (as defined in Clause 5.3.2)), Mandatory Costs and [**] [Confidential Treatment] and (b) the greater of (i) in the case of the Lenders, the average (rounded upwards if necessary to the next integral multiple of [**] [Confidential Treatment]) of the respective rates per annum at which each of the Lenders is able to acquire in accordance with its normal practice deposits in Dollars in successive periods of one (1) month (or for such shorter period as the Agent may in its sole discretion select) in the relevant interbank eurocurrency market in an amount equivalent to or comparable with its relevant Contribution to such sum, and, in the case of the Agent, the rate per annum at which it is able to acquire in accordance with its normal practice deposits in Dollars in successive periods of one (1) month (or for such shorter period as the Agent may in its sole discretion select) in the relevant interbank eurocurrency market in an amount

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equivalent to such sum, as at approximately 11.00 a.m. London time on any relevant day and (ii) in the case of the Lenders, the average (rounded upwards if necessary to the next integral multiple of [**] [Confidential Treatment] of the cost to each of the Lenders of funding its relevant Contribution to such sum, and, in the case of the Agent, the cost of funding such sum, such interest to be compounded at the end of the period selected by the Agent and to be payable on demand. In the event of LIBOR not being available then the Agent shall in its discretion use the Substitute Basis for its calculation as set out in Clause 6.3.
5   Swingline Facility
  5.1   Swingline Lender’s participation
The Swingline Lender shall notify the Agent by 9.00 a.m. Oslo time on the Business Day after it receives a notice from the Borrower pursuant to Clause 2.4.1 of the amount of the Swingline Facility Drawing.
  5.2   Relationship with the Revolving Credit Facility
  5.2.1   The Revolving Credit Facility may be used by way of the Swingline Facility. The Swingline Facility is not independent of the Revolving Credit Facility.
 
  5.2.2   Notwithstanding any other term of this Agreement the Swingline Lender is only obliged to advance a Swingline Facility Drawing to the extent that it would not result in its Commitment in the Facility exceeding its Available Commitment after the earlier of the relevant Due Date and the relevant Reallocation Date.
  5.3   Reallocation
  5.3.1   If a Swingline Facility Drawing is not repaid in full on its due date (the “Due Date”), the Agent shall (on being requested to do so in writing by the Swingline Lender) set the date (the “Reallocation Date”) on which payments shall be made between the Lenders to re-distribute the unpaid amount between them. The Reallocation Date shall be the third (3rd) Business Day after the Due Date. The Agent shall give notice to each affected Lender of the Reallocation Date not later than 10.00 a.m. London time two (2) Business Days prior to the Reallocation Date and notify it of the amounts to be paid or received by it. Interest shall be payable on the Swingline Facility Drawing between the Due Date and the Reallocation Date in accordance with Clause 5.3.2. The Interest Period shall commence on the Due Date and expire on the Reallocation Date.
 
  5.3.2   On the Reallocation Date each Lender shall pay to the Agent its proportion of the Unpaid Amount less its Unpaid Swingline Participation (if any). If this produces a negative figure for a Lender no amount need be paid by that Lender. Any such payment made shall be deemed to be a Contribution of that Lender to a Revolving Credit Facility Drawing. The Interest Rate applicable to the Unpaid Amount shall be the rate per annum which is the sum of LIBOR, the aggregate of the Applicable Margin and [**] [Confidential Treatment] and Mandatory Costs. The Interest Period shall be of one (1) month’s duration. The provisions of

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      Clause 2.3 shall not apply to the deemed Revolving Credit Facility Drawing.
The “proportion” of a Lender means the proportion borne by:
  (a)   its Commitment (or, if its Commitment is then zero, its Commitment immediately prior to its reduction to zero) minus its Contribution to the Facility (but ignoring its Contribution to the unpaid Swingline Facility Drawing): to
 
  (b)   the aggregate of the Available Commitments (or, if the Commitments are then zero, the Commitments immediately prior to their reduction to zero) minus any outstanding Revolving Credit Facility Drawings (but ignoring the unpaid Swingline Facility Drawing).
The “Unpaid Amount” means, in relation to a Swingline Facility Drawing, any principal not repaid and/or any interest accrued but unpaid on that Swingline Facility Drawing calculated from the Advance Date to the Reallocation Date.
The “Unpaid Swingline Participation” of a Lender means that part of the Unpaid Amount (if any) owed to that Lender (before any redistribution under this Clause 5.3).
  5.3.3   Out of the funds received by the Agent pursuant to Clause 5.3.2 the Agent shall pay to the Swingline Lender an amount equal to the Shortfall (if any) of the Swingline Lender where:
The “Shortfall” of the Swingline Lender is an amount equal to its Unpaid Swingline Participation minus its proportion of the Unpaid Amount.
  5.3.4   (a) On a payment under this Clause 5.3, the paying Lender will be subrogated to the rights of the Swingline Lender.
 
  (b)   If and to the extent a paying Lender is not able to rely on its rights under Clause 5.3.4(a), the Borrower shall be liable to the paying Lender for a debt equal to the amount the paying Lender has paid under this Clause 5.3.
 
  (c)   Any payment under this Clause 5.3 does not reduce the obligations in aggregate of any Obligor.
6   Substitute Basis of Funding
  6.1   Market disturbance
Notwithstanding anything to the contrary in this Agreement, if prior to the commencement of any Interest Period the Agent shall determine in good faith (which determination shall be conclusive and binding on the parties hereto) that:
  6.1.1   by reason of circumstances affecting the relevant interbank eurocurrency market adequate and fair means do not exist for ascertaining the Interest Rate during such Interest Period pursuant to Clause 4 or Clause 5; or

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  6.1.2   deposits in Dollars of equal duration to such Interest Period will not be available to any of the Lenders in the relevant interbank eurocurrency market in sufficient amounts in the ordinary course of business to fund its relevant Contribution during such Interest Period; or
 
  6.1.3   by reason of any material change in applicable law or regulation or of any change in national or international financial or economic conditions any of the Lenders is unable to fund or to continue to fund its relevant Contribution during such Interest Period by deposits obtained in the relevant interbank eurocurrency market,
then the Agent shall promptly give a notice (being a Suspension Notice), containing full particulars thereof in reasonable detail to the Borrower.
  6.2   Suspension of drawdown
If a Suspension Notice is given by the Agent before the advance of a Drawing in accordance with Clause 2 then the Agent shall not be obliged to advance any Drawing until notice to the contrary is given by the Agent. During the period of thirty (30) days from the giving of such Suspension Notice, the Agent and any Lender affected by the relevant market disturbance shall consult in good faith with the Borrower with a view to agreeing to an alternative basis for advancing of the Facility or any relevant part thereof. If such alternative basis is agreed between the Borrower, the Agent and the relevant Lender or Lenders, it shall apply in accordance with its terms.
  6.3   Certificates of Substitute Basis
  6.3.1   If a Drawing has been advanced before a Suspension Notice is given, the Lender or Lenders affected by the relevant market disturbance shall within thirty (30) days following the date of the Suspension Notice, certify (through the Agent) in good faith to the Borrower an alternative basis (being the Substitute Basis) for maintaining its relevant Contribution affected by the relevant market disturbance. Such Substitute Basis may be retroactive to the beginning of the then current Interest Period in respect of the Drawing and may include an alternative method of fixing the Interest Rate (which shall reflect the cost to the relevant Lender or Lenders of funding its relevant Contribution from other sources plus the Applicable Margin) or alternative Interest Periods for the relevant Drawing, provided always that so far as practicable any such Substitute Basis shall be computed in a manner and for periods as similar as possible to those provided in Clause 4.
 
  6.3.2   Each Substitute Basis so certified shall be binding upon the Borrower, the Agent and the Lenders and shall be treated as part of this Agreement.
  6.4   Review
So long as any Substitute Basis is in force, the Agent, in consultation with the Borrower and the Lenders, shall from time to time, but not less often than monthly, review whether or not the circumstances referred to in Clause 6.1 still prevail with a view to returning to the normal provisions of this Agreement.

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7   Payments
  7.1   Place for payment
Subject to Clause 13.3, all payments by the Borrower under this Agreement or any of the other Security Documents to which it may at any time be a party shall be made to the Agent in Same Day Funds to Bank of New York, New York, for the account of DnB NOR Bank ASA, Oslo account no [**] [Confidential Treatment] by 10.00 a.m. New York time, or such other account or bank as the Agent may from time to time designate.
  7.2   Deductions and grossing-up
  7.2.1   Each payment to be made by the Borrower to the Agent or the Lenders hereunder or under the fee letter referred to in Clause 14.2 or any other fee letter shall be made free and clear of and without deduction for or on account of Taxes unless the Borrower is required by law to make such a payment subject to the deduction or withholding of Taxes, in which case the sum payable by the Borrower in respect of which such deduction or withholding is required to be made shall be increased to the extent necessary to ensure that, after the making of such deduction or withholding, the Agent or the Lenders receives and retains (free from any liability in respect of any such deduction or withholding) a net sum equal to the sum which it would have received and so retained had no such deduction or withholding been made or required to be made.
 
  7.2.2   Without prejudice to the provisions of Clause 7.2.1, if any Lender or the Agent on its behalf or the Agent is required to make any payment on account of tax (not being a tax imposed on the net income of its Lending Branch by the jurisdiction in which it is incorporated or in which its Lending Branch is located or any other tax existing and applicable on the Signing Date under the laws of any jurisdiction) or otherwise on or in relation to any sum received or receivable hereunder by such Lender or the Agent on its behalf or the Agent (including, without limitation, any sum received or receivable under this Clause 7) or any liability in respect of any such payment is asserted, imposed, levied or assessed against such Lender or the Agent on its behalf or the Agent, the Borrower shall, upon demand of the Agent, indemnify such Lender or the Agent on its behalf or the Agent against such payment or liability, together with any interest, penalties and expenses payable or incurred in connection therewith other than interest penalties and expenses that are otherwise imposed or asserted on account of the bad faith or wilful neglect of such Lender or the Agent on its behalf or the Agent. If any Lender or the Agent proposes to make a claim under the provisions of this Clause 7.2.2 it shall certify to the Borrower in reasonable detail within thirty (30) days (or such longer period as any Lender or the Agent may reasonably require) after becoming aware of the event by reason of which it is entitled to make its claim or claims the basis of its claim or claims, such certificate to be conclusive, save for manifest error.

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  7.3   Production of receipts for Taxes
If the Borrower makes any payment hereunder in respect of which it is required by law to make any deduction or withholding, it shall pay the full amount to be deducted or withheld to the relevant taxation or other authority within the time allowed for such payment under applicable law and shall deliver to the Agent within thirty (30) days after it has made such payment to the applicable authority any original receipt issued by such authority evidencing the payment to such authority of all amounts so required to be deducted or withheld from such payment.
If an additional payment is made under Clause 7.2.2 and any Lender or the Agent on its behalf or the Agent determines that it has received or been granted a credit against or relief of or calculated with reference to the deduction or withholding giving rise to such additional payment, such Lender or the Agent on its behalf or the Agent shall, to the extent that it can do so without prejudice to the retention of the amount of such credit, relief, remission or repayment, pay to the Borrower such amount as such Lender or the Agent on its behalf or the Agent shall in its opinion have concluded to be attributable to the relevant deduction or withholding. Any such payment shall be conclusive evidence of the amount due to the Borrower hereunder and shall be accepted by the Borrower in full and final settlement of its rights of reimbursement hereunder in respect of such deduction or withholding. Nothing herein contained shall interfere with the right of any Lender and the Agent to arrange their respective tax affairs in whatever manner they think fit.
  7.4   Currency of account
Unless the Agent agrees or requires otherwise in accordance with the terms of this Agreement:
  7.4.1   a repayment or payment of all or part of the Facility, the Revolving Credit Facility, the Swingline Facility or any sum due and payable but unpaid by any Obligor (other than the Manager) under the Security Documents shall be made in the currency in which the Facility, the Revolving Credit Facility, the Swingline Facility or such unpaid sum is denominated on its due date;
 
  7.4.2   each payment of interest shall be made in the currency in which the sum in respect of which the interest is payable was denominated when that interest accrued; and
 
  7.4.3   each payment in respect of costs, expenses or Taxes shall be made in the currency in which the costs, expenses or Taxes are incurred
  7.5   Money of account
If any sum due from the Borrower under this Agreement or any other Security Document to which it may at any time be a party, or any order or judgment given or made in relation thereto, has to be converted from the currency (the “first currency”) in which the same is payable under such Security Document, order or judgment into another currency (the “second currency”) for the purpose of:

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  7.5.1   making or filing a claim or proof against the Borrower;
 
  7.5.2   obtaining an order or judgment in any court or other tribunal; or
 
  7.5.3   enforcing any order or judgment given or made in relation thereto;
the Borrower shall indemnify and hold harmless the Finance Parties from and against any damages or losses suffered as a result of any discrepancy between (a) the rate of exchange used to convert the sum in question from the first currency into the second currency and (b) the rate or rates of exchange at which each Lender or the Agent may in the ordinary course of business purchase the first currency with the second currency upon receipt of a sum paid to it in satisfaction, in whole or in part, of any such order, judgment, claim or proof. The above indemnity shall constitute an obligation of the Borrower separate and independent from its other obligations and shall apply irrespective of any indulgence granted by the Finance Parties or any of them.
  7.6   Accounts
The Agent shall maintain in accordance with its usual practice accounts evidencing the amounts from time to time lent by and owing to each of the Lenders hereunder or under any of the other Security Documents. In any legal action or proceeding arising out of or in connection with this Agreement or any other Security Documents, the entries made in the accounts so maintained shall be prima facie evidence, save in the case of manifest error, of the existence and amounts of the obligations of the Borrower recorded therein.
  7.7   Earnings
Provided no Event of Default or Possible Event of Default has occurred (following which the Agent shall (inter alia) be entitled to request the Owners to give notice pursuant to clause 4 of the Earnings Assignments and apply the Earnings in accordance with Clause 13.2) the Earnings shall throughout the Security Period be at the free disposal of the Owners.
  7.8   Continuing security
The security created by this Agreement and each of the other Security Documents shall be held by the Agent and/or the Lenders as a continuing security for the repayment of the Outstanding Indebtedness and the security so created shall not be satisfied by any intermediate payment or satisfaction of any part of the amount hereby or thereby secured or by any amendment of this Agreement or any of the other Security Documents. Such security shall be in addition to and shall not in any way be prejudiced or affected by any collateral or other security now or hereafter held by the Agent or the Lenders or any of them for all or any part of the amount hereby or thereby secured or any other right or remedy of the Agent or the Lenders or any of them under this Agreement or any of the other Security Documents, by operation of law or otherwise howsoever arising. All the powers arising from any and all such security may be exercised from time to time as the Agent or the Lenders or any of them may deem expedient.

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  7.9   Mitigation
Without affecting the Borrower’s obligations under Clause 7.2 the affected Lender or the Agent shall take such reasonable steps as may be open to it to mitigate the effect of any tax withholding requirement. The reasonable costs of mitigating the effect shall be borne by the Borrower.
8   Yield Protection and Force Majeure
  8.1   Increased costs
  8.1.1   If by reason of:
  (a)   any change in law or in its interpretation or administration after the Signing Date; and/or
 
  (b)   after the Signing Date compliance with any request from or requirement of any central bank or other fiscal, monetary or other authority including but without limitation the Basle Committee on Banking Supervision whether or not having the force of law:
  (i)   any of the Lenders or an Associated Company incurs a cost as a result of the relevant Lender performing its obligations under this Agreement and/or its advancing its Contribution hereunder; or
 
  (ii)   there is any increase in the cost to any of the Lenders or an Associated Company of the relevant Lender funding or maintaining all or any of the advances comprised in a class of advances formed by or including its Contribution advanced or to be advanced by it hereunder; or
 
  (iii)   any of the Lenders or an Associated Company incurs a cost as a result of the relevant Lender having entered into and/or its assuming or maintaining its commitment under this Agreement; or
 
  (iv)   any of the Lenders or an Associated Company becomes liable to make any payment on account of Tax or otherwise (other than Tax on its overall net income) on or calculated by reference to the amount of the relevant Lender’s Contribution advanced or to be advanced hereunder and/or any sum received or receivable by it hereunder; or
 
  (v)   any of the Lenders or an Associated Company suffers any decrease in its rate of return as a result of any changes in the requirements relating to capital ratios, monetary control ratios, reserve assets, the payment of special deposits, liquidity costs or other similar requirements affecting that Lender or Associated Company,

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except to the extent included in the Mandatory Cost then the Borrower shall from time to time on demand pay to the Agent for the account of the relevant Lender, Lenders, Associated Company or Associated Companies amounts sufficient to indemnify the relevant Lender, Lenders, Associated Company or Associated Companies against, as the case may be, such cost, such increased cost (or such proportion of such increased cost as is in the reasonable opinion of the relevant Lender, Lenders, Associated Company or Associated Companies attributable to the funding or maintaining of the relevant Lender or Lenders’ Contribution(s) hereunder) or such liability.
  8.1.2   A Lender affected by any provision of Clause 8.1.1 shall promptly inform the Agent after becoming aware of the relevant change or request and its possible results and the Agent shall, as soon as reasonably practicable thereafter, notify the Borrower of the change or request and its possible results. Without affecting the Borrower’s obligations under Clause 8.1.1 and in consultation with the Agent, the affected Lender will then take all such reasonable steps as may be open to it to mitigate the effect of the change or request (for example (if then possible) by changing its Lending Branch or transferring some or all of its rights and obligations under this Agreement to another financial institution reasonably acceptable to the Agent and after consultation with the Borrower). The reasonable costs of mitigating the effect of any such change shall be borne by the Borrower save where such costs are of an internal administrative nature and are not incurred in dealings by any Lender with third parties.
  8.2   Force Majeure
Where the Agent or any Lender (the “Non-Performing Party”) is prevented from performing any of its obligations under this Agreement by reason of Force Majeure this Agreement shall remain in effect but the Non-Performing Party’s relevant obligations shall be suspended for so long as the Force Majeure continues and to the extent that the Non-Performing Party is so prevented, PROVIDED THAT:
  8.2.1   the suspension of performance is of no greater scope and of no longer duration than is required by the Force Majeure;
 
  8.2.2   the obligations of the Non-Performing Party shall not be excused as a result of the Force Majeure; and
 
  8.2.3   in respect of the suspension of the Non-Performing Party’s obligations:
  (a)   the Non-Performing Party gives the Agent prompt written notice which the Agent shall forthwith upon receipt send to the Borrower describing the circumstances of Force Majeure (including the nature of the occurrence, its expected duration and the effects of the Force Majeure on the ability of the Non-Performing Party to perform its relevant obligations), and continues to furnish weekly reports with respect thereto during the period of Force Majeure;
 
  (b)   the Non-Performing Party uses all reasonable efforts to remedy its inability to perform and to mitigate the effects of the Force Majeure; and

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  (c)   as soon as reasonably possible after the cessation of the Force Majeure the Non-Performing Party shall notify the Agent (who shall notify the Borrower) in writing of such cessation and shall resume performance of its obligations under this Agreement if such resumption is then possible.
9   Representations and Warranties
  9.1   Duration
The representations and warranties in Clause 9.2 shall survive the execution of this Agreement and shall be deemed to be repeated, with reference mutatis mutandis to the facts and circumstances subsisting, as if made on each day until the Borrower has no remaining obligations, actual or contingent, under or pursuant to this Agreement or any of the other Security Documents.
  9.2   Representations and warranties
The Borrower represents and warrants to the Finance Parties that:
  9.2.1   Status Each Obligor is a corporation duly organised, constituted and validly existing under the laws of the country of its incorporation, possessing perpetual corporate existence, the capacity to sue and be sued in its own name and the power to own and charge its assets and carry on its business as it is now being conducted.
 
  9.2.2   Powers and authority Each of the Obligors has the power to enter into and perform this Agreement and those of the other Security Documents to which it is a party and the transactions contemplated hereby and thereby and has taken all necessary action to authorise the entry into and performance of this Agreement and such other Security Documents and such transactions.
 
  9.2.3   Legal validity This Agreement constitutes legal, valid and binding obligations of the Borrower enforceable in accordance with its terms and in entering into this Agreement and borrowing the Facility, the Borrower is acting on its own account. Each other Transaction Document constitutes (or will constitute when executed) legal, valid and binding obligations of each Obligor expressed to be a party thereto enforceable in accordance with their respective terms.
 
  9.2.4   Non-conflict with laws The entry into and performance of this Agreement and the other Transaction Documents and the transactions contemplated hereby and thereby do not and will not conflict with:
  (a)   any law or regulation or any official or judicial order; or
 
  (b)   the constitutional documents of any Obligor; or
 
  (c)   any agreement or document to which any Obligor is a party or which is binding upon such Obligor or any of its assets,

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nor result in the creation or imposition of any Encumbrance on an Obligor or its assets pursuant to the provisions of any such agreement or document.
  9.2.5   No default Save as disclosed in writing to the Agent prior to the Signing Date, no event has occurred which constitutes a default under or in respect of any Transaction Document to which any Obligor is a party or by which any Obligor may be bound (including (inter alia) this Agreement) and no event has occurred which, with the giving of notice, lapse of time, determination of materiality or other condition might constitute a default under or in respect of any such Transaction Document and no event has occurred which constitutes a default under or in respect of any agreement or document to which any Obligor is a party or by which any Obligor may be bound to an extent or in a manner which might have a material adverse effect on its business, assets or financial condition and no event has occurred which, with the giving of notice, lapse of time, determination of materiality or other condition might constitute a default under or in respect of any such agreement or document.
 
  9.2.6   Consents Except for the filing of those Security Documents which require registration in the Companies Registries in England and Wales, the Isle of Man, the United States of America and/or Bermuda, which filing must be completed within twenty one (21) days and one (1) month respectively of the execution of the relevant Security Document(s) in the case of England and Wales and the Isle of Man, and for the registration of the Mortgages through the Bahamas Maritime Authority, all authorisations, approvals, consents, licences, exemptions, filings, registrations, notarisations and other matters, official or otherwise, required in connection with the entry into, performance, validity and enforceability of this Agreement and each of the other Transaction Documents and the transactions contemplated thereby have been obtained or effected and are in full force and effect.
 
  9.2.7   Accuracy of information All information furnished by any Obligor relating to the business and affairs of any Obligor in connection with this Agreement and the other Transaction Documents was and remains true and correct in all material respects and there are no other material facts or considerations the omission of which would render any such information misleading.
 
  9.2.8   Full disclosure Each Obligor has fully disclosed in writing to the Agent all facts relating to each Obligor which it knows or should reasonably know and which might reasonably be expected to influence the Lenders in deciding whether or not to enter into this Agreement.
 
  9.2.9   No Encumbrances None of the assets or rights of any Obligor is subject to any Encumbrance except Permitted Liens.
 
  9.2.10   Pari passu or priority status The claims of the Finance Parties against the Borrower under this Agreement will rank at least pari passu with the claims of all unsecured creditors of the Borrower (other than claims of such creditors to the extent that they are statutorily preferred) and in

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      priority to the claims of any creditor of the Borrower who is also an Obligor.
 
  9.2.11   Solvency The Obligors are and shall remain, after the advance to them of the Facility or any of it, solvent in accordance with the laws of Bermuda and the United Kingdom and in particular with the provisions of the United Kingdom’s Insolvency Act 1986 (as from time to time amended) and the requirements thereof.
 
  9.2.12   Winding-up, etc. Subject to Clause 10.11, neither the Borrower nor any other Obligor has taken any corporate action nor have any other steps been taken or legal proceedings been started or (to the best of its knowledge and belief) threatened against any of them for the winding-up, dissolution or for the appointment of a liquidator, administrator, receiver, administrative receiver, trustee or similar officer of any of them or any or all of their assets or revenues nor have either sought any other relief under any applicable insolvency or bankruptcy law.
 
  9.2.13   Accounts The consolidated audited accounts of the NCLC Group for the period ending on 31 December of each financial year during the period of this Agreement (which accounts will be prepared in accordance with US GAAP) will fairly represent the financial condition of the NCLC Group as shown in such audited accounts.
 
  9.2.14   Litigation Save as disclosed in the Disclosure Letter and/or the Borrower’s most recent US Securities Exchange Commission filing, no litigation, arbitration or administrative proceedings of or before any court, arbitral body or agency (including but not limited to investigative proceedings) are current or pending or, to its knowledge, threatened, which might, if adversely determined, have a Material Adverse Effect. For the avoidance of doubt, the disclosure of any such litigation, arbitration or administrative proceedings after the Signing Date shall not be deemed to be a fact and circumstance subsisting at any time that this representation is deemed to be repeated pursuant to Clause 9.1.
 
  9.2.15   Tax liabilities To the best of its knowledge, the NCLC Group has complied with all taxation laws in all jurisdictions in which it is subject to Taxation and has paid all material Taxes due and payable by it; no material claims are being asserted against it with respect to Taxes, which might, if such claims were successful, have a material adverse effect on the ability of any Obligor to perform its obligations under the Transaction Documents.
 
  9.2.16   Ownership of assets Each member of the NCLC Group has good and marketable title to all its assets which is reflected in the audited accounts referred to in Clause 9.2.13.
 
  9.2.17   No immunity None of the Obligors nor any of their respective assets enjoys any right of immunity (sovereign or otherwise) from set-off, suit or execution in respect of their obligations under this Agreement or any of the other Transaction Documents or by any relevant or applicable law.

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  9.2.18   Taxes on payments As at the Signing Date all amounts payable by the Borrower hereunder may be made free and clear of and without deduction for or on account of any Taxation.
 
  9.2.19   Place of business None of the Obligors has a place of business in any jurisdiction (except as already disclosed) which requires any of the Security Documents to be filed or registered in that jurisdiction to ensure the validity of the Security Documents to which it is a party.
 
  9.2.20   Ownership of shares All the shares in each of the Owners and the Manager shall be legally and beneficially owned directly or indirectly by the Borrower and such structure shall remain so throughout the Security Period. Further, no Event of Default has occurred under Clause 12.1.16 in respect of the ownership and/or control of the shares in the Borrower.
 
  9.2.21   Completeness of documents The copies of the Management Agreements and any other relevant third party agreements delivered to the Agent are true and complete copies of each such document constituting valid and binding obligations of the parties thereto enforceable in accordance with their respective terms and no amendments thereto or variations thereof have been agreed other than (if applicable), in the case of the Management Agreements, in accordance with clause 6.1.17 of the two (2) deeds of covenants collateral to the two (2) first priority statutory Bahamian ship mortgages, as amended by the Co-ordination Deeds, to be granted by each of the Owners over its Vessel nor has any action been taken by the parties thereto which would in any way render such document inoperative or unenforceable.
 
  9.2.22   No undisclosed commissions There are and will be no commissions, rebates, premiums or other payments by or to or on account of any Obligor, their shareholders or directors in connection with the transaction as a whole other than as disclosed to the Agent in writing.
 
  9.2.23   Environment Each of the Obligors:
  (a)   is in compliance with all applicable federal, state, local, foreign and international laws, regulations, conventions and agreements relating to pollution prevention or protection of human health or the environment (including, without limitation, ambient air, surface water, ground water, navigable waters, water of the contiguous zone, ocean waters and international waters), including without limitation, laws, regulations, conventions and agreements relating to:
  (i)   emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants, wastes, toxic substances, hazardous materials, oil, hazard substances, petroleum and petroleum products and by-products (“Materials of Environmental Concern”); or
 
  (ii)   the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Materials of

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      Environmental Concern (such laws, regulations, conventions and agreements the “Environmental Laws”);
  (b)   has all permits, licences, approvals, rulings, variances, exemptions, clearances, consents or other authorisations required under applicable Environmental Laws (“Environmental Approvals”) and are in compliance with all Environmental Approvals required to operate its business as presently conducted or as reasonably anticipated to be conducted;
 
  (c)   has not received any notice, claim, action, cause of action, investigation or demand by any other person, alleging potential liability for, or a requirement to incur, investigatory costs, clean-up costs, response and/or remedial costs (whether incurred by a governmental entity or otherwise), natural resources damages, property damages, personal injuries, attorney’s fees and expenses or fines or penalties, in each case arising out of, based on or resulting from:
  (i)   the presence or release or threat of release into the environment of any Material of Environmental Concern at any location, whether or not owned by such person; or
 
  (ii)   circumstances forming the basis of any violation, or alleged violation, of any Environmental Law or Environmental Approval (“Environmental Claim”),
which is material; and
there are no circumstances that may prevent or interfere with such full compliance in the future.
There is no Environmental Claim pending or threatened against any of the Obligors which the Borrower, in its reasonable opinion, believes to be material.
There are no past or present actions, activities, circumstances, conditions, events or incidents, including, without limitation, the release, emission, discharge or disposal of any Material of Environmental Concern, that the Borrower reasonably believes could form the basis of any bona fide material Environmental Claim against any of the Obligors.
  9.2.24   Money laundering Any borrowing by the Borrower hereunder, and the performance of its obligations hereunder and under the other Security Documents, will be for its own account and will not, to the best of its knowledge, involve any breach by it of any law or regulatory measure relating to “money laundering” as defined in Article 1 of the Directive (91/308/EEC) of the Council of the European Communities.

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10   Undertakings
  10.1   Duration
The undertakings in this Clause 10 shall remain in full force and effect until the Borrower has no remaining obligations, actual or contingent, under or pursuant to this Agreement or any of the other Security Documents.
  10.2   Information
The Borrower will provide to the Agent (or will procure the provision of):
  10.2.1   as soon as practicable (and in any event within one hundred and twenty (120) days after the close of each of its financial years) a Certified Copy of its Accounts (commencing with the audited accounts made up to 31 December 2006);
 
  10.2.2   as soon as practicable (and in any event within sixty (60) days after the close of each of the first three (3) quarters of each financial year) a Certified Copy of the unaudited consolidated accounts of the NCLC Group for that quarter (commencing with the unaudited accounts made up to 31 March 2007);
 
  10.2.3   as soon as practicable (and in any event within one hundred and twenty (120) days after the close of each financial year), beginning with the financial year ending 31 December 2006, annual cash flow projections on a consolidated basis of the NCLC Group showing on a monthly basis advance ticket sales (for at least twelve (12) months following the date of such statement) for the NCLC Group;
 
  10.2.4   as soon as practicable (and in any event not later than 31 January of each financial year):
  (a)   a budget for the NCLC Group for such new financial year including a twelve (12) month liquidity budget for such new financial year;
 
  (b)   updated financial projections of the NCLC Group for at least the next five (5) years (including income statement, balance sheet and cash flow projections for the NCLC Group); and
 
  (c)   an outline of the assumptions supporting the budget and financial projections referred to in paragraphs (a) and (b) of this Clause 10.2.4;
  10.2.5   within fifteen (15) days of a request from the Agent (but at intervals no more frequently than annually at the Borrower’s expense unless an Event of Default has occurred and is continuing), a valuation of each of the Vessels obtained in accordance with the provisions of Clause 10.17;
 
  10.2.6   as soon as practicable (and in any event within sixty (60) days after the close of each of the first three (3) quarters of its financial year and within one hundred and twenty (120) days after the close of each financial year)

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      a statement signed by the NCLC Group’s chief financial officer in the form of Schedule 6 (commencing with the fourth quarter of the financial year ending 31 December 2006) and such other information as the Agent may request;
 
  10.2.7   promptly, such further information in its possession or control regarding its financial condition and operations and those of any company in the NCLC Group as the Agent may request; and
 
  10.2.8   on a quarterly basis, details of any material litigation, arbitration or administrative proceedings affecting any Obligor which are instituted and served, or, to the knowledge of the Borrower, threatened (and for this purpose proceedings shall be deemed to be material if they involve a claim in an amount exceeding [**] [Confidential Treatment] Dollars [**] [Confidential Treatment] or the equivalent in another currency).
All accounts required under this Clause 10.2 shall be prepared in accordance with US GAAP and shall fairly represent the financial condition of the relevant company.
  10.3   Financial Undertakings
The Borrower will ensure that:
  10.3.1   at all times the minimum Free Liquidity will be not less than [**] [Confidential Treatment] Dollars [**] [Confidential Treatment];
 
  10.3.2   either:
  (a)   as at 30 September 2006 and as at the end of each subsequent financial quarter the ratio of Consolidated EBITDA to Consolidated Debt Service for the NCLC Group, computed for the period of the four (4) consecutive financial quarters ending at the end of the relevant financial quarter, shall not be less than [**] [Confidential Treatment]; or
 
  (b)   at all times during the period of twelve (12) months ending as at the end of the relevant financial quarter the NCLC Group has maintained a minimum Free Liquidity in an amount which is not less than [**] [Confidential Treatment] Dollars [**] [Confidential Treatment]; and
  10.3.3   as at 30 September 2006 and as at the end of each subsequent financial quarter, the ratio of Total Net Funded Debt to Total Capitalisation of the NCLC Group shall not exceed [**] [Confidential Treatment].
 
    Amounts available for drawing under the Facility or any other revolving or other credit facilities of the NCLC Group which remain undrawn at the time of the relevant calculation shall not be counted as cash or indebtedness for the purposes of this ratio.
Save as specified in Clause 10.3.2, the ratios referred to in this Clause 10.3 will be measured on a quarterly basis by reference to the consolidated accounts of the NCLC Group.

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  10.4   Dividends
  10.4.1   During any financial year of the Borrower until the date on which the Borrower becomes a listed company on an Approved Stock Exchange (on which date the restriction contained in this Clause 10.4.1 shall cease to apply), the Borrower shall not and shall procure that no other member of the NCLC Group shall, pay any dividends or make any other distributions in respect of its share capital to any person which during any financial year of the Borrower in aggregate exceeds fifty per cent (50%) of the Consolidated Net Income (if positive) of the NCLC Group for such financial year PROVIDED HOWEVER THAT (whether before or after the Borrower becomes a listed company on an Approved Stock Exchange) the NCLC Group shall not be entitled to pay any dividend or make any distribution in respect of any of its share capital if an Event of Default has occurred and is continuing or would occur as a result of the payment of such dividend or the making of such distribution and shall provide the Agent with a certificate signed by the chief financial officer of the NCLC Group confirming that no Event of Default has occurred and is continuing or would occur as a result of the payment of a dividend or the making of a distribution before such dividend is paid or distribution is made.
 
  10.4.2   Subject to the provisions of Clause 10.4.1, the Borrower will procure that any dividends or other distributions and interest paid or payable in connection with such dividends or other distributions will be received promptly by the Borrower directly or indirectly from the Owners’ shareholder(s) (if such shareholder is not the Borrower) by way of dividend.
  10.5   Notification of default
The Borrower will notify the Agent of any Event of Default or Possible Event of Default forthwith upon any Obligor becoming aware of the occurrence thereof. Upon the Agent’s request from time to time the Borrower will issue a certificate stating whether any Obligor is aware of the occurrence of any Event of Default or Possible Event of Default.
  10.6   Consents and registrations
The Borrower will procure that (and will promptly furnish Certified Copies to the Agent of) all such authorisations, approvals, consents, licences and exemptions as may be required under any applicable law or regulation to enable it or any Obligor to perform its obligations under, and ensure the validity or enforceability of, each of the Transaction Documents are obtained and promptly renewed from time to time and will procure that the terms of the same are complied with at all times. Insofar as such filings or registrations have not been completed on or before the first Advance Date the Borrower will procure the filing or registration within applicable time limits of each Security Document which requires filing or registration together with all ancillary documents required to preserve the priority and enforceability of the Security Documents.

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  10.7   Negative pledge
The Borrower will not create or permit to subsist any Encumbrance on the whole or any part of its or the Owners’ present or future assets, except for the following:
  10.7.1   Encumbrances created with the prior consent of the Lenders; or
 
  10.7.2   Permitted Liens.
  10.8   Disposals
Except with the prior consent of all the Lenders, the Borrower shall not (and will procure that no other company in the NCLC Group shall), either in a single transaction or in a series of transactions whether related or not and whether voluntarily or involuntarily, sell, transfer, lease or otherwise dispose of all or a substantial part of its assets except that the following disposals shall not be taken into account:
  10.8.1   disposals made in the ordinary course of trading of the disposing entity (excluding disposal of ships) including without limitation, the payment of cash as consideration for the purchase or acquisition of any asset or service or in the discharge of any obligation incurred for value in the ordinary course of trading;
 
  10.8.2   disposals of cash raised or borrowed for the purposes for which such cash was raised or borrowed;
 
  10.8.3   disposals of assets in exchange for other assets comparable or superior as to type and value; and
 
  10.8.4   a vessel or any other asset owned by any member of the NCLC Group (other than the Owners) may be sold provided such sale is on a willing seller willing buyer basis at or about market rate and at arm’s length subject always to the provisions of any loan documentation for the financing of such vessel or other asset.
  10.9   Purchases
Except with the prior consent of all the Lenders, the Borrower shall not (and will procure that no other company in the NCLC Group shall), either in a single transaction or in a series of transactions whether related or not purchase any asset:
  10.9.1   other than on arm’s length terms;
 
  10.9.2   which is not for its use in its ordinary course of business; or
 
  10.9.3   the cost of which is more than its fair market value at the date of acquisition.
  10.10   Change of name or business
Except with the prior consent of the Majority Lenders, the Borrower shall not change its name or make or threaten to make any substantial change in its business as presently conducted or carry on any other business which is

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substantial in relation to its business as presently conducted so as to affect, in the opinion of the Majority Lenders, the Borrower’s ability to perform its obligations hereunder and shall not form any further subsidiaries and the Borrower will procure that the other Obligors continue, throughout the Security Period, to perform their current business activities PROVIDED THAT any new leisure or hospitality venture embarked upon by any member of the NCLC Group (other than the Borrower) shall not constitute a substantial change in its business.
  10.11   Mergers
Except with the prior consent of the Majority Lenders, the Borrower will not enter into any amalgamation, restructure, substantial reorganisation, merger, de-merger or consolidation or anything analogous to the foregoing nor will it acquire any equity, share capital or obligations of any corporation or other entity and will procure that no company in the NCLC Group (other than the Shareholder or NCL America Holdings, Inc.) shall do so.
However, the prior consent of the Majority Lenders shall not be required in respect of any amalgamation, voluntary cessation of business, consolidation, voluntary dissolution, solvent liquidation, merger, de-merger, voluntary termination of existence, solvent winding-up, restructure or other reorganisation (any of which, for the purposes of this Clause, shall be referred to as a “Reorganisation”) involving wholly owned (whether directly or indirectly) Subsidiaries of the Borrower only which does not imperil the security created by any of the Security Documents or affect the ability of any Obligor duly to perform any of its obligations under any Security Document to which it may be a party at any time, PROVIDED THAT the Borrower has first consulted with the Agent with regard to the proposed Reorganisation and provides evidence satisfactory to the Agent that the Borrower will be in compliance with the financial undertakings contained in Clause 10.3 after any such Reorganisation SUBJECT TO:
  10.11.1   Clause 9.2.20; and
 
  10.11.2   the cash flows from which the Outstanding Indebtedness will be repaid remaining comparable as to amount (relative to the amount of the Outstanding Indebtedness) and accessibility for the Borrower to the cash flows as at the Signing Date, in the sole discretion of the Lenders.
For the avoidance of doubt, if the Agent is satisfied the Borrower will be in compliance with the financial undertakings contained in Clause 10.3 after the acquisition by a member of the NCLC Group of any shares in any company or corporation, such acquisition shall not in itself constitute a merger or consolidation with such company or corporation requiring the consent of the Majority Lenders under this Clause 10.11.
  10.12   Maintenance of status and franchises
The Borrower will do all such things as are necessary to maintain its corporate existence in good standing and will ensure that it has the right and is duly qualified to conduct its business as it is conducted in all applicable jurisdictions and will obtain and maintain all franchises and rights necessary for the conduct of its business.

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  10.13   Financial records
The Borrower will keep proper books of record and account, in which proper and correct entries shall be made of all financial transactions and the assets, liabilities and business of the Borrower in accordance with US GAAP.
  10.14   Subordination of indebtedness
The Borrower shall procure that any and all indebtedness (and in particular with any other Obligor) is at all times fully subordinated to the Security Documents and the obligations of the Borrower hereunder. Upon the occurrence of an Event of Default or a Possible Event of Default, the Borrower shall not make any repayments of principal, payments of interest or of any other costs, fees, expenses or liabilities arising from or representing such indebtedness.
  10.15   Guarantees
Save as contemplated by this Agreement, the Borrower will procure that none of the owners of mortgaged vessels in the NCLC Fleet will issue or enter into any guarantee or indemnity or otherwise become directly or contingently liable for the obligations of any other person, firm or corporation, otherwise than in the ordinary course of its business as owner of its vessel.
Subject to the above provision of this Clause, the Borrower will not, and will procure that no member of the NCLC Group will, issue or enter into any guarantee or indemnity or otherwise become directly or contingently liable for the obligations of any other person, firm or corporation without first notifying the Agent with full details of the amount(s) and the period(s) of the guarantee(s) or indemnity(ies), if such is or are in excess of (in aggregate (if applicable)) the amount of [**] [Confidential Treatment] Dollars [**] [Confidential Treatment].
  10.16   Further assurance
The Borrower will, from time to time on being required to do so by the Agent, do or procure the doing of all such acts and/or execute or procure the execution of all such documents in a form satisfactory to the Agent as the Agent may reasonably consider necessary for giving full effect to any of the Transaction Documents or securing to the Finance Parties or any of them the full benefit of the rights, powers and remedies conferred upon the Finance Parties or any of them in any such Transaction Document.
  10.17   Valuation of the Vessels
  10.17.1   Each of the Vessels shall for the purposes of this Clause 10.17 be valued in Dollars by two (2) independent firms of shipbrokers or shipvaluers nominated by the Borrower and approved by the Agent (acting on the instructions of the Majority Lenders) or failing such nomination and approval, appointed by the Agent (acting on such instructions) in its sole discretion (each such valuation to be made without, unless reasonably required by the Agent, physical inspection and on the basis of a sale for prompt delivery for cash at arm’s length on normal commercial terms as between a willing buyer and a willing seller without taking into account the benefit of any charterparty or other engagement concerning the

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      Vessel). The first such valuations in respect of each of the Vessels shall be obtained on or about sixty (60) days prior to the first Advance Date and thereafter they shall be obtained within fifteen (15) days of a request from the Agent (but at intervals no more frequently than annually at the Borrower’s expense unless an Event of Default has occurred and is continuing). The average of the valuations shall constitute the value of the Vessel for the purposes of this Clause 10.17.
 
  10.17.2   The Borrower shall procure that forthwith upon the issuance of any valuation obtained pursuant to this Clause 10.17 a copy thereof is sent directly to the Agent for review.
  10.18   Marginal security
If at any time the value of the Vessels as assessed in accordance with the provisions of Clause 10.17:
  10.18.1   is less than one hundred per cent (100%) of the amount of the aggregate of the Available Commitments and the Contributions to the Facility during the period commencing on the Signing Date and ending forty eight (48) months after the Signing Date;
 
  10.18.2   is less than one hundred and ten per cent (110%) of the amount of the aggregate of the Available Commitments and the Contributions to the Facility during the period commencing on the date falling forty eight (48) months after the Signing Date and ending seventy two (72) months after the Signing Date; and
 
  10.18.3   thereafter, is less than one hundred and twenty per cent (120%) of the amount of the aggregate of the Available Commitments and the Contributions to the Facility,
then the Borrower shall, upon notice from the Agent, within ten (10) Business Days either:
  (a)   provide the Agent with additional security acceptable to the Majority Lenders such that the security value of the Vessels and any additional security provided to the Agent hereunder (at valuations reasonably estimated by the Agent from time to time) is at least one hundred per cent (100%), one hundred and ten per cent (110%) or one hundred and twenty per cent (120%) (as the case may be) of the aggregate of the Available Commitments and the Contributions to the Facility; or
 
  (b)   reduce the Available Commitments by such an amount that the value of the security is at least one hundred per cent (100%), one hundred and ten per cent (110%) or one hundred and twenty per cent (120%) (as the case may be) of the amount of the aggregate of the Available Commitments and the Contributions to the Facility.
  10.19   No dealings with Master Agreements
The Borrower shall not assign, novate or encumber or in any other way transfer any of its rights or obligations under any Master Agreement.

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  10.20   Financial year end
The Borrower shall not change its financial year end.
  10.21   Maintenance and insurance
The Borrower will keep, and will procure that each member of the NCLC Group keeps, all of its real property and assets properly maintained and in existence and will comprehensively insure, and will procure that each member of the NCLC Group comprehensively insures, for its full reinstatement cost all of its property which is of an insurable nature in such name as the Agent shall in writing approve and on such terms, for such amounts and of such types as would be effected by prudent companies carrying on business similar to the Borrower or its Subsidiary (as the case may be). In particular but without limitation, the Borrower shall procure that each of the Owners maintains and insures its Vessel in accordance with the provisions of the relevant Mortgage.
  10.22   Vessels
The Borrower will procure that each of the Vessels is traded within the NCLC Fleet from the first Advance Date and throughout the remainder of the Security Period.
11   Rights of the Agent and the Lenders
  11.1   No derogation of rights
Any rights conferred on the Agent and the Lenders or any of them by this Agreement or any other Security Document shall be in addition to and not in substitution for or in derogation of any other right which the Agent and the Lenders or any of them might at any time have to seek from the Borrower or any other person for payment of sums due from the Borrower or indemnification against liabilities as a result of the Borrower’s default in payment of sums due from it under this Agreement or any other Security Document.
  11.2   Enforcement of remedies
None of the Agent or the Lenders shall be obliged before taking steps to enforce any rights conferred on it or them by this Clause or this Agreement or exercising any of the rights, powers and remedies conferred on it or them hereby or by law:
  11.2.1   to take action or obtain judgment in any court against the Borrower or any other person from whom it or they may seek payment of any sum due from the Borrower under this Agreement or any other Security Document;
 
  11.2.2   to make or file any claim in a bankruptcy, winding-up, liquidation or re-organisation of the Borrower or any other such person; or
 
  11.2.3   to enforce or seek to enforce any other rights it or they may have against the Borrower or any other such person.

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12   Default
  12.1   Events of default
Each of the events set out below is an Event of Default:
  12.1.1   Non-payment
The Borrower or any other Obligor (other than the Manager) does not pay on the due date any amount of principal or interest of the Facility (provided however that if any such amount is not paid when due solely by reason of some error or omission on the part of the bank or banks through whom the relevant funds are being transmitted no Event of Default shall occur for the purposes of this Clause 12.1.1 until the expiry of three (3) Business Days following the date on which such payment is due), or within three (3) days of the due date any other amount, payable by it under any Security Document to which it may at any time be a party, at the place and in the currency in which it is expressed to be payable.
  12.1.2   Breach of other obligations
  (a)   Any Obligor fails to comply with any other material provision of any Security Document to which it is a party or there is any other material breach in the sole opinion of the Agent of any of the Transaction Documents and such failure (if in the opinion of the Agent in its sole discretion it is capable of remedy) continues unremedied for a period of thirty (30) days from the date of its occurrence and in any such case as aforesaid the Agent in its sole discretion considers that such failure is or could reasonably be expected to become materially prejudicial to the interests, rights or position of the Finance Parties or any of them; or
 
  (b)   If there is a repudiation or termination of any Transaction Document or if any of the parties thereto becomes entitled to terminate or repudiate any of them and evidences an intention so to do.
  12.1.3   Misrepresentation
Any representation, warranty or statement made or repeated in, or in connection with, any Security Document or in any accounts, certificate, statement or opinion delivered by or on behalf of any Obligor thereunder or in connection therewith is materially incorrect when made or would, if repeated at any time hereafter by reference to the facts subsisting at such time, no longer be materially correct.
  12.1.4   Cross default
  (a)   Any event of default occurs under any financial contract or financial document relating to any Financial Indebtedness of any member of the NCLC Group.

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  (b)   Any such Financial Indebtedness or any sum payable in respect thereof is not paid when due (after the expiry of any applicable grace period(s)) whether by acceleration or otherwise.
 
  (c)   Any Encumbrance over any assets of any member of the NCLC Group becomes enforceable.
 
  (d)   Any other Financial Indebtedness of any member of the NCLC Group is not paid when due or is or becomes capable of being declared due prematurely by reason of default or any security for the same becomes enforceable by reason of default,
PROVIDED THAT:
  (i)   No Event of Default will arise if the relevant Financial Indebtedness is not accelerated or, if it is accelerated but, in aggregate, the Financial Indebtedness is less than fifteen million Dollars (USD15,000,000);
 
  (ii)   Financial Indebtedness being contested by the Borrower in good faith will be disregarded PROVIDED first that full details of the dispute shall be submitted to the Agent forthwith upon its occurrence and second if the dispute remains unresolved for a period of one hundred and fifty (150) days this Clause 12.1.4(ii) shall not apply to that Financial Indebtedness; and
 
  (iii)   If at any time hereafter the Borrower or any other member of the NCLC Group agrees to the incorporation of a cross default provision into any financial contract or financial document relating to any Financial Indebtedness that is more onerous than this Clause 12.1.4, then the Borrower shall immediately notify the Agent and that cross default provision shall be deemed to apply to this Agreement as if set out in full herein with effect from the date of such financial contract or financial document and during the currency of that financial contract or financial document.
  12.1.5   Winding-up
Subject to Clause 10.11, any order is made or an effective resolution passed or other action taken for the suspension of payments or dissolution, termination of existence, liquidation, winding-up or bankruptcy of any member of the NCLC Group.
  12.1.6   Moratorium or arrangement with creditors
A moratorium in respect of all or any debts of any member of the NCLC Group or a composition or an arrangement with creditors of any member of the NCLC Group or any similar proceeding or arrangement by which the assets of any member of the NCLC Group are submitted to the control of its creditors is applied for, ordered or declared or any member of the NCLC Group commences negotiations with any one or more of its creditors with a view to the general readjustment or rescheduling of all or a significant part of its Financial Indebtedness.

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  12.1.7   Appointment of liquidators etc.
A liquidator (subject to Clause 10.11), trustee, administrator, receiver, manager or similar officer is appointed in respect of any member of the NCLC Group or in respect of all or any substantial part of the assets of any member of the NCLC Group and in any such case such appointment is not withdrawn within thirty (30) days (the “Grace Period”) unless the Agent considers in its sole discretion that the interest of the Lenders might reasonably be expected to be adversely affected in which event the Grace Period shall not apply.
  12.1.8   Insolvency
Any member of the NCLC Group becomes or is declared insolvent or is unable, or admits in writing its inability, to pay its debts as they fall due or becomes insolvent within the terms of any applicable law.
  12.1.9   Legal process
Any distress, execution, attachment or other process affects the whole or any substantial part of the assets of any member of the NCLC Group and remains undischarged for a period of twenty one (21) days or any uninsured judgment in excess of [**] [Confidential Treatment] Dollars [**] [Confidential Treatment] following final appeal remains unsatisfied for a period of thirty (30) days in the case of a judgment made in the United States of America and otherwise for a period of sixty (60) days PROVIDED THAT no Event of Default shall be deemed to have occurred unless the distress, execution, attachment, other process or judgment adversely affects any Obligor’s ability to meet any of its material obligations under any Security Document to which it is a party or cause to occur any of the events specified in Clauses 12.1.5 to 12.1.8 (the determination of which shall be in the Majority Lenders’ sole discretion).
  12.1.10   Analogous events
Anything analogous to or having a substantially similar effect to any of the events specified in Clauses 12.1.5 to 12.1.9 shall occur under the laws of any applicable jurisdiction.
  12.1.11   Cessation of business
Subject to Clause 10.11, any member of the NCLC Group ceases to carry on all or a substantial part of its business.
  12.1.12   Revocation of consents
Any authorisation, approval, consent, licence, exemption, filing, registration or notarisation or other requirement necessary to enable any Obligor to comply with any of its obligations under any of the Transaction Documents to which it is a party is materially adversely modified, revoked or withheld or does not remain in full force and effect and within ninety (90) days of the date of its occurrence such event is not remedied to the satisfaction of the Agent and the Agent considers in its sole discretion

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that such failure is or might be expected to become materially prejudicial to the interests, rights or position of the Finance Parties or any of them PROVIDED THAT the Borrower shall not be entitled to the aforesaid ninety (90) day period if the modification, revocation or withholding of the authorisation, approval or consent is due to an act or omission of any Obligor and the Agent is satisfied in its sole discretion that the Finance Parties’ interests might reasonably be expected to be materially adversely affected.
  12.1.13   Unlawfulness
At any time it is unlawful or impossible for:
  (a)   any Obligor to perform any of its obligations under any Security Document to which it is a party; or
 
  (b)   the Agent or any other Finance Party to exercise any of its rights under any of the Security Documents;
PROVIDED THAT no Event of Default shall be deemed to have occurred (except where the unlawfulness or impossibility adversely affects any Obligor’s payment obligations under this Agreement and/or the other Security Documents (the determination of which shall be in the Agent’s sole discretion) in which case the following provisions of this Clause 12.1.13 shall not apply) where the unlawfulness or impossibility prevents any Obligor from performing its obligations (other than its payment obligations under this Agreement and the other Security Documents) and is cured within a period of twenty one (21) days of the occurrence of the event giving rise to the unlawfulness or impossibility and the relevant Obligor, within the aforesaid period, performs its obligation(s) and PROVIDED FURTHER THAT no Event of Default shall be deemed to have occurred where the Agent and/or any relevant Finance Party could, in its sole discretion, mitigate the consequences of unlawfulness or impossibility in the manner described in Clause 3.9. The costs of mitigation shall be determined in accordance with Clause 3.9.
  12.1.14   Insurances
An Owner fails to insure its Vessel in the manner specified in the relevant Mortgage or fails to renew the Insurances at least ten (10) days prior to the date of expiry thereof and produce prompt confirmation of such renewal to the Agent.
  12.1.15   Total Loss
If the Vessel shall become a Total Loss and the proceeds of the Insurances in respect thereof shall not have been received by the Agent within one hundred and fifty (150) days after the date of the event giving rise to such Total Loss.

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  12.1.16   Ownership and control of the Borrower
If:
  (a)   at any time when the ordinary share capital of the Borrower is not publicly listed on an Approved Stock Exchange or at any time when a dividend is to be paid to the existing shareholders of the Borrower by way of a share issue pursuant to a public offering on an Approved Stock Exchange, the Lim Family together or individually do not or will not, directly or indirectly, control the Borrower and beneficially own, directly or indirectly, at least fifty one per cent (51%) of the issued share capital of, and equity interest in, the Borrower; or
 
  (b)   at any time following the listing of the ordinary share capital of the Borrower on an Approved Stock Exchange:
  (i)   any individual or any Third Party:
  (A)   owns legally and/or beneficially and either directly or indirectly at least [**] [Confidential Treatment] per cent [**] [Confidential Treatment] of the ordinary share capital of the Borrower; or
 
  (B)   has the right or the ability to control either directly or indirectly the affairs of or the composition of the majority of the board of directors (or equivalent) of the Borrower,
and, at the same time as any of the events described in paragraphs (A) or (B) of this Clause have occurred and are continuing, the Lim Family together or individually do not, directly or indirectly, beneficially own at least fifty one per cent (51%) of the issued share capital of, and equity interest in, the Borrower; or
  (ii)   the Borrower ceases to be a listed company on an Approved Stock Exchange without the prior written consent of the Majority Lenders,
(and, for the purpose of this Clause 12.1.16 “control” of any company, limited partnership or other legal entity (a “body corporate”) by a member of the Lim Family, means that one (1) or more members of the Lim Family has, directly or indirectly, the power to direct the management and policies of such a body corporate, whether through the ownership of more than fifty per cent (50%) of the issued voting capital of that body corporate or by contract, trust or other arrangement).
  12.1.17   Disposals
If the Borrower or any other member of the NCLC Group shall have concealed, removed, or permitted to be concealed or removed, any part of its property, with intent to hinder, delay or defraud its creditors or any of them, or made or suffered a transfer of any of its property which may be

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fraudulent under any bankruptcy, fraudulent conveyance or similar law; or shall have made any transfer of its property to or for the benefit of a creditor with the intention of preferring such creditor over any other creditor.
  12.1.18   Prejudice to security
Anything is done or suffered or omitted to be done by any Obligor which in the reasonable opinion of the Agent would or might be expected to imperil the security created by any of the Security Documents.
  12.1.19   Governmental intervention
The authority of any member of the NCLC Group in the conduct of its business is wholly or substantially curtailed by any seizure or intervention by or on behalf of any authority and within ninety (90) days of the date of its occurrence any such seizure or intervention is not relinquished or withdrawn and the Agent reasonably considers that the relevant occurrence is or might be expected to become materially prejudicial to the interests, rights or position of the Finance Parties PROVIDED THAT the Borrower shall not be entitled to the aforesaid ninety (90) day period if the seizure or intervention executed by any authority is due to an act or omission of any member of the NCLC Group and the Agent is satisfied, in its sole discretion, that the Finance Parties’ interest might reasonably be expected to be materially adversely affected.
  12.1.20   Master Agreement termination
A notice is given by a Lender or its Affiliate (as the case may be) under section 6(a) of the relevant Master Agreement, or by any person under section 6(b)(iv) of a Master Agreement, in either case designating an Early Termination Date for the purpose of the Master Agreement, or a Master Agreement is for any other reason terminated, cancelled, suspended, rescinded, revoked or otherwise ceases to remain in full force and effect.
  12.2   Acceleration
  12.2.1   On the occurrence of an Event of Default or a Possible Event of Default and at any time thereafter whilst such event shall be continuing the Agent may if a Drawing has not yet been advanced, by notice to the Borrower cancel the obligations of the Lenders under this Agreement.
 
  12.2.2   On the occurrence of an Event of Default and at any time thereafter whilst such event shall be continuing, if a Drawing has been advanced the Agent may:
  (a)   by notice to the Borrower declare the whole or any part of the Facility due and repayable in accordance with the terms of such notice whereupon the same shall become due and repayable accordingly together with all interest accrued thereon and all other amounts payable hereunder and under any of the other Security

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      Documents and the Commitments to the Facility shall be cancelled; and/or
 
  (b)   from time to time exercise all or any of its rights under any of the Security Documents in such order and in such manner as it shall deem appropriate; and/or
 
  (c)   at its sole discretion terminate or continue with the Management Agreements.
  12.3   Default indemnity
The Borrower shall on demand indemnify the Agent and the Lenders, without prejudice to any of their other rights under this Agreement and the other Security Documents, against any loss or expense which the Agent or the Lenders shall certify as sustained or incurred by any of them as a consequence of:
  12.3.1   any default in payment by the Borrower of any sum under this Agreement or any of the other Security Documents when due, including, without limitation, any liability incurred by the Agent and the Lenders by reason of any delay or failure of the Borrower to pay any such sums;
 
  12.3.2   any break in funding (including without limitation warehousing and other related costs) due to the occurrence of any Event of Default or Possible Event of Default;
 
  12.3.3   any prepayment of the Facility or any part thereof being made at any time for any reason; and/or
 
  12.3.4   a Drawing not being drawn for any reason (excluding any default by the Agent or any Lender) after the relevant Drawdown Notice has been given,
including, in any such case, but not limited to, any loss or expense sustained or incurred in maintaining or funding a Drawing or in liquidating or re-employing deposits from third parties acquired to effect or maintain the Drawing and also any loss or expense (including without limitation warehousing and other related costs) incurred in connection with any Master Agreement.
  12.4   Set off
Following the occurrence of any Event of Default and for so long as the same is continuing, the Borrower irrevocably authorises the Agent and the Lenders without prior notice to apply any credit balance to which the Borrower is entitled upon any account of the Borrower with any branch of any of the Agent and the Lenders in or towards satisfaction of any sum due to the Agent or any Lender hereunder but unpaid, and to combine any accounts of the Borrower for this purpose. If such set-off requires a credit balance in a currency other than Dollars to be transferred to an account maintained in connection herewith the transfer shall be effected by crediting to the account in question the amount of Dollars which the Agent or the Lender (as the case may be) could obtain by exchanging such currency for Dollars at the rate of exchange at which its Lending Branch would, at the opening of business on the date on which the combination is

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effected, have sold the currency of that credit balance for Dollars for immediate delivery.
  12.5   Master Agreement rights
 
      The rights conferred on the Agent and the Lenders by Clause 12.4 shall be in addition to, and without prejudice to or limitation of, the rights of netting and set off conferred on the Lenders and/or their Affiliates by the Master Agreements.
13   Application of Funds
  13.1   Total Loss proceeds/proceeds of sale
 
      In the event of a Vessel becoming a Total Loss or if a Vessel is sold then the Total Loss proceeds or proceeds of sale of the Vessel shall be held by the Agent and applied in the following manner and order:
         
 
  FIRSTLY   to the payment of all fees, expenses and charges (including brokers’ commissions), the expenses of any sale, the expenses of retaining any attorney, solicitors’ fees, court costs and any other expenses or advances made or incurred by the Agent or any Lender in the protection of the Agent’s and the Lender’s rights or the pursuance of its or their remedies hereunder and under the other Security Documents or to any payments whether voluntary or not which the Agent considers advisable to protect its or their security and to provide adequate indemnity against liens claiming priority over or equality with the lien of the Security Documents or any other Encumbrances;
 
       
 
  SECONDLY   in or towards payment in such order as the Lenders may require of any accrued (but unpaid) fees and interest thereon to which the Finance Parties or any of them are entitled hereunder and/or under the other Security Documents (other than the Master Agreements) in connection with the Facility;
 
       
 
  THIRDLY   in or towards satisfaction of all interest accrued on the Facility;
 
       
 
  FOURTHLY   in retention by the Agent in its discretion in a suspense or impersonal interest bearing security realised account of such sum as it considers appropriate by way of security for the Outstanding Indebtedness (other than the Master Agreement Liabilities) or for any actual or contingent liability of the Finance Parties or any of them in connection with the transactions herein contemplated;
 
       
 
  FIFTHLY   in or towards payment of the Facility (whether or not then due and payable);
 
       
 
  SIXTHLY   in or towards satisfaction of any other amounts due from the Borrower to the Finance Parties under the Security Documents (other than the Master Agreement Liabilities)

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      using in the discretion of the Agent the same order of application as FIRSTLY to FIFTHLY;
 
       
 
  SEVENTHLY   in retention of such other sum or sums as the Agent may require as security for any further monies which may reasonably be expected to become due and payable to the Finance Parties under this Agreement or any of the other Security Documents and which the assigned Earnings may be insufficient to satisfy;
 
       
 
  EIGHTHLY   in or towards satisfaction of any additional security or amount to be prepaid in accordance with Clause 10.18;
 
       
 
  NINTHLY   in or towards satisfaction of the Master Agreement Liabilities in the same order in which the Transactions were entered into by the Borrower with the Lenders and/or their Affiliates (as the case may be); and
 
       
 
  TENTHLY   the balance, if any, in payment to the Borrower or whomsoever shall then be entitled thereto.
 
       
    In the event of the proceeds being insufficient to pay the amounts referred to above the Agent shall be entitled to collect the balance from the Borrower.
  13.2   General funds/Event of Default monies
 
      If an Event of Default has occurred and any monies are received by the Agent or any other Finance Party under or pursuant to the Security Documents or if any other monies are received by or in the possession of the Agent or any other Finance Party under or pursuant to the Security Documents which are expressed hereunder and/or under the Security Documents to be distributed in accordance with the provisions of this Clause or where no express provisions are made for disposal, such monies shall be applied in the discretion of the Agent as follows:
         
 
  FIRSTLY   to the payment of all fees, expenses and charges (including brokers’ commissions), the expenses of any sale, the expenses of retaining any attorney, solicitors’ fees, court costs and any other expenses or advances made or incurred by the Agent or any Finance Party in the protection of the Agent’s and the Finance Parties’ rights or the pursuance of its or their remedies hereunder and under the other Security Documents or to any payments whether voluntary or not which the Agent considers advisable to protect its or their security and to provide adequate indemnity against liens claiming priority over or equality with the lien of the Security Documents or any other Encumbrances;
 
       
 
  SECONDLY   in or towards payment in such order as the Lenders may require of any accrued (but unpaid) fees and interest thereon to which the Finance Parties are entitled hereunder and/or under the other Security Documents (other than the Master Agreements) in connection with the Facility;

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  THIRDLY   in or towards satisfaction of all interest accrued on the Facility;
 
       
 
  FOURTHLY   in retention by the Agent in its discretion in a suspense or impersonal interest bearing security realised account of such sum as it considers appropriate by way of security for the Outstanding Indebtedness (other than the Master Agreement Liabilities) or for any actual or contingent liability of the Finance Parties or any of them in connection with the transactions herein contemplated;
 
       
 
  FIFTHLY   in or towards payment of the Facility;
 
       
 
  SIXTHLY   in or towards satisfaction of any other amounts due from the Borrower to the Finance Parties under the Security Documents (other than the Master Agreement Liabilities) using in the discretion of the Agent the same order of application as FIRSTLY to FIFTHLY;
 
       
 
  SEVENTHLY   in retention of such other sum or sums as the Agent may require as security for any further monies which may reasonably be expected to become due and payable to the Finance Parties under this Agreement, any of the other Security Documents and which the assigned Earnings may be insufficient to satisfy;
 
       
 
  EIGHTHLY   in or towards satisfaction of the Master Agreement Liabilities in the same order in which the Transactions were entered into by the Borrower with the Lenders and/or their Affiliates (as the case may be); and
 
       
 
  NINTHLY   the balance (if any) shall be released to the Borrower or to its order or whomsoever else may be entitled thereto.
  13.3   Application of proceeds of Insurances
 
      Proceeds of the Insurances for partial losses shall be applied in accordance with the relevant Insurance Assignment and/or the loss payable clause endorsed on the Insurances in the form approved by the Agent and in the case of a Total Loss of a Vessel in accordance with Clause 3.11 and Clause 13.1.
 
  13.4   Suspense account
 
      Any monies received or recovered by the Agent or any Lender under or in connection with the Security Documents and credited to any suspense or impersonal interest bearing security realised account in accordance with FOURTHLY of Clause 13.1 or Clause 13.2 may be held in such account for so long as the Agent thinks fit pending application at the Agent’s discretion in accordance with Clause 13.1 or Clause 13.2 (as the case may be).

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14   Fees
  14.1   Commitment fee
 
      The Borrower shall pay to the Agent for distribution to the Lenders quarterly in arrears during the Commitment Period and on the last day of the Commitment Period, [**] [Confidential Treatment] per cent [**] [Confidential Treatment] of the Applicable Margin on the relevant payment date on the daily undrawn, uncancelled amount of Tranche 1 and, from the date that the condition of drawdown relating to Tranche 2 is satisfied, on the daily undrawn, uncancelled amount of the Facility during the Commitment Period.
 
      The Borrower shall also pay to the Agent for distribution to the Lenders quarterly in arrears during the Commitment Period and on the last day of the Commitment Period, [**] [Confidential Treatment] per cent [**] [Confidential Treatment] of the Applicable Margin on the relevant payment date on the daily undrawn, uncancelled amount of Tranche 2 during the Commitment Period until the date that the condition of drawdown relating to Tranche 2 is satisfied.
 
  14.2   Other fees
 
      The Borrower will pay to the Agent on behalf of itself and the other Finance Parties such fees as are set out in separate fee letters dated 1 December 2006 between the Mandated Lead Arrangers and/or the Agent and the Borrower.
15   Expenses
  15.1   Initial expenses
 
      The Borrower shall reimburse the Agent on demand on a full indemnity basis for the charges and expenses (together with value added tax or any similar tax thereon and including without limitation travel expenses and the fees (as pre-agreed) and expenses of legal, insurance and other advisers) incurred by the Mandated Lead Arrangers, the Lenders and the Agent in respect of the arrangement and syndication of the Facility and the negotiation, preparation, issue, printing, execution and registration of this Agreement and the other Transaction Documents and any other documents required in connection with the implementation of this Agreement.
 
  15.2   Enforcement expenses
 
      The Borrower shall reimburse the Finance Parties on demand of the Agent on a full indemnity basis for all charges and expenses (including value added tax or any similar tax thereon and including the fees and expenses of legal advisers) incurred by the Finance Parties in connection with the enforcement of, or the preservation of any rights under, this Agreement and the other Security Documents.
 
  15.3   Stamp duties
 
      The Borrower shall pay or indemnify the Finance Parties on demand of the Agent against any and all stamp, registration and similar Taxes which may be payable in any jurisdiction in connection with the entry into, performance and enforcement of this Agreement or any of the other Security Documents.

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16   Waivers, Remedies Cumulative
  16.1   No waiver
 
      No failure to exercise and no delay in exercising on the part of the Agent or any of the Lenders any right or remedy under any of the Security Documents shall operate as a waiver thereof, nor shall any single or partial exercise of any right or remedy preclude any other or further exercise thereof, or the exercise of any other right or remedy. No waiver by the Agent or any of the Lenders shall be effective unless it is in writing.
 
  16.2   Remedies cumulative
 
      The rights and remedies of the Agent, and the Lenders provided herein are cumulative and not exclusive of any rights or remedies provided by law.
 
  16.3   Severability
 
      If any provision of this Agreement is prohibited or unenforceable in any jurisdiction, such prohibition or unenforceability shall not invalidate the remaining provisions hereof or affect the validity or enforceability of such provision in any other jurisdiction.
 
  16.4   Time of essence
 
      Time is of the essence in respect of all of the obligations of the Borrower under the Security Documents provided however that none of the Agent or any of the Lenders shall be entitled to terminate or treat this Agreement or any of the other Security Documents as having been repudiated otherwise than in circumstances which constitute an Event of Default.
17   Counterparts
 
    This Agreement may be executed in any number of counterparts and all such counterparts taken together shall be deemed to constitute one and the same agreement.
 
18   Changes to the Lenders
  18.1   Assignments and transfers by the Lenders
 
      Subject to this Clause 18, a Lender (the “Existing Lender”) may:
  18.1.1   assign any of its rights under the Security Documents; or
 
  18.1.2   transfer by novation any of its rights and obligations under the Security Documents,
to another bank or financial institution or to a trust, fund or other entity which is regularly engaged in or established for the purpose of making, purchasing or investing in loans, securities or other financial assets (the “New Lender”) PROVIDED THAT any such assignment or transfer shall be in respect of an amount of its Commitment and/or Contribution of not less than [**] [Confidential Treatment] Dollars [**] [Confidential Treatment] and PROVIDED THAT the Swingline Lender may only assign all of its rights or transfer all of its rights and obligations to

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another such bank or financial institution, trust, fund or other entity with an office in New York.
Further, the Borrower shall have the right to require that an Existing Lender assigns or transfers the whole of its Commitment and Contribution to a New Lender proposed by the Borrower and approved by the Lenders if the cost to the Existing Lender of funding any part of the Facility is materially higher than the cost to the other Lenders or if the Existing Lender is affected by the provisions of Clauses 3.9, 7.2 or 8.1 and the cost to the Borrower is materially higher than in respect of the other Lenders similarly affected.
  18.2   Conditions of assignment or transfer
  18.2.1   The consent of the Agent and the Borrower is required for an assignment or transfer by a Lender, unless the assignment or transfer is to another Lender or an Affiliate of a Lender. The said consent of the Borrower may not be unreasonably withheld or delayed and shall not be required if an Event of Default or a Possible Event of Default has occurred and is continuing.
 
  18.2.2   An assignment will only be effective on:
  (a)   receipt by the Agent of written confirmation from the New Lender (in form and substance satisfactory to the Agent) that the New Lender will assume the same obligations to the Agent and the other Lenders as it would have been under if it was an Original Lender; and
 
  (b)   performance by the Agent of all “know your customer” or other checks relating to any person that it is required to carry out in relation to such assignment to a New Lender, the completion of which the Agent shall promptly notify to the Existing Lender and the New Lender.
  18.2.3   A transfer will only be effective if the procedure set out in Clause 18.5 is complied with.
 
  18.2.4   If:
  (a)   a Lender assigns or transfers any of its rights or obligations under the Security Documents or changes its Lending Branch; and
 
  (b)   as a result of circumstances existing at the date the assignment, transfer or change occurs, the Borrower would be obliged to make a payment to the New Lender or Lender acting through its new Lending Branch under Clause 7,
then the New Lender or Lender acting through its new Lending Branch is only entitled to receive payment under that Clause to the same extent as the Existing Lender or Lender acting through its previous Lending Branch would have been if the assignment, transfer or change had not occurred.

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  18.3   Assignment or transfer fee
 
      The Existing Lender shall, on the date upon which an assignment or transfer takes effect, pay to the Agent (for its own account) a fee of three thousand Dollars (USD3,000).
 
  18.4   Limitation of responsibility of Existing Lenders
 
  18.4.1   Unless expressly agreed to the contrary, an Existing Lender makes no representation or warranty and assumes no responsibility to a New Lender for:
  (a)   the legality, validity, effectiveness, adequacy or enforceability of the Security Documents or any other documents;
 
  (b)   the financial condition of the Borrower;
 
  (c)   the performance and observance by any Obligor of its obligations under the Security Documents or any other documents; or
 
  (d)   the accuracy of any statements (whether written or oral) made in or in connection with any Security Document or any other document,
and any representations or warranties implied by law are excluded.
  18.4.2   Each New Lender confirms to the Existing Lender, the Agent and the other Lenders that it:
  (a)   has made (and shall continue to make) its own independent investigation and assessment of the financial condition and affairs of each Obligor and its related entities in connection with its participation in this Agreement and has not relied exclusively on any information provided to it by the Existing Lender in connection with any Security Document; and
 
  (b)   will continue to make its own independent appraisal of the creditworthiness of each Obligor and its related entities whilst any amount is or may be outstanding under the Security Documents or any Commitment is in force.
  18.4.3   Nothing in any Security Document obliges an Existing Lender to:
  (a)   accept a re-transfer from a New Lender of any of the rights and obligations assigned or transferred under this Clause 18; or
 
  (b)   support any losses directly or indirectly incurred by the New Lender by reason of the non-performance by any Obligor of its obligations under the Security Documents or otherwise.
  18.5   Procedure for transfer
  18.5.1   Subject to the conditions set out in Clause 18.2, a transfer is effected in accordance with Clause 18.5.3 when the Agent executes an otherwise

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      duly completed Transfer Certificate delivered to it by the Existing Lender and the New Lender. The Agent shall, subject to Clause 18.5.2, as soon as reasonably practicable after receipt by it of a duly completed Transfer Certificate appearing on its face to comply with the terms of this Agreement and delivered in accordance with the terms of this Agreement, execute that Transfer Certificate.
 
  18.5.2   The Agent shall only be obliged to execute a Transfer Certificate delivered to it by the Existing Lender and the New Lender once it is satisfied it has complied with all necessary “know your customer” or other similar checks under all applicable laws and regulations in relation to the transfer to such New Lender.
 
  18.5.3   On the Transfer Date:
  (a)   to the extent that in the Transfer Certificate the Existing Lender seeks to transfer by novation its rights and obligations under the Security Documents each of the Borrower and the Existing Lender shall be released from further obligations towards one another under the Security Documents and their respective rights against one another shall be cancelled (being the “Discharged Rights and Obligations”);
 
  (b)   each of the Borrower and the New Lender shall assume obligations towards one another and/or acquire rights against one another which differ from the Discharged Rights and Obligations only insofar as the Borrower and the New Lender have assumed and/or acquired the same in place of the Borrower and the Existing Lender;
 
  (c)   the Agent, the New Lender and other Lenders shall acquire the same rights and assume the same obligations between themselves as they would have acquired and assumed had the New Lender been an Original Lender with the rights and/or obligations acquired or assumed by it as a result of the transfer and to that extent the Agent and the Existing Lender shall each be released from further obligations to each other under this Agreement; and
 
  (d)   the New Lender shall become a party as a “Lender”.
  18.6   Copy of Transfer Certificate to Borrower
 
      The Agent shall, as soon as reasonably practicable after it has executed a Transfer Certificate, send to the Borrower a copy of that Transfer Certificate.
 
  18.7   Disclosure of information
 
      Any Lender may disclose to any of its Affiliates and any other person:
  18.7.1   to (or through) whom that Lender assigns or transfers (or may potentially assign or transfer) all or any of its rights and obligations under this Agreement;

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  18.7.2   with (or through) whom that Lender enters into (or may potentially enter into) any sub-participation in relation to, or any other transaction under which payments are to be made by reference to, this Agreement or the Borrower; or
 
  18.7.3   to whom, and to the extent that, information is required to be disclosed by any applicable law or regulation,
any information about any Obligor and the Transaction Documents as that Lender shall consider appropriate if, in relation to Clauses 18.7.1 and 18.7.2, the person to whom the information is to be given has entered into a Confidentiality Undertaking.
  18.8   Borrower’s co-operation
 
      The Borrower shall co-operate fully with the Lender in relation to any assignment or transfer proposed by the Lender and shall execute, or procure the execution of, any documents which the Lender may require.
19   Changes to the Borrower
 
    The Borrower may not assign any of its rights or transfer any of its rights or obligations under the Security Documents.
 
20   Reference Banks and Agent
  20.1   Reference Banks
 
      If:
  20.1.1   the whole of the Contribution (if any) of any Reference Bank is prepaid;
 
  20.1.2   the Commitment of any Reference Bank is cancelled or reduced to zero in accordance with Clause 3.9 or any other relevant provision hereof;
 
  20.1.3   a Reference Bank transfers the whole of its rights and obligations (if any) as a Lender under this Agreement; or
 
  20.1.4   where applicable, any Reference Bank ceases to provide quotations to the Agent for the purposes of determining LIBOR,
the Agent may, acting on the instructions of the Majority Lenders, terminate the appointment of such Reference Bank and appoint another Lender to replace such Reference Bank.
  20.2   Decision making
  20.2.1   Save as expressly provided in Clause 20.2.2 or as otherwise expressly provided herein, any proposed course of action in connection with any matter requiring the consent of the Lenders under or in connection howsoever with this Agreement shall only be taken with the consent of all the Lenders including, but without limitation to the generality of the foregoing:

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  (a)   the release of the Borrower from any of its obligations hereunder provided that the Agent may agree with the Borrower the terms and conditions upon which a condition precedent that is not material, in the opinion of the Agent, may be deemed to be a condition subsequent;
 
  (b)   the amendment of any of the provisions of this Agreement;
 
  (c)   any time or other indulgence to be granted to the Borrower in respect of its obligations under this Agreement.
  20.2.2   Proposals in connection with the following matters shall, in the absence of agreement thereon by all of the Lenders or as otherwise provided in this Agreement, be determined by the Majority Lenders:
  (a)   the making of any declaration by the Agent under Clause 12.2;
 
  (b)   the institution of any legal proceedings for the enforcement of any rights or powers whatsoever pursuant to the terms of this Agreement;
 
  (c)   any course of action whatsoever from time to time (other than the making of a demand for payment hereunder) whether of a legal or commercial nature or otherwise howsoever for the purpose of achieving a full or partial recovery of any principal, interest or other amount due and payable by the Borrower hereunder or otherwise in connection therewith following the making of a declaration by the Agent under Clause 12.2;
 
  (d)   any other matter in respect of which this Agreement expressly provides that the consent of the Majority Lenders shall be required.
  20.2.3   Any determination of the Lenders shall be ascertained by the Agent either:
  (a)   by means of a telefax sent by the Agent to each of the Lenders in identical terms on the proposal or matter in issue; or
 
  (b)   by means of the vote of representatives of each Lender at a meeting convened by the Agent and held for the purpose of discussing (inter alia) such proposal or matter in issue.
Furthermore, it is hereby agreed by the Lenders that:
  (i)   where a decision of the Lenders is sought by the Agent by means of a telefax sent in accordance with paragraph (a) above and PROVIDED THAT the Agent verifies forthwith by telephone with each relevant Lender that it has received such telefax in good order, then the Agent may in its telefax:
  (1)   recommend a proposed course of action to be taken by the Lenders; and

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  (2)   specify a time limit (of not less than three (3) Business Days) within which the Lenders are required to respond to the Agent’s recommendation
so that, if any Lender fails to notify the Agent within such time limit of its response to the recommendation, such Lender shall be deemed to have accepted and approved the course of action proposed by the Agent; and
  (ii)   where the approval of the Majority Lenders is required in respect of any matter, the approval shall be deemed to have been given as soon as the Agent receives the requisite number of votes in favour of the proposal so that the Agent may act on the basis of such votes without having to wait for the response of (or to give any notification to) any other Lender who has yet to reply to the Agent.
  20.3   The Agent
  20.3.1   Each of the Lenders hereby appoints the Agent to act as its agent under this Agreement and the Security Documents with such rights, powers and discretions as are expressly delegated to the Agent hereunder and thereunder.
 
  20.3.2   The Agent shall:
  (a)   promptly inform the Lenders of the contents of any notice or request received by it from the Borrower under this Agreement (whether such notice or request is addressed to the Agent alone or the Agent on behalf of the Lenders) and of any information delivered to it pursuant to Clause 10.2 and of any other matters which the Agent considers material;
 
  (b)   promptly deliver to the Lenders copies of any accounts and certificates delivered to it pursuant to Clause 10.2 and, as soon as reasonably practicable, copies of the documents delivered in satisfaction of the requirements of Schedule 3;
 
  (c)   promptly inform the Lenders in reasonable detail of any exercise by it of any of the rights, powers and/or discretions vested in it hereunder (but without the Agent being under any obligation to give prior notice to the Lenders of any such exercise);
 
  (d)   promptly notify the Lenders of the occurrence of any Event of Default or any other default by the Borrower in the due performance of or compliance with its material obligations under this Agreement of which the Agent has actual knowledge or actual notice and the occurrence of which the Agent has verified;
 
  (e)   if directed by the Majority Lenders, exercise (or refrain from exercising) any right, power or discretion vested in it hereunder in accordance with the directions (subject to Clause 20.2.1) of the Majority Lenders provided, however, that it may refrain from

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      acting in accordance with any such directions until it has received such security as it may require (whether by way of payment in advance or otherwise) for all costs, claims, expenses (including legal fees) and liabilities which it will or may expend or incur in complying with such directions and for this purpose the Agent shall make a demand for such security addressed to all the Lenders;
 
  (f)   receive from the Borrower all payments of principal, interest and other moneys expressed to be payable to the Agent hereunder on behalf of all or any of the Lenders and shall promptly distribute the same amongst the Lenders and itself in accordance with the terms of this Agreement pending which the Agent shall hold any and all such moneys on trust for the Lenders and itself; and
 
  (g)   enter into any amendment to any of the Security Documents or grant any waiver of any obligation of any of the Obligors under any of such Security Documents if so instructed by the Lenders.
  20.3.3   The relationship between the Agent on the one part and each Lender on the other is that of agent and principal and, except in relation to any moneys referred to in Clause 20.3.2(f) and held by the Agent pending distribution hereunder, the Agent shall not have a fiduciary relationship with or be, or be deemed to be, a trustee of or for any such party.
 
  20.3.4   In addition to the powers expressly given to the Agent by this Agreement:
  (a)   the Lenders may give the Agent (generally or in any particular case) any powers which the Lenders consider appropriate; and
 
  (b)   the Agent has power to take any other action which it considers to be reasonably incidental or conducive to the performance of its functions under this Agreement or otherwise appropriate in the context of those functions, including the exercise of any powers given to it by the Lenders.
  20.3.5   The rights, powers and discretions vested in the Agent by this Agreement shall only be exercised by the Agent in accordance with the instructions of the Majority Lenders or (if so required in accordance with the provisions of Clause 20.2.1) the Lenders provided however that the Agent shall be entitled (but not bound) to exercise or refrain from exercising any such right, power or discretion without the directions of the Majority Lenders or the Lenders (as the case may be) if the Agent believes that the immediate exercise of such right, power or discretion is necessary or desirable to protect the interests of the Lenders under or in respect of this Agreement.
 
      Where any right, power or discretion is vested in the Agent under this Agreement but is expressed as being exercisable in accordance with the directions of the Lenders or the Majority Lenders, such right, power or discretion shall not be exercised by the Agent without the lawful directions of the Lenders or the Majority Lenders (as the case may be).

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  20.3.6   Notwithstanding anything to the contrary expressed or implied herein, the Agent shall not:
  (a)   be bound to enquire as to the occurrence or otherwise of any Event of Default or as to the performance by the Borrower of its obligations under this Agreement;
 
  (b)   be bound to disclose to any other person any information relating to the Borrower if such disclosure would or might in its opinion constitute a breach of any law or regulation or be otherwise actionable at the suit of any person;
 
  (c)   have any responsibility to the Lenders or each other for:
  (i)   the financial position, creditworthiness, affairs or prospects of the Borrower;
 
  (ii)   the performance or non-performance howsoever by the Borrower of any of its obligations hereunder;
 
  (iii)   the due execution, effectiveness, genuineness, validity or enforceability of this Agreement or any document relating hereto or any filing or recording thereof or the taking of any other action whatsoever and howsoever in connection therewith or the collectability of any sum due hereunder;
 
  (iv)   any computations and/or information supplied to the Lenders by the Agent in reliance upon which the Lenders have entered into this Agreement;
  (d)   be under any liability whatsoever for any consequence of relying on:
  (i)   any written communication or document believed by it to be genuine or correct and to have been communicated or signed by the person by whom it is purported to have been communicated or signed; or
 
  (ii)   the advice or opinions of any professional advisers selected by it;
  (e)   be under any duty to account to any Lender or the Agent for any sum received by it for its own account or the profit element of any such sum; or
 
  (f)   be under any obligation other than those for which express provision is made herein.
  20.3.7   The Agent may:
  (a)   carry out its duties hereunder through such officers, directors, employees, consultants or independent agents as it may in its unfettered discretion think fit;

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  (b)   assume that no Event of Default has occurred and that the Borrower is not in breach of its obligations under this Agreement unless the Agent has actual knowledge or actual notice to the contrary;
 
  (c)   engage and pay for the advice or services of any internal or external lawyers, accountants, surveyors or other experts whose advice or services may to it seem necessary, expedient or desirable and rely upon any advice so obtained;
 
  (d)   rely as to any matters of fact which might reasonably be expected to be within the knowledge of the Borrower upon a certificate signed by or on behalf of the Borrower; and
 
  (e)   rely upon any communication or document believed by it to be genuine.
  20.3.8   It is understood that each of the Lenders has itself been, and will continue to be, solely responsible for making its own independent appraisal of and investigations into the financial condition, creditworthiness, condition, affairs, status and nature of the Borrower and, accordingly, each of the Lenders warrants to the Agent that it has not relied and will not rely on the Agent:
  (a)   to check or enquire on its behalf into the adequacy, accuracy or completeness of any information provided by the Borrower in connection with this Agreement; or
 
  (b)   to assess or keep under review on its behalf the financial condition, creditworthiness, condition, affairs, status or nature of the Borrower.
  20.3.9   Subject to the terms of this Agreement, this Agreement shall be serviced, supervised and administered by the Agent in the ordinary course of its business and in accordance with its usual practices. In performing its duties and functions hereunder, the Agent shall exercise the same care as it normally exercises in making and administering loans for its own account, but assumes no further responsibility in respect of such performance.
 
  20.3.10   The Agent shall not be under any liability as a result of taking or omitting to take any action in relation to this Agreement save in the case of gross negligence or wilful misconduct and the Lenders will not assert or seek to assert against any director, officer or employee of the Agent any claim they might have against any of them in respect of the matters referred to in this Clause 20.3.10.
 
  20.3.11   The Agent (or any officer thereof) shall not be precluded by reason of so acting from underwriting, guaranteeing the subscription of or subscribing for or otherwise acquiring, holding or dealing with any debentures, shares or securities whatsoever of the Borrower or from entering into any contract or financial or other transaction with or from engaging in any banking or other business with the Borrower and shall not be liable to

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      account for any profit made or payment received by it thereby or in connection therewith.
  20.4   Retirement and replacement of the Agent
  20.4.1   The Agent may retire at any time without assigning any reason by giving to the Borrower, the Agent and the Lenders not less than thirty (30) days notice of its intention to do so. Unless the Agent in its notice of retirement nominates any of its associated companies to be its successor, the successor Agent may be appointed by the Majority Lenders (with the prior written consent of the Borrower, such consent not to be unreasonably withheld or delayed) during such thirty (30) day period PROVIDED THAT, should they fail to do so, the Agent may then appoint as its successor a reputable and experienced bank with an office in London.
 
  20.4.2   If any Lender is dissatisfied with the Agent and wants it to be replaced, such Lender shall consult with the other relevant Lenders and the Borrower for a period of up to thirty (30) days to decide whether the Agent should be replaced and, if so, by whom (such replacement being one of the relevant Lenders or an associated company thereof). If at the end of such period the relevant Lenders unanimously agree that the Agent should be replaced by a particular Lender or one of its associated companies, and if the Borrower consents in writing to the identity of the proposed replacement (such consent (a) not to be unreasonably withheld and (b) not to be required if an Event of Default has occurred and is continuing), then notice shall be given by the relevant Lenders to the Agent specifying the date, being not fewer than five (5) Business Days after the date of such notice, on which the appointment of the successor Agent is, subject to Clause 20.4.4, to take effect.
 
  20.4.3   For the purposes of this Clause 20.4:
  (a)   an “associated company” of the Agent and/or any Lender shall mean any company which is a holding company of the Agent and/or such Lender or a wholly-owned subsidiary of it or its parent company; and
 
  (b)   relevant Lenders” means all of the Lenders other than that Lender which acts as Agent or whose associated company acts in such capacity.
  20.4.4   Any appointment of a successor Agent under Clause 20.4.1 or Clause 20.4.2 shall take effect upon:
  (a)   the successor confirming in writing its agreement to be bound by the provisions of this Agreement; and
 
  (b)   notice thereof by the Agent and its successor (which notice, shall specify the banks to which payments to the new Agent shall be made thereafter) being given to each of the other parties to this Agreement.

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  20.4.5   If a successor to the Agent is appointed under the provisions of this Clause 20.4:
  (a)   the outgoing Agent shall be discharged from any further obligation under this Agreement;
 
  (b)   its successor and each of the other parties hereto shall have the same rights and obligations amongst themselves as they would have had if such successor had been a party hereto in place of the outgoing Agent;
 
  (c)   Clause 20 and the other provisions of this Agreement shall remain in effect for the benefit and protection of the outgoing Agent in relation to any claim or loss which may be brought against or incurred by it in connection with or as a result of any act, omission, breach, neglect or other occurrence or matter relating to or arising out of this Agreement which took place before its resignation.
21   Notices
  21.1   Mode of communication
 
      Except as otherwise provided herein, each notice, request, demand or other communication or document to be given or made hereunder shall be given in writing but unless otherwise stated, may be made by telefax.
 
  21.2   Address
 
      Any notice, demand or other communication (unless made by telefax) to be made or delivered by the Agent to the Borrower pursuant to this Agreement shall (unless the Borrower has by fifteen (15) days’ written notice to the Agent specified another address) be made or delivered to the Borrower at 7665 Corporate Center Drive, Miami, Florida 33126, United States of America (marked for the attention of Ms Bonnie Biumi and the Legal Department (but one (1) copy shall suffice)). Any notice, demand or other communication to be made or delivered by the Borrower to the Agent or the Swingline Lender pursuant to this Agreement shall (unless the Agent or the Swingline Lender has by fifteen (15) days’ written notice to the Borrower specified another address) be made or delivered to the Agent or the Swingline Lender (as the case may be) at its Lending Branch, the details of which are set out in Schedule 1.
 
  21.3   Telefax communication
 
      Any notice, demand or other communication to be made or delivered pursuant to this Agreement may be sent by telefax to the relevant telephone numbers (which at the date hereof in respect of the Borrower is +1 305 436 4140 (marked for the attention of Ms Bonnie Biumi) and +1 305 436 4117 (marked for the attention of the Legal Department) and in the case of the Agent or any Original Lender (including the Swingline Lender) is as recorded in Schedule 1) specified by it from time to time for the purpose and shall be deemed to have been received when transmission of such telefax communication has been completed. Each such telefax communication, if made to the Agent or any Lender (including the

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      Swingline Lender) by the Borrower, shall be signed by the person or persons authorised in writing by the Borrower and whose signature appears on the list of specimen signatures contained in the secretary’s certificate required to be delivered by paragraph 2 of Part I of Schedule 3 and shall be expressed to be for the attention of the department or officer whose name has been notified for the time being for that purpose by the Agent or any Lender (including the Swingline Lender) to the Borrower.
 
  21.4   Electronic mail
 
      Any notice, demand or other communication other than a Drawdown Notice or a Renewal Notice to be made or delivered pursuant to this Agreement may be made by electronic mail or other electronic means, if the Agent, the Borrower and/or the Lender (including the Swingline Lender):
  21.4.1   agree that, unless and until notified to the contrary, this is to be an accepted form of communication; and
 
  21.4.2   notify each other in writing of their electronic mail address and/or any other information required to enable the sending and receipt of information by that means; and
 
  21.4.3   notify each other of any change to their electronic mail address or any other such information supplied by them.
Any Original Lender (including the Swingline Lender) which sets out an email address beneath its name in Schedule 1 is deemed to agree to receiving notices, demands or other communications from the Agent or, in the case of the Swingline Lender, the Borrower, by electronic mail.
Any electronic communication made:
  (a)   by the Agent to the Borrower or a Lender or by the Swingline Lender to the Borrower or the Agent will be effective when it is sent by the Agent or the Swingline Lender (as the case may be) unless the Agent or the Swingline Lender (as the case may be) receives a message indicating failed delivery and, if upon the sender’s express request, a confirmation of receipt is requested, such confirmation has been sent; and
 
  (b)   by the Borrower or a Lender (including the Swingline Lender) to the Agent will be effective only when actually received by the Agent and then only if it is addressed in such a manner as the Agent shall specify to that party for this purpose.
The Agent shall notify the Borrower and the Lenders (including the Swingline Lender) and the Borrower or a Lender (including the Swingline Lender) shall notify the Agent in each case promptly upon becoming aware that its electronic mail system or other electronic means of communication cannot be used due to technical failure (and that failure is continuing for more than two (2) Business Days). Until the Agent, the Borrower or that Lender (including the Swingline Lender) has notified as aforesaid that the failure has been remedied, all notices between the Agent and the Borrower or that Lender (including the Swingline Lender) shall be sent by fax or letter in accordance with this Clause 21.

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  21.5   Receipt
 
      Each such notice, demand or other communication shall be deemed to have been made or delivered (in the case of any letter) when delivered to its office for the time being or, if sent by post, five (5) days after being deposited in the post first class or express airmail (as the case may be) postage prepaid in an envelope addressed to it at that address or, if sent by electronic mail, in accordance with Clause 21.4.
 
  21.6   Language
 
      Each notice, demand or other communication made or delivered by one (1) party to another pursuant to this Agreement or any other Security Document shall be in the English language or accompanied by a certified English translation. In the event of any conflict between the translation and the original text the translation shall prevail unless the original text is a statutory instrument, legal process or any other document of a similar type.
22   Governing Law
 
    This Agreement shall be governed by English law.
 
23   Waiver of Immunity
 
    To the extent that the Borrower may in any jurisdiction claim for itself or its assets immunity from suit, execution, attachment (whether in aid of execution, before judgment or otherwise) or other legal process in relation to this Agreement or the other Security Documents and to the extent that in any such jurisdiction there may be attributed to itself or its assets such immunity (whether or not claimed) the Borrower hereby irrevocably and unconditionally agrees throughout the Security Period not to claim and hereby irrevocably waives such immunity to the full extent permitted by the laws of such jurisdiction. In respect of any legal action or proceedings arising out of or in connection with any of the Security Documents the Borrower hereby consents generally as a matter of procedure in relation to the waiver of immunity (but not so as to prejudice any defence which the Borrower may have on the merits of the substantive issue) to the giving of any relief or the issue of any process in connection with such legal action or proceedings including without limitation, the making, enforcement or execution against any property whatsoever (irrespective of its uses or intended uses) of any order or judgment which may be made or given in such legal action or proceedings.
 
24   Jurisdiction
  24.1   The courts of England have exclusive jurisdiction to settle any dispute arising out of or in connection with this Agreement (including a dispute regarding the existence, validity or termination of this Agreement) (a “Dispute”). Each party to this Agreement agrees that the courts of England are the most appropriate and convenient courts to settle Disputes and accordingly no party will argue to the contrary.
 
      This Clause 24.1 is for the benefit of the Lenders and the Agent only. As a result, no such party shall be prevented from taking proceedings relating to a Dispute in any other courts with jurisdiction. To the extent allowed by law, any such party may take concurrent proceedings in any number of jurisdictions.

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  24.2   The Borrower may not, without the Agent’s prior written consent, terminate the appointment of the Process Agent; if the Process Agent resigns or its appointment ceases to be effective, the Borrower shall within fourteen (14) days appoint a company which has premises in London and has been approved by the Agent to act as the Borrower’s process agent with unconditional authority to receive and acknowledge service on behalf of the Borrower of all process or other documents connected with proceedings in the English courts which relate to this Agreement.
 
  24.3   For the purpose of securing its obligations under Clause 24.2, the Borrower irrevocably agrees that, if it for any reason fails to appoint a process agent within the period specified in Clause 24.2, the Agent may appoint any person (including a company controlled by or associated with the Agent or any Lender) to act as the Borrower’s process agent in England with the unconditional authority described in Clause 24.2.
 
  24.4   No neglect or default by a process agent appointed or designated under this Clause (including a failure by it to notify the Borrower of the service of any process or to forward any process to the Borrower) shall invalidate any proceedings or judgment.
 
  24.5   The Borrower appoints in the case of the courts of England the Process Agent to receive, for and on its behalf service of process in England of any legal proceedings with respect to this Agreement and any other Security Document.
 
  24.6   A judgment relating to this Agreement which is given or would be enforced by an English court shall be conclusive and binding on the Borrower and may be enforced without review in any other jurisdiction.
 
  24.7   Nothing in this Clause shall exclude or limit any right which the Agent or a Lender may have (whether under the laws of any country, an international convention or otherwise) with regard to the bringing of proceedings, the service of process, the recognition or enforcement of a judgment or any similar or related matter in any jurisdiction.
 
  24.8   In this Clause “judgment” includes order, injunction, declaration and any other decision or relief made or granted by a court.
IN WITNESS whereof the parties hereto have caused this Agreement to be duly executed as a deed on the day first written above.
         
SIGNED SEALED and DELIVERED as a DEED
    )       PA Turner 
by PA Turner
    )  
for and on behalf of
    )  
NCL CORPORATION LTD.
    )  
in the presence of:
    )  

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SIGNED SEALED and DELIVERED as a DEED
        )     Theodora Kokota
by Theodora Kokota
        )      
for and on hehalf of
        )      
DnB NOR BANK ASA
        )      
as a Mandated Lead Arranger, an Original Lender,
        )      
the Swingline Leader and the Agent
        )      
in the presence of:
  Carolyn Hamilton Stephenson Hardwood     )      
 
  One St. Paul’s Church Yard     )      
 
  London EC4M 8SH solicitors     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Theodora Kokota
by Theodora Kokota
        )      
for and on hehalf of
        )      
CITIBANK N.A.
        )      
as a Mandated Lead Arranger and an Original Lender
        )      
in the presence of:
  Carolyn Hamilton Stephenson Hardwood     )      
 
  One St. Paul’s Church Yard     )      
 
  London EC4M 8SH solicitors     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Theodora Kokota
by Theodora Kokota
        )      
for and on hehalf of
        )      
COMMERZBANK AKTIENGESELLSCHAFT
        )      
Hamburg Branch, Global Shipping
        )      
as a Mandated Lead Arranger and an Original Lender
        )      
in the presence of:
  Carolyn Hamilton Stephenson Hardwood     )      
 
  One St. Paul’s Church Yard     )      
 
  London EC4M 8SH solicitors     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Theodora Kokota
by Theodora Kokota
        )      
for and on hehalf of
        )      
KRW
        )      
as a Mandated Lead Arranger and an Original Lender
        )      
in the presence of:
  Carolyn Hamilton Stephenson Hardwood     )      
 
  One St. Paul’s Church Yard     )      
 
  London EC4M 8SH solicitors     )      
 
               

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SIGNED SEALED and DELIVERED as a DEED
        )     Theodora Kokota
by Theodora Kokota
        )      
for and on hehalf of
        )      
NORDDEUTSCHE LANDESBANK GIROZENTRALE
        )      
as a Mandated Lead Arranger and an Original Lender
        )      
in the presence of:
  Carolyn Hamilton Stephenson Hardwood     )      
 
  One St. Paul’s Church Yard     )      
 
  London EC4M 8SH solicitors     )      
 
               
SIGNED SEALED and DELIVERED as a DEED
        )     Theodora Kokota
by Theodora Kokota
        )      
for and on hehalf of
        )      
NORDEA BANK NORGE ASA
        )      
as a Mandated Lead Arranger and an Original Lender
        )      
in the presence of:
  Carolyn Hamilton Stephenson Hardwood     )      
 
  One St. Paul’s Church Yard     )      
 
  London EC4M 8SH solicitors     )      
 
               

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Schedule 1
Particulars of Agent, Mandated Lead Arrangers
and Original Lenders
Name and Address
Agent
DnB NOR BANK ASA
Stranden 21
NO-0021 Oslo
Norway
     
Fax:
  +47 22 482894
Attn:
  Mrs Solveig Nuland Knoff
Mandated Lead Arrangers
Name and Address
DnB NOR BANK ASA
Stranden 21
NO-0021 Oslo
Norway
     
Fax:
  +47 22 482020
Attn:
  Mr Jon Flovik
Email:
  jon.flovik@dnbnor.no
CITIBANK N.A.
388 Greenwich Street, 23rd Floor
New York, New York 10013
United States of America
     
Fax:
  +1 646 291 5051
Attn:
  Mr Philip Ziegler
Email:
  philip.ziegler@citigroup.com
COMMERZBANK AKTIENGESELLSCHAFT
Hamburg Branch
Global Shipping
Ness 7-9
20457 Hamburg
Germany
     
Fax:
  +49 40 3683 4068 / 2049
Attn:
  Mr Stefan Kuch / Mr Siegfried Hoffmann
Email:
  stefan.kuch@commerzbank.com /
 
  siegfried.hoffmann@commerzbank.com

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Name and Address
KfW
Palmengartenstrasse 5-9
60325 Frankfurt am Main
Germany
     
Fax:
  +49 69 7431 3768/4110
Attn:
  Mr Josef Schmid / Ms Clare Dooley
Email:
  josef.schmid@kfw.de /
 
  clare.dooley@kfw.de
NORDDEUTSCHE LANDESBANK
GIROZENTRALE

Friedrichswall 10
30159 Hannover
Germany
     
Fax:
  +49 511 361 4785
Attn:
  Mr Thomas Schramme / Mr Alexander Viets
Email:
  shipping@nordlb.de
NORDEA BANK NORGE ASA
Middelthuns gate 17
Oslo
Norway
P O Box 1166 Sentrum
NO-0107 Oslo
     
Fax:
  +47 22 484278
Attn:
  Mr Arne Berglund
Email:
  arne.berglund@nordea.com

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Lenders (including the Swingline Lender)
             
Name and Address   Commitment to   Commitment to
        Revolving Credit   Swingline Facility
        Facility as a   as a Proportion
        Proportion    
For all matters:        
 
           
DnB NOR BANK ASA   [**] [Confidential Treatment]   [**] [Confidential Treatment]
Stranden 21        
NO-0021 Oslo        
Norway        
 
           
Fax:
  +47 22 482020        
Attn:
  Mr Jon Flovik        
Email:
  jon.flovik@dnbnor.no        
 
           
For all matters relating to the Swingline Facility:        
 
           
DnB NOR BANK ASA       [**] [Confidential Treatment]
New York Branch        
200 Park Avenue        
31st Floor        
New York, NY 10166-0396        
United States of America        
 
           
Fax:
  +1 212 681 4123        
Attn:
  Ms Helene Vales / Ms Fay Murray        
Email:
  helene.vales@dnbnor.no /        
 
  fay.murray@dnbnor.no1        
 
           
CITIBANK N.A.   [**] [Confidential Treatment]   [**] [Confidential Treatment]
399 Park Ave 16th FLS        
New York, NY 10043        
United States of America        
 
           
Fax:
  +1 212 994 0847        
Attn:
  Mr Askia Abdul-Qadir        
Email:
  askia.m1.abdulquadir@citigroup.com        
 
1   See Clause 21.4 in respect of Drawdown Notices

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Name and Address   Commitment to   Commitment to
        Revolving Credit   Swingline Facility
        Facility as a   as a Proportion
        Proportion    
COMMERZBANK AKTIENGESELLSCHAFT   [**] [Confidential Treatment]   [**] [Confidential Treatment]
Hamburg Branch        
Global Shipping        
Ness 7-9        
20457 Hamburg        
Germany        
 
           
Fax:
  +49 40 3683 4068 / 2049        
Attn:
  Mr Stefan Kuch / Mr Siegfried Hoffmann        
Email:
  stefan.kuch@commerzbank.com /        
 
  siegfried.hoffmann@commerzbank.com        
 
           
KfW   [**] [Confidential Treatment]   [**] [Confidential Treatment]
Palmengartenstrasse 5-9        
60325 Frankfurt am Main        
Germany        
 
           
Fax:
  +49 69 7431 3768/4110        
Attn:
  Mr Josef Schmid / Ms Clare Dooley        
Email:
  josef.schmid@kfw.de /        
 
  clare.dooley@kfw.de        
 
           
NORDDEUTSCHE LANDESBANK
GIROZENTRALE
  [**] [Confidential Treatment]   [**] [Confidential Treatment]
Friedrichswall 10        
30159 Hannover        
Germany        
 
           
Fax:
  +49 511 361 4785        
Attn:
  Mr Thomas Schramme / Mr Alexander Viets        
Email:
  shipping@nordlb.de        
 
           
NORDEA BANK NORGE ASA   [**] [Confidential Treatment]   [**] [Confidential Treatment]
Middelthuns gate 17        
Oslo        
P O Box 1166 Sentrum        
NO-0107 Oslo        
Norway        
 
           
Fax:
  +47 22 484278        
Attn:
  Mr Arne Berglund        
Email:
  arne.berglund@nordea.com        

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Schedule 2
Notice of Drawdown
Clause 2.3 or Clause 2.4
     
FROM:
  NCL CORPORATION LTD.
 
  Milner House
 
  18 Parliament Street
 
  Hamilton HM 12
 
  Bermuda
 
   
TO:
  [DnB NOR BANK ASA
 
  Stranden 21
 
  NO-0021 Oslo
 
  Norway]
 
   
 
  [DnB NOR BANK ASA
 
  New York Branch
 
  200 Park Avenue
 
  31st Floor
 
  New York, NY 10166-0396
 
  United States of America]
20[  ]
Dear Sirs
     
FACILITY AGREEMENT DATED   DECEMBER 2006 (THE “FACILITY AGREEMENT”)
     
We refer to the Facility Agreement pursuant to which you have agreed to advance to us the Facility on the terms and conditions set out therein.
Terms and expressions defined in the Facility Agreement shall have the same respective meanings when used in this notice.
We hereby give you notice that we wish to draw down a Drawing of the [Revolving Credit Facility][Swingline Facility] in the amount of [                    ] Dollars (USD[          ]) under Clause 2.[3][4] of the Facility Agreement on [               ] 20[  ].
Such amount is to be paid to:
[               ]
We confirm that:
(i)   all of the representations and warranties contained in Clause 9 of the Facility Agreement remain true and correct;
(ii)   no Possible Event of Default or Event of Default has occurred nor will occur with the giving of this notice;

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(iii)   the Interest Period shall be of [one (1) month’s][three (3)][six (6)] [months’] [one (1) Business Day’s][two (2)][three (3)][four (4)][five (5)] [Business Days’] duration;
(iv)   the Drawing will be applied [in refinancing all existing indebtedness related to the Vessels][for general corporate and working capital purposes of the Borrower and its Subsidiaries][for general short term corporate purposes of the Borrower but not the repayment or prepayment of another Swingline Facility Drawing]; [and]
(v)    [upon application of the Drawing hereby requested to be advanced in the manner hereinbefore appearing all sums owing to the existing financiers of the Vessels shall have been fully and finally repaid].
Yours faithfully
NCL CORPORATION LTD.
By:                                                                                 

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Schedule 3
Conditions Precedent
Clause 2.6
The Facility is expressly conditional upon the Agent having received in such form and substance as it shall require:
    A On signing hereof
Borrower
1   Certified Copies of any consents required from any ministry, governmental, financial or other authority for the execution of and performance by the Borrower of its obligations under this Agreement and each of the Security Documents or if no such consents are required a secretary’s certificate of the Borrower to this effect confirming that no such consents are required.
 
2   Notarially attested secretary’s certificate for the Borrower:
  2.1   attaching a copy of its Certificate of Incorporation and Memorandum of Association and Bye-Laws evidencing power to:
  2.1.1   enter into the transactions contemplated by this Agreement and in the other Security Documents and to buy ships and enter into arrangements for the chartering and management thereof; and
 
  2.1.2   borrow money in the amount referred to in this Agreement and as security therefor to mortgage or charge assets;
  2.2   giving the names of the present officers and directors;
 
  2.3   setting out specimen signatures of persons who would be authorised to sign documents or otherwise perform its obligations under the Security Documents;
 
  2.4   giving the legal and beneficial owners of its shares and the number of shares held by each shareholder;
 
  2.5   attaching copies of resolutions passed at a duly convened meeting of the directors authorising the borrowing of the Facility and the execution of this Agreement and such of the other Security Documents to which the Borrower is a party and the issue of any power of attorney to execute the same; and
 
  2.6   containing a declaration of solvency as at the date of the secretary’s certificate.
3   Where the secretary’s certificate referred to in paragraph 2 of this Schedule 3 is dated more than fifteen (15) days prior to the Signing Date, a bringdown certificate, which need not be notarially attested if signed by the same person that signed the secretary’s certificate referred to in paragraph 2 of this Schedule 3.
4   The original power of attorney issued pursuant to the resolutions referred to in paragraph 2 above, notarially attested.

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5   The Disclosure Letter duly executed.
Other Obligors
6   Certified Copies of any consents required from any ministry, governmental, financial or other authority for the execution of and performance by each of the other Obligors of its obligations under the Security Documents to which it is a party or if no such consents are required a secretary’s certificate of that Obligor to this effect confirming that no such consents are required.
7   Notarially attested secretary’s certificate:
  7.1   attaching a copy of its Certificate of Incorporation and Memorandum of Association and Bye-Laws evidencing power to enter into the transactions contemplated by this Agreement;
 
  7.2   giving the names of the present officers and directors;
 
  7.3   setting out specimen signatures of persons who would be authorised to sign documents or otherwise perform its obligations under the Security Documents;
 
  7.4   attaching copies of resolutions passed at a duly convened meeting of the directors approving the granting and the execution of the documents whose execution is contemplated hereby, insofar as they relate to it and the issue of any power of attorney to execute the same; and
 
  7.5   containing a declaration of solvency as at the date of the secretary’s certificate.
8   Where the secretary’s certificate referred to in paragraph 7 of this Schedule 3 is dated more than fifteen (15) days prior to the Signing Date, a bringdown certificate, which need not be notarially attested if signed by the same person that signed the secretary’s certificate referred to in paragraph 7 of this Schedule 3.
9   The original powers of attorney issued pursuant to the resolutions referred to in paragraph 7.1 of this Schedule 3, notarially attested.
General
10   Confirmation from the Process Agent that it will act for each of the Obligors as agent for service of process in England.
11   Opinions from lawyers appointed by the Agent including English, Bermudan and Isle of Man lawyers as to any of the foregoing matters or otherwise as the Lenders may require in the form required by the Lenders.
12   A copy of:
  12.1   the audited consolidated financial statements of the NCLC Group for the financial year ending on 31 December 2005;
 
  12.2   the unaudited consolidated financial statements of the NCLC Group for the fiscal quarter ending on 30 September 2006; and

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  12.3   detailed projected consolidated financial statements of the NCLC Group for the six (6) financial years commencing with the financial year ending on 31 December 2006, which projections shall (a) reflect the forecasted consolidated financial condition of the NCLC Group after giving effect to the Facility and the related financing thereof; and (b) be prepared and approved by the chief financial officer of the NCLC Group.
13   Letter from the secretary of the Borrower to the Agent stating that the Borrower is and shall remain, after the advance to it of the Facility or any of it, solvent in accordance with the laws of Bermuda and the United Kingdom and in particular with the provisions of the United Kingdom’s Insolvency Act 1986 (as from time to time amended) and the requirements thereof.
 
14   Copies of all Companies Acts forms for filing of charges in Bermuda.
 
15   Payment of all fees under Clause 14 and all expenses due under Clause 15.
 
B.   At least five (5) Business Days before the first Advance Date in respect of Tranche 1
 
16   Drawdown notice duly executed by the Borrower in the form of Schedule 2.
 
17   Certified Copy of such documents as have been received by the Owners from the existing financiers of the Vessels in evidence of the existing indebtedness in respect of the Vessels.
 
18   Financial projections of the NCLC Group for the twelve (12) month period commencing on the first day of the financial quarter of the NCLC Group in which the first Advance Date falls (including income statement, balance sheet and cash flow statement for the NCLC Group) and an outline of the assumptions supporting such budget and financial projections and details of any scheduled dry-docking of any of the vessels owned and/or operated by companies in the NCLC Group during such period, demonstrating that the Borrower will be in compliance with the financial undertakings contained in Clause 10.3 during such twelve (12) month period.
 
C   On the first Advance Date in respect of Tranche 1
 
19   Such evidence as the Lenders may require that the Borrower has raised a minimum of two hundred million Dollars (USD200,000,000) in paid up new equity since 30 November 2006, which amount has not been released or repaid.
 
20   Such evidence as the Lenders may require that each of the Vessels is:
  20.1   at least provisionally registered in the name of the relevant Owner under the Bahamian flag with a certificate of registry free from all liens and encumbrances except the relevant Mortgage and any other mortgage acceptable to the Lenders and the subject of a Co-ordination Deed;
 
  20.2   classified with the highest classification available free of all recommendations and qualifications with Det Norske Veritas, save as disclosed to the Agent;
 
  20.3   insured in accordance with the terms of the Security Documents; and
 
  20.4   managed by the Manager pursuant to the relevant Management Agreement.

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21   In respect of each of the Vessels:
  21.1   copies of valid trading and other certificates;
 
  21.2   Certified Copy of the Management Agreement;
 
  21.3   Mortgage duly executed and lodged for registration at the Bahamas Maritime Authority in London;
 
  21.4   Earnings Assignment duly executed;
 
  21.5   Insurance Assignment duly executed;
 
  21.6   Management Agreement Assignment duly executed;
 
  21.7   Co-ordination Deed duly executed; and
 
  21.8   Telefax confirmations from the insurance brokers for marine risks (hull and machinery) and the managers of any protection and indemnity or war risks association through whom any Insurances in respect of the Vessels have been placed that the Insurances have been placed and upon receipt of notices of assignment of the Insurances they will issue letters of undertaking in the form approved by the Lenders.
22   In respect of each of the Vessels, the first valuations referred to in Clause 10.17.1 providing evidence that the aggregate market value of the Vessels is not less than [**] [Confidential Treatment] Dollars [**] [Confidential Treatment].
 
23   Guarantees duly executed by the Owners.
 
24   Charges duly executed in respect of the Owners.
 
25   Opinions from Bahamian lawyers appointed by the Agent as to due registration of the Vessels and due registration of the Mortgages and from English, Bermudan and Isle of Man lawyers appointed by the Agent as to any of the foregoing matters or otherwise as the Lenders may require in the form required by the Lenders.
 
26   From the Agent’s insurance advisers, a report on the Insurances for each of the Vessels and a certificate confirming that such Insurances are placed with such insurance companies and/or underwriters and/or clubs, in such amounts, against such risks, and in such form, as should be acceptable to the Lenders and conform with the provisions of the relevant Mortgage.
 
27   Where a secretary’s certificate referred to in paragraph 2 or paragraph 7 of this Schedule 3 is dated more than ten (10) days prior to the first Advance Date, a bringdown certificate, which need not be notarially attested if signed by the same person that signed the secretary’s certificate referred to in paragraph 2 or paragraph 7 (as the case may be) of this Schedule 3.
 
28   Certified Copy of the carrier initiative agreement(s) executed pursuant to the Mortgages.
 
29   Certified Copies of any current certificates of financial responsibility in respect of the Vessels issued under OPA.

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30   Certified Copies of valid safety management certificates (or interim safety management certificates) issued to the Vessels in respect of their management by the Manager pursuant to the International Safety Management Code.
 
31   Certified Copies of a valid document of compliance (or an interim document of compliance) issued to the Manager in respect of ships of the same type as the Vessels pursuant to the International Safety Management Code.
 
32   Certified Copies of valid international ship security certificates issued to the Vessels in accordance with the International Ship and Port Facility Security Code adopted by the International Maritime Organisation.
 
33   Certified Copies of valid international air pollution prevention certificates issued to the Vessels under 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) (as the same may be amended from time to time).
General
34   Copies of Companies Act forms for filing of charges in Bermuda and the Isle of Man.
 
35   Payment of all fees due under Clause 14 and all expenses due under Clause 15.
 
D   On the first Advance Date in respect of Tranche 2
 
36   Such evidence as the Lenders may require that the Borrower has raised a further minimum of two hundred million Dollars (USD200,000,000) in paid up new equity and an aggregate of four hundred million Dollars (USD400,000,000) in paid up new equity since 30 November 2006, which amount has not been released or repaid.

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Schedule 4
Confidentiality Undertaking
[ON BANK’S HEADED PAPER]
     
TO:
  NCL CORPORATION LTD.
 
  Milner House
 
  18 Parliament Street
 
  Hamilton HM 12
 
  Bermuda
 
   
 
  DnB NOR BANK ASA
 
  Stranden 21
 
  NO-0021 Oslo
 
  Norway
NCL CORPORATION LTD.
UP TO USD610,000,000 FACILITY (THE “FACILITY”)
FORM OF CONFIDENTIALITY UNDERTAKING
In connection with a possible future transaction involving NCL Corporation Ltd., a Bermuda company, and certain of its subsidiaries and affiliates (hereinafter collectively referred to as “NCL”) and BANK NAME (“BANK NAME”), NCL is furnishing BANK NAME with certain proprietary and confidential information concerning NCL and its business, assets and liabilities. The information furnished to BANK NAME together with analyses, compilations, studies and other documents prepared by BANK NAME or its agents, representatives (including attorneys, accountants and financial advisors) or employees which contain or otherwise reflect such information for BANK NAME review of NCL, is hereinafter referred to as “Confidential Information”. In consideration of NCL furnishing BANK NAME with the Confidential Information, NCL asks BANK NAME to agree that:
1   Except as otherwise provided herein, the Confidential Information will be kept confidential and shall not, without NCL’s prior written consent be disclosed by BANK NAME, or by its directors, officers, affiliates, agents, representatives, advisors or employees (collectively, its “Representatives”), in any manner whatsoever, in whole or in part, and shall not be used by BANK NAME or its Representatives, other than for the purpose of evaluating the transaction described above. Moreover, except as otherwise provided herein, BANK NAME agrees to reveal the Confidential Information only to its Representatives who need to know the Confidential Information for the purpose of the transaction described above, who are informed by BANK NAME of the confidential nature of the Confidential Information and who shall agree to keep such information confidential in accordance with BANK NAME’s customary practices with respect to the handling of confidential information. BANK NAME shall be responsible for any breach of this Agreement by its Representatives.
2   Except as otherwise provided herein, without NCL’s prior written consent, BANK NAME and its Representatives will not disclose to any person the fact that the Confidential

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    Information has been made available to BANK NAME, that discussions or negotiations are taking place concerning a possible transaction relating to BANK NAME or any of the terms, conditions or other facts with respect to any such possible transaction (including the status thereof).
3   NCL may at any time terminate further access by BANK NAME or its Representatives to the Confidential Information and BANK NAME agrees that the Confidential Information, except for the portion of the Confidential Information which consists of analyses, compilations, studies or other documents prepared by BANK NAME or its Representatives, will be returned to NCL or destroyed, in each case, immediately upon our request, or in the event BANK NAME does not proceed with the transaction that is the subject of this Agreement, including all copies, whether electronic or otherwise, made of the Confidential Information, except that BANK NAME may keep such copies of the Confidential Information as may be required by applicable legal and regulatory requirements. No such termination will affect the obligations of BANK NAME or its Representatives hereunder, all of which obligations shall continue until such time as this Agreement terminates pursuant to paragraph 9 below.
4   Notwithstanding the foregoing, the term “Confidential Information” shall not include information that (and the terms of this Agreement shall be inoperative as to such information) (i) is or becomes generally available to the public through no breach of this Agreement by BANK NAME or its Representatives, or (ii) is in BANK NAME or its Representatives’ possession or becomes available to BANK NAME or its Representatives on a non-confidential basis from a source other than NCL or any of its affiliates or agents, or (iii) is otherwise available to the general public or generally known or available to the public or within the passenger cruise industry or (iv) was or is independently developed by BANK NAME or its Representatives through no breach of BANK NAME’s or its Representatives’ obligations hereunder.
5   BANK NAME understands that NCL has endeavoured to include in the Confidential Information those materials which NCL believes to be reliable and relevant for the purpose of BANK NAME evaluation, but BANK NAME acknowledges that neither NCL nor any of its affiliates nor any of its or its agents, representatives or employees make any representation or warranty as to the completeness of the Confidential Information. BANK NAME agrees that neither NCL nor any of its affiliates nor any of its or its agents, representatives or employees shall have any liability to BANK NAME or its Representatives resulting from the use or content of the Confidential Information.
6   Notwithstanding anything herein to the contrary, it shall not be a breach of this Agreement to disclose any Confidential Information, if such disclosure is (a) consented to in writing by NCL, or (b) made to BANK NAME’s regulatory authorities or other governmental or regulatory agencies or (c) required by law or applicable legal process, provided that, solely in the case of this clause (c), BANK NAME shall (unless prohibited by court order, law or regulation) (i) use reasonable efforts to give the earliest notice possible to NCL that such disclosure is or may be required and (ii) take reasonable measures to cooperate in protecting the confidential or proprietary nature of the Confidential Information which must so be disclosed.
7   Without the prior written consent of NCL, BANK NAME will not solicit any employee of NCL to become employed by BANK NAME that, to the actual and personal

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    knowledge (and not constructive knowledge) of the BANK NAME officer, employee or representative making such solicitation, has devoted a substantial amount of effort to the underlying transaction contemplated hereby.
8   This Agreement may be amended, modified, superseded or waived only by a written instrument which specifically states that it amends this Agreement executed and delivered by an authorized officer for each entity to be bound by such amendment.
9   The term of this Agreement shall commence on the date set forth above and shall continue for a period of two (2) years from such date, except when such Confidential Information is a trade secret of NCL and is identified as such by NCL, in which case BANK NAME’s obligations to protect such Confidential Information shall be perpetual and continuing.
10   It is further understood and agreed that no failure or delay by NCL in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any right, power or privilege hereunder.
11   BANK NAME agrees that monetary damages would not be a sufficient remedy for any breach of this Agreement by BANK NAME or its Representatives, and that in addition to all other remedies, NCL shall be entitled to seek specific performance and injunctive or other equitable relief as a remedy for any such breach.
12   This Agreement is made subject to and shall be construed under the laws of the State of Florida, without giving effect to its principles or rules regarding conflicts of laws, and the parties hereto agree that the state or federal courts situated in Miami-Dade County, Florida shall have exclusive jurisdiction to resolve any disputes with respect to this Agreement or the Confidential Information, with each party irrevocably consenting to the jurisdiction thereof for any actions, suits or proceedings arising out of or relating to this Agreement or the Confidential Information, and each party hereto irrevocably waives its rights to jury trials with respect thereto.
AGREED TO AND ACCEPTED BY:
For and on behalf of
BANK NAME:
By:                                                                                  
Date:

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Schedule 5
Transfer Certificate
Lenders are advised not to employ Transfer Certificates or otherwise to assign or transfer interests in the Facility Agreement without further ensuring that the transaction complies with all applicable laws and requisitions, including the Financial Services Act 1986 and regulations made thereunder and similar statutes which may be in force in other jurisdictions.
     
TO:
  DnB NOR BANK ASA (the “Agent”) as agent on its own behalf and for and on behalf of the Borrower, the Owners and the Lenders as each such term is defined in the Facility Agreement referred to below
 
   
 
  ATTENTION: Mrs Solveig Nuland Knoff
Date:
This certificate (the “Transfer Certificate”) relates to a loan facility agreement dated December 2006 (as the same may from time to time be amended, supplemented and/or novated the "Facility Agreement”) made between (among others) (1) NCL Corporation Ltd. as borrower (the "Borrower”) (2) the banks and financial institutions referred to therein as lenders (the “Lenders”) and (3) the Agent whereby the Lenders have agreed to make available to the Borrower a revolving loan facility in the amount of up to six hundred and ten million Dollars (USD610,000,000). Terms defined in the Facility Agreement shall, unless otherwise defined herein, have the same meanings herein as therein.
In this Transfer Certificate:
the “Transferor” means [full name] of [lending branch];
the “Transferee” means [full name] of [lending branch].
1   The Transferor with full title guarantee transfers to the Transferee absolutely in accordance with Clause 18.1 of the Facility Agreement all rights and interests (present, future or contingent) which the Transferor has as Lender under or by virtue of the Facility Agreement and all the other Security Documents insofar as such rights and interests relate to that portion of its [Commitment][Contribution] to the Facility in an amount of [                    ] Dollars (USD[               ]) out of its total [Commitment][Contribution] which at the date hereof is [          ] Dollars (USD[               ]).
2   By virtue of this Transfer Certificate and Clause 18.5 of the Facility Agreement, the Transferor is discharged entirely with effect from the Transfer Date from that portion of its [Commitment][Contribution] to the Facility and its obligations relating thereto to the extent of [                              ] Dollars (USD[                    ]) out of its total [Commitment][Contribution] at such date.
3   The Transferee hereby requests:
  3.1   the Borrower, the Owners, the Agent and the Lenders to accept the executed copies of this Transfer Certificate as being delivered pursuant to and for the purposes of Clause 18.1 of the Facility Agreement; and

89


 

  3.2   the Agent to execute this Transfer Certificate on behalf of itself and the other said parties pursuant to Clause 18.5 of the Facility Agreement so that this Transfer Certificate will take effect in accordance with the terms thereof on [specify date of transfer] [or] [the date on which the Agent receives a certificate signed by [the Transferor] confirming that the following conditions have been fulfilled [specify conditions to transfer].
4   The Transferee:
  4.1   confirms that it has received a copy of the Facility Agreement and the other Security Documents together with such other documents and information as it has required in connection with the transaction contemplated thereby;
 
  4.2   confirms that it has not relied and will not hereafter rely on the Transferor, the Agent or the Lenders to check or enquire on its behalf into the legality, validity, effectiveness, adequacy, accuracy or completeness of the Facility Agreement or any other of the Security Documents or any other documents or information;
 
  4.3   agrees that it has not relied and will not rely on the Transferor, the Agent or the Lenders to assess or keep under review on its behalf the financial condition, creditworthiness, condition, affairs, status or nature of the Borrower or any other party to the Facility Agreement or any other of the Security Documents (save as otherwise expressly provided therein);
 
  4.4   warrants that it has power and authority to become a party to the Facility Agreement and has taken all necessary action to authorise execution of this Transfer Certificate and to obtain all necessary approvals and consents to the assumption of its obligations under the Facility Agreement and the other Security Documents;
 
  4.5   if not already a Lender, appoints the Agent to act as its agent as provided in the Facility Agreement and the other Security Documents and agrees to be bound by the terms of Clause 18.5 of the Facility Agreement and by all the terms of Clause 20 of the Facility Agreement.
5   The Transferor:
  5.1   warrants to the Transferee that it has full power to enter into this Transfer Certificate and has taken all corporate action necessary to authorise it to do so;
 
  5.2   warrants to the Transferee that this Transfer Certificate is binding on the Transferor under the laws of England, the country in which the Transferor is incorporated and the country in which its Lending Branch is located; and
 
  5.3   agrees that it will, at its own expense, execute any documents which the Transferee reasonably requests for perfecting in any relevant jurisdiction the Transferee’s title under this Transfer Certificate or for any similar purpose.
6   The Transferee hereby undertakes to the Transferor and each of the other parties to the Facility Agreement that it will perform in accordance with its terms all those obligations which by the terms of the Facility Agreement will be assumed by it after the transfer contemplated by this Transfer Certificate has taken effect.

90


 

7   If a Transferor and a Transferee effect a transfer in accordance with Clause 3 of this Transfer Certificate during an Interest Period, the Agent shall make all payments which would have become due to the Transferor under the Facility Agreement during the relevant Interest Period to the Transferor, as if no such transfer had been effected by the Transferor to the Transferee, according to the percentages of the Transferor’s Contribution and/or Commitment transferred and retained pursuant to Clauses 1 and 2 of this Transfer Certificate, and the Transferor and the Transferee shall be responsible for paying to each other pro rata all amounts (if any) due to them from each other for such Interest Period. On and from the commencement of the immediately succeeding Interest Period, the Agent shall make all payments due under the Facility Agreement for the account of the Transferor, to the Transferor, and shall make all payments due under the Facility Agreement for the account of the Transferee, to the Transferee. This provision is for administrative convenience only and shall not affect the rights of the Transferor and the Transferee under the Facility Agreement.
8   None of the Transferor, the Agent or the Lenders:
  8.1   makes any representation or warranty nor assumes any responsibility with respect to the legality, validity, effectiveness, adequacy or enforceability of the Facility Agreement or any other of the Security Documents or any document relating thereto;
 
  8.2   assumes any responsibility for the financial condition of the Borrower or any other party to the Facility Agreement or any other of the Security Documents or any such other document or for the performance and observance by the Borrower or any other party to the Facility Agreement or any other of the Security Documents or any such other document (save as otherwise expressly provided therein) and any and all such conditions and warranties, whether expressed or implied by law or otherwise, are hereby excluded (except as aforesaid).
9   The Transferor and the Transferee each undertakes that it will on demand fully indemnify the Agent in respect of any claim, proceeding, liability or expense which relates to or results from this Transfer Certificate or any matter connected with or arising out of it unless caused by the Agent’s or the Agent’s gross negligence or wilful misconduct, as the case may be.
10   The agreements and undertaking of the Transferee in this Transfer Certificate are given to and for the benefit of and made with each of the other parties to the Facility Agreement.
11   This Transfer Certificate shall be governed by, and construed in accordance with, English law.
IN WITNESS whereof the Transferor, the Transferee and the Agent (as agent for and on behalf of itself as the Agent, the Borrower, the Owners and the Lenders (other than the Transferor)) have caused this Transfer Certificate to be executed on the day first written above.

91


 

         
The Transferor
       
 
       
SIGNED by
    )  
 
    )  
for and on behalf of
    )  
[          ]
    )  
in the presence of:
    )  
 
       
The Transferee
       
 
       
SIGNED by
    )  
 
    )  
for and on behalf of
    )  
[          ]
    )  
in the presence of:
    )  
 
       
The Agent
       
 
       
SIGNED by
    )  
 
    )  
for and on behalf of
    )  
DnB NOR BANK ASA
    )  
as agent for and on behalf
    )  
of itself as the Agent, the Borrower,
    )  
the Owners and the Lenders
    )  
in the presence of:
    )  
     
Note:
  The execution of this Transfer Certificate alone may not transfer a proportionate share of the Transferor’s interest in the security constituted by the Security Documents in the Transferor’s or Transferee’s jurisdiction. It is the responsibility of each individual Lender to ascertain whether any other documents are required to perfect a transfer of such a share in the Transferor’s interest in such security in any such jurisdiction, and, if so, to seek appropriate advice and arrange for execution of the same.

92


 

Schedule
Administrative Details of Transferee
Name of Transferee:
Lending Branch:
Contact Person
(Loan Administration Department):
Telephone:
Fax:
Email:
Contact Person
(Credit Administration Department):
Telephone:
Fax:
Email:
Account for Payments:

93


 

Schedule 6
Quarterly Statement of Financial Covenants
     
TO:
  DnB NOR BANK ASA
 
  Stranden 21
 
  NO-0021 Oslo
 
  Norway
 
   
 
  Attn: Mr Jon Flovik
We refer to clause 10.3 of the loan facility agreement dated     December 2006 (as amended, varied and/or supplemented from time to time) (the “Facility Agreement”) between (among others) you as agent and ourselves as borrower. Terms defined in the Facility Agreement shall have the same meanings herein.
We hereby certify the amounts set out in the attached schedule as at the last day of the financial quarter ending           20[   ] for NCL Corporation Ltd. (the “Borrower”) and its subsidiaries on a consolidated basis. We also hereby certify that the Borrower is in compliance with all the financial covenants set out in clause 10.3 of the Facility Agreement [[and that no Event of Default or Possible Event of Default has occurred and is continuing][an [Event of Default][Possible Event of Default] has occurred and is continuing under clause 12.1.[  ] of the Facility Agreement and the following step[s][is/are] being taken to cure the same: [   ]]].
NCL CORPORATION LTD.
     
 
By: [          ]
   
Chief Financial Officer
   
 
   
Dated:                     20[   ]
   

94


 

Schedule
Statement of Financial Covenants as of [                ] 20[  ] (in USD’000)
                 
Clause (of
               
Facility
Agreement)
      as of []   Required Covenants
            A>[**] [Confidential Treatment]
 
          (10.3.1)**    
10.3.1/           A>[**] [Confidential Treatment]
10.3.2(b)**   Free Liquidity   A   (10.3.2(b))**
10.3.2(a)
  Consolidated EBITDA:   B   >[**] [Confidential Treatment]    
 
  Consolidated Debt Service   C        
10.3.3
  Total Net Funded Debt:   D   <[**] [Confidential Treatment]    
 
  Total Capitalisation   E        
 
 
  Consolidated EBITDA            
 
  Consolidated Net Income
(loss)
      x    
(Deduct)/Add:
  (Gain)/Loss on sale of assets or reserves       x    
Add:
  Consolidated Interest
Expense
      x    
Add:
  Depreciation and amortisation of assets       x    
Add:
  Impairment charges       x    
(Deduct)/Add:
  Other non-cash charges (gains)       x    
Add:
  Deferred income tax expense       x    
 
               
 
  Consolidated EBITDA       x   B
 
               
 
  Consolidated Debt Service            
 
  Principal paid/payable (excluding balloon payments, voluntary prepayments/repayments on sale/total loss of an NCLC Fleet vessel)       x    
Add:
  Consolidated Interest Expense       x    
 
  Distributions       x    
 
  Rent under capitalised leases       x    
 
               
 
  Consolidated Debt Service       x   C
 
               
 
  Total Net Funded Debt            
 
  Indebtedness for Borrowed Money       x    
Add:
  Guarantees of non-NCLC Group members’ obligations       x    
 
               
 
          x    
 
               
Deduct:
  Cash Balance       (x)    
 
               
 
  Total Net Funded Debt       (x)   D
 
               
 
  Total Capitalisation            
 
  Total Net Funded Debt       x    
Add:
  Consolidated stockholders’ equity       x    
 
               
 
  Total Capitalisation       x   E
 
               

95


 

For and on behalf of NCL CORPORATION LTD.
                                                            
[ ]
I, [ ], the officer primarily responsible for the financial management of the NCLC Group, hereby declare that, to the best of knowledge and belief, the above Statement of Financial Covenants as of [ ] 20[ ], in my opinion, is true and correct.
                                                            
[ ]
Chief Financial Officer
NCL CORPORATION LTD.
Dated:                20[ ]
**   Evidence satisfactory to the Agent of A at all times during the relevant period shall be provided together with this statement

96

EX-4.36 13 g05791exv4w36.htm EX-4.36 AMENDMENT AGREEMENT EX-4.36 Amendment Agreement
 

Exhibit 4.36
[Confidential Treatment]
Private & Confidential
To: NCL (Bahamas) Ltd. (NCLB) and NCL Corporation Ltd. (NCLC)
From: Crown Odyssey Limited (COL)
Date: 1 September 2006
Dear Sirs,
Subject: Sale and Charter of m.v. Norwegian Crown (the “Ship”)
1.   Reference is made to:
 
(i)   the bareboat charter dated 20 April 2004 (the Original Charter) pursuant to which COL agreed to charter the Ship to NCLB;
 
(ii)   the guarantee dated 20 April 2004 (the Original Charter Guarantee) pursuant to which NCLC agreed to guarantee to COL the due performance of the Original Charter by NCLB;
 
(iii)   the memorandum of agreement dated 1 June 2006 (the MOA) pursuant to which COL agreed to sell the ship to Fred. Olsen Cruise Lines Pte. Ltd., or permitted nominee (the Buyer); and
 
(iv)   the bareboat charter dated 1 June 2006 (the New Charter) pursuant to which the Buyer agreed to charter the Ship to COL and to permit COL to sub-charter the Ship subject to certain restrictions provided for in the New Charter.
 
2.   Each of COL and NCLB hereby agrees that upon and with effect from completion of the sale of the Ship pursuant to the MOA:
 
(i)   the terms and conditions of the Original Charter will be amended and restated as set out in the attached Schedule; and
 
(ii)   the Original Charter will continue to bind each of COL and NCLB in accordance with such amended and restated terms and conditions.
 
3.   NCLC hereby:
 
(i)   approves the proposed amendment and restatement of the Original Charter; and
 
(ii)   agrees that its obligations and liabilities under the Original Charter Guarantee will continue in full force and effect after the proposed amendment and restatement of the Original Charter becomes effective.
 
4.   Each of COL, NCLB and NCLC hereby agrees that:

 


 

(i)   the agreement (the Agreement) constituted by the countersignatures below on behalf of NCLB and NCLC will take effect as an addendum to each of the Original Charter and the Original Charter Guarantee;
 
(ii)   except as expressly amended and restated by the Agreement, each of the Original Charter and the Original Charter Guarantee will remain in full force and effect;
 
(iii)   nothing contained in the Agreement will relieve NCLB or NCLC of any their respective obligations or liabilities under the Original Charter or the Original Charter Guarantee;
 
(iv)   if the ship is not delivered to the Buyer in accordance with the MOA, the Agreement will automatically terminate at the time and on the date when the MOA is terminated.
Yours faithfully,
Crown Odyssey Limited
By:   Vijay Jeyaratnam
Attorney-in-fact
We hereby confirm our agreement to the terms and conditions set out above.
                 
NCL (Bahamas) Ltd.   NCL Corporation Ltd.    
 
               
By:
  Paul Turner
Attorney-in-fact
  By:   Paul Turner
Attorney-in-fact
   

-2-


 

Schedule
Words and expressions defined in the attached Agreement will bear the same meaning in this Schedule.
Upon and with effect from completion of the sale of the Ship pursuant to the MOA, the Original Charter will be amended and restated as set out below.
Box 3 will read “Crown Odyssey Limited, Bermuda as disponent owners.”
Box 16 will read “East Coast USA at a port selected by Charterers.”
Box 19 will read “In conformity with Class Rules.”
Box 20 will read “Worldwide trading within Institute Warranty Limits but always excluding all war zones, countries banned by the UN from time to time and any areas/countries prohibited by the government of the Vessel’s flag or underwriters.”
Box 21 will read “The Vessel shall be redelivered between [**] [Confidential Treatment] and, by written notice to Owners given no later than [**] [Confidential Treatment] , Charterers shall: (i) fix a redelivery date between (and including) [**] [Confidential Treatment] ; and (ii) fix the port of redelivery.”
Box 28 will be amended to mirror the provisions contained in Clause 12(b) of the New Charter.
Box 29 will read “US$125,000,000”
Other provisions [**] [Confidential Treatment].
(End of Schedule)

-3-

EX-4.37 14 g05791exv4w37.htm EX-4.37 ADDENDUM NO. 1/CROWN WIND LIMITED EX-4.37 Addendum No. 1/Crown Wind Limited
 

Exhibit 4.37
[Confidential Treatment]
Addendum No. 1 to the bareboat charter dated 20 April 2004 between NCL (Bahamas) Ltd. as charterers and Crown Wind Limited as owners in relation to the vessel named “MV Norwegian Wind” (the “Charter”)
1.   The parties have agreed that the Charter Period set out in box 21 of the Charter shall be amended to read “The Vessel shall be redelivered between [**] [Confidential Treatment] ”.
2.   Save as expressly provided by this Addendum No. 1, all other terms and conditions of the Charter shall remain unamended and in full force and effect.
Mark E. Warren
                                                            
For and on behalf of NCL (Bahamas) Ltd.
Date: 28 November 2006
Signature Illegible
                                                            
For and on behalf of Crown Wind Limited
Date: 28 November 2006

EX-4.38 15 g05791exv4w38.htm EX-4.38 ADDENDUM NO. 1/OCEAN DREAM LIMITED EX-4.38 Addendum No. 1/Ocean Dream Limited
 

Exhibit 4.38
[Confidential Treatment]
Addendum No. 1 to the bareboat charter dated 20 April 2004 between NCL (Bahamas) Ltd. as charterers and Ocean Dream Limited as owners in relation to the vessel named “MV Norwegian Dream” (the “Charter”)
1.   The parties have agreed that the Charter Period set out in box 21 of the Charter shall be amended to read “The Vessel shall be redelivered between [**] [Confidential Treatment] ”.
2.   Save as expressly provided by this Addendum No. 1, all other terms and conditions of the Charter shall remain unamended and in full force and effect.
Mark E. Warren
                                                                        
For and on behalf of NCL (Bahamas) Ltd.
Date: 28 November 2006
Signature Illegible
                                                            
For and on behalf of Ocean Dream Limited
Date: 28 November 2006

EX-4.39 16 g05791exv4w39.htm EX-4.39 ADDENDUM NO. 1/OCEAN VOYAGER LIMITED EX-4.39 Addendum No. 1/Ocean Voyager Limited
 

Exhibit 4.39
[Confidential Treatment]
Addendum No. 1 to the bareboat charter dated 20 April 2004 between NCL (Bahamas) Ltd. as charterers and Ocean Voyager Limited as owners in relation to the vessel named “MV Norwegian Majesty” (the “Charter”)
1.   The parties have agreed that the Charter Period set out in box 21 of the Charter shall be amended to read “The Vessel shall be redelivered between [**] [Confidential Treatment] ”.
2.   Save as expressly provided by this Addendum No. 1, all other terms and conditions of the Charter shall remain unamended and in full force and effect.
Mark E. Warren
                                                                        
For and on behalf of NCL (Bahamas) Ltd.
Date: 28 November 2006
Mark E. Warren
                                                                               
For and on behalf of Ocean Voyager Limited
Date: 28 November  2006

EX-4.40 17 g05791exv4w40.htm EX-4.40 ADDENDUM NO. 4,5 & 6/PRIDE OF AMERICA EX-4.40 Addendum No. 4,5 & 6/Pride of America
 

Exhibit 4.40
[Confidential Treatment]
EXECUTION COPY
Addendum No. 4
to the Contract dated as of 5 February 2003
(as amended and supplemented
from time to time, the “Contract”)
between
Pride of America Ship Holding, Inc. (“Owner”)
and
Lloyd Werft Bremerhaven GmbH (“LWB”)
Preamble
The Vessel is planned to be delivered on 6 June 2005.
The Owner is planning an early arrival of crew members not being any members of the OMT, but being officers, engineers and normal crew members who shall be trained and made familiar with the Vessel in the premises of the Yard before Redelivery of the Vessel to the Owner. All such persons not being staff of the Owner’s OMT or Owner’s subcontractors are hereinafter called the “Crew” or “Crew Members”.
The first group of Crew Members is scheduled to arrive end of March 2005 and by the end of May up to 1,100 Crew shall be on board the Vessel.

 


 

- 2 -
Now therefore the Parties agree as follows:
1.   The Owner may send up to 1,100 Crew on board the Vessel before the Redelivery Date always provided that
  -   subject to the other express provisions of this Addendum, the Owner shall bear all and any costs and risk resulting out or in connection with all or any Crew. Costs and expenses for the Crew are not included in the Contract Price (Clause 11.3.4), but are solely for Owner’s account.
 
  -   In respect of Crew Clause 14.1. of the Contract shall not apply and LWB shall only be responsible for any damage or injury caused to Crew’s property or Crew in case LWB or its subcontractors have acted gross negligently or wilfully and always limited to the insured amount mentioned in Clause 14.2. of the Contract which shall also apply for Crew.
 
  -   Owner shall insure the risk for any damage or injury caused by Crew to LWB and/or its subcontractors and/or third persons and shall fully indemnify and hold harmless and defend LWB from and against any and all losses except to the extent that any losses are caused directly or indirectly by the executives of LWB.
 
  -   Any delay caused by Crew in the Redelivery of the Vessel shall be treated as a Permissible Delay according to Clause 7.3 of the Contract and Clause 7.3.4 (a) is herewith amended so as to clarify that delays caused by the Crew will be deemed to be delays caused by the Owner under Clause 7.3.4 (a).
 
  -   Any damage caused by Crew is to be made good by LWB as a new order from the Owner to LWB under and subject to Clause 6.1 of the Contract.
2.   LWB shall arrange the necessary extension of the builders risk insurance cower, including an extension of cover for the co-insured Owner in respect of the increased risk of having Crew Members on board of the Vessel before Redelivery at the time the Vessel is at the Yard and under trials. It being understood that the costs for any additional premiums shall be charged to the project costs before the final results of the project are calculated and before any resulting profits are divided equally between LWB and the Owner.

 


 

- 3 -
3.   Before the Crew shall enter the Vessel the Owner and LWB shall clearly define each area to which the Crew shall have access for the purposes of training and accommodation (each a “Defined Area”). For familiarisation purposes only, the Crew shall have access to all areas of the Vepssel, always provided that it shall not interfere with the Works. Before the Crew enter a Defined Area on board the Vessel, the Owner and LWB shall complete the mechanical completion procedures in relation to the Defined Area according to Clause 9.1, 9.2 and 9.3 of the Contract and a Mechanical Completion Certificate shall be signed in respect of the Components of Work in the Defined Area.
 
    Without limiting the other express provisions of this Addendum and subject to the proviso to this paragraph, signature of a Mechanical Completion Certificate for each Component of Work in a Defined Area will mean that the Owner has accepted the relevant Component of Work under Clause 9.1 and that the Warranty Period according to Clause 10.1 of the Contract in respect of each such Component of Work shall have started with effect from the date of signing of the Mechanical Completion Certificate PROVIDED THAT: (i) LWB shall be Obliged successfully to complete any outstanding tests in relation to the relevant Component or Defined Area: (ii) LWB Shall be obliged to rectify any Defects in relation to the relevant Component of Work noted in the Mechanical Completion Certificate: (iii) LWB shall be obliged to rectify any Defects in the relevant Component or Defined Area discovered after signature of the Mechanical Completion Certificate but which the Owner can demonstrate were not caused by the Crew; and (iv) LWB shall be obliged to complete the remainder of the Works in accordance with the Contract.
 
4.   The Owner shall safeguard and be responsible that
  -   the Crew shall effect and fulfil all security and safety provisions as requested by the hull underwriters, the underwriters, expert team VHT, the P&l Club and LWB;
 
 
  -   the Owner shall be responsible for arranging roving fire guards within the relevant Defined Areas and for controlling access to the Defined Areas and Crew access to the remainder of the Vessel, and the Crew shall give LWB and its subcontractors access to the Defined Areas for testing, defect rectification or other necessary pre-redelivery Works:

 


 

- 4 -
  -   the Owner shall allow and empower LWB fire guards to control the Defined Areas in addition to Owner’s fire guards if the same is ordered by underwriters:
 
  -   the Crew shall ensure that Owner’s occupation of the Defined Areas and other parts of the Vessel does not hinder any remaining Works to be carried out by LWB.
5.   It is understood and agreed that due to the ongoing completion of the Vessel, the local fire brigade considers the Vessel to be unsafe for accommodation, but that nonetheless the Owner wishes to accommodate the Crew on board and with the adoption of certain procedures believes that the crew may be accommodated safely. The Owner undertakes to hold harmless and indemnify LWB against all costs, liabilities and losses incurred by LWB by reason of the accommodation of the Crew on board with respect to the Defined Areas and other parts of the Vessel occupied by the Crew.
6.   Save as expressly provided in this Addendum an other terms and conditions of the Contract (and previous addenda thereto) shall remain un-amended and in full force and effect.

 


 

- 5 -
7.   Words and expressions defined in the Contract shall have the same meaning when used in this Addendum.
         
  Signed on 28 April 2005


Mark E. Warren
For and on behalf of
Pride of America Ship Holding, Inc.
 
 
  Signed on 18 April 2005
__________________________________  
 
  Signature Illegible
__________________________________  
 
  For and on behalf of

Lloyd Werft Bremerhaven GmbH
 
 
  Signed on 13 May 2005
__________________________________  
 
  Signature Illegible
__________________________________
Wolfgang van Betteray
as Sachwalter of LWB
 
 
     
     
     
 

 


 

Addendum No. 5 to the Contract dated as of 5 February 2003 (as amended and supplemented from time to time, the Contract) between Pride of America Ship Holding, Inc (the Owner) as legal successor of Ship Holding LLC, and Lloyd Werft Bremerhaven GmbH (LWB) in relation to the passenger ship known as “Pride of America” (the Vessel)
The parties have agreed to enter into this Addendum in order to record certain matters agreed between them in connection with redelivery of the Vessel under the Contract. Now, therefore, it is hereby agreed as follows:
1. Determination and payment of certain sums referred to in Addendum No. 3 to the Contract
1.1 The sums referred to in clauses 16 (a) and (b), and 20 (c), of Addendum No. 3 to the Contract shall be determined as follows:
     (a) In respect of the payment due to the Owner under clause 16. (a) and (b) of Addendum No. 3,
  (i)   LWB has rendered a concurrent cost estimation on a monthly basis both in respect of the Casualty works and the completion Works. A copy of the concurrent cost estimation as of May 25, 2005 is attached as Annex 1, showing
  -   regarding the Casualty Works, a provisional result of [**] [Confidential Treatment] representing the full amount of the [**] [Confidential Treatment] insurance cost savings to be credited to the Owner and LWB jointly under clause 5 of the “Vereinbarung”, and
 
  -   regarding the completion Works, a provisional result of [**] [Confidential Treatment] in favour of the Owner (including [**] [Confidential Treatment] representing [**] [Confidential Treatment] of all scrap proceeds referred to in clause 20. (c) of Addendum No. 3);
  (ii)   in view of the current shortened business year of LWB, which, due to the Insolvency proceedings, will end on 30 June 2005, LWB will render its annual accounts by 30 August 2005. The annual accounts will be verified by the accountants of LWB by 20 September 2005, and may for the purposes of

 


 

- 2 -
      determining the payment due to the Owner be verified by the accountants of the Owner;
 
  (iii)   in view of the subsequent shortened business year of LWB ending on 31 December 2005, LWB will render its subsequent annual accounts by 30 March 2006 which will be verified by the accountants of LWB by 30 April 2006 and may for the purposes of determining the payment due to the Owner be verified by the accountants of the Owner; and
 
  (iv)   based on Annex 1, the annual account of the business year ending 30 June 2005 and the annual account of the business year ending 31 December 2005, the accountants of LWB and the Owner shall jointly determine the exact sum payable to the Owner in accordance with clause 16. (a) and 17. (c) of Addendum No. 3;
 
  (b)   Regarding payments due to the Owner under clause 20. (c) of Addendum No. 3, the scrap revenues are included in the concurrent cost estimation and this position is therefore part of the result under 1 (a) (i).
1.2.   The provisional result of [**] [Confidential Treatment] regarding the completion of Works referred to in clause 1.1.(a) (i) of this Addendum No. 5 has been determined without computing in determining such provisional result the sum of [**] [Confidential Treatment] referred to in clause 2.8.
 
    The release of this sum to either party as well as any further payments made by LWB to the Owner [**] [Confidential Treatment] referred to in clause 2.6 below or further agreement will change the provisional result and any improvement of the result shall be credited at [**] [Confidential Treatment] to the Owner, and any reduction of the result shall be reimbursed by the Owner to LWB in an amount corresponding to [**] [Confidential Treatment] of the reduction.
 
1.3.   Payment of the sums referred to in paragraphs 1.1 and 1.2 above shall be made as follows:
 
(a)   LWB shall make an advance payment on the amount due under clause 16 (a) of Addendum No. 3 in the amount of [**] [Confidential Treatment] at redelivery of the Vessel, which amount shall then be deducted from the Casualty Compensation.

 


 

- 3 -
(b)   LWB shall make payment of the amount due under clause 16 (b) of Addendum No. 3, as soon as the full and final settlement regarding the Casualty Works has been achieved with VHT and the insurers and the final instalment has been paid, assumed for the end of July 2005, which amount shall then be deducted from the Casualty Compensation.
 
(c)   The remaining funds due to the Owner under clause 16. (a) shall be paid by LWB to the Owner as soon as the joint determination referred in clause 1. (a) (iv) above has been completed, such further payments to reduce the Casualty Compensation accordingly.
2.   Works and other matters outstanding at redelivery
2.1   The Works referred to in the attached Annex 2 will not be completed as at redelivery and LWB hereby agree, at their risk and expense (and without any impact on the profit share calculations referred to in clause 1 above) to complete all such Works to the Owner’s satisfaction fully in accordance with the Contract and the Specification as soon as practicable after redelivery. In the limited time available for redelivery it has not been possible for the parties’ technical representatives to verify the accuracy and completeness of Annex 2. The parties therefore agree that they will work closely together and in good faith in order to verify and, as necessary, amend or supplement and/or reduce Annex 2 as soon as reasonably practicable after redelivery in order to ensure that Annex 2 reflects the actual position as at redelivery.
 
2.2   Without prejudice to clause 2.1 above, if (a) by [**] [Confidential Treatment] any of the Works referred to in the attached Annex 3 shall not have been completed to the Owner’s satisfaction in accordance with the Contract and the Specification or any of the remaining Tests and Trials shall not have been passed successfully or any of the certificates and other documents to be issued by any of the Classification Bodies or Regulatory Bodies shall not have been issued or shall have been issued subject to any conditions, recommendations or other restrictions and (b) by reason of any of the foregoing the Vessel is not ready to enter continuous fare paying passenger service by midnight (Vessel local time) on [**] [Confidential Treatment] then from such time and until the Vessel does enter fare paying passenger service LWB shall be liable to pay the Owner from time to time on demand by way of agreed liquidated damages and not as a penalty liquidated damages at the rates and for the periods specified in clause 12.1.3 of the Contract (but

 


 

- 4 -
    without the eight days grace period provided for in that clause) for each day (and pro rata for each part of a day) during such period provided however that the total amount payable by LWB under this clause 2.2 and clause 2.6 (b) (i)  [**] [Confidential Treatment]. For the avoidance of doubt, this provision does not relieve LWB of its obligation to pay Casualty Compensation under Addendum No. 3. With reference to item 5 # 124 and 132 of the USCG Worklist in Annex 3, the Owner is required to provide three additional licensed engineers to provide a continuous watch to respond to alarms in respect of the machinery automation system and three additional electrical bridge officers to provide a continuous match in respect of the ship security alert systems [**] [Confidential Treatment].
 
2.3   Pending completion of the Works referred to in Annex 3 in accordance with clause 2.2, the Owner may withhold the sum of [**] [Confidential Treatment] from the final instalment of the Contract Price. Such sum will be placed in an escrow account with HSBC Bank plc in London or another mutually acceptable bank in London as soon as practicable after redelivery and on terms that it will be released only upon joint written instructions of the parties’ duly authorised representatives. The parties will promptly provide the relevant bank with ail such information and documentation as it may require to open the escrow account pursuant to this clause. The parties agree that as soon as the Works referred to in Annex 3 have been completed to Owner’s satisfaction in accordance with the Contract and the Specification, all remaining Tests and Trials have been passed successfully, and all certificates and other documents have been issued free of conditions, recommendations so that the Vessel is ready to enter continuous fare paying passenger service the Owner will join with LWB in instructing HSBC to release the principal amount of the escrowed funds to LWB less the aggregate total amount of any liquidated damages payable by LWB under clause 2.2 which amount shall be released to the Owner. [**] [Confidential Treatment].
 
2.4   In order to complete the Works referred to in clauses 2.1 and 2.2 above LWB will, at its sole risk and expense (and without any impact on the profit share calculations referred to in clause 1 above) arrange for up to [**] [Confidential Treatment] workers to travel with the Vessel to New York. At all times and in all respects such workers shall be deemed to be employees of LWB who shall be fully and directly responsible for — and who shall from time to time on demand indemnify the Owner fully against — all liabilities in relation to death or injury to any such workers or the loss, damage or destruction of any of their property save only

 


 

- 5 -
    to the extent that any such liability arose as a direct result of wilful default or gross negligence on the part of the Owner. LWB will arrange and pay for the repatriation from New York of the workers referred to above.
 
2.5   Without prejudice to LWB’s obligations under clauses 2.2 above, if the Owner in its free discretion agrees that any of the relevant Works may be completed by LWB after [**] [Confidential Treatment], LWB shall ensure that all such Works shall be planned and executed with all due despatch after [**] [Confidential Treatment] without any interruption to the Vessel’s service and without adversely affecting the convenience and comfort of the Vessel’s passengers.
 
2.6  
(a)   There are open issues between the parties in relation to: [**] [Confidential Treatment].
    the parties agree to negotiate with one another in good faith in order to resolve their disagreements in relation to these issues as soon as practicable after redelivery of the Vessel provided always that if it is not possible for the parties to resolve their disagreements in relation to such issues by the due date for payment to LWB of the sum payable to it under clause 2.3 above then the parties may refer such matters to arbitration in London pursuant to clause 22 of the Contract.

 


 

- 6 -
 (b) LWB acknowledge and agree that:
  (i)   in relation to the matters referred to in (a) (i) above, and notwithstanding redelivery of the Vessel, the Owner shall be entitled to claim the costs of (a) all necessary materials, installation and modification works; (b) all necessary dry dock costs; (c) all fuel and port costs incurred in moving the Vessel from her service berth to the dry dock, in carrying out all necessary sea trials, and in moving the Vessel back to her service berth; (d) all attendance costs of representatives of the Classification Bodies and other persons who may be required to attend the Vessel in connection with the remedial works and related trials; (e) and liquidated damages at the rate of [**] [Confidential Treatment] per day (and pro rata) for each day (or part of a day) during which the Vessel is out of service on account of the remedial works, dry docking etc;
 
  (ii)   the remedial works and dry docking may be carried out where and when most convenient to the Owner’s scheduled service for the Vessel and in order to minimise disruption to such service;
 
  (iii)   the Warranty Period referred to in clause 10.1 of the Contract will continue until [**] [Confidential Treatment] from the due date for payment of the sums payable to LWB under clause 2.3 above. The Warranty Period shall apply to works in relation to the matters referred to in (a) (i) above and shall continue until [**] [Confidential Treatment] from the date of completion of such works provided that (without prejudice to the Warranty Period for the equipment already installed in the Vessel) in the case of the new propellers the [**] [Confidential Treatment] Warranty Period will commence when they are ready to be installed on the Vessel; and
 
  (iv)   the provisions of clause 10 of the Contract do not apply to the Owner’s claims in respect of the matters referred to in paragraphs (i) to (iv) above.
       
For the avoidance of doubt, the Owner’s right to make any recovery from LWB in relation to the matters referred to 2.6. (a) shall be subject to and conditional upon either LWB accepting liability for such matters or such liability being determined [**] [Confidential Treatment].

 


 

- 7 -
2.7   By accepting redelivery of the Vessel the Owner shall not be deemed to have waived any of its rights which may arise (or which may have arisen) at any time under and in connection with the Contract in respect of any of the matters referred to in paragraphs 2.2 and 2.6 above, all of which rights are fully reserved.
 
2.8   The parties have agreed that, as security for the Owner’s disputed claims under clause 2.6 (a) (i) above, the Owner may withhold [**] [Confidential Treatment] which sum is to be paid as soon as practicable after redelivery into an escrow account opened and held by HSBC Bank plc in London or such other bank in London as is mutually acceptable to both parties and on terms that all payments from the escrow account shall be made only upon either the joint written instructions of the duly authorized representatives of both parties or in accordance with a binding arbitration award obtained in the arbitration proceedings referred to in clause 2.6. Interest on the escrowed funds will follow the agreement of the parties or the award of the arbitration tribunal. The parties will provide the relevant bank with ail such information and documentation as it may require to open the escrow account pursuant to this clause. LWB and its Shareholders (as defined in the Memorandum of Agreement made between LWB, the Owner, the Shareholders and KfW on or about 1 July 2004 (the “MoA”) further agree that:
  (i)   if and to the extent that LWB accept liability or are adjudged to be liable to the Owner [**] [Confidential Treatment] and such liability exceeds the amount recoverable by the Owner from the escrowed funds and LWB are unable to pay the excess then subject to the following proviso the amount of the Owner’s claim for Casualty Compensation referred to in the MoA shall be increased by the amount of such excess up to a cap of [**] [Confidential Treatment] provided that such cap is solely for the purposes of fixing the amount of the Owner’s claims that are secured by the securities referred to in (ii) below and shall not cap the amount of the Owner’s claim against LWB;
 
  (ii)   by no later than [**] [Confidential Treatment] LWB and the Shareholders (as defined in the MoA) shall at their cost procure that the Owner’s claim for Casualty Compensation (as the same may be increased pursuant to the provision of (i) above) is directly secured on an in rem basis to the Owner’s satisfaction by granting the same securities to the Owner as to KfW and the Banks (as defined in the MoA) for the Loan (also defined in the MoA) on the basis that such securities would be subordinate to and rank directly after the interest of KfW and the Banks under

 


 

- 8 -
 
their existing securities subject always and without prejudice to the obligations of KfW and the Banks under and in connection with the MoA.
2.9   Pending agreement of the parties or [**] [Confidential Treatment] for the matters referred to in clause 2.6 (a) (i), LWB and the Owner will work closely together in order to plan and timetable the necessary remedial works, with LWB taking the lead role vis-a-vis the manufacturers of the relevant equipment provided always that LWB shall obtain the prior written approval of the Owner in relation to all material decisions in connection with such works including, without limitation, the design, location and timing of such works. LWB shall pay for the necessary materials, works and dry-docking charges. If they accept liability [**] [Confidential Treatment] for such costs and charges and the sum total of the amounts recoverable by the Owner under clause 2.6 (b)(i) above shall be less than the funds standing to the credit of the escrow account, the relevant amount due to the Owner shall be released to the Owner and the balance shall be released to LWB. Alternatively if the Owner accepts liability or is adjudged to be liable for such costs and charges then the funds (including interest) standing to the credit of the escrow account shall be released to LWB and in addition the Owner will reimburse LWB for the amounts already paid by it on account of such costs and charges.
 
2.10   NCL Corporation Ltd guarantees and undertakes to ensure that the sums referred to in clauses 2.3 and 2.8 above (which sums are presently held on deposit by HSBC Bank plc in London) will continue to be held by HSBC Bank plc until the escrow accounts referred to in those clauses have been opened and will then cause such sums to be paid to such accounts pursuant to clauses 2.3 and 2.8.
 
2.11   The Final Completion Certificate and the Protocol of Redelivery shall be in all respects subject and subordinate to the provisions of this Addendum.
 
3.   Save as expressly provided in this Addendum all other terms and conditions of the Contract (and previous addenda thereto), including but not limited to clause 17 (c) of Addendum No. 3, shall remain unamended and in full force and effect. By their signature of this Addendum each of the Owner, LWB and the Sachwalter fully and unconditionally affirm the Contract as amended by this Addendum.

 


 

- 9 -
4.   Words and expressions defined in the Contract shall have the same meaning when used in this Addendum.
             
Signed on 7/6/2005 by:
      Signed on 7/6/2005 by:    
 
           
/s/ PA Turner
      /s/ PA Turner    
 
           
For and on behalf of
      For and on behalf of    
Pride of America Ship Holding Inc.
      NCL Corporation Ltd.    
 
           
Signed on 7/6/2005 by:
      Signed on 07/06 2005 by:    
 
           
/s/ [ILLEGIBLE]
      /s/ [ILLEGIBLE]    
 
           
For and on behalf of
      For and on behalf of    
Lloyd Werft Bremerhaven GmbH
      Wolfgang van Betteray
as Sachwalter of LWB
   
 
           
Signed on 7/6/2005 by:
      Signed on 7/6/2005 by:    
 
           
/s/ [ILLEGIBLE]
      /s/ [ILLEGIBLE]    
 
           
For and on behalf of
      For and on behalf of    
L.P.S. Dienstleistungs- und
      W.L. Werner Lüken Verwaltungs- und    
Verwaltungsgesellschaft Bremerhaven
      Beteiligungs GmbH    
GmbH
           

 


 

- 10 -
    Annex 1: [**] [Confidential Treatment]
 
    Annex 2: [**] [Confidential Treatment]
 
    Annex 3: [**] [Confidential Treatment]

 


 

Addendum No. 6 to the Contract dated 5 February 2003 (as amended and supplemented from time to time, the Contract) between Pride of America Ship Holding, Inc (the Owner) as legal successor of Ship Holding LLC, and Lloyd Werft Bremerhaven GmbH (LWB) in relation to the passenger ship known as “Pride of America” (the Vessel).
NOW, IT IS HEREBY AGREED as follows:
1.   The Owner asserts that LWB became liable to pay liquidated damages pursuant to Clause 2.2 in Addendum 5 of the Contract with effect from midnight (New York time) on [**] [Confidential Treatment]. LWB disputes this assertion. Each party reserves all of its rights and remedies in relation to this dispute and agrees that the making of this Addendum shall be without prejudice to all such rights and remedies.
 
2.   The Vessel is scheduled to enter continuous fare paying passenger service in Miami on [**] [Confidential Treatment] for a cruise (the first cruise) from Miami to Los Angeles. However, as at the date of this Addendum, the Works to be performed by LWB under the Contract in relation to [**] [Confidential Treatment] have not yet been completed to the Owner’s satisfaction in accordance with the Contract and the Specification. The parties disagree about the number of cabins affected by [**] [Confidential Treatment]. LWB accept that [**] [Confidential Treatment] cabins cannot be used for continuous fare paying passenger service by reason of [**] [Confidential Treatment]. However, the Owner has reason to believe that, after the Vessel enters fare paying passenger service, [**] [Confidential Treatment] may affect other cabins and spaces in the Vessel. In order to enable the Owner to put the Vessel into partial fare paying passenger service on [**] [Confidential Treatment], the parties have agreed that LWB shall pay liquidated damages to the Owner in accordance with the following provisions:-
  (i)   With effect from commencement of the first cruise on [**] [Confidential Treatment] until the time on the date when the cause and effects of the [**] [Confidential Treatment] in [**] [Confidential Treatment] the affected cabins referred to above have been permanently remedied, and when such permanent remedy has been proved by all necessary tests, to the Owner’s satisfaction in accordance with the Contract and the Specification LWB shall pay the Owner liquidated damages at the rate of [**] [Confidential Treatment],-per day (and pro rata for each part of a day). This rate represents [**] [Confidential Treatment]% of a per day rate of [**] [Confidential Treatment], this being the % of the Vessel’s cabin capacity agreed by LWB (as at the date of this Addendum) to be unusable by reason of [**] [Confidential Treatment].
 
  (ii)   All necessary tropical climate inspections, tests and trials of the [**] [Confidential Treatment] will be carried out, at the times and in accordance with the procedures already agreed between the technical representatives of the Owner and LWB, during the first cruise while the Vessel is transiting the Panama Canal. If such tropical inspections, tests and trials prove that other cabins (in addition to [**] [Confidential Treatment] the cabins referred to at (i) above) or other spaces in the Vessel are affected by [**] [Confidential Treatment], the liquidated damages payable by LWB for the duration of the first cruise and each subsequent fare paying passenger cruise shall be increased to reflect the % of the Vessel’s cabin capacity and other spaces that are in fact affected by the [**] [Confidential Treatment] until the cause and effects of the [**] [Confidential Treatment] in the affected cabins and other spaces have been permanently remedied, and until such permanent remedy has been proved by all necessary inspections tests

 


 

      and trials, to the Owner’s satisfaction in accordance with the Contract and the Specification provided however that, at the commencement of each subsequent fare paying passenger cruise, the liquidated damages rate per day (and pro rata) for such cruise shall be reduced proportionately to reflect the number of cabins and other spaces that were proven, to the Owner’s satisfaction in accordance with the Contract and the Specification, to have ceased to be affected by [**] [Confidential Treatment] during or after completion of the previous fare paying passenger cruise.
    [**] [Confidential Treatment]
3.   Directly following signature of this Addendum on behalf of the parties, the Owner and LWB will consult with one another in good faith with a view to agreeing the nature, extent and timing of the corrective works to be carried out by LWB (at their sole risk and expense) in order to permanently remedy the causes and effects of all [**] [Confidential Treatment] to the Owner’s satisfaction in accordance with the Contract and the Specification provided always that such works shall be planned and carried out with all due despatch, without any interruption to the Vessel’s service and without affecting the comfort or convenience of the Vessel’s passengers.
 
4.   Notwithstanding Clause 3 above, LWB agree that if the causes and effects of all [**] [Confidential Treatment] shall not have been permanently remedied, and that such permanent remedy shall not have been proved by all necessary inspections tests and trials, to the Owner’s satisfaction in accordance with the Contract and the Specification by completion of the first cruise, the Owner shall be entitled (without prejudice to its other rights under the Contract) to arrange for corrective works to be carried out by their own contractors and charged to LWB under and in accordance with Clauses 10.9 and 10.10 of the Contract.
 
5.   LWB acknowledge and agree that [**] [Confidential Treatment] cabins [**] [Confidential Treatment], that this incident constitutes a Defect for which LWB is responsible under Clause 10 of the Contract, and that the Owner may bring a claim in respect of such Defect under and in accordance with Clauses 10.9 and 10.10 of the Contract.

-2-


 

6.   For the avoidance of doubt this Addendum does not alter, excuse, relieve or reduce any of the obligations and liabilities of LWB or LWB’s Shareholders to the Owner under and in connection with Addendum 5 (including LWB’s obligation to complete all outstanding Annex 2 and Annex 3 Works with all due despatch in accordance with the other provisions of Addendum 5) or any other provisions of the Contract (including LWB’s guarantee and warranty obligations under Clause 10 of the Contract). Accordingly, save as expressly provided in this Addendum all other terms and conditions of the Contract (and all previous addenda thereto), including but not limited to Clause l7(c) of Addendum No. 3, shall remain unamended and in full force and effect. By their signature of this Addendum each of the Owner, LWB and the Sachwalter fully and unconditionally affirm the Contract as amended by this Addendum.
 
7.   Words and expressions defined in the Contract shall have the same meaning when used in this Addendum.
(End of Addendum 6)
 
 
Authorised Signatures of the parties
     
Signed on 25 June, 2005 by:
  Signed on 25 June, 2005 by:
 
/s/ Colin Veitch
  /s/ Werner Luken
 
   

-3-


 

     
/s/ Colin Veitch
  /s/ Werner Luken
 
   
For and on behalf of
  For and on behalf of
Pride of America Ship Holding Inc.
  Lloyd Werft Bremerhaven GmbH
 
   
 
   
Signed on 25 June, 2005 by:
  Signed on 25 June, 2005 by:
 
 
  /s/ Werner Luken
 
   
For and on behalf of
  For and on behalf of
Wolfgang van Betteray
  W.L. Werner Lüken Verwaltungs-und
As Sachwalter of LWB
  Beteiligungs GmbH
 
   
 
   
 
   
Signed on 25 June, 2005 by:
   
 
   
 
   
For and on behalf of L.P.S. Dienstleistungs-und
   
Verwaltungsgesellschaft Bremerhaven
   
GmbH
   
 
/s/ Werner Luken
   
 
   

-4-

EX-4.41 18 g05791exv4w41.htm EX-4.41 ADDENDUM 3/PRIDE OF HAWAI'I EX-4.41 Addendum 3/Pride of Hawai'i
 

Exhibit 4.41
[Confidential Treatment]
DELIVERY DATE ADDENDUM
Addendum to the Contract (as amended and supplemented from time to time, the “Contract”) dated as of 15 September 2003 and made between Jos. L. Meyer GmbH, Pride of Hawaii,Inc. (formerly known as Ship Ventures Inc.) and Arrasas Limited in respect of the construction of Hull No. S.668.
It is hereby agreed as follows:
1.   The date specified in the first line of Clause 1.1 of Article 7 of the Contract is hereby amended to read 12 April 2006.
 
2.   The date specified in the last line of Clause 2.1(i) of Article 9 of the Contract is hereby amended to read 12 April 2006.
Authorised Signatures
Signed by: SIGNATURE ILLEGIBLE
for and on behalf of
Jos. L. Meyer GmbH on 14 February 2006
Signed by: /s/ Colin Veitch                                                                                            Initiated JK
for and on behalf of
Pride of Hawaii, Inc. on 13 February 2006
Signed by: /s/ Colin Veitch
for and on behalf of
Arrasas Limited on 13 February 2006
End of Addendum


 

ADDENDUM NO. 3
Addendum Number 3 to the Shipbuilding Contract (as amended and supplemented from time to time, the “Shipbuilding Contract”) dated as of 15 September 2003 and made between the company now known as MEYER WERFT GmbH as builder (the “Builder”), the company now known as Pride of Hawaii, Inc. as buyer (the “Buyer”) of the passenger cruise ship now known as m.v. Pride of Hawaii (the “Ship”), and Arrasas Limited as guarantor for the Buyer (“AL”).
The parties have agreed to enter into this Addendum in order to record certain matters agreed between them in connection with delivery of the Ship under the Shipbuilding Contract. Now, therefore, it is hereby agreed as follows:
 
1. The Buyer has agreed to accept delivery of the Ship in reliance upon and subject to the undertakings and reservations referred to in paragraphs 2 to 5 below.
2. The Builder undertakes, at its entire risk and expense, with all due despatch and without any interruption to the Ship’s operations or service: (i) to procure [**] [Confidential Treatment] referred to in the Minutes of Meeting No. [**] [Confidential Treatment], with Buyer’s reasonable co-operation where applicable; and (ii) to rectify [**] [Confidential Treatment] in accordance with the Minutes of Meeting [**] [Confidential Treatment].
[**] [Confidential Treatment]
6. The protocol of delivery and acceptance signed by the Builder and the Buyer at delivery of the Ship shall be in all respects subject and subordinate to the provisions of this Addendum.
7. Save and except as expressly provided in this Addendum, the terms and conditions of the Shipbuilding Contract shall remain unamended and in full force and effect.
8. This Addendum shall be deemed an integral part of, and read as one with, the Shipbuilding Contract.
9. Expressions defined in the Shipbuilding Contract shall bear the same meanings when used in this Addendum.

 


 

Authorised Signatures

Signed by: BERNARD MEYER
for and on behalf of
the Builder on 19 APRIL 2006
/s/ BERNARD MEYER


Signed by: VIJAY JEYARATNAM
for and on behalf of
the Buyer on 19 APRIL 2006
/s/ VIJAY JEYARATNAM


Signed by: VIJAY JEYARATNAM
for and on behalf of
AL on 19 APRIL 2006
/s/ VIJAY JEYARATNAM


(End of Addendum No.3)

- 2 -

EX-4.42 19 g05791exv4w42.htm EX-4.42 ADDENDUM NO. 1/ NORWEGIAN PEARL EX-4.42 Addendum No. 1/ Norwegian Pearl
 

Exhibit 4.42
DELIVERY DATE ADDENDUM
Addendum to the Contract (as amended and supplemented from time to time, the “Contract”) dated as of 24 December 2004 and made between Jos. L. Meyer GmbH, Norwegian Pearl, Ltd. (formerly known as Hull 669 Ltd.) and NCL Corporation Ltd. in respect of the construction of Hull No. S .669,
It is hereby agreed as follows:
1.   The date specified in the first line of Clause 1.1 of Article 7 of the Contract is hereby amended to read 28 November 2006.
 
2.   The date specified in the last line of Clause 2.1 (i) of Article 9 of the Contract is hereby amended to read 28 November 2006.
Authorised Signatures
Signed by: /s/ Jos. L. Meyer
for and on behalf of
Jos. L. Meyer GmbH on 14th February 2006
Signed by: /s/ Colin Veitch
for and on behalf of
Norwegian Pearl, Ltd. on 13th February 2006
Signed by: /s/ Colin Veitch
for and on behalf of
NCL Corporation Ltd. on 13th February 2006
End of Addendum.

EX-4.43 20 g05791exv4w43.htm EX-4.43 SHIPBUILDING CONTRACT FOR HULL NO. C33 EX-4.43 Shipbuilding Contract for Hull No. C33
 

Exhibit 4.43
[Confidential Treatment]
SHIPBUILDING CONTRACT
BETWEEN
AKER YARDS S.A.
AND
F3 ONE, LTD
 
IN RELATION TO HULL NO. C33
 

 


 

CONTENTS
         
Clause   Page
Article 1: Subject Matter Of Contract
    1  
1. Agreement To Build, Sell And Purchase
    1  
2. Description Of The Ship
    2  
3. Specification And Plans
    3  
4. Classification
    4  
5. Subcontracting And Makers’ List
    6  
6. Buyer’s Supplies
    8  
7. Builder’s Tally Of Buyer’s Supplies
    10  
Article 2: Supervision
    12  
1. Supervisor
    12  
2. Planned Programme And Plan Approval
    13  
3. Work Approval
    15  
4. Technical Disputes
    16  
Article 3: Modifications
    17  
1. Modifications
    17  
2. Classification And Regulatory Changes
    18  
3. Substitution Of Parts
    19  
Article 4: Title And Insurances
    20  
1. Title, Risk And Encumbrances
    20  
2. Insurances
    21  
3. Loss Or Damage
    22  
Article 5: Permissible Delays
    24  
1. Extension Of Time For Work
    24  
2. Delay Notices
    26  
Article 6: Tests And Liquidated Damages
    28  
1. Tests
    28  
2. Liquidated Damages
    31  
Article 7: Delivery And Guarantee
    37  
1. Delivery And Acceptance
    37  
2. Guarantee
    39  
Article 8: Contract Price And Payment Terms
    44  
1. Contract Price
    44  

 


 

         
Clause   Page
2. Payments
    44  
Article 9: Termination
    48  
1. Termination By Builder
    48  
2. Termination By Buyer
    50  
3. Termination By Either Party
    52  
Article 10: Representations, Covenants And Indemnities
    53  
1. Representations, Warranties And Covenants
    53  
2. Exclusion Of Liabilities
    54  
Article 11: Intellectual Property Rights
    55  
1. Patents, Trade Marks And Copyrights
    55  
2. Rights To Engineering And Design Data
    56  
Article 12: Taxes And Contract Expenses
    57  
1. Taxes And Contract Expenses
    57  
Article 13: Disputes
    58  
1. Technical Disputes
    58  
2. Jurisdiction
    59  
3. Governing Law
    59  
4. Notices
    60  
Article 14: General Matters
    62  
1. Computation Of Time
    62  
2. Assignments
    62  
3. Partial Illegality
    62  
4. Confidentiality
    63  
5. Amendments
    63  
6. No Waiver
    63  
7. Consents
    63  
8. Language
    64  
9. Models
    64  
10. Counterparts
    64  
11. Effective Date
    64  
12. Protected Parties
    65  
13. Relationship Of Parties, Previous Negotiations
    66  
14. Exclusions
    66  
15. Fair Dealing And Business Standards
    66  
16. Cost Savings
    67  

 


 

         
 
Clause   Page
17. Priority Of Contract, Plans And Specification
    67  
 
       
Schedule 1 Form Of Aom
    68  
 
       
Schedule 2 Form Of Protocol Of Delivery And Acceptance
    69  
 
       
Schedule 3 Form Of Refund Guarantee
    70  
 
       
Schedule 4 Form Of Builder’s Performance Guarantee
    73  
 
       
Schedule 5 Form Of Buyer’s Performance Guarantee
    76  
 
       
Schedule 6 Definition Of Certain Terms
    79  
 
       
Schedule 7 Sound And Vibration
    84  

 


 

THIS SHIPBUILDING CONTRACT is dated as of 7th September 2006 and made between:
(1)   AKER YARDS S.A., a company organised and existing under the laws of France and having its principal office at Avenue Bourdelle — B.P. 90180, 44613 Saint-Nazaire Cedex, France (the “Builder”); and
 
(2)   F3 ONE, LTD., a company incorporated in Bermuda and having its registered office at Milner House, 18 Parliament Street, Hamilton HM12, Bermuda (the “Buyer”).
NOW IT IS HEREBY AGREED as follows:
ARTICLE 1: SUBJECT MATTER OF CONTRACT
1.   AGREEMENT TO BUILD, SELL AND PURCHASE
 
1.1   On and subject to the express provisions of this Contract, the Plans and the Specification:-
  (i)   the Builder shall:
  (a)   design, engineer, build, launch, equip and outfit the passenger cruise ship more particularly described in the Plans and the Specification (the “Ship”) at the Shipyard, and
 
  (b)   provide all components, equipment, gear, fittings, machinery, materials, parts, plant, outfit, spares and supplies which are necessary to achieve the objects and purposes described in Clause 1.1(i) (a) (the “Parts”) other than the specified supplies to be provided by the Buyer (the “Buyer’s Supplies”),
 
  (c)   supply all operating and maintenance manuals, training materials, spares lists, plans, drawings, records and other construction documents specified in the Specification (together, the “Manuals”),
 
  (d)   provide or procure the provision of all training of the Buyer’s employees specified in the Specification, and
 
  (e)   test, complete, finish, sell and deliver the Ship to the Buyer at Shipyard.
  (ii)   the Buyer shall purchase and accept delivery of the duly completed Ship at the Shipyard.
 
  (iii)   The Builder, as a first class shipbuilder with knowledge of the Buyer’s performance and quality requirements and standards as expressed in the Plans and the Specification, shall ensure that all Work shall be carried out in a good and workmanlike manner and in accordance with the highest shipbuilding and marine engineering practices and standards for new passenger cruise ships, and so that (unless specified to the contrary in the Specification) the complexity, quality of workmanship, quality of Parts, design of the cabins, public areas and other interior spaces of the Ship specified in the Specification shall not be lower than the corresponding complexity, quality and design standards of the reference ships referred to in the Specification.

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2.   DESCRIPTION OF THE SHIP
 
2.1   The Ship shall be a passenger cruise ship suitable for continuous year-round worldwide cruising, with the following main dimensions and characteristics:
  (i)   Main Dimensions
Length, overall — [**] [Confidential Treatment] metres*
Length, between perpendiculars: — [**] [Confidential Treatment] metres*
Breadth, moulded hull — [**] [Confidential Treatment] metres (with a right for the Builder to reduce to 40.0 metres)
Depth to deck 4 — [**] [Confidential Treatment] metres
Design draft, moulded — [**] [Confidential Treatment] metres
(* signifies a tolerance of +/- half a metre)
  (ii)   Guaranteed Deadweight
 
      The guaranteed deadweight at delivery of the Ship, determined in accordance with the Specification, in seawater of [**] [Confidential Treatment] specific gravity at a design draft of [**] [Confidential Treatment] metres (the “Design Draft”), shall be not less than [**] [Confidential Treatment] metric tons (the “Guaranteed Deadweight”).
 
  (iii)   Passenger Accommodation
[**] [Confidential Treatment]
Total passenger cabins — 2100
  (iv)   Crew Accommodation
[**] [Confidential Treatment]

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  (v)   Life saving equipment
 
      The Ship will be designed for the transport of [**] [Confidential Treatment] passengers and [**] [Confidential Treatment] crew, and there shall be eight (8) tenders on board and lifeboats according to the Regulatory Rules for a total of [**] [Confidential Treatment] persons.
 
  (vi)   Guaranteed Service Speed
 
      With the main engines operating at [**] [Confidential Treatment]% of maximum continuous rating at the Design Draft, with a [**] [Confidential Treatment]% sea margin in trial conditions and wind / sea not exceeding 2 on the Beaufort Scale, the Ship’s speed as measured during the sea trials in accordance with the Specification shall be at least [**] [Confidential Treatment] knots (the “Guaranteed Service Speed” or “GSS”).
 
  (vii)   Guaranteed Fuel Consumption
 
      The Ship shall be delivered with [**] [Confidential Treatment] main engines. The fuel consumption of each such engine during the trials conducted at the engine manufacturer’s test bed in accordance with the Specification shall not exceed [**] [Confidential Treatment] per shaft KW per hour in the conditions referred to in section M.1.3 of the Specification (the “Guaranteed Fuel Consumption” or “GFC”).
2.2   The details of the dimensions and characteristics referred to in Clause 2.1 above, as well as the definitions and method of measurements and calculations, are as indicated in the Specification and no changes shall be made to such dimensions and characteristics without the Buyer’s prior written approval.
 
2.3   The hull number of the Ship will be C33 and that number shall in accordance with Clause 1.2 in Article 4 be placed upon the Ship and the Parts during construction.
 
3.   SPECIFICATION AND PLANS
 
3.1   The Specification and the Plans describe in detail Work standards, certain specific features of the Work and the general scope of the Work but, although the contents of the Specification and the Plans are believed by the Builder and the Buyer to be accurate, all dimensions, measurements and other details shall be independently verified and checked by the Builder. If there is any error or inconsistency in the Specification or Plans that may adversely affect the technical performance of the Ship, the Builder shall correct the same, after first notifying the Buyer in writing and obtaining the Buyer’s written approval (which is not to be unreasonably withheld), without any increase in the Contract Price or any extension of the Delivery Date.
 
3.2   Save as otherwise expressly provided in this Contract, the Builder shall be solely and directly responsible for all aspects of the design, performance and quality of the Work, and the fact that any calculations, measurements, drawings, plans, test results or any other documents and data relating to the Work shall have been made, prepared or supplied by the Buyer or shown to the Buyer or approved by or on behalf of the Buyer and/or any Regulatory Authority and/or the Classification Society and/or any other

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    specified person(s) or that modifications or alterations shall have been carried out in accordance with the Buyer’s requirements shall not in any manner or to any extent relieve the Builder from (or otherwise reduce) any of the Builder’s obligations and/or liabilities under this Contract.
 
3.3   All Parts:
  (i)   shall be new or (with the Supervisor’s prior written approval which shall not be unreasonably withheld) unused, of good quality, suitable for their intended purpose and in strict and full accordance and compliance with this Contract, the Plans and the Specification;
 
  (ii)   save only as otherwise expressly provided for in the Specification or the Plans, or as further agreed by the duly authorised representatives of the Builder and the Buyer, shall be manufactured by leading, reputable and suitably qualified and experienced makers and suppliers of equipment to the passenger cruise ship industry; and
 
  (iii)   in addition to and without derogation from the Builder’s obligations under paragraphs (i) and (ii) above, shall be in strict and full accordance and compliance with the Builder’s usual high standards and practices of construction for passenger cruise ships of a similar standard.
3.4   The Builder shall furnish spare parts and maintenance tools of the kind and in at least the quantities required by the Specification and the Classification Society. The cost of such spares and tools are included in the Contract Price. The Builder at its own cost and risk shall be responsible for the handling, storing and bringing on board the Ship of all spares and tools. Spares and tools furnished by the Builder shall be properly protected against physical decay, corrosion and mechanical damage and shall be properly listed so that replacements can be readily ordered by the Buyer.
 
4.   CLASSIFICATION
 
4.1   The Builder shall design and build the Ship under the supervision and special survey of Det Norske Veritas (the “Classification Society”), in accordance with the regulations, requirements, resolutions and rules of the Classification Society as well as all additions and amendments thereto that are (i) in force as of the Signing Date and (ii) officially published as of the Signing Date for ratification, enactment or implementation at any time thereafter (before or after the Delivery Date) (the “Class Rules”). For the avoidance of doubt, this provision does not (a) require the Builder to comply with proposed additions or amendments to the Class Rules that are still under discussion and that have not been officially published as at the Signing Date or (b) subject to the following proviso, require the Builder to comply with additions and amendments officially published as of the Signing Date if such compliance would prevent the Builder from delivering the Ship in accordance with the Class Rules in force on the Delivery Date provided that if the Builder becomes aware of any conflict between the Class Rules referred to at (i) and (ii) above the Builder shall promptly notify the Buyer and comply with the Buyer’s requests to obtain such dispensation or waiver as may reasonably be required by the Buyer so as to avoid or resolve the conflict. On delivery the Ship shall

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    achieve the class notation [**] [Confidential Treatment] free of all conditions, notations, qualifications, recommendations, reservations and restrictions subject to the tolerances, and the qualifications on the Buyer’s right to reject the Ship and to terminate the Contract on account of the Builder’s failure to achieve such class notation, expressly provided for in Article 6, Clauses 2.10 to 2.15.
 
4.2   Decisions of the Classification Society as to whether or not Work complies with the requirements and standards of the Class Rules shall be final and binding on the parties. However, to the extent that any of the requirements and standards binding on the Builder under this Contract, the Plans or the Specification are higher than the Class Rules, the first sentence of this Clause 4.2 shall not in any manner or to any extent relieve the Builder from (or otherwise reduce) the Builder’s obligations to ensure that the Work complies with such higher requirements and standards.
 
4.3   The Builder shall also design and build the Ship under the supervision and in accordance with the regulations, requirements, resolutions and rules of the Regulatory Authorities, all other specified regulations, requirements, resolutions and rules, and all additions and amendments thereto that, are (i) in force as of the Signing Date and (ii) officially published as of the Signing Date for ratification, enactment or implementation at any time thereafter (before or after the Delivery Date) (the “Regulatory Rules”). For the avoidance of doubt this provision does not (a) require the Builder to comply with proposed additions or amendments to the Regulatory Rules that are still under discussion and that have not been officially published as at the Signing Date or (b) subject to the following proviso require the Builder to comply with additions and amendments officially published as of the Signing Date if such compliance would prevent the Builder from delivering the Ship in accordance with the Regulatory Rules in force on the Delivery Date provided that if the Builder becomes aware of any conflict between the Regulatory Rules referred to at (i) and (ii) above the Builder shall promptly notify the Buyer and comply with the Buyer’s requests to obtain such dispensation or waiver as may reasonably be required by the Buyer so as to avoid or revolve the conflict. On delivery the Ship shall comply with the Regulatory Rules free of all conditions, notations, qualifications, recommendations, reservations and restrictions provided that where the Specification expressly allows compliance with any Regulatory Rules or other requirements to be demonstrated by tests carried out after delivery of the Ship, the Builder shall be obliged to take all such steps as may be practicable before delivery of the Ship in order to obtain advance comments so that any issues raised by the relevant Regulatory Authorities can be addressed before delivery and so that compliance with the relevant Regulatory Rules can be demonstrated after delivery in the manner and in accordance with the timetable provided for in the Specification.
 
4.4   Decisions of a Regulatory Authority as to whether or not Work complies with its Regulatory Rules shall be final and binding on the parties. However, to the extent that any of the requirements and standards binding on the Builder under this Contract, the Plans or the Specification are higher than the relevant Regulatory Rules, the first sentence of this Clause 4.4 shall not in any manner or to any extent relieve the Builder from (or otherwise reduce) the Builder’s obligations to ensure that Work complies with such higher requirements and standards.

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4.5   All classification, certification, testing, survey and other fees and charges payable to the Classification Society and any Regulatory Authority in relation to the Work shall be for the account of the Builder.
 
4.6   The Builder shall provide (or procure that the Classification Society or the Regulatory Authorities provide) the Buyer with copies of all correspondence, minutes of meetings and other documents passing between the Builder, the Classification Society or any Regulatory Authorities in relation to the Work. In addition, the Buyer may attend all meetings between the Builder, the Classification Society or any Regulatory Authorities, and the Builder shall keep the Buyer well informed (in advance) of all of such meetings. The Builder shall promptly inform the Supervisor of any unscheduled meetings between the Builder and the Classification Society or any Regulatory Authorities and, if the Supervisor does not attend any of such meetings, the Builder shall give the Supervisor a reasonably detailed account of the matters discussed and decisions taken at the meeting.
 
4.7   The Builder and its Subcontractors shall comply with all laws, rules and regulations applicable to the Builder’s activities in respect of the Work, and accordingly the Builder shall obtain all licenses, permits, certificates and permissions required for the execution and completion of the Work, including those required by the Classification Society and the Regulatory Authorities.
 
4.8   The Builder shall be responsible for obtaining the approval of all drawings, calculations and other necessary matters by the Classification Society and the Regulatory Authorities, and shall arrange for all applicable certificates and approvals to be issued.
 
5.   SUBCONTRACTING AND MAKERS’ LIST
 
5.1   The main assembly, construction and erection of the Ship, including the installation of the Ship’s main Parts and all other major elements of the Work, shall be carried out by the Builder at the Shipyard.
 
5.2   On prior written notice to the Buyer, the Builder may subcontract the fabrication of steel blocks to European Subcontractors who are certified by the Classification Society as meeting DNV MPQA standards (or equivalent, if another Classification Society is appointed with the Buyer’s agreement) and who are otherwise objectively regarded as reputable and suitably qualified and experienced contractors to the passenger cruise ship industry.
 
5.3   Appendix 3 of the Specification contains an agreed list (the “Makers’ List”) of potential Subcontractors for the performance of important elements of the Work and for the supply of major Parts. The Makers’ List may be modified by agreement of the parties in order to take advantage of technical developments and improvements. Either party may make proposals to the other in this respect and each party agrees to give reasonable consideration to any such proposals but neither party will be obliged to accept any proposal that adversely affects its obligations, liabilities or interests under the Contract.
 
5.4   The Builder shall use the approved Subcontractors referred to in the Makers’ List for the execution of the Work, and the supply of the Parts, therein specified. The Builder shall not be entitled, without the express prior written approval of the Buyer (which may be

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    withheld on reasonable grounds by the Buyer), to change any Subcontractor referred to in the Makers’ List or to engage any new Subcontractor for the same element of the Work or the supply of the same Parts or any replacements for such Parts. Nor shall the Builder permit any of such approved Subcontractors to subcontract any of their Work or supply obligations in a manner that is inconsistent with the other provisions of this Clause 5.
 
5.5   Where more than one Subcontractor is named in the Makers’ List in relation to an element of the Work or a Part, the Builder must nominate its choice of Subcontractor by notice in writing to the Buyer as soon as possible and at the same time provide the Buyer with the relevant technical specifications for Work or the Part in question.
 
5.6   The Buyer will have up to ten (10) Working Days from its receipt of each written nomination and the related specifications within which to accept or to reject the Builder’s nomination and instead select a different Subcontractor from the Makers’ List.
 
5.7   Before purchasing any major Parts from, or subcontracting any major elements of the Work (apart from the Parts and Work elements referred to in Clause 5.2) to, Subcontractors who are not named in the Makers’ List, the Builder will notify the Buyer in writing of its proposal and provide the Buyer with the relevant technical specifications in order to allow the Buyer to submit its comments to the Builder. The Buyer will have ten (10) Working Days within which to object to such proposal on the grounds of the availability of spares and the quality of post-delivery services support in North America.
 
5.8   If the Buyer wishes the Builder to select a Subcontractor other than the one nominated by the Builder then the difference, if any, between that Subcontractor’s price and the price of the Subcontractor nominated by the Builder shall be added to or (as the case may be) subtracted from the Contract Price in accordance with the provisions of Article 3, Clause 1. Any other differences between the supply and warranty conditions offered by the Subcontractor selected by the Buyer and the conditions offered by the Subcontractor nominated by the Builder shall be accepted and borne by the Buyer.
 
5.9   The Builder and the Buyer will work together closely in good faith, and each will use all reasonable commercial efforts, to avoid, minimise and mitigate the effects of any cost differentials between competing Subcontractors.
 
5.10   The Builder’s appointment, contracting, employment or use of any workmen, Subcontractors, agents and other representatives (including, without limitation, any such persons appointed or employed or contracted by the Builder with the Buyer’s approval) shall not in any manner or to any extent relieve the Builder from (or otherwise reduce) any of the Builder’s obligations and/or liabilities under or in connection with this Contract nor diminish the Builder’s responsibility to the Buyer to manage, supervise and conduct such persons in a workmanlike manner and in accordance with the practices and standards referred to in Clause 1.1.
 
5.11   Save as otherwise agreed between the parties, all contacts with Subcontractors shall be made through the Builder. However, the Buyer may at any time contact and contract with Subcontractors in relation to post-delivery maintenance and support arrangements only.

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5.12   The Builder covenants with the Buyer that:
  (i)   it shall ensure that there is not and will not be created by the Builder any legal relationship between the Buyer and any Subcontractors appointed or otherwise used by the Builder (save for such relationships as may be created by reason of the warranty and guarantee assignments to be made by the Builder under Clause 2.9 of Article 7 or by mandatory operation of law);
 
  (ii)   it shall take reasonable care in the selection, employment, appointment and supervision of all Subcontractors who supply Parts, and shall procure their employment or appointment on terms consistent with the Buyer’s rights, and the Builder’s obligations and liabilities, under this Contract including, without limitation, such matters as (a) the nature of guarantees and warranties, and liberty for the Builder to assign all or any part(s) of such guarantees and warranties to the Buyer, (b) good service of the Subcontractors, (c) reliability of the Subcontractors, (d) availability and quality of pre-delivery training, and (e) availability of spares and quality of post-delivery service support as these matters are contemplated by the Specification;
 
  (iii)   it shall prevent its Subcontractors from exercising any rights to arrest, attach, detain or encumber the Ship, the Parts, or any of the Buyer’s Supplies;
 
  (iv)   it shall promptly provide the Buyer with such information and access as it may require from time to time in order to verify the performance of the supplies, services and Work provided or carried out by the Builder’s Subcontractors;
 
  (v)   it shall promptly take all necessary steps to ensure the proper performance of any such Subcontractors;
 
  (vi)   without prejudice to the operation of Article 10, Clause 2, it shall be fully, directly and solely responsible (as between the Builder, the Buyer and the other protected parties) for the acts, omissions and defaults of the Builder’s Subcontractors (including, without limitation, any persons appointed, employed or contracted by the Builder with the approval of the Buyer) and for the acts, omissions and defaults of the respective officers, employees, workmen, agents and other representatives of the Builder and its Subcontractors; and
 
  (vii)   upon the Buyer’s reasonable request from time to time, it shall promptly provide the Buyer with information relating to any subcontract.
5.13   All labour costs (including overtime costs) of the Builder and of the workmen, Subcontractors, and others used by the Builder shall be for the account of the Builder.
 
6.   BUYER’S SUPPLIES
 
6.1   The Buyer, at its own risk and expense, shall supply and deliver the Buyer’s Supplies to the Shipyard on a DDP (Incoterms 2000) basis, free of any encumbrances, and in proper condition for installation or incorporation in, or stowage on board, the Ship in accordance with the agreed delivery schedule in Part G of the Specification as the same is updated and amended by agreement of the parties during the construction period.

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6.2   The Builder shall, at its own risk and expense, receive, check as to visual compliance with transport documents, inspect the packaging, insure (in accordance with Clause 2 of Article 4), clearly mark as the property of the Buyer, safely store and keep well protected and completely segregated from Parts and other materials owned by the Builder or other parties, and properly put on board and thereafter install or incorporate in or stow on the Ship, all of the Buyer’s Supplies from time to time delivered to the Shipyard, and (whenever so requested by the Supervisor) the Builder shall also assist the Buyer to clear any Buyer’s Supplies through French customs. If any packaging is discovered damaged, the Builder will promptly inform the Buyer and the parties’ representatives will jointly unpack and inspect the content of the package. In addition, the Buyer’s personnel may unpack any other consignment of Buyer’s Supplies in order to check its conformity with the related orders and transport documents.
 
6.3   In order to facilitate the installation and incorporation of the Buyer’s Supplies by the Builder, the Buyer shall furnish the Builder with all plans, instruction books, test reports and certificates provided to the Buyer by its suppliers. Upon request by the Builder, the Buyer’s available personnel at the Shipyard will assist — or cause the Buyer’s relevant suppliers to assist — the Builder and its Subcontractors with the installation of the Buyer’s Supplies. If any Buyer’s Supplies (including relevant technical documentation and any Buyer’s Supplies to be replaced by the Buyer pursuant to this Clause 6) have not been delivered within five (5) Working Days after the Supervisor’s receipt of a notice from the Builder under Clause 6.4(ii), the Builder shall be entitled to proceed with the construction of the Ship without installing or incorporating such Buyer’s Supplies in or on the Ship and the lack of any such installation or incorporation shall not be treated as a defect in the Ship provided that if the relevant Buyer’s Supplies may be installed or incorporated in or on the Ship at a later date without any additional cost to the Builder or any delay in delivery of the Ship then the Builder will accommodate any request by the Supervisor to extend the date for delivery and installation or incorporation of the relevant Buyer’s Supplies.
 
6.4   The Builder:
  (i)   shall be liable to the Buyer for any damage to or loss of any Buyer’s Supplies caused by Builder’s default and occurring or arising after delivery of such Buyer’s Supplies under Clause 6.1; and
 
  (ii)   shall notify the Supervisor as soon as practicable of any loss of, damage to, or deficiency in the supply or performance of, any of the Buyer’s Supplies or any late delivery thereof in accordance with Clause 6.3.
6.5   Where the Builder is liable to the Buyer for any damage to or loss of any Buyer’s Supplies, the Builder will promptly replace the relevant Supplies with identical items at its risk and expense, in which case any insurance proceeds paid in respect of such loss and damage will be paid to and retained by the Builder. In all other cases where the Builder gives notice to the Buyer under Clause 6.4(ii), the Buyer will as soon as may reasonably be practicable replace the relevant Buyer’s Supplies at its risk and expense. For the avoidance of doubt, the other provisions of this Clause 6 shall apply to such replacements.

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6.6   The Buyer acknowledges and agrees that the Builder shall not be responsible for the design, performance or quality of Buyer’s Supplies.
 
6.7   The Contract Price includes an allowance of [**] [Confidential Treatment] which may be used by the Buyer for the payment of Buyer’s Supplies ordered by the Buyer. This allowance will be paid for the Buyer, through each payment of the Contract Price under Article 8 Clause 2.1, in the following five tranches:
  (i)   the Contract Price payment under Article 8, Clause 2.1 (i) will include the sum of [**] [Confidential Treatment] in respect of the first tranche of the allowance;
 
  (ii)   the Contract Price payment under Article 8, Clause 2.1 (ii) will include the sum of [**] [Confidential Treatment] in respect of the second tranche of the allowance;
 
  (iii)   the Contract Price payment under Article 8, Clause 2.1 (iii) will include the sum of [**] [Confidential Treatment] in respect of the third tranche of the allowance;
 
  (iv)   the Contract Price payment under Article 8, Clause 2.1 (iv) will include the sum of [**] [Confidential Treatment] in respect of the fourth tranche of the allowance; and
 
  (v)   subject to Clause 6.9, the Contract Price payment under Article 8, Clause 2.1 (i) will include the sum of [**] [Confidential Treatment] (forty million euros) in respect of the fifth tranche of the allowance.
6.8   As soon as each pre-delivery payment of the Contract Price has been made by the Buyer under Article 8 Clause 2.1, the Builder shall pay the relevant tranche of the allowance to the Buyer.
 
6.9   Upon delivery and acceptance of the Ship in accordance with this Contract, the Builder shall pay the fifth tranche of the allowance to the Buyer in or towards payment for Buyer’s Supplies ordered for the Ship provided that if the aggregate total cost of Buyer’s Supplies ordered for the Ship shall be less than the amount of the allowance, the amount of the fifth tranche of the allowance payable by the Buyer — and hence the amount of the Contract Price payable under Article 8 Clause 2.1(v) — shall be reduced accordingly.
 
6.10   Within fifteen (15) days after the Ship has been delivered by the Builder and accepted by the Buyer in accordance with the express provisions of this Contract, the Buyer will remove from the Shipyard any of the Buyer’s Supplies which have not been used in the construction of, or otherwise delivered with, the Ship.
 
7.   BUILDER’S TALLY OF BUYER’S SUPPLIES
 
7.1   The Builder shall make and keep fully itemised and up-to-date records of all Buyer’s Supplies from time to time delivered to the Shipyard and/or other premises of the Builder (and/or its Subcontractors) and, without prejudice to the generality of the foregoing, the

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    Builder shall ensure that such records are made and kept in the form used by the Builder for its own stocks and show:
  (i)   the date of delivery to the Builder (or its Subcontractors) of each batch or consignment of Buyer’s Supplies;
 
  (ii)   where and how such Buyer’s Supplies are stored;
 
  (iii)   when such Buyer’s Supplies are incorporated or installed in, or stowed on, the Ship; and
 
  (iv)   the balance (in usual units) of any unused Buyer’s Supplies.
7.2   The Builder shall provide the Supervisor, on a monthly basis, with a complete set of the records described in Clause 7.1 and all amendments of, or supplements to, such records.
(End of Article 1)

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ARTICLE 2: SUPERVISION
1.   SUPERVISOR
 
1.1   The Buyer may retain a supervisor (the “Supervisor”) and a supervision team of a reasonable size at the Shipyard to maintain close contact with the Builder and, on behalf of the Buyer, to supervise the Work. The Buyer shall be responsible for obtaining and maintaining any necessary French permissions and authorisations for the Supervisor and his team to carry out their duties, and the Builder will assist the Buyer in this regard.
 
1.2   The Supervisor and his team shall carry out their inspections and supervision in an efficient manner and in such a way as to avoid any increase in the building costs or delays to the Work.
 
1.3   All salaries and, subject to Clause 1.4, costs and expenses of the Supervisor and his team shall be for the Buyer’s account.
 
1.4   The Builder shall provide, free of charge to the Buyer, the Supervisor and his team suitably equipped and maintained changing rooms and offices in close proximity to the Shipyard and all such other facilities within such offices as may be necessary to enable the Supervisor and the Supervisor’s team effectively to carry out their Work including, without limitation, direct call national and international telephone lines (in respect of which the Builder will pay for line rentals and local calls and the Buyer will pay the actual cost of all other calls plus a 5% administration fee), fax lines and machines, broadband computer connections, and laser printers. The Builder will also: allow the Supervisor and his team to use the refectory at the Shipyard; and assist the Supervisor to find lodgings for his team by introducing him to local rental agents.
 
1.5   A written statement confirming the Supervisor’s appointment and the scope of his actual authority shall be given by the Buyer to the Builder within thirty (30) days after the Effective Date. Written notice of revocation of appointment of the Supervisor and/or any change in the scope of his actual authority shall be given by the Buyer to the Builder as soon as reasonably practicable after any such revocation and/or change has been decided upon by the Buyer.
 
1.6   The Supervisor and his team shall be given notice of and shall observe the safety and security precautions and other rules and regulations in force from time to time at the Shipyard and at the premises of the Builder’s Subcontractors.
 
1.7   The Builder may request the Buyer to replace a representative who is deemed unsuitable and unsatisfactory for the proper progress of the Ship’s construction. The Buyer shall investigate any such request (if necessary, by sending its representative(s) to the Shipyard). If the Buyer considers the Builder’s request to be justified, it will effect the replacement as soon as may be conveniently arranged.
 
1.8   The Buyer may request the Builder to replace any representative in the Builder’s equivalent of the Supervisor’s team who is deemed unsuitable and unsatisfactory for the proper progress of the Ship’s construction. The Builder shall investigate any such request and, if the Builder considers the request to be justified, it will effect the replacement as soon as may be conveniently arranged.

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1.9   Each of the Builder and the Buyer agrees to work closely with the other and to act reasonably and in good faith with a view to agreeing, by no later than the first anniversary of the Effective Date, the terms necessary to regulate the timetable, conditions and procedures for the advance occupation of certain parts of the Ship by the Buyer for crew familiarisation, training and lodging purposes.
 
1.10   The Builder shall allow key representatives of the Buyer for the Ship to attend the Shipyard upon reasonable prior written notice to the Builder, and to be present during tests and for familiarisation, training and lodging purposes
 
2.   PLANNED PROGRAMME AND PLAN APPROVAL
 
2.1   Each of the Builder and the Buyer acknowledges and agrees that successful completion of the construction of the Ship in accordance with this Contract, the Plans and the Specification will require a high degree of co-operation and flexibility on the part of both parties.
 
2.2   Notwithstanding the generality of Clause 2.1, the Work shall be carried out in strict accordance with the express provisions of this Contract, the Specification and the Plans, and on the Effective Date the Builder will provide the Supervisor with: a planned programme containing a critical path treatment of the major and significant elements of the Work, in their proper sequence, which must be completed to ensure delivery of the Ship (the “Planned Programme”); and the schedule of inspections and tests referred to in Part G.11 of the Specification (the “Tests Schedule”).
 
2.3   Without prejudice to the Builder’s express obligations under the other provisions of this Contract, if the Builder considers it necessary to make any material alterations in the Planned Programme the Builder shall promptly provide the Supervisor with written details of and reasons for the proposed alterations. Without prejudice to the Builder’s express rights under the other provisions of this Contract, no alterations to the Planned Programme shall delay completion of the Work or delivery of the Ship in accordance with this Contract, nor shall any such alterations accelerate the performance or change the tenor of any of the Buyer’s obligations under this Contract.
 
2.4   The Builder shall submit to the Buyer each month, commencing on the date falling three (3) months after the Effective Date, until delivery, the following documentation (the reasonable accuracy of which the Builder hereby warrants):
  (i)   a status report (in form acceptable to the Buyer) of the Work as compared with the Planned Programme, including the critical path;
 
  (ii)   a report (in form acceptable to the Buyer) setting out the actual progress of the Work during the previous month as compared with the Planned Programme;
 
  (iii)   a list of modifications (if any) agreed or determined during the previous month;
 
  (iv)   a report in proper form on the delivery of Parts and Buyer’s Supplies during the previous month.

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2.5   Without prejudice to the Builder’s other obligations under this Contract, if the construction of the Ship should, for any reason whatsoever, be materially delayed beyond the time-frame indicated in the Planned Programme, the Builder shall promptly notify the Buyer and thereafter keep the Buyer regularly informed about the steps being planned and taken by the Builder in order to try to overcome the delay.
 
2.6   All plans, drawings and other documents required by the Specification to be developed and supplied by the Builder to the Buyer for approval shall be delivered by the Builder in their proposed final form in three (3) hard copies (and, if so requested, electronically) to the Supervisor for approval by and on behalf of the Buyer. The Builder agrees to submit all such plans, drawings and documents in such timely manner that the Buyer may have a reasonable opportunity to review and approve or comment on the same within the periods provided for in Clauses 2.7 and 2.9.
 
2.7   Within six (6) Working Days after the Supervisor’s receipt of each set of plans, drawings and other documents submitted to the Supervisor for approval pursuant to the Specification one (1) copy of each such plan, drawing and other document shall be returned by the Buyer to the Builder either as approved or as rejected by the Buyer provided that all rejections shall specify with reasons all aspects of the rejected plans, drawings or documents which in the opinion of the Buyer do not, or which provide for Work which does not, comply with the requirements of this Contract, the Plans or the Specification.
 
2.8   If a plan, drawing or other document is approved by the Buyer, the Builder shall proceed with the Work shown therein.
 
2.9   If any aspect of a plan, drawing or other document is rejected by the Buyer under Clause 2.7, and the Builder accepts such rejection, the Builder shall promptly alter the relevant plan, drawing or document without charge to the Buyer and resubmit it as altered for approval by the Buyer in accordance with the procedure and timetable referred to in Clause 2.7. For the avoidance of doubt, if any plans, drawings or other documents rejected by the Supervisor contain any error, omission, ambiguity, inconsistency, inadequacy or other deficiency they and the related Work shall be remedied by the Builder (if the Builder accepts such rejection) without any increase in the Contract Price or any extension of the Delivery Date.
 
2.10   All Work performed by the Builder prior to approval by the Buyer of all plans, drawings or documents relating to such Work shall be at the sole risk and expense of the Builder without prejudice to the Builder’s right to dispute any rejection by the Buyer under Article 13.
 
2.11   If the Buyer (or the Supervisor on the Buyer’s behalf) fails to return to the Builder or (in the case of any rejections) fails to give reasons, in accordance with the time limits referred to in Clause 2.7 and Clause 2.9, any plan or drawing or other document and this failure is not remedied within two (2) Working Days after the Supervisor’s receipt of a written notice from the Builder specifying such failure, such plan or drawing or other document shall be deemed to have been automatically and expressly approved by the Buyer without any comments.

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2.12   Although the Buyer’s approval (or deemed approval) of plans, drawings and other documents shall preclude the Buyer from subsequently requiring any changes therein (except pursuant to Article 3), such approval or deemed approval shall not in any manner or to any extent relieve the Builder from (or otherwise reduce) any of the Builder’s obligations and/or liabilities under or in connection with the Contract.
 
2.13   If the Builder discovers any aspect of the Plans, the Specification or the Work that does not conform with the Class Rules or the Regulatory Rules or the shipbuilding and marine engineering practices referred to in Article 1, Clause 1.1 the Builder shall promptly notify the Supervisor and submit a proposal to the Supervisor for the Buyer’s approval (such approval not to be unreasonably withheld or delayed) for the removal of the non-conformity without any cost to the Buyer, without any increase in the Contract Price and without any extension of the Delivery Date.
 
3.   WORK APPROVAL
 
3.1   Throughout the period during which the Ship is being built the Builder will conduct its usual quality control programme of inspections, testing and supervision by a team of the Builder’s staff specially designated for this purpose but the Work and all Parts, as the same may at any time and at any place be completed or be in progress, shall also be subject to inspection by and the approval of the Buyer (acting through the Supervisor and his team) and the Classification Society.
 
3.2   Subject only to the proviso at the end of this Clause 3.2, the Builder shall at all times during normal working hours and subject to the usual regulations of the Shipyard give the Supervisor and the Supervisor’s team free and ready access to (and a free right to inspect) the Ship and Parts at any place where Work is being done or tests are being carried out or Parts are being processed or stored in connection with the building of the Ship including the Shipyard and other yards, workshops and stores of the Builder, and the premises of the Builder’s Subcontractors who are doing Work in connection with the building of the Ship or assembling, manufacturing, processing or storing of Parts, and the Builder shall ensure that provisions equivalent to the provisions of this Clause 3.2 are inserted into all subcontracts from time to time made by it in connection with the Work provided that the Supervisor or any member of his team must be accompanied by a representative of the Builder during all visits to the design offices of the Builder and any Subcontractors.
 
3.3   The Buyer shall be entitled but not obliged to reject any Work or Parts that do not comply with the requirements of this Contract, the Plans and the Specification unless and to the extent that such non-compliance is the direct result of the Builder seeking to avoid (in a manner approved by the Buyer, such approval not to be unreasonably withheld) any non-conformities referred to in Clause 2.13 provided that all rejections shall be made in writing, and shall specify with reasons those aspects of the Work or Parts inspected which in the opinion of the Buyer do not comply with the requirements of this Contract, the Plans or the Specification.
 
3.4   If any Work or Parts shall be rejected by the Buyer as not complying with the Contract, the Plans or the Specification, the Builder shall promptly remedy or replace such Work or Parts without any increase in the Contract Price or any extension of the Delivery Date

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    unless the Builder does not accept the validity of the Buyer’s rejection in which case the provisions of Clause 4 below shall apply.
 
3.5   The Builder shall not cover up any Part or element of the Work that the Supervisor or his team are entitled to inspect so as to render impossible any proper inspection thereof by the Supervisor without giving the Supervisor sufficient advance written notice and a reasonable opportunity to inspect the relevant Part or Work. If any such covering up occurs the Buyer may require the Builder to uncover the relevant Part or Work so that the Supervisor may make its inspection. For the avoidance of doubt, if the Supervisor receives sufficient advance written notice and reasonable opportunity to inspect the relevant Part or Work but fails to do so, the Buyer will be deemed to have waived its right to require the Builder to uncover such Part or Work.
 
3.6   If the conduct of subsequent Work invalidates the results of earlier inspections, tests or trials on previously completed Work, the Supervisor may require the Builder to carry out further inspections, tests and trials on such Work.
 
3.7   The inspection, supervision and testing from time to time carried out by the Supervisor and his team shall not in any manner or to any extent relieve the Builder from (or otherwise reduce) any of the Builder’s obligations and/or liabilities under or in connection with the Contract.
 
4.   TECHNICAL DISPUTES
 
4.1   If, at any time before delivery of the Ship, there is a difference of opinion between the Builder and the Buyer in relation to any technical matter regarding the Specification and/or the Plans (including any dispute concerning compliance with any of the quality requirements and other technical standards provided for in this Contract), then either party may give a notice to the other party and if the parties do not resolve the difference of opinion within five (5) Working Days after the date of service of such a notice, the Builder or the Buyer may require that the difference of opinion be treated as a Dispute of a technical nature to be resolved in accordance with Clause 1 of Article 13.
(End of Article 2)

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ARTICLE 3: MODIFICATIONS
1.   MODIFICATIONS
 
1.1   This Contract, the Plans and the Specification may be modified from time to time by agreement of the parties provided that all reasonable and timely modifications requested by the Buyer, and/or any modifications required to be made under Clause 2 which are occasioned by any changes in the Class Rules or in any of the Regulatory Rules after the Signing Date, shall be implemented by the Builder if the Buyer agrees to necessary modifications to the Contract Price, the Delivery Date and any other relevant provisions of this Contract, the Builder agreeing to act in good faith and use all reasonable efforts to accommodate any such reasonable requests by the Buyer so that all such modifications shall be made:
  (i)   at the lowest cost reasonably possible agreed or determined in accordance with Clause 1.2;
 
  (ii)   within the shortest period of time reasonably possible; and
 
  (iii)   without any loss in the relative priority of the Work for the Ship compared to other construction Work in the Shipyard,
    provided that nothing in this Clause 1.1 shall require the Builder to jeopardise its contracted building schedule(s) for other ships.
 
1.2   Any adjustment of the Contract Price to be made pursuant to this Clause shall be in a fixed amount, not subject to any escalation and shall reasonably reflect the Builder’s increased costs (or savings in costs) directly, necessarily and reasonably occasioned by the proposed modification. If the parties cannot agree on the amount of such increased costs (or savings in costs), the same shall be deemed to be the sum of:
  (i)   the net positive or negative change in the Builder’s newbuilding labour costs (excluding profit) as a direct and necessary result of the modification, (including the direct cost of any necessary design and engineering services not otherwise charged to the Buyer) as of the date when the requirement to effect the modification is proposed;
 
  (ii)   the net positive or negative change in the Builder’s cost of materials (excluding profit) as a direct and necessary result of the modification; and
 
  (iii)   the Builder’s agreed profit, which shall be a positive number equal to [**] [Confidential Treatment] per cent. ([**] [Confidential Treatment]) of the sum of the amounts determined in accordance with paragraphs (i) and (ii), in the case of increased costs only.
    The Builder has provided the Buyer with a table of the Builder’s unit rates for newbuild labour costs and main materials, and these rates shall be used when calculating all adjustments to the Contract Price under this Clause 1.2.
 
1.3   Any agreement on a modification (“AOM”) of this Contract, the Plans or the Specification shall be agreed by the parties before execution of such alterations and changes, and shall include:

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  (i)   any increase or decrease in the Contract Price agreed or determined in accordance with Clause 1.2;
 
  (ii)   any change in the Delivery Date, and
 
  (iii)   any other adjustment to or amendment of any relevant provisions of this Contract, the Plans or the Specification,
    that is necessarily and reasonably occasioned by such modification.
 
    Whenever so requested by the Buyer, the Builder will verify its calculations by providing to the Buyer, on an open book basis, a reasonably detailed explanation of the Builder’s calculations and details of the man-hours and other data used in connection with any of the alterations or changes occasioned by any modification to be made under this Article 3. For all purposes of this Contract, “open book” basis means the provision by or on behalf of the Builder of all such invoices and other supporting information, and of all such calculations, determinations and other data as may be required in order to afford complete transparency to the Buyer but it does not entitle the Buyer to make an audit of the Builder’s accounts.
 
1.4   Any agreement on a modification of this Contract, the Plans or the Specification shall be recorded and evidenced by an AOM in the form set out in Schedule 1 of this Contract and signed by the parties’ duly authorised representatives, and following the signature of each AOM the Builder shall modify the building of the Ship in accordance therewith.
 
1.5   If the parties fail to reach agreement on all matters relating to a modification requested by the Buyer within six (6) Working Days from the date on which the Builder has submitted its cost modification proposal to the Buyer or if there is any Dispute between the parties as to the cost of the requested modification then, if the Buyer so requires, the Builder will make the requested modification before the Dispute has been resolved provided the Buyer:
  (i)   makes an AOM pursuant to Clause 1.4 in respect of the agreed non-cost related alterations and changes to this Contract, the Plans and the Specification occasioned by the modification; and
 
  (ii)   undertakes to pay the amount found due to the Builder under Article 13 Clause 1.1.
2.   CLASSIFICATION AND REGULATORY CHANGES
 
2.1   If, after the Signing Date, any Class Rules and/or any Regulatory Rules are changed by the Classification Society or any Regulatory Authority, each party shall promptly notify the other in writing of the relevant change(s) and as soon as reasonably practicable thereafter the Builder shall propose the necessary modifications to be made to this Contract, the Plans and the Specification.
 
2.2   If, following its receipt of a notice under Clause 2.1, the Buyer reasonably considers that the operation of the Ship would permit of a dispensation or waiver, the Builder will at the

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    request of the Buyer apply for a dispensation from, or waiver of compliance with, the relevant change(s).
 
2.3   If the Buyer does not require the Builder to apply for a dispensation or waiver or it has not been possible to obtain a dispensation or waiver within a period of fifteen (15) days after the Buyer’s receipt of a notice under Clause 2.1 (or such longer period of time as the parties may reasonably agree in the light of all the circumstances then prevailing), the parties shall make an agreement to modify this Contract in accordance with and subject to the conditions of Clause 1 and thereafter the Builder shall make the relevant change(s) in the design or building of the Ship.
 
3.   SUBSTITUTION OF PARTS
 
3.1   The Builder is aware of the commonality of supply and other service related principles by reference to which the Buyer has approved the selection of all main Parts and the related Subcontractors. If (notwithstanding all reasonable efforts on the part of the Builder and provided that orders for the same were placed in good time by the Builder) any Parts are not available at the time required for their installation or incorporation in the Ship, the Builder may (and, if such situation is not directly caused by one or more of the contingencies specified in Clause 1.3 of Article 5, with the prior written approval of the Buyer which is not to be unreasonably withheld) use suitable substitute Parts that are at least the equivalent in standard and quality as the Parts that were not available and that are capable of meeting all of the requirements of:
  (i)   this Contract, the Plans and the Specification; and
 
  (ii)   the Classification Society and the Regulatory Authorities.
3.2   Where a proposed substitution of Parts is approved by the Buyer and (as necessary, by the Classification Society and any relevant Regulatory Authority), the Builder shall bear all additional costs and expenses whatsoever in relation to such substitution.
(End of Article 3)

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ARTICLE 4: TITLE AND INSURANCES
1.   TITLE, RISK AND ENCUMBRANCES
 
1.1   Title to the Ship and all Parts (but not Buyer’s Supplies, title to which will at all times be and remain with the Buyer) shall pass to the Buyer upon the Ship’s delivery to, and acceptance by, the Buyer in accordance with Clause 1 in Article 7 and until such delivery and acceptance shall have occurred all risks connected with the Work — including, without limitation, all risks in relation to the Ship, all Parts and all Buyer’s Supplies from the time when they are taken into the custody of the Builder or any of its Subcontractors — shall lie exclusively with the Builder.
 
1.2   Immediately upon:
  (i)   the receipt by the Builder (or any of its Subcontractors) of any Buyer’s Supplies; and
 
  (ii)   the delivery to, or the assembly fabrication or manufacture by, the Builder (or any of its Subcontractors) of all steel blocks and other main Parts,
    the Builder shall mark (or cause its relevant Subcontractors to mark) the same and the Ship (as it is from time to time built) with hull number C33.
 
1.3   The Builder shall have no authority to create (and waives all rights to create) any encumbrances whatsoever over any of the Buyer’s Supplies, nor shall it permit any encumbrances of any kind (other than permitted encumbrances) to be imposed on or asserted against any of the Buyer’s Supplies.
 
1.4   At any time when a payment is due to the Builder under this Contract, and at all other reasonable times, the Buyer may require the Builder to provide a written statement satisfactory to the Buyer showing what, if any, encumbrances of any kind (other than permitted encumbrances) have been imposed on or asserted against any of the Buyer’s Supplies.
 
1.5   If any encumbrance of any kind (other than any permitted encumbrance) is imposed on or asserted against any of the Buyer’s Supplies as a result of the acts or omissions of the Builder or those for whom the Builder is responsible under this Contract, the Builder shall promptly notify the Buyer and shall, not later than ten (10) days thereafter, secure the discharge or release of such encumbrance provided that if the Builder desires to contest any such encumbrance and such discharge or release is not available under law during such contest (including, without limitation, through the filing of a bond or other security), the Builder shall immediately take such steps to prevent such encumbrance from delaying or otherwise adversely affecting the Work and shall indemnify fully, hold harmless and defend the Buyer and all other protected parties from and against all losses which any of them may sustain or incur as a result of the imposition of any such encumbrance.
 
1.6   Notwithstanding the provisions of Clause 1.5, the Buyer may secure the removal of any such encumbrance in which event the Builder shall reimburse the Buyer in full for its costs (including legal fees) of securing such removal.

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1.7   Prior to the installation of any of the Buyer’s Supplies that have been purchased, paid for or provided by the Buyer, the Buyer shall confirm in writing to the Builder whether any permitted encumbrances have been imposed on or asserted against such Buyer’s Supplies and shall discharge any such permitted encumbrances prior to the installation of such Buyer’s Supplies, and if the Buyer fails to discharge any such permitted encumbrances, the Builder may withhold the installation of the relevant Buyer’s Supplies in which case any resulting delays will be the Buyer’s responsibility.
 
1.8   The Builder may grant one or more mortgages over the Ship and Parts (a “Mortgage”), but not over the Buyer’s Supplies, to one or more mortgagees as security for the Builder’s construction financing of the Ship and for the financing of the Refund Guarantees provided that:
  (i)   the aggregate total amount to be secured by any such Mortgages shall not exceed the Contract Price (as the same may be increased in accordance with the express provisions of this Contract); and
 
  (ii)   the Builder’s obligations under the construction financing arrangements referred to above, and the related Mortgages and other encumbrances, shall be without recourse to the Buyer and other protected parties.
1.9   All encumbrances (including, without limitation, all Mortgages) over the Ship and Parts, and all associated entries in any registers, shall be cancelled and discharged at the latest simultaneously with the Ship’s delivery to the Buyer.
 
2.   INSURANCES
2.1   From the date when steelwork for the first hull section of the Ship is completed and until delivery to the Buyer the Ship, all Parts, and all Buyers’ Supplies (for their insured value as declared by the Buyer) taken into the custody of the Builder (or any of its Subcontractors) and whether or not built into or installed on or in the Ship, shall be at the exclusive risk of the Builder which shall at its own expense keep the same insured with first class European and / or Lloyd’s of London insurers acceptable to the Buyer against all usual builder’s risks, including protection and indemnity risks, tests risks, and war risks under policy terms that shall be no less favourable than those of the London Institute Builder’s Risks clauses (with appropriate amendment if any sea trial tests are to be conducted more than 250 nautical miles from the Shipyard). All premiums shall be for the sole account of the Builder. Deductibles shall be applied to the Builder or the Buyer in respect of their respective interests in the insurances to be arranged by the Builder under this Article (the “Insurances”). Neither the brokers nor the insurers shall have any rights of recourse against the Ship after her delivery to the Buyer, or against the Buyer or any other of the protected parties at any time whatsoever, or any rights to make any deduction, set-off or other withholding whatsoever from or against any sum payable to the Buyer or its assignees in connection with the Insurances. If, by the time when steel work for the first hull section of the Ship has been completed, the Builder’s insurance arrangement have been consolidated with the insurance arrangements of the AKER YARDS Group, then the Builder may propose an alternative policy based on the AKER YARDS Group standard terms for approval by the Buyer; such approval not to be unreasonably withheld or delayed.

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2.2   The amount of the Insurances shall be not less than (i) the actual value of the Ship as built from time to time, and (ii) the insured value, as declared by the Buyer, of all Buyers’ Supplies from time to time taken into the custody of the Builder or any of its Subcontractors, and whether or not such Supplies are built into or installed on or in the Ship.
2.3   All Insurances shall name the Builder as the assured party and the Buyer as the co-insured party for their respective interests. The Insurances shall contain loss payable provisions reasonably acceptable to the Buyer.
2.4   All Insurances shall provide that there shall be no recourse against the Ship after her delivery to the Buyer, or against the Buyer or the Buyer’s assignees for the payment of any premiums or commissions and that no cancellation of the Insurances, for any reason whatsoever, shall become effective unless and until fourteen (14) days prior written notice has been given by the relevant brokers or insurers to the Buyer.
2.5   Within five (5) days after steelwork for the first hull section of the Ship has been completed the Builder shall supply the Buyer with an original cover note and all related documents specifying the terms of the Insurances and security.
 
2.6   If at any time there is:
  (i)   any lapse in the insurance coverage which the Builder is required to arrange under this Clause 2 and such lapse is not corrected within seven (7) days, the Buyer may effect replacement coverage at the Builder’s expense; or
 
  (ii)   any failure by the Builder to pay any premiums due in respect of the Insurances and such failure is not corrected within seven (7) days, the Buyer may pay the same and recover the relevant payment(s) from the Builder.
3.   LOSS OR DAMAGE
 
3.1   In the event of any partial loss of the Ship before delivery:
  (i)   the loss shall be made good by the Builder as soon as reasonably possible, the Delivery Date shall be extended in accordance with Clause 1 in Article 5 (provided that the cause of the partial loss is excused under that Clause) and the partial loss proceeds referable to the Ship and/or Parts (other than Buyer’s Supplies) subject to the partial loss shall be applied by the Builder in making good the partial loss in accordance with this Contract, the Plans and the Specification; and
 
  (ii)   the partial loss proceeds referable to any Buyer’s Supplies subject to the partial loss shall be paid to the Buyer.
3.2   In the event of the total loss of the Ship before delivery, either the Builder or the Buyer shall be entitled to terminate this Contract by written notice to the other, such notice to be delivered within thirty (30) days after the date (the “Determination Date”) on which it is determined that the Ship has become a total loss pursuant to Clause 3.5 below.

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3.3   If, following the total loss of the Ship, neither party terminates this Contract pursuant to Clause 3.2, the Builder shall receive all total loss proceeds — apart from those referable to any Buyer’s Supplies subject to the total loss, which shall be paid to the Buyer — and thereafter the Builder shall proceed with the building of the Ship in accordance with this Contract and the Delivery Date shall be extended by agreement of the parties.
 
3.4   If there is a total loss of the Ship before delivery, then:-
  (i)   if either party elects to terminate this Contract pursuant to Clause 3.2, the Builder shall within ninety (90) days from (and including) the Determination Date pay to the Buyer an amount equal to the sum of:
  (a)   all payments on account of the Contract Price previously made by the Buyer to the Builder under this Contract together with interest thereon at the Relevant Rate calculated from the date on which the Builder received each such payment to the date on which the reimbursement is received by the Buyer, and
 
  (b)   the Buyer’s Supply Costs in respect of any Buyer’s Supplies which are subject to the total loss or which cannot be removed in sound condition from the Ship, the Shipyard or other place(s) where they are stored and returned to the Buyer, free from all encumbrances whatsoever, and in addition the Builder will return to the Buyer all Buyer’s Supplies which have not been lost or damaged and which can be removed in sound condition from the Ship, the Shipyard and other place(s) where they are stored, whereupon this Contract shall be deemed to have been rescinded — subject and without prejudice to the rights, duties, liabilities and obligations of either party under any other of the express provisions of this Contract (including, without limitation, Articles 9 to 14) — and the Builder alone shall be entitled to receive and retain any and all amounts recoverable under the Insurances; or
  (ii)   if neither party terminates this Contract pursuant to Clause 3.2, then Clause 3.1 of this Article 4 shall apply.
3.5   A total loss shall be deemed to have occurred:
  (i)   if it consists of an actual loss, on the actual date of loss; or
 
  (ii)   if it consists of a constructive or compromised or arranged or agreed total loss, on the date on which notice of abandonment of the Ship is given to her insurers.
(End of Article 4)

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ARTICLE 5: PERMISSIBLE DELAYS
1.   EXTENSION OF TIME FOR WORK
1.1   If the Builder gives notice as provided in Clauses 2.1, 2.2 and 2.3 the Builder shall be entitled to an extension of the Delivery Date but only if the Builder can demonstrate clearly that:
  (i)   there is a specific contingency which is delaying or will delay Work in the updated critical path of delivery of the Ship for more than one Working Day;
 
  (ii)   such delay is being caused or will be caused by one or more of the contingencies specified in Clause 1.3;
 
  (iii)   it has used and is continuing to use all reasonable efforts to avoid, prevent, minimise and overcome the actual delay in delivery of the Ship provided that such reasonable efforts do not jeopardise the Builder’s contracted obligations for the construction of other ships; and
 
  (iv)   the contingency in question occurred before the Delivery Date.
    provided that (a) the length of any such extension shall be the number of days by which the Builder can demonstrate clearly that completion of the Work and delivery of the Ship actually will be delayed by such contingency(ies) and (b) delays attributable to two (2) or more concurrent contingencies shall not be aggregated or counted more than once.
 
1.2   The Builder shall at all times have the burden of demonstrating clearly each of the matters required to be established by this Clause 1 and in the event that it is not possible for it to demonstrate clearly whether, or to what extent, any delay in delivery is caused by any contingency which is excused by the express provisions of this Clause 1, the Builder shall not be entitled to any extension of the Delivery Date.
1.3   The Builder shall be entitled to an extension of the Delivery Date, as provided in Clause 1.1, for delay caused by one or more of the following contingencies:
  (i)   by legislation or other action by or on behalf of any government (or any agency or other authority of such government) prohibiting or otherwise preventing the Builder from proceeding with the Work;
 
  (ii)   by war or warlike events (including such acts of terror, sabotage or other hostile acts or preparations therefore as are beyond the Builder’s control) involving any country which is relevant to the building of the Ship;
 
  (iii)   by extraordinary weather conditions not included in normal planning;
 
  (iv)   by such strikes, lockouts and other labour disturbances of or directly affecting the Builder or those of its Subcontractors who supply important Parts (such as engines, major castings, or other major turn-key Parts) as are beyond the Builder’s control provided that the Builder shall not be entitled to any extension of the Delivery Date for delays resulting from strikes, lock outs or other labour

- 24 -


 

      disturbances of its personnel occurring after the date falling 90 (ninety) days before the Delivery Date;
 
  (v)   by such accidents, explosions, fires, disruptions of power supplies and other similar occurrences as are beyond the Builder’s control;
 
  (vi)   by the non-compliant or late delivery to the Builder of any Parts, or the non-compliant or late performance of the Builder’s Subcontractors provided that the late delivery or performance resulted from causes which would entitle the Builder (if applying to it) to an extension of the Delivery Date under this Clause 1 and provided that the Builder proves that it has exercised due diligence (a) in contracting for such Parts and with such Subcontractors, (b) in the performance of any acts required of it with respect to such Parts or Subcontractors, (c) in monitoring the acts and circumstances of such Subcontractors, and (d) in expediting deliveries or performance under the Builder’s purchase or subcontracts or procuring equivalent substitute performance in the event of the late delivery of such Parts or the under-performance in such purchase or subcontracts; or
 
  (vii)   to the extent not covered by any of paragraphs (i) to (vi) of this Clause 1.3, by such Acts of God as could not reasonably be foreseen or provided against by the Builder.
1.4   Notwithstanding anything to the contrary in this Clause 1, the Builder shall not be entitled to any extension of the Delivery Date for:
  (i)   any delay resulting from a contingency or other cause of delay which has itself been caused by the acts, omissions, neglect or other default of the Builder;
 
  (ii)   any delay resulting from a contingency or other cause of delay in existence as of the Effective Date; or
 
  (iii)   any delay resulting from a contingency or other cause of delay, which was or reasonably should have been foreseen or anticipated by the Builder by reason of facts which were, or after reasonable enquiry should have become, known to the Builder as of the Effective Date; or
 
  (iv)   any delay resulting from contingencies or other causes of delay which reasonably could have been avoided by the Builder;
 
  (v)   any delay resulting from the non-compliant or late performance or other default of a Subcontractor, if such delay results from a contingency or other cause of delay (a) which is in effect, published and announced as of the date of the award of the relevant purchase contract or subcontract, or (b) which would not entitle the Builder (if applying to it) to an extension of the Delivery Date under this Clause 1; or
 
  (vi)   any delay due to increased labour or material costs or other financial stress of the Builder or any Subcontractors;

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  (vii)   any delay resulting from a contingency or other cause of delay occurring after the Delivery Date.
    In this Clause 1.4 references to the Builder shall include the Builder and all officers, employees, workmen and other representatives of the Builder.
 
1.5   The Builder may claim an extension of the Delivery Date for and equivalent to any actual delay to Work in the updated critical path of delivery of the Ship if such delay is caused by any failure on the part of the Buyer to perform its obligations under this Contract (unless any such failure is caused or excused by any failure on the part of the Builder to perform any of its obligations under this Contract) provided that the Builder gives written notice of such claim to the Buyer within five (5) days after the date on which the Builder first had knowledge of the cause of the delay. If the parties do not agree upon the length of the extension claimed by the Builder, the Builder’s entitlement to claim extension of the Delivery Date shall be determined as a Dispute pursuant to Article 13
2.   DELAY NOTICES
2.1   The Builder shall give written notice to the Buyer of a contingency pursuant to Clause 1.3 as soon as practicable and no later than five (5) days after the date on which the Builder first has knowledge of such contingency and in such notice the Builder shall describe the cause of the delay, the date of commencement (or first occurrence) of the cause, its expected duration and its expected effect on Work in the updated critical path of delivery of the Ship.
2.2   The Builder will provide the Buyer with regular written status reports (at such reasonable intervals as the Buyer may request) with respect to any delay in respect of which the Builder has given notice pursuant to Clause 2.1 and as to the steps being taken (and planned) by the Builder to minimise and overcome any actual delay in delivery of the Ship.
2.3   Within five (5) days after any cause of delay set forth in Clause 1.3 has ceased to exist, the Builder shall notify the Buyer of such cessation and give the Buyer a written statement of the actual or estimated delay in the completion of the Work resulting from such cause together with such detailed information and documentation as is then available to it justifying such extension, and any such detailed information and documentation thereafter becoming available to the Builder shall be promptly be given to the Buyer.
2.4   On the basis of the notices, reports, statements and information given to the Buyer by the Builder relating to any actual or estimated delay in delivery (and such further information and documentation as the Buyer may reasonably request), the Buyer and the Builder shall confer and attempt to agree upon the number of days by which the Delivery Date shall be extended provided that if the Buyer and the Builder cannot so agree within thirty (30) days after the completion of any such conference, the extension of the Delivery Date (if any) shall be determined as a Dispute pursuant to Article 13.

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2.5   The extension of the Delivery Date provided for in this Article shall be the only remedy for delay to which the Builder shall be entitled (subject and without prejudice to the express provisions of Article 6, Clauses 1.4 and 1.5) and, by way of illustration but not limitation, the Builder shall not be entitled to damages or any increase in the Contract Price or other compensation for delay.
(End of Article 5)

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ARTICLE 6: TESTS AND LIQUIDATED DAMAGES
1.   TESTS
1.1   At its sole and direct risk and expense, the Builder shall subject the Ship and specified Parts to the tests in order to ascertain whether the Ship and such Parts have been completed in full accordance with this Contract, the Plans and Specification. In connection with the sea trials tests, the Builder shall provide at its own expense the required quantities of ballast water (if any), fresh water, fuel oil, lubricating oil, greases and other consumables as well as the crew required to ensure safe navigation. By the time of commencement of the tests, the Ship shall have been substantially completed so as to enable the tests to be performed as specified.
1.2   The Buyer shall be entitled to have the Supervisor and his team present at all tests and the Builder shall give the Supervisor:
  (i)   two (2) Working Days’ prior written notice of all tests (except sea trials tests) (a) designated for such notice by the Supervisor following delivery by the Builder of the Schedule of Tests and (b) scheduled to take place on week-ends or other non-Working Days; and
 
  (ii)   one (1) Working Day’s prior written notice of all other tests (except sea trials tests).
1.3   The Builder shall give the Supervisor fifteen (15) Working Days estimated, and seven (7) Woking Days’ definite, prior written notice of the time and the place for the sea trials tests provided that only one (1) day’s prior written notice need be given to the Supervisor with respect to retrials at sea conducted within three (3) days after completion of a previous sea trial test at or upon which the need for such retrial was determined.
1.4   The course to be followed during the sea trials tests shall be determined by the Builder but shall be [**] [Confidential Treatment]. If the weather conditions on the date specified for the sea trials tests are (in the reasonable opinion of the Builder) so unfavourable that they would prevent the Builder from carrying out such tests in a proper manner then the same shall take place on the first available day thereafter that weather conditions permit. If, during the sea trials tests unexpected changes in the weather occur which, in the reasonable opinion of the Builder, are such as to prevent the continuation of such tests in a proper manner then such tests shall be discontinued and postponed until the next following favourable day unless the Buyer shall (in its option) agree in writing to accept the Ship on the basis of the tests made. If commencement of the sea trials tests is postponed or such tests are discontinued pursuant to the provisions of this Clause 1.4 and the aggregate total delay to such tests exceeds twenty four (24) hours, then the Delivery Date shall thereafter be postponed by the period of delay in excess of twenty four (24) hours.
1.5   The failure of the Supervisor to be present at any test, after due notice, shall be deemed to be a waiver of the Supervisor’s right to be present at the relevant test and the Buyer shall be obliged to accept the results of such test on the basis of a certificate of the Builder and the Classification Society that the Ship and specified Parts, after due

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    completion of the tests, were found to have been completed in full accordance with this Contract, the Plans and the Specification provided that if the Supervisor’s failure to attend any test, after due notice, is due to an event or combination of events outside the Supervisor’s control which arose not later than forty-eight (48) hours before commencement of the relevant test and the Buyer or the Supervisor so notifies the Builder before commencement of the test in question, then the test shall be postponed until the Supervisor (or substitute) is able to attend or the expiration of forty-eight (48) hours from the time at which the originally scheduled test was due to commence, whichever first occurs and the Delivery Date shall be postponed by the period for which commencement of the test is delayed.
1.6   All tests to which the Supervisor has, by endorsement of the Schedule of Tests, indicated his wish to attend but which are conducted without due notice to the Supervisor shall be reconducted by the Builder on due notice to the Supervisor at the sole risk and expense of the Builder.
1.7   Within three (3) Working Days after completion of the tests, the Builder shall notify the Buyer in writing of the results of the tests and shall, when appropriate, confirm to the Buyer that the Ship complies with the requirements of this Contract, the Plans and the Specification.
1.8   Within three (3) Working Days after its receipt of the Builder’s notice under Clause 1.7, the Buyer shall notify the Builder in writing of its technical acceptance of the Ship or its technical rejection of the Ship. If the Buyer notifies the Builder of its technical rejection of the Ship, the Buyer’s notice shall specify the respects in which, in the Buyer’s opinion, the Ship fails to comply with this Contract, the Plans and Specification. The Builder acknowledges and agrees that the Buyer may reject the Ship not only for defects discovered during or as a result of tests but also defects discovered and previously notified to the Builder that have not yet been remedied.
1.9   If and to the extent that the Builder accepts the Buyer’s technical rejection of the Ship, the Builder shall at its sole risk and expense forthwith take all such steps as may be necessary to remedy the defects and all such tests as may be necessary to demonstrate to the Buyer, the Classification Society and the Regulatory Authorities the full and final remedy of such defects. When appropriate, the Builder shall notify the Buyer in writing that the necessary remedial steps and tests have been completed and that the Ship complies with the requirements of this Contract, the Plans and the Specification
1.10   Within three (3) Working Days after its receipt of the Builder’s notice under Clause 1.9, the Buyer shall notify the Builder in writing of its technical acceptance of the Ship or its technical rejection of the Ship. If the Buyer notifies the Builder of its technical rejection of the Ship, the Buyer’s notice shall specify the respects in which, in the Buyer’s opinion, the Ship still fails to comply with this Contract, the Plans and Specification in which case the provisions of Clause 1.9 and 1.10 shall again apply.
1.11   If the Buyer fails to notify the Builder of its technical acceptance or technical rejection of the Ship together with its reasons for any rejection, within the time periods specified in Clauses 1.8 and 1.10 above, the Buyer shall be deemed to have technically accepted the Ship.

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1.12   The above process shall be repeated as often as necessary until the earlier of the time at which the Buyer notifies the Builder in writing of its technical acceptance of the Ship, and the valid and lawful termination of this Contract by either party. If there is any difference of opinion between the Builder and the Buyer as to whether the Ship complies with the requirements of this Contract, the Plans or the Specification either party may require that the difference of opinion be treated as a Dispute to be resolved in accordance with the provisions of Article 13.
1.13   The Buyer’s technical acceptance of the Ship shall be final and binding on the Buyer insofar as compliance of the Ship (as she is then built and equipped) with this Contract, the Plans and the Specification as demonstrated by the tests is concerned (with the exception of any outstanding defects or disputed defects) and shall preclude the Buyer from refusing formal tender of the Ship for delivery provided that:
  (i)   the Builder then maintains the Ship, as technically accepted by the Buyer, in full accordance with this Contract, the Plans and the Specification; and
 
  (ii)   the Builder fully complies with all preconditions and other requirements for delivery as provided in this Contract.
1.14   For the avoidance of doubt, all time used and costs expended in removing or otherwise remedying any defects, in making any necessary alterations and in carrying out all necessary tests and retests shall be for the Builder’s account and shall not result in any extension of the Delivery Date or increase in the Contract Price.
1.15   If: (i) the Ship has been completed in full accordance with this Contract, the Plans and Specification apart from defects of a minor nature (each a “minor defect”) meaning defects that in and of themselves, and also in the process of being remedied: (a) do not and will not adversely affect the seaworthiness of the Ship; or (b) do not and will not prevent the unrestricted use of the Ship in its intended service and purpose as described in the Plans and the Specification; or (c) do not and will not prevent the commercial functional use of any of the Ship’s passenger accommodation or any of the areas designated in the Specification as public spaces, or in any other way adversely affect the comfort or safety of the Ship’s passengers; or (d) do not and will not affect the safety of the Ship’s crew or their ability to carry out their duties in a safe working environment and with appropriate accommodation; or (e) do not and will not adversely affect the operational efficiency of the Ship; or (f) do not and will not involve any condition, qualification, recommendation, reservation or restriction in relation to any certificate issued (or to be issued) by the Classification Society or any Regulatory Authority which in the opinion of the Buyer (acting in good faith and being reasonable) is or could be material in a commercial or technical sense; and (ii) the Builder undertakes in writing to remedy defects at the Builder’s entire risk and expense, without any interruption to the Ship’s service to passengers, and with all convenient speed in accordance with a remedial plan and timetable approved by the Buyer (acting in good faith and being reasonable), then the Buyer shall not be entitled to withhold its technical acceptance of the Ship. From the time when the first Work inspections and approvals are to be made and given on behalf of the Buyer, the Builder and the Buyer shall jointly maintain a written record (the “Defects List”) in the form of a list of defects (including minor defects) noted on

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    behalf of the Buyer. The Builder and the Buyer, each acting reasonably and in good faith, shall update the Defects List at regular intervals to reflect the addition and removal of defects.
 
1.16   All defects in the Ship at the time of her final acceptance, whether or not recorded in the Defects List, shall qualify as defects covered by the Builder’s guarantee and shall be remedied pursuant to Clause 2 of Article 7. However, if before delivery and final acceptance of the Ship under Clause 1.4 of Article 7, a duly authorised representative of the Buyer expressly in writing waives its right to require the Builder to remedy a particular defect recorded in the Defects List, or accepts the Builder’s remedy of a particular defect, then the defect in question will be outside the scope of the Builder’s guarantee unless it recurs during the Guarantee Period notwithstanding the Builder’s remedial works before of after delivery or a new defect arises in the same Part.
1.17   The tests that are to be carried out after delivery shall be performed in the manner, under the conditions and in accordance with the timetable provided for in the Specification. Defects discovered during such tests shall qualify as defects covered by the Builder’s guarantee and shall be remedied pursuant to Clause 2 of Article 7.
 
2.   LIQUIDATED DAMAGES
2.1   The Builder agrees that certain deficiencies and certain delays in the delivery of the Ship shall oblige it to pay to the Buyer, by way of agreed and final liquidated damages and not as penalties, the compensation provided for in this Clause 2.
2.2   The speed of the Ship shall be demonstrated and tested during the sea trials tests under the conditions described in [**] [Confidential Treatment] of the Specification.
2.3   If the Builder before delivery fails to remedy any deficiency in the Guaranteed Service Speed or GSS, the Builder shall have no liability to the Buyer if the actual speed of the Ship as determined during the final sea trials tests is up to [**] [Confidential Treatment] of a knot below GSS but commencing with a deficiency of more than [**] [Confidential Treatment] of a knot below the GSS the Builder shall pay liquidated damages to the Buyer as follows for a speed between:
  (i)   [**] [Confidential Treatment] knots, a total sum of [**] [Confidential Treatment];
 
  (ii)   [**] [Confidential Treatment] knots, a total sum of [**] [Confidential Treatment];
 
  (iii)   [**] [Confidential Treatment] knots, a total sum of [**] [Confidential Treatment];
 
  (iv)   [**] [Confidential Treatment] a total sum of [**] [Confidential Treatment];
 
  (v)   [**] [Confidential Treatment] knots, a total sum of [**] [Confidential Treatment];
    provided that if the speed deficiency is more than [**] [Confidential Treatment] knot below the GSS, then the Buyer may, at its option, accept the Ship upon payment by the Builder of liquidated damages for such deficiency of [**] [Confidential Treatment] or reject the Ship and terminate this Contract pursuant to Clause 2 in Article 9.

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2.4   The fuel consumption of each main engine of the Ship shall be demonstrated and tested in tests conducted at the engine manufacturers’ test bed under the conditions described in [**] [Confidential Treatment] of the Specification.
2.5   If the Builder before delivery fails to remedy any deficiency in the fuel consumption of any of the Ship’s main engines, the Builder shall have no liability to the Buyer if such fuel consumption as determined during the final tests is more than the Guaranteed Fuel Consumption or GFC provided such excess is not more than [**] [Confidential Treatment] over the GFC but commencing with an excess of more than [**] [Confidential Treatment] in actual fuel consumption the Builder shall pay liquidated damages to the Buyer for each such engine in the sum of [**] [Confidential Treatment] for each full [**] [Confidential Treatment] (provided that if the Builder’s back to back position against its against the engine supplier entitles the Builder to claim fractions of a % calculated in proportion, the Buyer shall have the same entitlement against the Builder under this provision) increase in fuel consumption above such [**] [Confidential Treatment] level up to a maximum of [**] [Confidential Treatment] over the GFC provided that if the fuel consumption is more than [**] [Confidential Treatment] above the GFC, the Buyer may, at its option, accept the Ship upon payment by the Builder of liquidated damages for such deficiency of [**] [Confidential Treatment] or reject the relevant engine.
2.6   The deadweight capacity of the Ship shall be demonstrated by the Builder in the specified deadweight capacity test under the conditions described in [**] [Confidential Treatment] of the Specification.
2.7   If the Builder fails to remedy any deficiency in the Ship’s deadweight capacity before delivery, the Builder shall have no liability to the Buyer if the actual deadweight capacity of the Ship as determined in accordance with the Specification is less than [**] [Confidential Treatment] metric tons below the Guaranteed Deadweight capacity but the Builder shall pay liquidated damages to the Buyer in the sum of [**] [Confidential Treatment] for each full metric ton of such deficiency being more than [**] [Confidential Treatment] metric tons up to a maximum deficiency of [**] [Confidential Treatment] metric tons at a draft of not more than [**] [Confidential Treatment] even keel provided that if the actual deadweight deficiency at a draft of not more than [**] [Confidential Treatment] even keel is more than [**] [Confidential Treatment] metric tons, the Buyer may, at its option, accept the Ship against the Builder’s payment of liquidated damages in the amount of [**] [Confidential Treatment] for such deficiency or reject the Ship and terminate this Contract pursuant to Clause 2 in Article 9.
2.8   The guaranteed cabin capacity of the Ship shall be as defined in [**] [Confidential Treatment] of the Specification and no change shall be made to such cabin capacity without the Buyer’s prior written consent.
2.9   If the actual number of either the passenger or crew cabins is lower than the number of passenger and crew cabins as defined in [**] [Confidential Treatment] of the Specification, the Builder shall pay liquidated damages to the Buyer in the sum of [**] [Confidential Treatment] for each passenger or crew cabin deficiency. If any such cabin deficiency:

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  (a)   exceeds [**] [Confidential Treatment] passenger cabins the Buyer may, at its option, accept the Ship against the Builder’s payment of liquidated damages in the amount of [**] [Confidential Treatment] euros for such deficiency or reject the Ship and terminate this Contract pursuant to Clause 2 in Article 9; and/or
 
  (b)   exceeds [**] [Confidential Treatment] crew cabins the Buyer may, at its option, accept the Ship against the Builder’s payment of liquidated damages in the amount of [**] [Confidential Treatment] euros for such deficiency or reject the Ship and terminate this Contract pursuant to Clause 2 in Article 9.
2.10   The columns under the heading of Column A in Schedule 7 describe: the maximum sound and vibration levels and related tolerances and graces defined by the Classification Society notation DNV Comf V (1) (the “S & V Notation”); and the application of the S & V Notation to and between the suites, cabins and other public spaces on board the Ship (the “spaces”) referred to in such columns.
2.11   The Builder shall carry out the Works so that, at delivery, the Ship achieves the S&V Notation.
2.12   If any of the sound and vibration levels in the spaces — as tested and measured in accordance with the testing and measurement procedures referred to in [**] [Confidential Treatment] of the Specification — exceed any of the sound or vibration level or space number or area tolerances and graces defined by the S & V Notation, before the Delivery Date the Builder shall take all such remedial steps and make all such further tests and measurements as may reasonably be required (i) to reduce the levels, numbers and areas to within the applicable S & V Notation tolerances and graces referred to in the columns under the heading of Column A in Schedule 7, and (ii) to demonstrate the complete and permanent correction of the relevant deficiencies.
2.13   If the Builder is unable to reduce the relevant levels, numbers and areas to within the applicable S & V Notation tolerances and graces, and to demonstrate the complete and permanent correction of the relevant deficiencies, the Builder shall be obliged to pay liquidated damages to the Buyer at the applicable rates per space specified in the Liquidated Damage columns under the heading of Column B in Schedule 7 for every space in which the measured levels of sound or vibration exceed the peak level for such space specified in the Limit column under the heading of Column B of Schedule 7.
2.14   If, after taking into account the applicable S & V Notation space, number and area tolerances and graces, the measured levels of sound or vibration in any space exceed the peak level for such space specified in the Limit column under the heading of Column B of Schedule 7 and the peak number and area allowance specified in the Number(s) and Area columns under the heading of Column B of Schedule 7 then the Buyer may, at its option, accept the Ship against the Builder’s payment of the aggregate total liquidated damages for all sound and vibration deficiencies calculated in accordance with Schedule 7 or the Buyer may reject the Ship and terminate this Contract pursuant to Clause 2 in Article 9.

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2.15   For the avoidance of doubt, the parties agree that the tolerances referred to in the columns under the heading of Column B in Schedule 7 shall be read and applied as overlapping with — and not as additional to — the tolerances and graces defined by the S & V Notation in the columns under the heading of Column A in Schedule 7.
2.16   The Buyer intends to arrange for the Ship’s first cruise with fare paying passengers to be held on the [**] [Confidential Treatment]. The Builder:
  (i)   acknowledges that it is imperative for the Ship to be ready at the time, and in the condition, provided for in this Contract so as to enable the Buyer to fulfil its commitments in relation to the Ship’s first cruise; and
 
  (ii)   agrees to do all it can to assist the Buyer to fulfil its commitments in relation to the Ship’s first cruise.
2.17   If delivery of the Ship is not made on the Compensation Date, the Buyer will suffer loss and damage (including reputational damage) in amounts which are extremely difficult to quantify in advance but it is agreed by the Builder and the Buyer that the per day sums set out in paragraphs (i) to (iv) below represent a genuine and reasonable estimate of the Buyer’s loss and damage for each day of delay in delivery of the Ship beyond the Compensation Date and that they constitute the final compensation payable by the Builder to the Buyer for delay in delivery of the Ship beyond the Compensation Date. If delivery of the Ship is delayed beyond the Compensation Date, the Builder shall be obliged to pay to the Buyer by way of the liquidated damages for each calendar day (or pro-rata for each part of a calendar day) at the per rates set out at paragraphs (i) to (iv) below from (and including) the Compensation Date until delivery of the Ship is actually made or this Contract is terminated:
  (i)   if the Builder shall have given to the Buyer less than or equal to thirty (30) days notice of the delay in delivery prior to the Delivery Date:
  (a)   for the first [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;
 
  (b)   for the [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;
 
  (c)   for the [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;
 
  (d)   for the [**] [Confidential Treatment] the rate shall be [**] [Confidential Treatment] per day;
  (ii)   if the Builder shall have given to the Buyer more than thirty (30) days but less than or equal to ninety (90) days notice of the delay in delivery prior to the Delivery Date:
  (a)   for the [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;

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  (b)   for the [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;
 
  (c)   for the [**] [Confidential Treatment] days the rate shall [**] [Confidential Treatment] per day;
 
  (d)   for [**] [Confidential Treatment] the rate shall be [**] [Confidential Treatment] per day;
  (iii)   if the Builder shall have given to the Buyer more than ninety (90) days but less than or equal to one hundred and eighty (180) days notice of the delay in delivery prior to the Delivery Date:
  (a)   for the [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;
 
  (b)   for the [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;
 
  (c)   for the [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;
 
  (d)   for [**] [Confidential Treatment] the rate shall be [**] [Confidential Treatment] per day;
  (iv)   if the Builder shall have given to the Buyer more than one hundred and eighty (180) days notice of the delay in delivery prior to the Delivery Date:
  (a)   for the [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;
 
  (b)   for the [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;
 
  (c)   for the [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;
    If the delay in delivery of the Ship continues for 240 (two hundred and forty) days after the Compensation Date then, in such event, the Buyer may at any time thereafter terminate this Contract pursuant to Clause 2 in Article 9. If the delay in delivery of the Ship continues for 271 (two hundred and seventy one) days after the Compensation Date, and provided the Buyer has not by then elected to terminate this Contract, the Builder may (by written notice) require the Buyer to make an election in which case the Buyer shall — within 15 (fifteen) days after its receipt of the Builder’s notice — notify the Builder in writing of its intention either to terminate this Contract or to consent to the acceptance of the Ship at an agreed future date on the basis that the Buyer shall remain entitled to all liquidated damages which would otherwise have been payable or allowable by the Builder in accordance with the provisions of this Contract; it being further understood that, if the Ship is not delivered by such agreed future date, the Buyer shall have the same right of termination upon the same terms and conditions as set out above. If the Buyer fails to make an election as specified above within the relevant 15 (fifteen) days

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    period, the Buyer shall be deemed to have consented to the Ship being delivered at the future date proposed by the Builder.
 
2.18   In no event shall the aggregate of final liquidated damages payable by the Builder to the Buyer in accordance with this Clause 2 exceed [**] [Confidential Treatment].
 
2.19   The amounts of all liquidated damages payable under this Clause 2 shall be determined and paid to the Buyer on delivery of the Ship or when applicable on termination of the Contract.
 
2.20   The parties acknowledge and agree that:
  (i)   the liquidated damages provided for in the sub-clauses of Clause 2 in respect of speed, deadweight, fuel consumption, sound and vibration, and delay are cumulative and not exclusive so that, when applicable, the Buyer may claim under one or more of such sub-clauses in respect of the same event; and
 
  (ii)   subject always and without prejudice to the guarantee provisions in Article 7 Clause 2 and to the termination provisions in Article 9 Clause 2, the liquidated damages provided for in this Clause 2 shall be the only compensation recoverable by the Buyer in respect of the breaches of Contract to which they relate and, in particular, the Builder shall not be liable for any loss of profit, loss of revenue or other consequential losses resulting from such breaches.
2.21   The Builder hereby irrevocably and unconditionally waives all rights whatsoever to claim that the any of the entitlements intended to be conferred on the Buyer to claim liquidated damages under any of the express provisions of this Contract are in any manner or to any extent void, invalid or unenforceable as being in the nature of penalties. However, if for any reason the enforcement of any of the Buyer’s claims for liquidated damages is prohibited by any applicable law or if any express provision of this Contract relating to liquidated damages is rendered void, invalid or enforceable by applicable law, the Builder shall nonetheless be liable to pay general damages in respect of the relevant breach of its obligations under this Contract provided that the Builder’s liability in such circumstances shall not exceed the liability that the Builder would have had to pay liquidated damages for such breach under the express provisions of this Contract.
(End of Article 6)

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ARTICLE 7: DELIVERY AND GUARANTEE
1.   DELIVERY AND ACCEPTANCE
1.1   The Ship shall be ready for delivery at the Shipyard on 16th of November 2009 (the “Delivery Date”). The Ship shall not be delivered before this date without the express written approval of the Buyer. When:
  (i)   the Builder has completed the Work in compliance with this Contract, the Plans and the Specification;
 
  (ii)   all tests have been performed and completed in accordance with this Contract, the Plans and the Specification, the parties have agreed the Defects List, and the remedial plan and timetable referred to in Article 6, Clause 1.15;
 
  (iii)   the Ship (a) (in accordance with the Builder’s usual practices and to their usual standards for ships of this type) has been cleaned and prepared so that she is ready to take on a full complement of passengers, officers, crew and staff, and (b) is in all other respects ready to enter service as a passenger cruise ship;
 
  (iv)   the Builder has removed from the Ship all unused construction materials and debris, and otherwise left the Ship in a clean and safe ready for sea condition,
    the Builder shall tender the Ship for delivery to the Buyer safely afloat alongside a safe and accessible quay at the Shipyard where there must be sufficient water for the Ship always to remain afloat and from where there must be direct, free, unimpeded, safe and lawful access to international waters provided that the Builder shall have given to the Buyer not less than 15 (fifteen) Working Days definite, prior written notice of delivery.
 
1.2   The Builder shall deliver the Ship to the Buyer with full title guarantee, and free and clear of all encumbrances (including, without limitation, all Mortgages) whatsoever.
1.3   On delivery of the Ship the Builder shall also deliver the following documents (together, the “Delivery Documents”):
  (i)   a Protocol of Delivery and Acceptance in the form of Schedule 2 confirming delivery of the Ship to, and acceptance and taking possession of the Ship by, the Buyer pursuant to this Contract, executed in two original counterparts by the Builder and the Buyer and stating the date and (local) time of such delivery and acceptance;
 
  (ii)   a declaration of warranty by the Builder in a mutually agreed form confirming that the Ship is delivered to the Buyer free and clear of all encumbrances whatsoever (including, without limitation, all Mortgages and other obligations and all liabilities of the Builder arising from the financing, the construction or the operation of the Ship for the purposes of the tests or otherwise before delivery) and that the Ship is absolutely free of all burdens in the nature of imposts, taxes or other charges imposed by the national, provincial, local or port authorities of France;

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  (iii)   a detailed inventory showing the machinery and equipment installed on the Ship and the spares, stores and other consumable items delivered with the Ship;
 
  (iv)   the makers’ certificates, Subcontractors’ instruction books, and all of the Classification Society, trading and other certificates (each free of conditions, qualifications, recommendations, reservations and restrictions) required to be supplied upon delivery of the Ship pursuant to this Contract and the Specification, and the Buyer will accept provisional certificates provided that: (a) they do not to any extent impair the Buyer’s ability to register, finance, insure or operate the Ship in its intended service; and (b) the Builder undertakes to deliver fully compliant permanent certificates as soon as they are available from the relevant issuing authority;
 
  (v)   a protocol showing the results of the tests;
 
  (vi)   a non-registration or deletion certificate issued by the competent French authorities;
 
  (vii)   a commercial invoice for the Ship and all other amounts payable by the Buyer on delivery;
 
  (viii)   a builder’s certificate in a form acceptable to the Buyer, notarised and legalised in accordance with the Buyer’s instructions, and such other written instruments as may be strictly necessary, to confirm that full and clean title in the Ship has been vested in the Buyer and to enable the Buyer to register the Ship under the Flag State;
 
  (ix)   a full set of the drawings, plans and other construction documents provided for in the Specification;
 
  (x)   if required by the Buyer’s financiers, such documents as may be necessary to prove the authority of the parties’ respective representatives to sign the documents to be executed on behalf of the Builder and the Buyer in connection with delivery of the Ship.
1.4   Acceptance of the Ship by the Buyer shall be accomplished by:
  (i)   the signature by the Buyer and the Builder of two (2) original counterparts of the Protocol of Delivery and Acceptance; and
 
  (ii)   payment by the Buyer to the Builder of that part of the Contract Price and all other sums that the Buyer is required to pay upon delivery of the Ship pursuant to the provisions of this Contract.
1.5   The Buyer shall be afforded five (5) days free of any wharfage or any other charge, and up to three (3) further days at the usual wharfage fee charged by the relevant port authority, within which to remove the Ship from her point of delivery.
1.6   The following consumables remaining on board at delivery of the Ship shall be jointly inventoried by the Builder and the Buyer, and the Buyer shall pay for them at the Builder’s actual cost price: lubricating oils in storage tanks, fresh water, diesel oils and

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    fuel oils. The Builder shall remove all waste-oil and sludge from the Ship at the Builder’s risk and expense prior to delivery. The Buyer shall not be obliged to pay for the Ship’s ballast.
1.7   Acceptance of the Ship and the related Delivery Documents by the Buyer under this Clause 1:
  (i)   shall signify that the Buyer has taken possession and the risk of loss of the Ship and the related Delivery Documents as of the time and date set out in the Protocol of Delivery and Acceptance and that the Builder may terminate the Insurances; and
 
  (ii)   shall not be deemed to constitute a waiver of or otherwise prejudice any of the Buyer’s rights under Clause 2 of this Article 7 with respect to any defect, whether known or unknown, and whether or not noted in any document delivered in connection with delivery and acceptance of the Ship, which may exist in the Ship at the time it is accepted by the Buyer, and any such defect may be reported to, and shall be remedied at the sole and direct risk and expense of, the Builder under the guarantee provided in Clause 2.
1.8   At the time of the Ship’s delivery to the Buyer under this Contract, the Buyer will register the Ship under the flag and laws of the Bahamas (the “Flag State”), with Nassau as the Ship’s home port, and all fees and charges relating to such registration shall be for the account of the Buyer.
 
2.   GUARANTEE
2.1   Subject to the express provisions of this Clause 2, the Builder guarantees the Ship and all Parts against all defects for the period of [**] [Confidential Treatment], (subject to any extension thereof as provided for in this Clause 2) from the date of the Ship’s actual delivery to the Buyer under Article 7, Clause 1.4 (the “Guarantee Period”).
2.2   In calculating the length of the Guarantee Period there shall be excluded any day(s) during which the Ship is prevented from entering or is taken out of service solely on account of any defect in the Ship or in any Part for which the Builder is responsible under this Clause 2.
2.3   Where any defect in the Ship or any Part is remedied during or after the Guarantee Period, the Builder’s guarantee under this Clause 2 shall apply to such remedial Work for the longer of [**] [Confidential Treatment] from the date on which the remedial Work was completed and the end of the period specified in Clause 2.1 above so that the Guarantee Period for such items shall not exceed [**] [Confidential Treatment]. The [**] [Confidential Treatment] time limit shall apply to the Guarantee Period as calculated under the provisions of this Clause 2.
2.4   If any remedial works made or agreed to be made by or on behalf of the Builder before, during or within 30 days after the Guarantee Period (or any extension thereof under this Clause 2) indicate any recurring defect (meaning any defect that requires two (2) or more

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    repairs, replacements or modifications due to the same cause), the Builder shall take the following steps as soon as reasonably possible:
  (i)   promptly perform a root cause analysis; and
 
  (ii)   ascertain the root cause of such recurring defect and the design modification or other remedial Work required to implement a full and final solution; and
 
  (iii)   remedy such recurring defect, and its root cause, in order to avoid a continuation or repetition of such recurring defect.
    If it is not possible for any defect covered by the Builder’s guarantee under this Clause 2 to be fully and finally remedied within the Guarantee Period defined above, both the Guarantee Period and the Builder’s guarantee obligations under this Clause 2 shall be deemed to be extended in respect of such defect until either the Builder has implemented a remedial solution or the Builder has made a commercial settlement with the Buyer which is (in either case) reasonably satisfactory to the Buyer.
 
2.5   The Builder shall not be responsible for the remedy of any defect if it is due to:
  (i)   perils of the sea, accident (subject to Builder’s responsibility under Clause 2.12), negligence (but excluding negligence on the part of the Builder), or improper maintenance or handling (including, without limitation, overloading) of the Ship or any Parts;
 
  (ii)   use of fuels or lubricants not recommended by the relevant manufacturer; or
 
  (iii)   normal wear and tear;
 
  (iv)   any fault in (or caused by) any Buyer’s Supplies which were properly (a) received, (b) handled, (c) installed or incorporated in, (d) stowed on, or (e) otherwise delivered with the Ship by the Builder in accordance with all of the requirements of this Contract, the Plans and the Specification; or
 
  (v)   subject to the other express provisions of this Clause 2, repairs carried out by anyone other than the Builder, its Subcontractors or other persons nominated or approved by the Builder.
2.6   The Buyer shall give written notice to the Builder as soon as possible and in any event within fourteen (14) days after the discovery of any defect for which a claim is made under this Clause 2 and, a copy of each such notice shall also be given to the guarantee engineer, who shall acknowledge receipt by his signature thereof. The Buyer’s notice shall give full details (so far as possible) as to the nature of the defect and the extent of any damage caused thereby.
2.7   Within thirty (30) days after the end of the [**] [Confidential Treatment] referred to in Clause 2.1 as extended by the operation of Clause 2.2, the Buyer (in consultation with the guarantee engineer) will draw up, and send to the Builder, a list identifying every defect for which a claim which is existing on the last day of such period is to be made under this Clause 2 provided that this Clause 2.7 will not preclude

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    the Buyer from giving notice to the Builder of, and making claims in respect of, any defect which is covered by the Builder’s extended guarantee under Clause 2.3.
2.8   Each defect will be remedied by the Builder as soon as reasonably practicable (and the necessary remedial works shall be scheduled so as to minimise disruption to the Ship’s service and the availability of cabins, public rooms and areas, and other passenger facilities) or, at the Buyer’s option, under the instruction or supervision of the Builder at a suitably qualified shipyard or workshop selected by the Buyer and approved by the Builder (such approval not to be unreasonably withheld or delayed), and in each case the Builder shall bear and pay:
  (i)   the cost of all equipment, parts, tools and materials reasonably required and incurred to remedy the defect (including, without limitation, the cost of delivering the same to the selected shipyard or workshop by airfreight if the Buyer reasonably so requires, and the cost of returning any defective equipment, parts and materials);
 
  (ii)   the cost of all labour reasonably required and incurred to remedy the defect including, without limitation, the expenses of independent contractors in travelling to the Ship;
 
  (iii)   the cost of any necessary underwater inspection of the Ship by divers; and
 
  (iv)   where the Ship is drydocked exclusively on account of the need to remedy any defect in the Ship’s external underwater parts at any time before the Ship’s first scheduled drydocking after delivery (provided that the remedy of such defect cannot reasonably be postponed until the Ship’s first scheduled drydocking), the drydocking costs and the costs of remedying any defect that is covered by the Builder’s guarantee obligations under this Clause 2.
    The Buyer agrees to use the normal diligence and business practices of a competent shipowner with a view to minimising the cost of remedial works carried out by anyone other than the Builder, its Subcontractors or other persons nominated by the Builder.
 
    For the avoidance of doubt, in view of the intended area of the Ship’s operation during the Guarantee Period, the Builder will not be entitled to require the Ship to be returned to any of the Builder’s facilities for the remedy of any defects.
 
    If the Buyer discovers any defect which (in the reasonable opinion of the Buyer) requires remedial action on an urgent basis, the Buyer will (acting in good faith) give such notice to the Builder as is practicable in the circumstances then prevailing (the intention being that, circumstances permitting, the Builder shall have a reasonable opportunity to take necessary actions to remedy the defect on an urgent basis, to obtain necessary remedial instructions from the relevant Subcontractor(s) and to relay such instructions to the Buyer) and thereafter the necessary remedial works (if not carried out by the Builder) may be carried out by the Ship’s crew or, if practicable having regard to the degree of urgency, by the nearest suitably qualified shipyard or workshop selected by the Buyer, and in each such case the Builder shall reimburse the Buyer for the costs described in Clause 2.8(i), (ii), (iii) and (iv) above. The Buyer agrees to use the normal diligence and

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    business practices of a competent shipowner with a view to minimising the cost of such remedial works.
 
2.9   At the Buyer’s request after final completion of the remedial works to be made or paid for by the Builder under this Clause 2 in respect of a particular aspect of the Work or any Part, the Builder will:
  (i)   assign to the Buyer, to the fullest extent possible and without any charge to the Buyer, that part of every contractual warranty or guarantee given by any Subcontractor with respect to the particular aspect of the Work or Part which extends beyond the Guarantee Period or which is otherwise more favourable to the Buyer than the guarantee of the Builder under this Clause 2; or
 
  (ii)   if it is not possible fully and effectively to assign the relevant part of any such contractual warranty or guarantee, hold and enforce the relevant contractual warranty and guarantee as trustee and agent for the Buyer and promptly account to the Buyer for all monies received in or pursuant to the holding or enforcement of any such contractual warranty or guarantee.
2.10   The Builder shall, at its sole risk and expense (except for the cost of suitable accommodation and food on board the Ship which shall be supplied free of charge by the Buyer), employ and place a suitably qualified and experienced English-speaking guarantee engineer acceptable to the Buyer on board the Ship for so long as the Buyer may reasonably require during the Guarantee Period and thereafter until the Builder has remedied every defect to which this Clause 2 applies but in any event no more than 180 (one hundred and eighty) days in aggregate. Not later than fifteen (15) days before delivery of the Ship, the Builder shall provide to the Buyer for its approval (which is not to be unreasonably withheld) the name and credentials of the proposed guarantee engineer. If at any time the Buyer considers the guarantee engineer’s performance of his duties to be unsatisfactory, the Buyer may by notice to the Builder request the replacement of the guarantee engineer. The Builder shall promptly investigate the Buyer’s complaint and, if the complaint is justified, the Builder shall (without any cost or liability to the Buyer) effect a suitable replacement acceptable to the Buyer as soon as may be practicable in the prevailing circumstances.
2.11   If:
  (i)   any defect in the Ship’s external underwater parts is discovered during the Guarantee Period or the period of thirty (30) days referred to in Clause 2.7; or
 
  (ii)   any defect in the Ship’s external underwater parts is discovered either during the Ship’s first scheduled drydocking after delivery provided that the first scheduled dry-docking occurs within twenty-four months after delivery of the Ship or, if there is no scheduled dry-docking within this period, under a joint underwater inspection under Classification Society supervision which is to be carried out as close to the end of such twenty four months period as may be convenient having regard to the Ship’s itinerary and the need to select a suitable location for such under water inspection. The costs (including the costs of attendance of the Classification Society’s representative) of such inspection shall be borne by the

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      Builder if any defect is discovered for which the Builder is responsible under this Clause 2 and otherwise such costs shall be borne by the Buyer,
    and if the Classification Society imposes a condition in respect of a defect in such underwater parts for which the Builder is responsible under this Clause 2 and requires the defect to be remedied before the next Ship’s scheduled drydocking the Builder shall be responsible for the necessary remedial works and the associated drydocking costs. Otherwise, the Buyer shall bear and pay for the haul day and any associated drydocking costs incurred in the ordinary course of the Ship’s next scheduled drydocking maintenance and the Builder, in addition to the costs of all necessary remedial works, shall bear and pay for such additional drydocking day(s) as may be required to remedy such defect.
 
2.12   Without prejudice to the Builder’s obligations and liabilities under the other express provisions of this Clause 2, the Builder shall not be responsible for any loss or damage caused by any defect except:
  (i)   that, in addition to the other guarantee obligations specified in this Clause 2, the Builder shall be obliged to remedy (or, as provided for in the preceding paragraphs of this Clause 2, to pay for the remedy of) any equipment or part of the Ship that is physically damaged as a direct and proximate result of any defect covered by the Builder’s guarantee under this Clause 2;
 
  (ii)   for any physical damage directly caused by the Builder’s remedy of any defect; and
 
  (iii)   for any physical damage directly caused by the wrongful refusal or failure of the Builder or its Subcontractors to remedy (or authorise the remedy) of any defect.
2.13   Any sum(s) payable by the Builder under this Clause 2 shall be due and payable as set out in Article 8.
2.14   Except as otherwise expressly provided in Clause 2.11, the Builder shall not be responsible or liable for any defect discovered after the expiry of the Guarantee Period (as the same is defined and extended pursuant to this Clause 2), loss of time due to repair or for any loss of profit, loss of revenue or other consequential losses suffered by the Buyer by reason of any defect. Furthermore, the guarantee under this Clause 2 replaces and excludes any warranty, liability, term and/or condition imposed or implied by any law, custom or usage and — save as otherwise expressly provided for in this Contract, the Plans or the Specification — the Builder makes no warranty/condition of merchantability or fitness of the Ship or any Part thereof for any particular purpose.
(End of Article 7)

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ARTICLE 8: CONTRACT PRICE AND PAYMENT TERMS
1.   CONTRACT PRICE
 
1.1   The Contract Price for the Ship:
  (i)   shall be EUR735,000,000 (seven hundred and thirty five million euros); and
 
  (ii)   is a fixed price and may be adjusted only in strict accordance with, and subject to, the express provisions of this Contract.
1.2   For the avoidance of doubt:
  (i)   the Contract Price includes the cost of the Ship, completed in accordance with the requirements of this Contract, the Specification and the Plans;
 
  (ii)   the Contract Price includes the cost of all Work and the cost of all surveys, tests and trials of the Ship to be performed by, or on behalf of, the Builder or any third parties including the Classification Society and the Regulatory Authorities;
 
  (iii)   the Contract Price includes the cost of procuring the classification notation for the Ship, and of obtaining all certificates and other documents which are required to be delivered pursuant to this Contract, the Specification and the Plans;
 
  (iv)   the Contract Price includes all other costs and expenses of the Builder as provided for herein or otherwise incurred by the Builder unless expressly provided for in this Contract as being for the Buyer’s account;
 
  (v)   without prejudice to the express rights and obligations of either party under the other provisions of this Contract (including, without limitation, in relation to AOM’s agreed between the parties), the Buyer shall have no liability for any increases in the Builder’s costs of performing the Contract of any nature whatsoever; and
 
  (vi)   all fees and charges incidental to the registration of the Ship under the flag and laws of the Flag State shall be for the account of the Buyer.
2.   PAYMENTS
 
2.1   Payment of the Contract Price shall be made to the Builder as follows:
  (i)   [**] [Confidential Treatment] within 3 (three) Working Days after the Effective Date;
 
  (ii)   [**] [Confidential Treatment] on first steel cutting but not before 14th September 2007;
 
  (iii)   [**] [Confidential Treatment] on completion of keel laying (and for these purposes keel laying will be deemed to have taken place when the first prefabricated steel block has been completed

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      and located in its final position in the building dock at the Shipyard) but not before [**] [Confidential Treatment];
 
  (iv)   [**] [Confidential Treatment], on the date the Ship is launched into the water at the Shipyard (and for these purposes launching will be deemed to have taken place when the Ship is safely afloat provided that the Ship’s hull and primary internal structural parts are by then fully welded out and that the Classification Society has confirmed in writing that there is adequate completion of the hull for launching) but not before [**] [Confidential Treatment]; and
 
  (v)   the balance of the Contract Price, on the date of delivery and acceptance of the Ship and the Delivery Documents in accordance with the express provisions of this Contract.
2.2   The Builder shall by not less than fourteen (14) days advance written notice advise the Buyer of the date upon which each of the payments referred to sub-clauses 2.1(ii) to (iv) shall become due and payable and, in addition, the notice given in relation to sub-clause 2.1(v) will show (in reasonable detail and on an “open-book” basis as this expression is defined in Article 3) the Builder’s calculation of the balance of the Contract Price payable on delivery of the Ship and, in particular, the amounts of any reductions in or additions to the Contract Price occasioned by the terms and conditions of this Contract.
 
2.3   The Buyer’s obligations to make the payments referred to in sub-clauses 2.1(i) to (iv) shall, in the case of each such payment, be subject to and conditional upon the Buyer’s receipt of:
  (i)   the Builder’s invoice for the relevant payment; and
 
  (ii)   an irrevocable refund guarantee (“Refund Guarantee”) issued in favour of the Buyer in the form set out in Schedule 2 by a first class bank, insurance company or financial institution (“Refund Guarantor”) acceptable to the Buyer (such acceptance not to be unreasonably withheld) securing the refund to the Buyer of the relevant payment together with interest thereon at the Relevant Rate calculated from the date of the Builder’s receipt of such payment to the date of the Buyer’s receipt of the refund.
    The Buyer’s obligation to make the payment referred to in sub-clause 2.1(v) shall be subject to and conditional upon the Buyer’s receipt of the Builder’s invoice for the relevant payment and signature of the Protocol of Delivery and Acceptance on behalf of the Buyer and the Builder.
 
2.4   The other payments from time to time due under this Contract shall be made as follows:
  (i)   any amount for which a specific payment date is stipulated in this Contract shall be paid on such date;
 
  (ii)   payment or credits for any modifications pursuant to Article 3 (together with an appropriate interest payment or credit, calculated at the Relevant Rate, from the date(s) specified in the relevant AOM’S or as determined under Article 13,

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      Clause) shall be made simultaneously with delivery of the Ship and the relevant amounts shall be shown in the invoices to be issued and delivered by the Builder in respect of the Contract Price under Clause 2.1 (v);
 
  (iii)   payment of any other amounts accruing prior to delivery shall be made simultaneously with delivery of the Ship, and the relevant amounts shall be shown in the invoice to be issued and delivered by the Builder in respect of the Contract Price payment referred to in Clause 2.1(v) and
 
  (iv)   for any amount accruing after delivery in respect of a defect covered by the Builder’s guarantee under this Contract, payment shall be made as follows:
  (a)   if the parties agree that the defect in question is covered by the Builder’s guarantee under this Contract, not later than fifteen (15) days after the Builder’s receipt of an invoice for the defect remedied pursuant to Clause 2 in Article 7; or
 
  (b)   if there is a Dispute as to whether or not the defect is covered by the Builder’s guarantee under this Contract, on the date on which it is finally determined or adjudged to be a defect under Article 13, together with interest thereon at the Relevant Rate calculated from the date of the Builder’s receipt of an invoice for the defect remedied pursuant to Clause 2 in Article 7 up to and including the date of the Buyer’s receipt of the relevant amount.
2.5   Every amount from time to time due under this Contract but unpaid for longer than three (3) days from (and excluding) the due date shall bear interest at the Relevant Rate from the due date up to and including the date of receipt by the party to which the amount is owed.
 
2.6   If the Buyer fails to make any payment when it is due under sub Clauses 2.1(i), (ii), (iii) or (iv), such failure is not due to a default or breach of this Contract by the Builder, and such failure continues for longer than seven (7) days from (and excluding) the due date, then without prejudice to its other obligations under this Contract the Builder shall be entitled (after giving written notice to the Buyer) to suspend performance of all Work from the date on which the notice is given until the date of receipt of the unpaid sum in the Builder’s Account. In the event of such a suspension, the Delivery Date shall be automatically extended by the actual period of suspension of the Work.
 
2.7   All amounts payable to the Builder under this Contract shall be paid direct to the Builder’s Account, and the Builder and the Buyer shall consult with each other about the mode of payment with a view to reducing the amount of any applicable bank transfer charges.
 
2.8   All payments made by the Buyer to the Builder on account of the Contract Price before delivery and acceptance of the Ship shall be in the nature of advances to the Builder.
 
2.9   Neither party shall be entitled to set off any claims against payments due to the other under this Contract.

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2.10   Payments made by either party to the other under this Contract shall not be construed as a waiver of the right of one party to challenge the other as to the amount due or the due date of any such payments.
 
2.11   All fees, costs and other charges (including taxes and other amounts payable in respect of bank transfers) whatsoever arising in connection with:
  (i)   each guarantee issued under Clause 2.3 (including, without limitation, fees and other costs or charges payable to the relevant bank(s) and/or insurance company(ies) in respect of the issuance and maintenance thereof) shall be borne and paid by the Builder; and
 
  (ii)   the remittance of payments made under this Contract shall be borne and paid by the paying party.
2.12   The euro is the currency of account and payment for each and every sum at any time due from either party to the other under or in connection with this Contract.
(End of Article 8)

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ARTICLE 9: TERMINATION
1. TERMINATION BY BUILDER
1.1   Each of the following events shall be a “Builder Termination Event” for the purposes of this Contract:
  (i)   if the Buyer fails to pay any part of the Contract Price under any of Clauses 2.1 (i), (ii), (iii) or (iv) in Article 8 on the due date for such payment and such failure is not remedied within ten (10) Working Days after the receipt by the Buyer of a written notice from the Builder notifying the Buyer of such failure and requesting remedial action; or
 
  (ii)   if the Buyer fails to accept delivery of (and pay the balance of the Contract Price for) the Ship within two (2) Working Days after the Ship and the related Delivery Documents have been duly tendered for delivery by the Builder in compliance with this Contract, the Plans and the Specification; or
 
  (iii)   if any of the following events or circumstances shall occur before the Buyer has accepted delivery of the Ship and paid the balance of the Contract Price (a) a final order shall be made or an effective resolution shall be passed for the winding up of the Buyer (otherwise than by a members’ voluntary winding up for the purpose of an amalgamation or reconstruction on terms previously approved by the Builder, which approval shall not be unreasonably withheld) or (b) a receiver shall be appointed in respect of the whole or any substantial part of the undertaking of the Buyer or (c) the Buyer shall suspend the payment of its debts or (d) the Buyer shall make an arrangement or composition with its creditors generally or (e) the Buyer shall apply to any court for protection from its creditors generally or (f) the Buyer shall be unable, or shall admit its inability, to pay its debts as they fall due or it shall become or shall be declared insolvent under any applicable law or (g) the Buyer defaults the loan agreement relating to the purchase of the Ship for reasons not attributable to the Builder as a result of which the Buyer’s financiers terminate their commitment to finance the Ship unless the relevant financing arrangements are reconstituted in a manner reasonably acceptable to the Builder within thirty (30) days or (h) any distress, execution, attachment or other process shall affect the whole or any substantial part of the Buyer’s business and assets and shall remain undischarged for a period exceeding 21 (twenty one) days or (i) the whole or any substantial part of the Buyer’s business and assets shall be subject to Compulsory Acquisition by the Bermudian government or any agency thereof for a period exceeding 30 (thirty) days or (j) the Buyer’s Performance Guarantee or the security thereby given is or becomes wholly or partially invalid, ineffective or unenforceable or the Buyer’s Guarantor becomes insolvent or enters into proceedings similar to any of those referred to in any of paragraphs (a) to (f) of this Clause 1.1(iii) and the Buyer is unable to propose a substitute guarantee and / or guarantor acceptable to the Builder (such acceptance not to be unreasonably withheld) within ten (10) Working Days after the receipt by the

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      Buyer of a written notice from the Builder requiring replacement of the Buyer’s Guarantor; or
 
  (iv)   if the Buyer commits a material breach of any of its material obligations under this Contract and fails to remedy any such breach within 60 (sixty) days after receipt of written notice from the Builder requesting remedial action.
1.2   At any time after a Builder Termination Event shall have occurred and be continuing, the Builder may, by written notice to the Buyer, terminate this Contract whereupon:
  (i)   title in the Buyer’s Supplies owned by the Buyer which have been installed or incorporated in the Ship before termination shall pass to the Builder; and
 
  (ii)   the Builder shall retain and apply (in the manner provided for in Clauses 1.4 and 1.5) all payments previously made by the Buyer to the Builder under this Contract.
1.3   If the Builder terminates this Contract under Clause 1.2, it may in its free discretion decide either to complete or not to complete the Ship and thereafter the Builder shall endeavour to obtain the best market price reasonably obtainable for the Ship, the Parts and the Buyer’s Supplies referred to in Clause 1.2 (i) by sale at public auction or tender or private sale.
1.4   If the Builder elects to sell the Ship in its completed state the proceeds of sale received by the Builder, and all amounts retained by the Builder under Clause 1.2 (ii) plus a credit for the value of Buyer’s Supplies previously delivered by the Buyer and either retained by the Builder or its Subcontractors or sold by any of them, shall be applied as follows:
  (i)   firstly, in payment of all unpaid instalments of the Contract Price as at the date of termination together with interest thereon at the Relevant Rate from the respective due dates for payment thereof to the date of application;
 
  (ii)   secondly, in payment of any other amounts payable by the Buyer to the Builder under the express provisions of this Contract as at the date of termination together with interest thereon at the Relevant Rate from the respective due dates for payment thereof to the date of application;
 
  (iii)   thirdly, in payment of the Builder’s loss of profit being the proved difference (if any) between the profit that the Builder could reasonably have expected to earn if the Contract had not been terminated and the profit actually earned from the sale of the Ship in its completed state; and
 
  (iv)   finally, in payment of any remaining balance to the Buyer,
 
  provided that if the total of such proceeds of sale, such retained amounts and such credit shall be less than the balance due to the Builder under paragraphs (i), (ii) and (iii) of this Clause 1.4, the difference shall be paid by the Buyer to the Builder.
1.5   If the Builder elects to sell the Ship in its incomplete state the proceeds of sale received by the Builder, and all amounts retained by the Builder under Clause 1.2(ii) plus a credit

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    for the value of Buyer’s Supplies previously delivered by the Buyer and either retained by the Builder or its Subcontractors or sold by any of them, shall be applied as follows:
  (i)   firstly, in payment of all costs necessarily and reasonably incurred by the Builder in preparing the Ship for sale (to the extent not already covered by the payments referred to in Clause 1.2(ii) above) together with interest thereon at the Relevant Rate;
 
  (ii)   secondly, in payment of the Builder’s loss of profit being the proved difference (if any) between the profit that the Builder could reasonably have expected to earn if the Contract had not been terminated and the profit actually earned from the sale of the Ship in its incomplete state; and
 
  (iii)   finally, in payment of any remaining balance to the Buyer,
  provided that if the total of such proceeds of sale, such retained amounts and such credit shall be less than the balance due to the Builder under paragraphs (i) and (ii) of this Clause 1.5, the difference shall be paid by the Buyer to the Builder.
 
2. TERMINATION BY BUYER
 
2.1  Each of the following events shall be a “Buyer Termination Event” for the purposes of this Contract:
  (i)   if (a) at any time the Buyer can demonstrate clearly that delivery will not be made, for whatever reason or combination of reasons (excepting reasons which entitle the Builder to extension of the Delivery Date under Article 5 or reasons attributable to the Buyer), by the date falling [**] [Confidential Treatment] from [**] [Confidential Treatment] or (b) delivery has not been made, for whatever reason or combination of reasons (excepting only one or more independent defaults by the Buyer), by the date falling [**] [Confidential Treatment] from [**] [Confidential Treatment];
 
  (ii)   if the Buyer becomes entitled to terminate this Contract under Clause 3.2 in Article 4 or any of Clauses 2.3, 2.7, 2.9, 2.12, 2.14 or 2.17 in Article 6;
 
  (iii)   if the Builder commits a material breach of any of its material obligations under this Contract and fails to remedy any such breach within 60 (sixty) days after receipt of written notice from the Buyer requesting remedial action;
 
  (iv)   if (a) any guarantee issued in favour of the Buyer under this Contract, or the security thereby given, is or becomes wholly or partially invalid, ineffective or unenforceable or (b) the issuer of any such guarantee becomes insolvent or enters into or is subject to any proceedings similar to any of those referred to in any of paragraphs (a) to (g) of Clause 2.1(vi), unless the Builder replaces any such guarantee and (as the case may be) issuer with a new guarantee and (as the case may be) issuer complying with Clause 2.3(ii) of Article 8 within ten (10) Working Days after receipt of written notice from the Buyer requiring such replacement; or

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  (v)   if either (a) the Builder shall fail at any time to effect or maintain the Insurances, or any insurer shall avoid or cancel the Insurances or the Builder shall commit any breach of or make any misrepresentation in respect of the Insurances the result of which is to entitle the insurers to avoid the cover or otherwise to be excused or released from any or all of their liabilities thereunder, or (b) any of the Insurances shall cease for any reason whatsoever to be in full force and effect, unless the Insurances are re-instated or reconstituted in a manner meeting the requirements of this Contract within seven (7) days; or
 
  (vi)   if (a) a final order shall be made or an effective resolution shall be passed for the winding up of the Builder (otherwise than by a members’ voluntary winding up for the purposes of amalgamation or reconstruction on terms previously approved by the Buyer, which approval shall not be unreasonably withheld) or (b) a receiver shall be appointed in respect of the whole or any substantial part of the undertaking of the Builder or (c) the Builder shall suspend the payment of its debts or (d) the Builder shall make an arrangement or composition with its creditors generally or (e) the Builder shall apply to any court for protection from its creditors generally or (f) the Builder shall be unable, or shall admit its inability, to pay its debts as they fall due or it shall become or shall be declared insolvent under any applicable law or (g) any distress, execution, attachment or other process shall affect the whole or any substantial part of the Builder’s business or assets and shall remain undischarged for a period exceeding 21 (twenty one) days or (h) the Builder defaults any loan agreement relating to the construction of the Ship for reasons not attributable to the Buyer as a result of which the Builder’s financiers (including the holder of any mortgage or the beneficiary of any other security granted by the Builder over the Ship, any Parts or the Insurances) terminate their commitment to finance the construction of the Ship or commence the enforcement of their rights against the Builder, the Ship, the Parts or the Insurances) unless the relevant financing arrangements are reconstituted in a manner reasonably acceptable to the Buyer within thirty (30) days or (i) the Ship or the whole or any substantial part of the Builder’s business or assets shall be subject to Compulsory Acquisition by the French government or any agency thereof for a period exceeding 30 (thirty) days.
2.2   At any time after a Buyer Termination Event shall have occurred and be continuing the Buyer may by notice to the Builder terminate this Contract and thereafter the Buyer may (in its free discretion) exercise any of the remedies provided for in Clause 2.3.
2.3   The Buyer may:
  (i)   retain and/or claim from the Builder all liquidated damages paid or payable by the Builder to the Buyer under Clause 2.17 in Article 6 subject to the following limits:
  (a)   if the Builder shall have given the Buyer more than one hundred and eighty (180) days notice of the delay in delivery prior to the Delivery Date, in no event shall the aggregate final liquidated damages payable by the Builder to the Buyer in respect of such delay exceeds the sum of [**] [Confidential Treatment];
 
  (b)   if the Builder shall have given the Buyer more than ninety (90) days and less than or equal to one hundred and eighty two (182) days notice of the delay in delivery prior to the Delivery Date, in no event shall the aggregate final liquidated damages payable by the Builder to the Buyer in respect of such delay exceeds the sum of

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      [**] [Confidential Treatment]
 
  (b)   if the Builder shall have given the Buyer more than ninety (90) days and less than or equal to one hundred and eighty two (182) days notice of the delay in delivery prior to the Delivery Date, in no event shall the aggregate final liquidated damages payable by the Builder to the Buyer in respect of such delay exceeds the sum of [**] [Confidential Treatment]
 
  (c)   if the Builder shall have given the Buyer less than or equal to ninety (90) days notice of the delay in delivery prior to the Delivery Date, in no event shall the aggregate final liquidated damages payable by the Builder to the Buyer in respect of such delay exceeds the sum of [**] [Confidential Treatment];
  (ii)   may also claim from the Builder the aggregate of (a) all payments previously made by the Buyer to the Builder under this Contract on account of the Contract Price together with interest thereon at the Relevant Rate calculated from the date upon which the Builder received each such payment to the date on which the refund is received by the Buyer, (b) the return, free of all encumbrances whatsoever, of any Buyer’s Supplies that have not been built into or installed on or in the Ship or which may be removed from the Ship, the Shipyard or other place(s) where they are stored and the Buyer’s Supply Costs for all other such Buyer’s Supplies that cannot be returned to the Buyer, and (c) all other amounts payable by the Builder to the Buyer under the express provisions of this Contract together with interest thereon at the Relevant Rate from the respective due dates until the date of actual payment of each such amount; and
 
  (iii)   if the Buyer’s right to terminate the Builder’s engagement under this Contract (whether under Articles 4 and/or 9 or otherwise) becomes exercisable as a result of any gross negligence or wilful misconduct on the part of the Builder the Buyer shall, in addition to the payments referred to in sub-clauses 2.3(i) and (ii), be entitled to claim from the Builder, as agreed liquidated damages for loss of this Contract and not as a penalty, an amount equivalent to [**] [Confidential Treatment]).
3.   TERMINATION BY EITHER PARTY
 
    The Builder’s receipt of all payments to be made by the Buyer under the express provisions of Article 9 or, as the case may be, the Buyer’s receipt of all payments to be made by the Builder under the express provisions of Article 9 shall operate as a full and final settlement and discharge of all obligations and liabilities of the relevant party to the other under this Contract save for any obligations and liabilities of either party in respect of any costs payable in connection with any references or proceedings under Article 13.
(End of Article 9)

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ARTICLE 10: REPRESENTATIONS, COVENANTS AND INDEMNITIES
1.   REPRESENTATIONS, WARRANTIES AND COVENANTS
 
1.1   Each party acknowledges that the other has entered into this Contract in full reliance on the representations set out in this Clause 1 and each party (in either case, the “warrantor”) warrants that such representations are in all respects true, accurate and not misleading in any respect.
 
1.2   The Warrantor represents and warrants to the other party that:
  (i)   all acts, conditions and things required to be done, fulfilled and performed in order (a) to enable it lawfully to enter into, exercise its rights under and perform and comply with the obligations expressed to be assumed by it in this Contract and (b) to ensure that the obligations expressed to be assumed by it in this Contract are legal, valid and binding have been done, fulfilled and performed; and
 
  (ii)   no legal proceedings have been started or (to the best of the warrantor’s knowledge and belief) threatened which might have a material adverse effect on the warrantor’s ability to perform its obligations under this Contract.
1.3   The Builder further represents and warrants to the Buyer:
  (i)   that neither the execution of this Contract nor the exercise by the Builder of its rights and performance of its obligations under this Contract will result in any breach of any French or European Union law, regulation, rule, directive or treaty;
 
  (ii)   that it shall obtain, comply with the terms of and do all that is necessary to maintain in full force and effect all authorisations, approvals, licences and consents required in or by the laws, regulations, rules, directives and treaties of France and the European Union to enable it lawfully to enter into and perform its obligations under this Contract.
1.4   The Buyer further represents and warrants to the Builder:
  (i)   that neither the execution of this Contract nor the exercise by the Buyer of its rights and performance of its obligations under this Contract will result in any breach of any law, regulation, rule, directive or treaty applicable to the Buyer or any of the protected parties; and
  (ii)   that it shall obtain, comply with the terms of and do all that is necessary to maintain in full force and effect all authorisations, approvals, licences and consents required in or by the laws, regulations, rules, directives and treaties of Bermuda to enable it lawfully to enter into and perform its obligations under this Contract.

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2.   EXCLUSION OF LIABILITIES
 
2.1   The Builder shall not be liable to the Buyer, any other protected parties or any of its or their respective representatives, agents or employees for personal injury, including death, during such time as they or any of them are on board the ship, at the Shipyard or within the premises of Subcontractors or suppliers of the Builder unless such injury, including death is caused by the gross negligence or wilful misconduct of the Builder or the representatives, agents or employees of the Builder. Nor shall the Builder be liable to the Buyer, any other protected parties or any of its or their respective representatives, agents or employees for damage to, or loss or destruction of property of the Buyer, the other protected parties or its or their representatives, agents or employees in France or elsewhere unless such damage, loss or destruction is caused by the gross negligence or wilful misconduct of the Builder or the representatives, agents or employees of the Builder.
 
2.2   Neither the Buyer nor any other of the protected parties shall be liable to the Builder, its representatives, agents or employees for personal injury, including death, during such time as they or any of them are on board the ship, at the Shipyard or within the premises of Subcontractors or suppliers of the Builder unless such injury, including death is caused by the gross negligence or wilful misconduct of the Buyer, other protected parties or the representatives, agents or employees of the Buyer or other protected parties. Nor shall the Buyer or any other of the protected parties be liable to the Builder, its representatives, agents or employees for damage to, or loss or destruction of property of the Builder, its representatives, agents or employees in France or elsewhere unless such damage, loss or destruction is caused by the gross negligence or wilful misconduct of the Buyer, other protected parties or the representatives, agents or employees of the Buyer or other protected parties.
(End of Article 10)

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ARTICLE 11: INTELLECTUAL PROPERTY RIGHTS
1.   PATENTS, TRADE MARKS AND COPYRIGHTS
 
1.1   The Builder shall procure all such approvals and licenses, and pay all such royalties, licence fees or other similar charges, on or in connection with:
  (i)   the Ship;
 
  (ii)   any Parts (other than Buyer’s Supplies) installed or incorporated in, stowed on or otherwise delivered with the Ship; and
 
  (iii)   any part of the Work,
    as may be necessary to ensure that the same are delivered to the Buyer and may be owned and operated by the Buyer (and its successors, assignees and counterparties) without infringement of any patent, patent right, copyright, trademark, trade secret or other intellectual property right.
 
1.2   The Builder shall indemnify fully, hold harmless and defend the Buyer and the other protected parties from and against all actions, claims, costs, liabilities and direct losses (subject to Article 14, Clause 14) that any of them may suffer or incur as a result of any actual or alleged infringement of any patents, patent rights, copyrights, trademarks, trade secrets or other intellectual property rights of any kind or nature on or in connection with the Ship, the Parts (other than Buyer’s Supplies) or any part of the Work or the ownership or the proper use thereof by the Buyer provided that this indemnity shall not apply to any such infringement if the management of the Buyer or the management of any other protected party knew of the relevant infringement (at any time between the Effective Date and the date of actual delivery of the Ship) but failed to notify the Builder.
 
1.3   If by reason of any claim for which the Builder is responsible under this Clause 1:
  (i)   the Ship or any Part (other than Buyer’s Supplies) shall be held to constitute an infringement of any patent, patent right, copyright, trademark, trade secret or other intellectual property right; or
 
  (ii)   the Buyer’s free use and possession or quiet enjoyment of the Ship or any such Part shall be in any manner or to any extent disturbed, interfered with, limited, restricted or restrained (whether by reason of an actual or threatened arrest, detention or claim or as a result of any other encumbrance or for any other reasons whatsoever),
the Builder shall, at its own expense, promptly take all such steps as may be necessary fully to restore to the Buyer the free use and possession and quiet enjoyment of the Ship or such Part including (without limitation) if the Buyer shall so require, by replacing any infringing Part with a non-infringing Part which is satisfactory to the Buyer and/or the Classification Society and/or the Regulatory Authorities.
1.4   The Buyer shall indemnify fully, hold harmless and defend the Builder from and against all actions, claims, costs, liabilities and direct losses (subject to the exclusions referred to in Article 14, Clause 14) that that it may suffer or incur as a result of any actual or

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    alleged infringement of any patents, patent rights, copyrights, trademarks, trade secrets or other intellectual property rights of any kind or nature on or in connection with any Buyer’s Supplies, plans, designs and engineering and design data supplied by the Buyer to the Builder under or in connection with this Contract provided that this indemnity shall not apply to any such infringement if the management of the Builder knew of the relevant infringement (at any time between the Effective Date and the date of actual delivery of the Ship) but failed to notify the Buyer.
 
2.   RIGHTS TO ENGINEERING AND DESIGN DATA
 
2.1   All plans, designs and engineering and design data supplied by the Buyer to the Builder which are the property of the Buyer shall remain the property of the Buyer, and such plans, designs and engineering and design data may be used by the Builder only as permitted by this Clause 2.
 
2.2   All plans, designs and engineering and design data supplied by the Builder to the Buyer which are the property of the Builder shall remain the property of the Builder, and such plans, designs and engineering and design data may be used by the Buyer only as permitted by this Clause 2.
 
2.3   The Builder hereby grants to the Buyer and the other members from time to time of the Buyer’s Group an irrevocable, non-exclusive, perpetual, royalty-free, worldwide license to use the plans, designs, and engineering and design data referred to in Clause 2.2 in connection with the operation, maintenance, modification, redesign, refurbishment, repair, sale or other use of the Ship after delivery and such licence to use may be transferred to any charterer or other operator, to any manager or to any buyer of the Ship for such purposes without the need to seek or obtain any consent from the Builder, its successors or assigns.
 
2.4   Each party shall take all reasonable precautions to maintain in confidence, and will not use or permit the use of except as may be necessary for the purposes of the Work — or as otherwise permitted by the express provisions of this Clause 2 — any of the designs, plans and engineering and design data owned by the other party.
 
2.5   Nothing contained in this Contract shall be construed as transferring any patent, patent right, copyright, trademark, trade secret or other intellectual property right created or used in the performance of this Contract, all of which are hereby expressly reserved to the true and lawful owners thereof.
(End of Article 11)

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ARTICLE 12: TAXES AND CONTRACT EXPENSES
1.   TAXES AND CONTRACT EXPENSES
 
1.1   The Builder shall be solely responsible for and shall pay or cause to be paid, without recourse to the Buyer or any member of the Buyer’s Group, all taxes of any kind whatsoever that are imposed, determined or assessed in any of the following jurisdictions (the “relevant jurisdictions”) France or (if different) the country of the Shipyard or the country of any Subcontractor, in connection with: (i) the making, execution and performance of this Contract by the Builder; (ii) the construction, sale, delivery and export of the Ship in and from any of the relevant jurisdictions; (iii) the manufacture in, and importation and exportation of any Parts (other than Buyer’s Supplies) into or out of, any of the relevant jurisdictions; and (iv) the receipt of the payment of the Contract Price in France, and the Builder shall indemnify fully, hold harmless and defend the Buyer and other protected parties from and against any actions, claims, costs, liabilities and losses which any of them may suffer or incur in relation to any such taxes.
 
1.2   The Buyer shall be solely responsible for and shall pay or cause to be paid, without recourse to the Builder, all taxes of any kind whatsoever that are imposed, determined or assessed in connection with: (i) the making, execution and performance of this Contract by the Buyer (other than any taxes imposed, determined or assessed in any of the relevant jurisdictions for which the Builder is responsible); (ii) the importation into any of the relevant jurisdictions of any Buyer’s Supplies delivered by the Buyer to the Builder or any Subcontractor; (iii) the importation of the Ship or any Parts into the country of the Buyer; and (iv) the residence or activities of any of the Buyer’s representatives in France, and the Buyer shall indemnify fully, hold harmless and defend the Builder from and against any from and against any actions, claims, costs, liabilities and losses which the Builder may suffer or incur in relation to any such taxes.
 
1.3   Each party shall bear and pay all costs and expenses incurred by it in connection with the negotiation, preparation and execution of this Contract.
(End of Article 12)

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ARTICLE 13: DISPUTES
1.   TECHNICAL DISPUTES
 
1.1   Except where a Dispute of a technical nature is determined by the Classification Society under Clause 4.2 in Article 1 or, as appropriate, by a Regulatory Authority under Clause 4.4 in Article 1, any Dispute of a technical nature giving rise to issues purely of fact (including, without limitation, any difference of opinion relating to the costs and time effects of any modifications proposed under Article 3 or to questions as to the existence, degree or extent of any alleged non-compliance of the Ship or any Part to the Contract, the Plans, the Specification, or the Class or Regulatory Rules) shall be referred to the Head Office of the Classification Society for its final decision provided that if the Head Office of the Classification Society declines to accept any such referral, or if either party reasonably considers that it is not appropriate to refer the Dispute in question to the Head Office of the Classification Society, with the agreement of both parties the Dispute shall be referred to a mutually acceptable technical expert for his final decision.
 
1.2   The procedure applicable to the resolution of any Dispute of a technical nature (whether by the Classification Society or by a mutually agreed technical expert) shall be as follows:
  (i)   the person or body to whom the Dispute is referred (the “Expert”, which term shall also apply to any substitute appointed by mutual agreement of the parties) shall be requested to make a final decision within 21 (twenty one) Working Days after it has accepted the appointment;
 
  (ii)   within 10 (ten) Working Days after the Expert has confirmed to both parties that it has accepted the appointment, each party will send to the Expert (and simultaneously to the other party), by email, telefax or registered courier, its submissions and supporting evidence in relation to the Dispute ;
 
  (iii)   if a party fails to submit its submissions and supporting evidence within the time limit laid down in paragraph (ii), it shall be deemed to have admitted the correctness of the other party’s submissions;
 
  (iv)   the Expert shall act as an expert and not as an arbitrator;
 
  (v)   the decision of the Expert shall be final and binding on both parties (except in the case of fraud, bad faith or manifest error or unless otherwise agreed in writing by the parties); and
 
  (vi)   the parties shall bear the Expert’s costs equally.
1.3   If within 10 (ten) Working Days after receipt by a party of a notice of a Dispute from the other party:
  (i)   the Head Office of the Classification Society has failed to accept a referral pursuant to Clause 1.1; or

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  (ii)   a party reasonably considers that it is not appropriate to refer any Dispute of a technical nature to the Head Office of the Classification Society or to a technical expert; or
 
  (iii)   the parties have failed to agree upon the identity of a mutually acceptable technical expert and obtain written acceptance of its appointment,
    the Dispute shall be determined in accordance with Clause 2.
 
2.   JURISDICTION
 
2.1   Except where a Dispute is determined under Clause 1.1, the English courts shall have exclusive jurisdiction to settle and determine all Disputes.
 
2.2   Each party agrees that the English courts are the most appropriate and convenient courts to settle and determine Disputes and that accordingly no party will argue to the contrary; and each party hereby irrevocably submits itself to the jurisdiction of the English courts for the purposes of this Contract.
 
2.3   A judgment relating to this Contract that is given or enforceable by the English courts may be enforced without review (subject to mandatory law) in any other jurisdiction and each party waives all of its rights to apply for or require any such review.
 
2.4   Subject to Clause 2.6 in Article 8, no Dispute shall entitle the Builder to cease or suspend any part of the Work or to withhold delivery of the Ship, nor shall any Dispute entitle the Buyer to withhold the payment of any part of the Contract Price due under any of Clauses 2.1(i), (ii), (iii) or (iv) in Article 8 beyond the relevant due date for payment provided that nothing in this provision shall prejudice any right which:
  (i)   the Builder may have to retain possession of the Ship on account of non-payment of the Contract Price; or
 
  (ii)   the Buyer may have to dispute the due date for payment of any part of the Contract Price under Clause 2.1(v) in Article 8.
2.5   For the avoidance of doubt, if any Dispute arises before delivery of the Ship and is referred for determination under any of the express provisions of Clauses 1 or 2 hereof, the Builder shall not be entitled to dispose of the Ship pending the final determination of such Dispute.
 
3.   GOVERNING LAW
 
3.1   This Contract is governed by and shall be construed in accordance with English law.
 
3.2   Each party irrevocably agrees before the Effective Date to appoint and thereafter to maintain Clifford Chance Secretaries Limited (“CCSL”) as agent for service of process in relation to any proceedings before the English courts in connection with this Contract and all related agreements, securities and other documents including (without limitation) the Builder’s Performance Guarantee, the Buyer’s Guarantee and the Option Agreement.
 
3.3   Without prejudice to any other mode of service allowed under any relevant law, service of any proceedings or process or judgment issued out of, or made or granted by, the

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    English courts may be served by being delivered to the last known address in London of CCSL or to the relevant party itself at the address for such party set out in Clause 4.
 
3.4   The Builder (for itself, its successors and assignees) irrevocably and unconditionally agrees that, notwithstanding the appointment of CCSL referred to in Clause 3.2 above, Clifford Chance LLP may act as legal advisors and attorneys of the Buyer and other members of the Buyer’s Group for all purposes whatsoever under or in connection with this Contract and all related agreements, securities and other documents including, without limitation, for the purposes of any legal proceedings arising out of or in connection with this Contract or such agreements, securities and other documents.
 
4.   NOTICES
 
4.1   Any notice or other communication in relation to material matters in connection with this Contract shall be in writing in the English language and shall be given to the addressee at the address set out below or sent by telefax to the telefax number given below, marked for the attention of the relevant individual listed in the “Attention” lines set out below provided that all notices and communications relating to technical matters (including, without limitation, those concerning the approval of Plans and tests) shall be given to the Supervisor at the address set out in paragraph (ii) below or sent by telefax to the telefax number specified in paragraph (ii) below.
         
(i)
  If to the Buyer, to:   F3 One, Ltd. c/o
 
      7665 Corporate Centre Drive
 
      Miami, Florida 33126
 
       
 
  Telefax:   + 1 305 436 4113
 
  Attention:   Mr Colin Veitch, President & CEO
 
  with a copy to telefax:   +1 305 436 4117
 
  Attention:   Mr Mark Warren, General Counsel
 
       
(ii)
  If to the Supervisor, to:   the Supervisor
 
      c/o the Supervisor’s designated office
 
      at the Shipyard
 
 
  Telefax:   To be advised
 
  Attention:   To be advised
 
       
(iii)   If to the Buyer’s UK newbuilding office, to:
 
 
      NCL (Bahamas) Ltd. c/o
 
      1 Derry Street
 
      London
 
      W8 5NN
 
       
 
  Telefax:   + 44 20 7938 4515
 
  Attention:   Mr Trond Sorensen
 
(iv)
  If to the Builder, to:   Aker Yards, S.A.
 
      Avenue Bourdelle - B.P. 90180
 
      44613

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      Saint-Nazaire
 
      Cedex
 
      France
 
       
 
  Telefax:   +33 (0) 2 51 10 91 61
 
  Attention:   Chief Executive Officer
 
       
 
  with copy to:    
 
       
 
  Telefax:   +33 (0) 2 51 10 99 94
 
  Attention:   Contract Director
 
       
 
  And with a copy to:    
 
       
 
  Telefax:   +358 10 670 24 04
 
  Attention:   Chief Legal Counsel
    or to such other person, address or telefax number as either party may (by not less than five (5) Working Days’ notice in writing) specify to the other.
 
4.2   In the absence of evidence of earlier receipt, any notice or other communication shall be deemed to have been duly given:
  (i)   if correctly addressed and marked for the attention of the appropriate individual and delivered personally, when left at the appropriate address of the addressee;
 
  (ii)   if correctly addressed and marked for the attention of the appropriate individual and sent by pre-paid registered mail (or registered airmail if international) or courier, upon acknowledgement of receipt by return telefax; and
 
  (iii)   if correctly addressed and marked for the attention of the appropriate individual and sent by telefax to the correct number, upon acknowledgement of receipt by return telefax.
4.3   Communications in relation to matters other than those referred to in Clause 4.1 may be given by email.
(End of Article 13)

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ARTICLE 14: GENERAL MATTERS
1.   COMPUTATION OF TIME
 
1.1   Except as otherwise provided in this Contract, all periods of time shall be computed by including Saturdays, Sundays and holidays except that if any period terminates on:
  (i)   any day which is not a Working Day in London or Paris (in the case of periods applicable to action by the Buyer); or
 
  (ii)   any day which is not a Working Day in Paris (in the case of periods applicable to action by the Builder),
    such period shall be deemed to be extended to the next following Working Day in such place.
 
2.   ASSIGNMENTS
 
2.1   The Buyer may:
  (i)   grant to its financiers of the Ship, or the other financiers of the Buyer’s Group, assignments of (or other security interests in) this Contract, the Insurances (in respect of Buyer’s Supplies), and the Refund Guarantees and any other securities that may be issued to the Buyer under and in connection with this Contract;
 
  (ii)   assign, novate or transfer this Contract to any member of the Buyer’s Group or to any other person connected with the financing of the Ship (with the prior approval of the Builder, which is not to be unreasonably withheld); and
 
  (iii)   assign its post-delivery rights under this Contract to any purchaser, lessee or bareboat charterer of the Ship,
    provided that the Buyer’s Guarantee shall remain in full force and effect or, if legally necessary to replicate the security intended to be conferred by such guarantee, shall be replaced with another guarantee acceptable to the Builder (such acceptance not to be unreasonably withheld) notwithstanding any such assignment, novation or transfer.
 
2.2   As and when so requested by the Buyer, the Builder will provide the Buyer’s financiers and permitted assignees with all such information and documentation as they may reasonably request without depriving the Builder of its rights and interest under this Contract.
 
2.3   The Builder may assign its rights under this Contract and its interest in the Insurances to its financiers for the Builder’s pre-delivery construction financing of the Ship and the Refund Guarantors. Otherwise, the Builder shall not assign or novate or transfer, or purport to assign or novate or transfer, any of its rights or obligations under this Contract.
 
3.   PARTIAL ILLEGALITY
 
3.1   If any provision of this Contract or the application thereof to any person or in any circumstances shall to any extent be illegal, invalid or unenforceable, such illegality,

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    invalidity or unenforceability shall not prejudice the effectiveness of the remainder of this Contract or the application of such provision to other persons or in other circumstances and each other provision of this Contract shall be legal, valid and enforceable to the fullest extent permitted by law.
 
4.   CONFIDENTIALITY
 
4.1   After the date of this Contract, the parties will agree the terms and publication date(s) of press announcements in relation to the construction of the Ship.
 
4.2   Save as provided in Clause 4.1, each party agrees that at all times before or after delivery of the Ship it shall hold this Contract, the Plans and the Specifications in strict confidence and shall not disclose (or allow to be disclosed) to any third party any information or documentation in relation to this Contract provided that:
  (i)   each party may, with the prior written consent of the other, disclose to any third party information relating to the matters referred to in this Clause 4.2;
 
  (ii)   each party shall be entitled to disclose information about the Contract strictly on a “need to know” basis — and then only to such extent as shall be reasonably necessary to enable each recipient to carry out its work in relation to the Contract — to its employees and other representatives, and also to its shareholders, bankers, auditors and legal advisors; and
 
  (iii)   each party shall be entitled to disclose information about the Contract to such extent as may from time to time be required by law or the rules or regulations of any applicable stock exchange or similar body.
5.   AMENDMENTS
 
5.1   No amendment, modification, supplement or other variation of this Contract, the Plans or the Specification shall be of any effect unless made in writing and signed by the Builder and the Buyer or their respective duly authorised representatives.
 
6.   NO WAIVER
 
6.1   No failure or delay on the part of either party in exercising any right, power or remedy under this Contract shall operate as a waiver thereof or a waiver of any other rights, powers or remedies nor shall any single or partial exercise of any such right power or remedy preclude any other or further exercise of any such right, power or remedy or the exercise any other right, power or remedy.
 
6.2   The respective rights, powers and remedies conferred on the parties by this Contract are cumulative and (save where the contrary is expressly stated) are in addition to (and not exclusive of) any rights, powers and remedies provided by law.
 
7.   CONSENTS
 
7.1   Subject to Clause 1.6 in Article 2, where any matter:
  (i)   requires an instruction from the Buyer, a waiver by the Buyer or the approval, authority or consent of the Buyer any such instruction, waiver, approval,

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      authority or consent shall not be deemed to have been given or to any extent effective unless it is given in writing by a duly authorised representative of the Buyer; and
 
  (ii)   is required to be acceptable or satisfactory to the Buyer, the Buyer shall not be deemed to have accepted, or to be satisfied with such matter, unless its acceptance or satisfaction is communicated in writing to the Builder by a duly authorised representative of the Buyer.
7.2   Subject to the other express provisions of this Contract, where any matter:
  (i)   requires an instruction from the Builder, a waiver by the Builder or the approval, authority or consent of the Builder any such instruction, waiver, approval, authority or consent shall not be deemed to have been given or to any extent effective unless it is given in writing by a duly authorised representative of the Builder; and
 
  (ii)   is required to be acceptable or satisfactory to the Builder, the Builder shall not be deemed to have accepted, or to be satisfied with such matter, unless its acceptance or satisfaction is communicated in writing to the Buyer by a duly authorised representative of the Builder.
8.   LANGUAGE
 
8.1   The official text of this Contract (and all plans, drawings, test and Work schedules, reports, protocols, certificates, instruction booklets, notices, communications and other materials or documents to be drawn up, developed or supplied under this Contract) shall be in the English language.
 
9.   MODELS
 
9.1   The Builder shall, at its cost and without charge to the Buyer, build, supply and deliver to the Buyer (and place on board the Ship before delivery) the models of the Ship referred to in Part G.6.4 of the Specification.
 
10.   COUNTERPARTS
 
10.1   This Contract may be executed in up to two (2) counterparts each of which when dated and signed by (or on behalf of) both parties shall be an original, but all counterparts together shall constitute one and the same instrument.
 
11.   EFFECTIVE DATE
 
11.1   This Contract shall not have any legal effect whatsoever until the time on the date (the “Effective Date”) when all of the following conditions have been satisfied:
  (i)   the Buyer shall have confirmed by written notice to the Builder that it has obtained binding written commitments (in terms reasonably satisfactory to the Buyer) for the financing arrangements that will be required to enable the Buyer to fund all Contract Price payments in accordance with Article 8;

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  (ii)   the Buyer shall have confirmed by written notice to the Builder that it has approved (a) the table referred to in Article 3, Clause 1.2, and (b) the final version of the Specification section relating to the public spaces in the Ship.
 
  (iii)   Star Cruises Limited shall have received the approval of its shareholders for the transactions contemplated by this Contract and shall have complied with the requirements of the applicable rules of the Stock Exchange of Hong Kong Limited and of the Singapore Exchange Securities Trading Limited;
 
  (iv)   the formats of each of the AOM form, the Refund Guarantee, the Builder’s Performance Guarantee and the Buyer’s Performance Guarantee shall have been finally agreed by the parties;
 
  (v)   the Buyer’s Performance Guarantee shall have been delivered to the Builder;
 
  (vi)   the Builder’s Performance Guarantee shall have been delivered to the Buyer; and
 
  (vii)   the Option Agreement shall have been signed by the Builder and the Buyer’s Guarantor.
11.2   The Parties intend that the conditions referred to in Clause 11.1 (i), (ii), (iv), (v), (vi) and (vii) shall be satisfied by 11 September 2006 and that the conditions referred to in Clause 11.1 (iii) shall be satisfied by 31 October 2006. If this Contract has not come into effect by 4pm (Paris time) on 31 October 2006 either party may, by written notice given to the other within ten (10) days thereafter, cancel this Contract.
 
11.3   In the event of the exercise by either party of its right to cancel this Contract under Clause 11.2, this Contract shall, with effect from such cancellation, be null and void without any liability whatsoever on the part of either party.
 
11.4   Notwithstanding any provision to the contrary in this Contract, the Buyer shall not be obliged to make any payment to the Builder hereunder until such time as all of the conditions set out in Clause 11.1 have been fulfilled or expressly waived in writing by both parties.
 
12.   PROTECTED PARTIES
 
12.1   Any of the protected parties may enforce only the provisions of this Contract that are expressed to confer any rights on them, subject to and in accordance with the Contracts (Rights of Third Parties) Act 1999.
 
12.2   The Builder and the Buyer may at any time, by agreement between them, rescind this Contract or vary it without the consent of the protected parties.
 
12.3   If any protected party becomes entitled to bring a claim against the Builder under or in respect of this Contract, the Buyer shall bring such claim against the Builder on behalf of the relevant protected party and all communications, notices and proceedings shall be channelled through the Buyer.

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12.4   If any claim is made against the Builder by the Buyer on behalf of a protected party under Clause 12.3, the Builder shall have available to it by way of defence only such matters as would have been available to it by way of defence if the relevant protected party had been a party to this Contract. For the avoidance of doubt, this means that in respect of any claim by the Buyer on behalf of a protected party the Builder shall be entitled to raise any defence that the Builder would have been entitled to raise if the relevant claim had been brought by the Buyer for itself.
 
12.5   Save as provided above the operation of the Contracts (Rights of Third Parties) Act 1999 is hereby excluded.
 
13.   RELATIONSHIP OF PARTIES, PREVIOUS NEGOTIATIONS
 
13.1   The Contract does not create any partnership, joint venture or other joint relationship between the Builder or the Buyer.
 
13.2   This Contract supersedes all prior negotiations, representations, undertakings and agreements between the parties in relation to the subject matter of this Contract.
 
14.   EXCLUSIONS
 
14.1   Subject to the obligations and liabilities of either party to pay the liquidated damages and other compensation amounts expressly provided for in this Contract, each party agrees that neither party shall be liable to the other under or in connection with this Contract for any form of consequential, exemplary, incidental, indirect or special losses and/or damages of any nature whatsoever, howsoever caused and whensoever arising.
 
14.2   Save as otherwise expressly provided in this Contract, all implied terms and conditions are hereby excluded.
 
14.3   Nothing in this Contract shall operate to exclude, limit or restrict any liability arising as a result of fraud, or death or personal injury resulting from gross negligence or wilful misconduct.
 
15.   FAIR DEALING AND BUSINESS STANDARDS
 
15.1   Each party agrees: to use all reasonable efforts to make timely decisions in a speedy and effective way; to deal fairly with each other; and at all times to act in good faith. In this context, “good faith” includes, without limiting the duty of each party to co-operate with the other, a duty of honesty to the other party and a duty not to intentionally mislead the other party.
 
15.2   Each party, in performing its obligations under the Contract, shall maintain appropriate business standards, procedures, precautions and controls, including those necessary to avoid any real or apparent impropriety or adverse impact on the interests of the other party. Each party shall implement (and shall ensure that its employees and other representatives comply with) a policy which prohibits the giving or receiving of any inappropriate favours, gifts, entertainment, payments, loans or other consideration of any kind directly or indirectly connected with the Contract or the Work or any other activities that might influence individuals to act contrary to the best interests of their principal or applicable law.

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15.3   Each party warrants and represents that all financial settlements, reports and billings rendered to the other party under or in connection with the Contract shall properly reflect the facts of all activities and transactions handled for the other party’s account and may be relied upon as being complete and accurate in any further recording or reporting made by the such party or any other member of the corporate group to which such party belongs.
 
15.4   Save for the commission payable by the Builder to brokers whose identity has previously been disclosed in writing by the Builder to the Buyer, no commission of any kind whatsoever is or will be payable (whether directly or indirectly) by or to the Builder in relation to or in connection with the Contract or any of the business transactions described in or contemplated by the Contract. Any breach of this Clause by the Builder may be treated by the Buyer as a material breach of the Builder’s obligations for the purposes of Article 9, Clause 2.1 (iii).
 
16.   COST SAVINGS
 
    The Builder and the Buyer will co-operate and Work closely together on an “open-book” basis in order to reduce costs and generate savings.
 
17.   PRIORITY OF CONTRACT, PLANS AND SPECIFICATION
 
17.1   This Contract, the Plans, and the Specification are intended to complement and supplement one another. All general language or requirements embodied in the Specification are intended to amplify, explain and implement the requirements of this Contract. The Specification and the Plans are also intended to explain each other, and anything shown in the Plans but not stipulated in the Specification or stipulated in the Specification and not shown in the Plans shall be deemed and considered as if embodied in both.
 
17.2   If there is any conflict between any provisions of the following documents, priority between them shall be determined as follows:
  (i)   this Contract and the Specification or Plans, the former shall prevail;
 
  (ii)   the Specification and the Plans, the former shall prevail;
 
  (iii)   the GA Plan and other Plans, the former shall prevail; and
 
  (iv)   one or more Plans (other than the GA Plan), the latest in time shall prevail.
(End of Article 14)

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SCHEDULE 1
Form of AOM
         
AKER FRANCE S.A   PROJECT:   AOM No:
St.Nazaire
  Calculation +/- costs   Date:
 
       
Subject:
       
 
       
Reference:
       
 
       
Description:
       
                                 
        ED   ID                    
        (External   (Internal   Work   Design   Weight   Longitudinal   Vertical
        Delivery)   Delivery)   hours   Hours   +/_   Position   position
BGR   Description of work   (Euro)   (Euro)   (Hours)   (Hours)   (Tonnes)   (Metres)   (Metres)
 
                               
 
                               
SUM:
                               
             
Calculation:
           
Sum ED + ID
         
Builders Margin ( 8 % ):
         
Sum ED + ID + Builders Margin:
         
Labour Cost:
  Hours x   /hour  
Design Cost:
  Hours x   /hour  
Sum Fabrication costs:
         
Interest: % Interest days: days Interest cost:
         
(Note: Interest is paid from the day the AOM related work is completed and handed over)    
                     
Calculation Price:
                   
Quotation to Owner:
  Yes O   Date:   No   O    
Negotiated with Owner:
  Yes O   Date:   No   O    
Final Price:
                   
Other non-cost related
modifications: — Guaranteed
Deadweight — Guaranteed
Service Speed — Delivery Date
- - Other Contractual Matters
         
Name:
  Phone:   Department:
:
  :   :
(End of Schedule 1)

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SCHEDULE 2
Form of Protocol of Delivery and Acceptance
It is this day agreed that the m.v. [ ] built by Aker Yards S.A. (the “Builder”) as Hull No.[C] 33 at the Builder’s Shipyard in Saint-Nazaire, France under the Shipbuilding Contract dated [ ] 2006 and made between the Builder and [ ] (the “Buyer”) has today, [ ], at [am/pm] local time been delivered by the Builder and accepted by the Buyer.
Signed by                                                             
for and on behalf of [Buyer]
Signed by                                                             
for and on behalf of AKER YARDS S.A.
(End of Schedule 2)

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SCHEDULE 3
Form Of Refund Guarantee
[Letterhead of Refund Guarantor]
     
To:
  [insert name of Buyer]
 
   
Date:
  []
[NB This format is provisional and is subject to written approval of both parties]
Refund Guarantee No. [] (the Guarantee)
1.   We refer to the shipbuilding contract dated as of [] 2006 (as amended or supplemented at any time, the “Contract”) and made between [] (the “Buyer”) and AKER YARDS SA (the “Builder”) in relation to the construction of the Builder’s Hull [] (the “Ship”). Terms used in this Guarantee shall bear the same meaning as in the Contract. Under the Contract, the Contract Price is to be paid in 5 (five) instalments and the Buyer’s obligation to pay each of the 4 (four) pre-delivery instalments of the Contract Price is conditional upon (amongst other things) the Buyer receiving an irrevocable refund guarantee from a first class bank, insurance company or other financial institution reasonably acceptable to the Buyer securing the refund of the instalment together with interest thereon at the Relevant Rate.
 
2.   In consideration of the Buyer agreeing to pay the sum of EUR [] corresponding to the [first] / [second] / [third] / [fourth] instalment (the “Instalment”) of the Contract Price payable under Article 8, Clause 2.1 of the Contract, and of the Buyer agreeing to accept this Guarantee under Article 8, Clause 2.3 of the Contract as security for the refund of the Instalment, at the request of the Builder we, [] hereby unconditionally and irrevocably: (i) guarantee to the Buyer to refund the Instalment to the Buyer (less the amount received by the Buyer from the Builder under Article 1, Clause 6.8 of the Contract) and to pay interest thereon at the Relevant Rate from the date of the Builder’s receipt of the Instalment to the date of the Buyer’s receipt of the refund, subject to an overall limit of EUR [] [corresponding to the Instalment plus interest equivalent to a % of the Instalment amount to be approved by the Buyer] in respect of such Instalment and interest, and without prejudice to the Buyer’s right to claim and recover interest in excess of this limit from the Builder or its other guarantors, against the Buyer’s simple written demand (a) specifying the amount claimed by the Buyer in respect of the Instalment together with interest thereon at the Relevant Rate, and (b) specifying the account to which the amount demanded is to be paid; and (ii) undertake to the Buyer that (a) payment will be made by us forthwith, subject to a fifteen (15) running day notification period under paragraph 3 below, upon our receipt of such simple written demand, without any counterclaim, deductions, set-off, withholdings or any objection whatsoever, and (b) if we are required by law to make any deduction or withholding from any payment to the Buyer under this Guarantee, our payment to the Buyer will be increased by such amount as may be necessary to ensure that, after all of the required deductions and withholdings have been made, the Buyer receives a payment equal to the amount it would have received had no such deductions or withholdings been made.

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3.   Notwithstanding paragraph 2 above, if, within fifteen (15) running days following our receipt of a written demand from the Buyer, the Builder has (i) confirmed to us in writing that the Builder is disputing the Buyer’s entitlement to make a claim under this Guarantee and (ii) delivered to us a copy of a written notice served on the Buyer stating the grounds upon which the Builder is disputing the Buyer’s entitlement to make a claim under this Guarantee, we shall not effect payment under this Guarantee pending settlement of the dispute between the parties or determination of the dispute in accordance with the Contract. If the Builder subsequently accepts all or any part of the Buyer’s claim, or if the Buyer obtains a final order from the English courts (meaning a judgment or court order in respect of which there is no right of appeal or in respect of which the time limit for submitting an application to appeal has expired without such application having been made by either party to the Contract) adjudging that all or any part of the claim is payable to the Buyer, we will pay the relevant amount to the Buyer (together with interest thereon as provided in paragraph 2 above) upon our receipt of a certified true copy of a settlement agreement signed on behalf of the Builder and the Buyer or (as the case may be) upon our receipt of a certified true copy of the relevant court order.
 
4.   This Guarantee shall become effective upon the Builder’s receipt of the Instalment. Save in respect of any demand made hereunder before the termination or expiry of this Guarantee, this Guarantee shall terminate upon the first to occur of (i) the Buyer’s acceptance of the Ship in accordance with the Contract, (ii) the date when we have received a written notice from the Buyer stating that it has (a) received, from another guarantor acceptable to the Buyer, a substitute guarantee securing the refund of the Instalment which is in form and substance satisfactory to the Buyer or (b) received a refund of the Instalment together with interest thereon as provided for in paragraph 2 above, (iii) our payment to you of the Instalment together with interest thereon as provided for in paragraph 2 above, (iii) the valid and lawful termination of the Contract by the Builder pursuant to the terms and conditions thereof, and (iv) the date falling [365 (three hundred and sixty five)] days after the Delivery Date provided that if either party commences legal proceedings in the English courts pursuant to the Contract before the termination or expiry of this Guarantee or within 45 (forty five) days after termination of the Contract, this Guarantee shall remain in full force until the date falling 45 (forty five) days after the date of the final order in such proceedings.
 
5.   Our obligations under this Guarantee are those of a sole primary obligor (as and for our own debt and independent from any obligations of the Builder) and not merely as surety, and we agree that the Buyer is not obliged to make any prior demand of the Builder under the Contract or to seek to enforce any remedies against the Builder before making a claim under this Guarantee.
 
6.   Our obligations under this Guarantee shall not be in any respect discharged, impaired or otherwise affected by reason of any events or circumstances whatsoever including without limitation (i) any invalidity, irregularity or unenforceability of any of the Builder’s obligations under or in connection with the Contract, (ii) the granting to the Builder of any time, waiver, consent, indulgence or other forbearance in relation to the Contract, (iii) any bankruptcy, insolvency or similar proceedings related to any party to the Contract, (iv) any amendments or supplements to the Contract, or (v) any other events or circumstances that might otherwise constitute a legal or equitable discharge of

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    or defence to a surety or guarantor under applicable law, and we hereby irrevocably and unconditionally waive any and all defences at law or in equity that may be available to us by reason of any such events or circumstances.
 
7.   This Guarantee shall be in addition to any other security granted by the Builder in favour of the Buyer under the Contract, and shall not be affected by any action taken by the Buyer under any such other security.
 
8.   This Guarantee may be assigned by the Buyer to any of the banks and financial institutions from time to time providing the Buyer with financial support for its payment obligations under or in connection with the Contract, and to any other permitted assignees of the Buyer’s rights under the Contract, provided that written notice of any such assignment shall be given to us promptly thereafter.
 
9.   We unconditionally and irrevocably (i) agree that this Guarantee shall be governed by and construed in accordance with English law, (ii) agree that the English courts shall have exclusive jurisdiction to hear and determine any suit, action or proceeding, and to settle any disputes, that may arise out of or in connection with this Guarantee, and (iii) submit to the jurisdiction of the English courts for the purposes of any proceedings under or in connection with this Guarantee.
 
10.   All correspondence, claims and demands under or in connection with this Guarantee shall be marked for the attention of [insert name] and delivered to us at [insert address]. Any legal process issued out of the English courts may be served on us by being delivered to our agent for service of process in London, [insert name] at [insert London address].
Yours faithfully
For and on behalf of [insert name of Refund Guarantor]
(End of Schedule 3)

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SCHEDULE 4
Form Of Builder’s Performance Guarantee
[Letterhead of Builder’s Performance Guarantor]
[NB This format is provisional and is subject to written approval of both parties]
     
To:
  [Buyer]
 
   
Date:
  []
Gentlemen:
HULL NUMBER [] (THE "SHIP")
We have been informed that on [], 2006 a shipbuilding contract (as the same may be supplemented, amended, changed or otherwise modified at any time hereafter, the “Contract”) was concluded between AKER YARDS SA a French société anonyme having its registered office at Avenue Bourdelle 44613 Saint-Nazaire, France (the “Builder”), and yourselves for the construction and delivery of one cruise ship having the Builder’s Hull No. [] (hereinafter called the “Ship”). Terms used in this Guarantee shall bear the same meaning as in the Contract.
In consideration of your entering into the Contract and the payment to ourselves of EUR 1 (receipt of which is hereby acknowledged) the undersigned AKER YARDS ASA (the “Guarantor”) hereby unconditionally and irrevocably guarantees to you, your successors and permitted assigns (the "Beneficiary”) the payment of all such monies (whether principal or interest) and other liabilities or any part thereof (collectively, the “Debts") as may become due to the Beneficiary under or in respect of Article 9, Clause 2.3(i) and (iii) of the Contract and under Article 9, Clause 2.3(ii) of the Contract for any interest not recovered by the Buyer from the Refund Guarantors.
Our obligations under this Guarantee shall not be in any respect discharged, impaired or otherwise affected by reason of any events or circumstances whatsoever including without limitation, (i) any invalidity, irregularity or unenforceability of any of the Builder’s obligations under or in connection with the Contract, (ii) the granting of any time, waiver, consent, indulgence or other forbearance in relation to the Contract, (iii) any bankruptcy, insolvency or similar proceedings related to any party to the Contract, (iv) any amendments or supplements or any other variation whatsoever to the Contract including (without limitation) any assignment, novation or other partial or total transfer of the Contract whatsoever, (v) any modification, disposal of all or part of our direct or indirect investment, interest, control or management (without limitation) of the Builder or (vi) any other events or circumstances that might otherwise constitute a legal or equitable discharge of or defence to a surety or guarantor under applicable law, and we hereby irrevocably and unconditionally waive any and all defences at law or in equity that may be available to us by reason of any such events or circumstances.
Our liability to make payment hereunder shall be conditional upon receipt of the Beneficiary’s signed written demand (i) stating that demand has been made upon the Builder for payment of Debts due by the Builder under the Contract (ii) specifying the amount claimed by the

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Beneficiary in respect of the Debts and/or interest thereon at the Relevant Rate, and (iii) confirming that the Builder has within fifteen (15) days of service of such demand failed to comply with the same.
We shall effect any payment under this Guarantee within a period of fifteen (15) running days following our receipt of the Beneficiary’s written demand without any counterclaim, deductions, set-off, withholdings or any objection whatsoever, and if we are required by law to make any deduction or withholding from any payment to the Beneficiary under this Guarantee, our payment to the Beneficiary will be increased by such amount as may be necessary to ensure that, after all of the required deductions and withholdings have been made, the Beneficiary receives a payment equal to the amount it would have received had no such deductions or withholdings been made.
However, if within the period of fifteen (15) running days following our receipt of the Beneficiary’s written demand, the Builder has (i) confirmed to us in writing that the Builder is disputing the Buyer’s entitlement to make a claim under this Guarantee and (ii) delivered to us a copy of a written notice served on the Buyer stating the grounds upon which the Builder is disputing the Buyer’s entitlement to make a claim under this Guarantee, we shall not effect payment under this Guarantee pending settlement of the dispute between the parties or determination of the dispute in accordance with the Contract. If the Builder subsequently accepts all or any part of the Buyer’s claim, or if the Buyer obtains a final order from the English courts (meaning a judgment or court order in respect of which there is no right of appeal or in respect of which the time limit for submitting an application to appeal has expired without such application having been made by either party to the Contract) adjudging that all or any part of the claim is payable to the Buyer, we will pay the relevant adjudged amount to the Buyer (together with interest thereon at the Relevant Rate) upon our receipt of a certified true copy of a settlement agreement signed on behalf of the Builder and the Buyer or (as the case may be) upon our receipt of a certified true copy of the relevant court order.
This Guarantee shall become effective on the Effective Date. Save in respect of any demands in relation to valid and lawful claims made hereunder before the termination or expiry of this Guarantee, this Guarantee shall terminate upon the earlier of (a) delivery and acceptance of the Ship in accordance with the Contract, (b) the valid and lawful termination of the Contract by the Builder pursuant to the terms thereof, (c) the date of the Beneficiary’s receipt from another guarantor acceptable to the Beneficiary of a guarantee in replacement for this Guarantee pursuant to the Contract in a form and substance acceptable to the Beneficiary, and (d) the date falling [**] [Confidential Treatment] days after the Delivery Date provided that if either party commences legal proceedings in the English courts pursuant to the Contract before the termination or expiry of this Guarantee or within 45 (forty five) days after termination of the Contract, this Guarantee shall remain in full force until the date falling 45 (forty five) days after the date of the final order in such proceedings.
The benefit of this Guarantee shall be capable of assignment without our consent to any permitted and lawful assignee of your benefit of this Contract provided that written notice of any such assignment shall be given to us as soon as reasonably practicable thereafter.
We shall not assign or transfer our obligations under this Guarantee without the prior written consent of the Beneficiary.

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This Guarantee shall be governed by the laws of England and shall be subject to the exclusive jurisdiction of the English Courts.
All correspondence, claims and demands under or in connection with this Guarantee shall be marked for the attention of [insert name] and delivered to us at [insert address]. Any legal process issued out of the English courts may be served on us by being delivered to our agent for service of process in London, [insert name] at [insert London address].
         
Yours faithfully
       
 
       
 
Duly Authorised Signatory
For and on behalf of AKER YARDS ASA
        
 
       
 
       
 
 
 
   
 
[name and position]
   [name and position]    
(End of Schedule 4)

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SCHEDULE 5
Form Of Buyer’s Performance Guarantee
[NB This format is provisional and is subject to written approval of both parties]
[Letterhead of the Buyer’s Performance Guarantor]
AKER YARDS SA
Date []
Gentlemen:
YOUR HULL NUMBER [] (THE “SHIP”)
We have been informed that on [], 2006 a shipbuilding contract (the “Contract”) was concluded between [], Ltd having its registered office at Milner House, 18 Parliament Street, Hamilton HM12, Bermuda (the “Buyer”), and yourselves for the construction and delivery of one cruise ship having the Builder’s Hull No. [] (hereinafter called the “Ship”). Terms used in this Guarantee shall bear the same meaning as in the Contract.
In consideration of your entering into the Contract and the payment to ourselves of EUR 1 (receipt of which is hereby acknowledged) the undersigned NCL Corporation having its registered office in at Milner House, 18 Parliament Street, Hamilton HM12, Bermuda (the “Guarantor”) hereby unconditionally and irrevocably guarantees to you, your successors and permitted assigns (the “Beneficiary”) the payment of any such monies (whether principal or interest) and other liabilities or any part thereof (the “Debts”) as may become due to the Beneficiary under or in respect of the Contract (as the same may be supplemented, amended, changed or otherwise modified hereafter).
Our obligations under this Guarantee shall not be in any respect discharged, impaired or otherwise affected by reason of any events or circumstances whatsoever including without limitation, (i) any invalidity, irregularity or unenforceability of any of the Buyer’s obligations under or in connection with the Contract, (ii) the granting of any time, waiver, consent, indulgence or other forbearance in relation to the Contract, (iii) any bankruptcy, insolvency or similar proceedings related to any party to the Contract, (iv) any amendments or supplements or any other variation whatsoever to the Contract including (without limitation) any assignment, novation or other partial or total transfer of the Contract whatsoever, (v) any modification, disposal of all or part of our direct or indirect investment, interest, control or management (without limitation) of the Buyer or (vi) any other events or circumstances that might otherwise constitute a legal or equitable discharge of or defence to a surety or guarantor under applicable law, and we hereby irrevocably and unconditionally waive any and all defences at law or in equity that may be available to us by reason of any such events or circumstances.
Our liability to make payment hereunder shall be conditional upon receipt of the Beneficiary’s signed written demand (i) stating that demand has been made upon the Buyer for payment of the Debts due by the Buyer under or in respect of the Contract (ii) specifying the amount claimed by the Beneficiary in respect of any of the Debts and/or interest thereon at the Relevant Rate, and (iii) confirming that the Buyer has within fifteen (15) running days of service of such demand failed to comply with the same.

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We shall effect any payment under this Guarantee within the period of fifteen (15) running days following our receipt of the Beneficiary’s written demand without any counterclaim, deductions, set-off, withholdings or any objection whatsoever, and if we are required by law to make any deduction or withholding from any payment to the Beneficiary under this Guarantee, our payment to the Beneficiary will be increased by such amount as may be necessary to ensure that, after all of the required deductions and withholdings have been made, the Beneficiary receives a payment equal to the amount it would have received had no such deductions or withholdings been made.
However, if within the period of fifteen (15) running days following our receipt of the Beneficiary’s written demand, the Buyer has (i) confirmed to us in writing that the Buyer is disputing the Builder’s entitlement to make a claim under this Guarantee and (ii) delivered to us a copy of a written notice served on the Builder stating the grounds upon which the Buyer is disputing the Builder’s entitlement to make a claim under this Guarantee, we shall not effect payment under this Guarantee pending settlement of the dispute between the parties or determination of the dispute in accordance with the Contract. If the Buyer subsequently accepts all or any part of the Builder’s claim, or if the Builder obtains a final order from the English courts (meaning a judgment or court order in respect of which there is no right of appeal or in respect of which the time limit for submitting an application to appeal has expired without such application having been made by either party to the Contract) adjudging that all or any part of the claim is payable to the Builder, we will pay the relevant adjudged amount to the Builder (together with interest thereon at the Relevant Rate) upon our receipt of a certified true copy of a settlement agreement signed on behalf of the Builder and the Buyer or (as the case may be) upon our receipt of a certified true copy of the relevant court order.
This Guarantee shall become effective on the Effective Date. Save in respect of any demands in relation to valid and lawful claims made hereunder before the termination or expiry of this Guarantee, this Guarantee shall terminate upon the earlier of (a) delivery and acceptance of the Ship in accordance with the Contract, (b) the valid and lawful termination of the Contract by the Buyer pursuant to the terms thereof, (c) the date of the Beneficiary’s receipt from another guarantor acceptable to the Beneficiary of a guarantee in replacement for this Guarantee pursuant to the Contract in a form and substance acceptable to the Beneficiary, and (d) the date falling [**] [Confidential Treatment] days after the Delivery Date provided that if either party commences legal proceedings in the English courts pursuant to the Contract before the termination or expiry of this Guarantee or within 45 (forty five) days after termination of the Contract, this Guarantee shall remain in full force until the date falling 45 (forty five) days after the date of the final order in such proceedings.
The benefit of this Guarantee shall be capable of assignment without our consent to any permitted and lawful assignee of your benefit of this Contract provided that written notice of such assignment shall be given to us promptly thereafter.
We shall not assign or transfer any of our obligations under this Guarantee without the prior written consent of the Beneficiary.
This Guarantee shall be governed by the laws of England and shall be subject to the exclusive jurisdiction of the English Courts.

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All correspondence, claims and demands under or in connection with this Guarantee shall be marked for the attention of [insert name] and delivered to us at [insert address]. Any legal process issued out of the English courts may be served on us by being delivered to our agent for service of process in London, [insert name] at [insert London address].
         
Yours faithfully
       
 
       
 
Duly Authorised Signatory
For and on behalf of NCL Corporation Ltd
        
 
       
 
       
 
       
 
 
 
   
 
[name and position]
   [name and position]    
(End of Schedule 5)

- 78 -


 

SCHEDULE 6
Definition Of Certain Terms
1.   DEFINITION OF CERTAIN TERMS
 
1.1   In this Contract:
 
    AOM” has the meaning given in Article 3, Clause 1.3;
 
    Builder’s Account” means the euro denominated account with IBAN number: [**] [Confidential Treatment] or as further modified by notice given by the Builder to the Buyer, and held by the Builder’s Bank at its office in Paris;
 
    Builder’s Bank” means Société Générale, Agence Opéra or as further modified by notice given by the Builder to the Buyer;
 
    Buyer’s Group” means (i) NCL Corporation Ltd, and its subsidiaries and (ii) all other associated or affiliated companies;
 
    Buyer’s Performance Guarantee” means the guarantee to be given by Buyer’s Guarantor in the form set out in Schedule 5;
 
    Buyer’s Guarantor” means NCL Corporation Ltd., a company incorporated in Bermuda and having its registered office at Milner House, 18 Parliament Street, Hamilton, HM12, Bermuda;
 
    Builder’s Performance Guarantee” means the guarantee to be given by Aker Yards ASA in the form set out in Schedule 4;
 
    Buyer’s Supplies” has the meaning given in Article 1, Clause 1.1(i)(b);
 
    Buyer’s Supply Costs” means at any given time the aggregate of (i) the costs incurred by the Buyer in relation to the delivery and transportation to the Shipyard, Ship or relevant Subcontractor, and all related incidental costs including insurance up to the point of delivery, of all Buyer’s Supplies and (ii) the Buyer’s reasonably estimated costs of acquiring and obtaining delivery of replacements for such Supplies at such time;
 
    Class Rules” has the meaning given in Article 1, Clause 4.1;
 
    Classification Society” has the meaning given in Article 1, Clause 4.1;
 
    commission” includes any advantage or benefit (whether monetary or not), brokerage, consideration, gift, gratuity, inducement, introduction fee, payment (other than any payment made or to be made in accordance with the express provisions of this Contract), promise, reward or success fee of any kind whatsoever payable to any broker, agent, intermediary or other person in relation to or in connection with the placing and/or performance of any activities connected with this Contract;
 
    Compensation Date” means (i) the 7th (seventh) day from (and including) the Delivery Date or (ii) the 3rd (third) day from (and including) the Delivery Date if the Ship has not

- 79 -


 

    been delivered by the intended delivery date mentioned in the 15 (fifteen) days definite notice given by the Builder under Clause 1.1 in Article 7;
 
    Compulsory Acquisition” means a requisition or other compulsory acquisition (including seizure, detention, confiscation or appropriation) by or on behalf of any government or governmental agency or by any persons acting or purporting to act on behalf of any government or governmental agency;
 
    Contract” means this shipbuilding contract and (save in the context of Article 14, Clause 18) includes the Plans, the Specification and the schedules, each of which forms an integral part of this Contract;
 
    Contract Price” means the fixed price for the Ship specified in Clause 1.1 of Article 8;
 
    Defects List” has the meaning given in Article 6, Clause 1.15;
 
    Delivery Date” means the fixed delivery date for the Ship specified in Clause 1.1 of Article 7, it being acknowledged and agreed by the parties that such date may be reset only in strict accordance with, and subject to, the express provisions of this Contract;
 
    Design Draft” has the meaning given in Article 1, Clause 2.12(ii);
 
    Dispute” means any dispute or difference whatsoever arising at any time out of or in connection with this Contract including a dispute regarding the existence, validity or termination of this Contract, and “Disputes” shall be construed accordingly;
 
    Effective Date” has the meaning given in Article 14, Clause 11.1;
 
    encumbrance” means (i) any claim or demand (whether in personam or in rem and including any arrest or other detention in connection with any claim) and any debt, and/or (ii) any mortgage, charge, pledge, maritime or possessory or other lien, assignment, hypothecation, trust arrangement, encumbrance, or other security interest securing any obligation of any person or any other type of preferential arrangement (including, without limitation, title transfer and retention arrangements) having a similar effect but does not include any permitted encumbrance;
 
    EUR” and “euro” mean the lawful currency of France.
 
    EURIBOR” means the percentage rate per annum for euro deposits determined by the Banking Federation for Europe for the relevant period displayed on the appropriate page of the Telerate or the Reuters screen from time to time or, if such display is not available at any time, as certified by the head office of the Builder’s Bank at Paris;
 
    Flag State” has the meaning given in Article 7, Clause 1.8;
 
    GA Plan” means the general arrangement plan [**] [Confidential Treatment], dated [] 2006 and initialled by the parties for the purposes of identification;
 
    Guaranteed Deadweight” has the meaning given in Article 1, Clause 2.1(ii);

- 80 -


 

    Guaranteed Fuel Consumption” or “GFC” has the meaning given in Article 1, Clause 2.1(vii);
 
    Guaranteed Service Speed” or “GSS” has the meaning given in Article 1, Clause 2.1(vi);
 
    Insurances” has the meaning given in Article 4, Clause 2.1;
 
    Manuals” has the meaning given in Article 1, Clause 1.1(i)(c);
 
    Makers’ List” has the meaning given in Article 1, Clause 5.3;
 
    Mortgage” has the meaning given in Article 4, Clause 1.8 and “Mortgages” shall be construed accordingly.
 
    minor defect” has the meaning given in Article 6, Clause 1.15;
 
    Option Agreement” means an agreement to be made on mutually acceptable terms between the Builder and the Buyer’s Guarantor for the construction of one further passenger cruise ship;
 
    Parts” has the meaning given in Article 1, Clause 1.1(i)(b);
 
    partial loss” means any loss of or damage to the Ship (including Buyer’s Supplies and other Parts) which does not constitute a total loss and “partial loss proceeds” means any insurance proceeds paid and/or payable in respect of any partial loss;
 
    permitted encumbrance” means any encumbrance (i) created by the Buyer or (ii) arising by operation of law in connection with claims against the Buyer by any person other than the Builder for which the Buyer would not be entitled to compensation or indemnification from the Builder under this Contract;
 
    Plans” means the GA Plan, and the other plans and drawings described or referred to in the Specification;
 
    protected parties” means (i) the Buyer and NCL (Bahamas) Ltd. (“NCLB”), and (ii) the respective agents, officers, employees, workmen, suppliers and other representatives of the Buyer and NCLB provided that, in the context of Article 12, Clause 1.1 “protected parties” means the Buyer and any other affected members of the Buyer’s Group;
 
    Protocol of Delivery and Acceptance” has the meaning given in Article 7, Clause 1.3(i);
 
    Refund Guarantee” has the meaning given in Article 8, Clause 2.3(ii);
 
    Refund Guarantor” has the meaning given in Article 8, Clause 2.3(ii);
 
    Regulatory Authorities” means the authorities, bodies and entities having regulatory responsibility and authority in respect of the Ship or specific areas or parts of the Ship, before or after delivery of the Ship, including those identified in Part G3 of the Specification;
 
    Regulatory Rules” has the meaning given in Article 1, Clause 4.3;

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    Relevant Rate” means the aggregate of (i) [**] [Confidential Treatment] and (ii) EURIBOR;
 
    remedy” shall be construed (with reference to defects and deficiencies referred to in Articles 6 and 7) so as to mean and include correct, rectify, redesign, remedy, repair, replace or otherwise make good, and test to prove the efficacy of the relevant remedial Work, every defect and deficiency, and any other physical damage, for which the Builder is liable under Articles 6 and 7, and “remedial” shall be construed accordingly;
 
    Ship” has the meaning given in Article 1, Clause 1.1(i)(a);
 
    Shipyard” means the Builder’s shipyard at Saint-Nazaire, France;
 
    Signing Date” means the date on which this Contract is signed by or on behalf of each party;
 
    Specification” means Specification [**] [Confidential Treatment] dated [] 2006 and, unless the context otherwise requires, “specified” means stipulated in the Specification or in the Appendices;
 
    Subcontractor(s)” shall include each of the Builder’s makers and suppliers and any other person, company or other entity to whom any part of the Work is subcontracted directly or indirectly by the Builder;
 
    tests” means (i) the shop and dock inspections, measurements and tests, (ii) the sea trials, (iii) the other inspections and tests referred to in the Specification and the Plans, and (iv) all such other commissioning, tests, trials and inspections (or retests, retrials and reinspections) as may reasonably be required in order to demonstrate and confirm compliance of the Ship with the Contract, Plans and Specification and the full and final remedy of any defects;
 
    total loss” means any actual, constructive, compromised or arranged or agreed total loss of the Ship (including Buyer’s Supplies or other Parts);
 
    Work” means all of the Parts to be provided and all of the services, labour and other Work to be supplied and carried out by the Builder and its Subcontractors under and in connection with this Contract, as more particularly described in the Specification and the Plans;
 
    Working Day” means any day, other than a Saturday or Sunday, on which banks are generally open for business in each of London and Paris; and
 
2.   INTERPRETATION OF CERTAIN REFERENCES
 
2.1   Save where the contrary is expressly stated, any reference in this Contract to:
  (i)   this Contract, the Specification, the Plans or any other agreements or documents shall be construed as a reference to this Contract, the Specification, the Plans or, as the case may be, such other agreements or documents as the same may have been, or may from time to time be, amended, modified, varied, novated or supplemented by agreement of the parties;

- 82 -


 

  (ii)   an Article or the schedule shall be construed as a reference to an Article or the schedule of this Contract;
 
  (iii)   an award shall be construed as a reference to any award, decision, declaration, injunction, judgement, order or other relief;
 
  (iv)   a claim shall be construed as a reference to any action, claim, demand, proceeding, process or suit, whether in arbitration or court or otherwise;
 
  (v)   a clause shall be construed as a reference to a clause of the Article in which the reference appears;
 
  (vi)   a person shall be construed as a reference to any individual, firm, company, corporation, unincorporated body of persons, or any state or state agency,
 
  (vii)   a party to this Contract shall include a reference to such party’s successors and permitted assigns;
 
  (viii)   a tax shall be construed as a reference to any tax, assessment, levy, impost, customs, stamp or other duty, or other charge of a similar nature (including, without limitation, any fine or penalty or interest payable in connection with any failure to pay or any delay in paying any of the same), whether national, provincial or local;
 
  (ix)   a judgment shall be construed so as to include any court order, injunction, declaration, decision and any other form of judicial relief;
 
  (x)   a receiver shall be construed so as to include any liquidator, trustee, administrator, receiver, administrative receiver, manager or similar officer; and
 
  (xi)   the winding up of a party to this Contract shall be construed so as to include the bankruptcy or liquidation of the party or any equivalent or analogous proceedings under the law of the jurisdiction in which such party is incorporated or any other jurisdiction in which such party carries on business.
2.2   The Index, Article, Clause and schedule headings and sub-headings are inserted for convenience only and shall not affect the interpretation of this Contract.
(End of Schedule 6)

- 83 -


 

SCHEDULE 7
Sound and Vibration
[**] [Confidential Treatment]
 
*   5dBA relaxation in sports area and pasage ways
 
*   5dBa relaxation near ventilation inlets and outlets

- 84 -


 

[**] [Confidential Treatment]

- 85 -


 

AOM No. 1 under the Contract for C33
IT IS HEREBY AGREED:
(1) that the Contract Price shall be increased by the amount of 3,435,000 (three million four hundred and thirty five thousand euros) on account of the agreed increase in the overall length of the Ship to [**] [Confidential Treatment] metres (with a tolerance of +/- half a metre) and all related modification Works;
(2) that the Contract Price increase referred to above shall be paid in accordance with Article 8, Clause 2.4 (ii) of the Contract; and
(3) that the modifications referred to in this AOM shall not change the Delivery Date or any other provision of the Contract.
Signed for F3 One, Ltd.
     
/s/ Colin Veitch 
on 7th September 2006
   
 
   
Signed for Aker Yards S.A.
   
 
   
Signature illegible 
on 7th September 2006
   

 


 

AOM No. 2 under the Contract for C33
IT IS HEREBY AGREED:
(1) that the Contract Price shall be increased by the amount of 783,000 (seven hundred and eighty three thousand euros) in order to take account of the netting off of the increases against the decreases referred to in the attached table;
(2) that the Contract Price increase referred to above shall be paid in accordance with Article 8, Clause 2.4 (ii) of the Contract; and
(3) that the modifications referred to in this AOM shall not change the Delivery Date or any other provision of the Contract.
Signed for F3 One, Ltd.
     
/s/ Colin Veitch 
on 7th September 2006
   
 
   
Signed for Aker Yards, S.A.
   
 
   
Signature illegible 
on 7th September 2006
   

 


 

Open Items Settlement List August 24,2006
                         
Item #   SPEC/REF   Description   Increase Aker / NCL   Decrease/Credit
3   H.4.15.1.1  
[**] [Confidential Treatment]
    [**] [Confidential Treatment]          
4   H.4.15.6  
[**] [Confidential Treatment]
    [**] [Confidential Treatment]          
17   G.3.2  
[**] [Confidential Treatment]
            [**] [Confidential Treatment]  
20   H.4.1.2.1  
[**] [Confidential Treatment]
    [**] [Confidential Treatment]          
26   E.10.10.2  
[**] [Confidential Treatment]
    [**] [Confidential Treatment]          
       
 
               
Sum
    [**] [Confidential Treatment]       [**] [Confidential Treatment]  
       
 
               
Net Total
    783,000.00          
- 2 -

 


 

AOM No. 3 under the Contract for C33
IT IS HEREBY AGREED:
(1) that the Contract Price shall be increased by the amount of 2,850,000 (two million eight hundred and fifty thousand euros) in respect of the agreed increase in GSS from [**] [Confidential Treatment] knots and all related modification Works;
(2) that the Contract Price increase referred to above shall be paid in accordance with Article 8, Clause 2.4 (ii) of the Contract; and
(3) that the modifications referred to in this AOM shall not change the Delivery Date or any other provision of the Contract.
Signed for F3 One, Ltd.
     
/s/ Colin Veitch 
on 7th September 2006
   
 
   
Signed for Aker Yards S.A.
   
 
   
Signature illegible 
on 7th September 2006
   

 


 

AOM No. 4 under the Contract for C33
IT IS HEREBY AGREED:
(1) that the Contract Price shall be increased by the amount of 400,000 (four hundred thousand euros) in order to take account of the set-off made in respect of (i) the agreed cost increases resulting from the [**] [Confidential Treatment] modifications agreed between the parties for decks [**] [Confidential Treatment], and (ii) the agreed cost decreases resulting from the space decrease modifications agreed betw een the parties for decks [**] [Confidential Treatment];
(2) that the Contract Price increase referred to above shall be paid in accordance with Article 8, Clause 2.4 (ii) of the Contract; and
(3) that the modifications referred to in this AOM shall not change the Delivery Date or any other provision of the Contract.
Signed for F3 One, Ltd.
     
/s/ Colin Veitch 
on 7th September 2006
   
 
   
Signed for Aker Yards S.A.
   
 
   
Signature illegible 
on 7th September 2006
   

 


 

Description of modification
  Deck 7 breadth of public spaces remains at [**] [Confidential Treatment] meters.
 
  Area of public spaces on deck 14 and on deck 15 is increased to accommodate [**] [Confidential Treatment] at the aft part of the Ship.
- 2 -

 

EX-4.44 21 g05791exv4w44.htm EX-4.44 SHIPBUILDING CONTRACT FOR HULL NO. D33 EX-4.44 Shipbuilding Contract for Hull No. D33
 

Exhibit 4.44
[Confidential Treatment]
SHIPBUILDING CONTRACT
BETWEEN
ER YARDS S.A.
AND
F3 TWO, LTD
 
IN RELATION TO HULL NO. D33
 

 


 

CONTENTS
         
Clause   Page  
Article 1: Subject Matter Of Contract
    1  
 
1. Agreement To Build, Sell And Purchase
    1  
2. Description Of The Ship
    2  
3. Specification And Plans
    3  
4. Classification
    4  
5. Subcontracting And Makers’ List
    6  
6. Buyer’s Supplies
    8  
7. Builder’s Tally Of Buyer’s Supplies
    10  
 
Article 2: Supervision
    12  
 
1. Supervisor
    12  
2. Planned Programme And Plan Approval
    13  
3. Work Approval
    15  
4. Technical Disputes
    16  
 
Article 3: Modifications
    17  
 
1. Modifications
    17  
2. Classification And Regulatory Changes
    18  
3. Substitution Of Parts
    19  
 
Article 4: Title And Insurances
    20  
 
1. Title, Risk And Encumbrances
    20  
2. Insurances
    21  
3. Loss Or Damage
    22  
 
Article 5: Permissible Delays
    24  
 
1. Extension Of Time For Work
    24  
2. Delay Notices
    26  
 
Article 6: Tests And Liquidated Damages
    28  
 
1. Tests
    28  
2. Liquidated Damages
    31  
 
Article 7: Delivery And Guarantee
    37  
 
1. Delivery And Acceptance
    37  
2. Guarantee
    39  
 
Article 8: Contract Price And Payment Terms
    44  
 
1. Contract Price
    44  

 


 

         
Clause   Page  
2. Payments
    44  
 
Article 9: Termination
    48  
 
1. Termination By Builder
    48  
2. Termination By Buyer
    50  
3. Termination By Either Party
    52  
 
Article 10: Representations, Covenants And Indemnities
    53  
 
1. Representations, Warranties And Covenants
    53  
2. Exclusion Of Liabilities
    54  
 
Article 11: Intellectual Property Rights
    55  
 
1. Patents, Trade Marks And Copyrights
    55  
2. Rights To Engineering And Design Data
    56  
 
Article 12: Taxes And Contract Expenses
    57  
 
1. Taxes And Contract Expenses
    57  
 
Article 13: Disputes
    58  
 
1. Technical Disputes
    58  
2. Jurisdiction
    59  
3. Governing Law
    59  
4. Notices
    60  
 
Article 14: General Matters
    62  
 
1. Computation Of Time
    62  
2. Assignments
    62  
3. Partial Illegality
    62  
4. Confidentiality
    63  
5. Amendments
    63  
6. No Waiver
    63  
7. Consents
    63  
8. Language
    64  
9. Models
    64  
10. Counterparts
    64  
11. Effective Date
    64  
12. Protected Parties
    65  
13. Relationship Of Parties, Previous Negotiations
    66  
14. Exclusions
    66  
15. Fair Dealing And Business Standards
    66  
16. Cost Savings
    67  

 


 

         
Clause   Page  
17. Priority Of Contract, Plans And Specification
    67  
 
Article 15: Sister Ship
    68  
 
Schedule 1 Form Of Aom
    71  
Schedule 2 Form Of Protocol Of Delivery And Acceptance
    72  
Schedule 3 Form Of Refund Guarantee
    73  
Schedule 4 Form Of Builder’s Performance Guarantee
    76  
Schedule 5 Form Of Buyer’s Performance Guarantee
    79  
Schedule 6 Definition Of Certain Terms
    82  
Schedule 7 Sound And Vibration
    87  

 


 

THIS SHIPBUILDING CONTRACT is dated as of 7th September 2006 and made between:
(1)   AKER YARDS S.A., a company organised and existing under the laws of France and having its principal office at Avenue Bourdelle — B.P. 90180, 44613 Saint-Nazaire Cedex, France (the “Builder”); and
(2)   F3 TWO, LTD., a company incorporated in Bermuda and having its registered office at Milner House, 18 Parliament Street, Hamilton HM12, Bermuda (the “Buyer”).
NOW IT IS HEREBY AGREED as follows:
ARTICLE 1: SUBJECT MATTER OF CONTRACT
1. AGREEMENT TO BUILD, SELL AND PURCHASE
1.1   On and subject to the express provisions of this Contract, the Plans and the Specification:-
  (i)   the Builder shall:
  (a)   design, engineer, build, launch, equip and outfit the passenger cruise ship more particularly described in the Plans and the Specification (the “Ship”) at the Shipyard, and
 
  (b)   provide all components, equipment, gear, fittings, machinery, materials, parts, plant, outfit, spares and supplies which are necessary to achieve the objects and purposes described in Clause 1.1(i) (a) (the “Parts”) other than the specified supplies to be provided by the Buyer (the “Buyer’s Supplies”),
 
  (c)   supply all operating and maintenance manuals, training materials, spares lists, plans, drawings, records and other construction documents specified in the Specification (together, the “Manuals”),
 
  (d)   provide or procure the provision of all training of the Buyer’s employees specified in the Specification, and
 
  (e)   test, complete, finish, sell and deliver the Ship to the Buyer at Shipyard.
  (ii)   the Buyer shall purchase and accept delivery of the duly completed Ship at the Shipyard.
 
  (iii)   The Builder, as a first class shipbuilder with knowledge of the Buyer’s performance and quality requirements and standards as expressed in the Plans and the Specification, shall ensure that all Work shall be carried out in a good and workmanlike manner and in accordance with the highest shipbuilding and marine engineering practices and standards for new passenger cruise ships, and so that (unless specified to the contrary in the Specification) the complexity, quality of workmanship, quality of Parts, design of the cabins, public areas and other interior spaces of the Ship specified in the Specification shall not be lower than the corresponding complexity, quality and design standards of the reference ships referred to in the Specification.

- 1 -


 

2.   DESCRIPTION OF THE SHIP
 
2.1   The Ship shall be a passenger cruise ship suitable for continuous year-round worldwide cruising, with the following main dimensions and characteristics:
  (i)   Main Dimensions
Length, overall - [**] [Confidential Treatment] metres*
Length, between perpendiculars: - [**] [Confidential Treatment] metres*
Breadth, moulded hull - [**] [Confidential Treatment] metres (with a right for the Builder to reduce to 40.0 metres)
Depth to deck 4 - [**] [Confidential Treatment] metres
Design draft, moulded - [**] [Confidential Treatment] metres
(* signifies a tolerance of +/- half a metre)
  (ii)   Guaranteed Deadweight
 
      The guaranteed deadweight at delivery of the Ship, determined in accordance with the Specification, in seawater of 1.025 specific gravity at a design draft of 8.7 metres (the “Design Draft”), shall be not less than 10,850 metric tons (the “Guaranteed Deadweight”).
  (iii)   Passenger Accommodation
[**] [Confidential Treatment]
[**] [Confidential Treatment]
[**] [Confidential Treatment]
[**] [Confidential Treatment]
[**] [Confidential Treatment]
[**] [Confidential Treatment]
[**] [Confidential Treatment]
[**] [Confidential Treatment]
[**] [Confidential Treatment]
[**] [Confidential Treatment]
[**] [Confidential Treatment]
[**] [Confidential Treatment]
Total passenger cabins - 2100
  (iv)   Crew Accommodation
[**] [Confidential Treatment]
[**] [Confidential Treatment]
[**] [Confidential Treatment]
[**] [Confidential Treatment]
[**] [Confidential Treatment]
[**] [Confidential Treatment]
[**] [Confidential Treatment]
[**] [Confidential Treatment]

- 2 -


 

  (v)   Life saving equipment
 
      The Ship will be designed for the transport of [**] [Confidential Treatment] passengers and [**] [Confidential Treatment] crew, and there shall be eight (8) tenders on board and lifeboats according to the Regulatory Rules for a total of [**] [Confidential Treatment] persons.
 
  (vi)   Guaranteed Service Speed
 
      With the main engines operating at [**] [Confidential Treatment]% of maximum continuous rating at the Design Draft, with a [**] [Confidential Treatment]% sea margin in trial conditions and wind / sea not exceeding 2 on the Beaufort Scale, the Ship’s speed as measured during the sea trials in accordance with the Specification shall be at least [**] [Confidential Treatment] knots (the “Guaranteed Service Speed” or “GSS”).
 
  (vii)   Guaranteed Fuel Consumption
 
      The Ship shall be delivered with [**] [Confidential Treatment] main engines. The fuel consumption of each such engine during the trials conducted at the engine manufacturer’s test bed in accordance with the Specification shall not exceed [**] [Confidential Treatment] per shaft KW per hour in the conditions referred to in section M.1.3 of the Specification (the “Guaranteed Fuel Consumption” or “GFC”).
2.2   The details of the dimensions and characteristics referred to in Clause 2.1 above, as well as the definitions and method of measurements and calculations, are as indicated in the Specification and no changes shall be made to such dimensions and characteristics without the Buyer’s prior written approval.
 
2.3   The hull number of the Ship will be D33 and that number shall in accordance with Clause 1.2 in Article 4 be placed upon the Ship and the Parts during construction.
 
3.   SPECIFICATION AND PLANS
 
3.1   The Specification and the Plans describe in detail Work standards, certain specific features of the Work and the general scope of the Work but, although the contents of the Specification and the Plans are believed by the Builder and the Buyer to be accurate, all dimensions, measurements and other details shall be independently verified and checked by the Builder. If there is any error or inconsistency in the Specification or Plans that may adversely affect the technical performance of the Ship, the Builder shall correct the same, after first notifying the Buyer in writing and obtaining the Buyer’s written approval (which is not to be unreasonably withheld), without any increase in the Contract Price or any extension of the Delivery Date.
 
3.2   Save as otherwise expressly provided in this Contract, the Builder shall be solely and directly responsible for all aspects of the design, performance and quality of the Work, and the fact that any calculations, measurements, drawings, plans, test results or any other documents and data relating to the Work shall have been made, prepared or supplied by the Buyer or shown to the Buyer or approved by or on behalf of the Buyer and/or any Regulatory Authority and/or the Classification Society and/or any other

- 3 -


 

    specified person(s) or that modifications or alterations shall have been carried out in accordance with the Buyer’s requirements shall not in any manner or to any extent relieve the Builder from (or otherwise reduce) any of the Builder’s obligations and/or liabilities under this Contract.
3.3   All Parts:
  (i)   shall be new or (with the Supervisor’s prior written approval which shall not be unreasonably withheld) unused, of good quality, suitable for their intended purpose and in strict and full accordance and compliance with this Contract, the Plans and the Specification;
 
  (ii)   save only as otherwise expressly provided for in the Specification or the Plans, or as further agreed by the duly authorised representatives of the Builder and the Buyer, shall be manufactured by leading, reputable and suitably qualified and experienced makers and suppliers of equipment to the passenger cruise ship industry; and
 
  (iii)   in addition to and without derogation from the Builder’s obligations under paragraphs (i) and (ii) above, shall be in strict and full accordance and compliance with the Builder’s usual high standards and practices of construction for passenger cruise ships of a similar standard.
3.4   The Builder shall furnish spare parts and maintenance tools of the kind and in at least the quantities required by the Specification and the Classification Society. The cost of such spares and tools are included in the Contract Price. The Builder at its own cost and risk shall be responsible for the handling, storing and bringing on board the Ship of all spares and tools. Spares and tools furnished by the Builder shall be properly protected against physical decay, corrosion and mechanical damage and shall be properly listed so that replacements can be readily ordered by the Buyer.
4.   CLASSIFICATION
4.1   The Builder shall design and build the Ship under the supervision and special survey of Det Norske Veritas (the “Classification Society”), in accordance with the regulations, requirements, resolutions and rules of the Classification Society as well as all additions and amendments thereto that are (i) in force as of the Signing Date and (ii) officially published as of the Signing Date for ratification, enactment or implementation at any time thereafter (before or after the Delivery Date) (the “Class Rules”). For the avoidance of doubt, this provision does not (a) require the Builder to comply with proposed additions or amendments to the Class Rules that are still under discussion and that have not been officially published as at the Signing Date or (b) subject to the following proviso, require the Builder to comply with additions and amendments officially published as of the Signing Date if such compliance would prevent the Builder from delivering the Ship in accordance with the Class Rules in force on the Delivery Date provided that if the Builder becomes aware of any conflict between the Class Rules referred to at (i) and (ii) above the Builder shall promptly notify the Buyer and comply with the Buyer’s requests to obtain such dispensation or waiver as may reasonably be required by the Buyer so as to avoid or resolve the conflict. On delivery the Ship shall

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    achieve the class notation [**] [Confidential Treatment] of all conditions, notations, qualifications, recommendations, reservations and restrictions subject to the tolerances, and the qualifications on the Buyer’s right to reject the Ship and to terminate the Contract on account of the Builder’s failure to achieve such class notation, expressly provided for in Article 6, Clauses 2.10 to 2.15.
 
4.2   Decisions of the Classification Society as to whether or not Work complies with the requirements and standards of the Class Rules shall be final and binding on the parties. However, to the extent that any of the requirements and standards binding on the Builder under this Contract, the Plans or the Specification are higher than the Class Rules, the first sentence of this Clause 4.2 shall not in any manner or to any extent relieve the Builder from (or otherwise reduce) the Builder’s obligations to ensure that the Work complies with such higher requirements and standards.
 
4.3   The Builder shall also design and build the Ship under the supervision and in accordance with the regulations, requirements, resolutions and rules of the Regulatory Authorities, all other specified regulations, requirements, resolutions and rules, and all additions and amendments thereto that, are (i) in force as of the Signing Date and (ii) officially published as of the Signing Date for ratification, enactment or implementation at any time thereafter (before or after the Delivery Date) (the “Regulatory Rules”). For the avoidance of doubt this provision does not (a) require the Builder to comply with proposed additions or amendments to the Regulatory Rules that are still under discussion and that have not been officially published as at the Signing Date or (b) subject to the following proviso require the Builder to comply with additions and amendments officially published as of the Signing Date if such compliance would prevent the Builder from delivering the Ship in accordance with the Regulatory Rules in force on the Delivery Date provided that if the Builder becomes aware of any conflict between the Regulatory Rules referred to at (i) and (ii) above the Builder shall promptly notify the Buyer and comply with the Buyer’s requests to obtain such dispensation or waiver as may reasonably be required by the Buyer so as to avoid or revolve the conflict. On delivery the Ship shall comply with the Regulatory Rules free of all conditions, notations, qualifications, recommendations, reservations and restrictions provided that where the Specification expressly allows compliance with any Regulatory Rules or other requirements to be demonstrated by tests carried out after delivery of the Ship, the Builder shall be obliged to take all such steps as may be practicable before delivery of the Ship in order to obtain advance comments so that any issues raised by the relevant Regulatory Authorities can be addressed before delivery and so that compliance with the relevant Regulatory Rules can be demonstrated after delivery in the manner and in accordance with the timetable provided for in the Specification.
 
4.4   Decisions of a Regulatory Authority as to whether or not Work complies with its Regulatory Rules shall be final and binding on the parties. However, to the extent that any of the requirements and standards binding on the Builder under this Contract, the Plans or the Specification are higher than the relevant Regulatory Rules, the first sentence of this Clause 4.4 shall not in any manner or to any extent relieve the Builder from (or otherwise reduce) the Builder’s obligations to ensure that Work complies with such higher requirements and standards.

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4.5   All classification, certification, testing, survey and other fees and charges payable to the Classification Society and any Regulatory Authority in relation to the Work shall be for the account of the Builder.
4.6   The Builder shall provide (or procure that the Classification Society or the Regulatory Authorities provide) the Buyer with copies of all correspondence, minutes of meetings and other documents passing between the Builder, the Classification Society or any Regulatory Authorities in relation to the Work. In addition, the Buyer may attend all meetings between the Builder, the Classification Society or any Regulatory Authorities, and the Builder shall keep the Buyer well informed (in advance) of all of such meetings. The Builder shall promptly inform the Supervisor of any unscheduled meetings between the Builder and the Classification Society or any Regulatory Authorities and, if the Supervisor does not attend any of such meetings, the Builder shall give the Supervisor a reasonably detailed account of the matters discussed and decisions taken at the meeting.
4.7   The Builder and its Subcontractors shall comply with all laws, rules and regulations applicable to the Builder’s activities in respect of the Work, and accordingly the Builder shall obtain all licenses, permits, certificates and permissions required for the execution and completion of the Work, including those required by the Classification Society and the Regulatory Authorities.
4.8   The Builder shall be responsible for obtaining the approval of all drawings, calculations and other necessary matters by the Classification Society and the Regulatory Authorities, and shall arrange for all applicable certificates and approvals to be issued.
5.   SUBCONTRACTING AND MAKERS’ LIST
5.1   The main assembly, construction and erection of the Ship, including the installation of the Ship’s main Parts and all other major elements of the Work, shall be carried out by the Builder at the Shipyard.
5.2   On prior written notice to the Buyer, the Builder may subcontract the fabrication of steel blocks to European Subcontractors who are certified by the Classification Society as meeting DNV MPQA standards (or equivalent, if another Classification Society is appointed with the Buyer’s agreement) and who are otherwise objectively regarded as reputable and suitably qualified and experienced contractors to the passenger cruise ship industry.
5.3   Appendix 3 of the Specification contains an agreed list (the “Makers’ List”) of potential Subcontractors for the performance of important elements of the Work and for the supply of major Parts. The Makers’ List may be modified by agreement of the parties in order to take advantage of technical developments and improvements. Either party may make proposals to the other in this respect and each party agrees to give reasonable consideration to any such proposals but neither party will be obliged to accept any proposal that adversely affects its obligations, liabilities or interests under the Contract.
5.4   The Builder shall use the approved Subcontractors referred to in the Makers’ List for the execution of the Work, and the supply of the Parts, therein specified. The Builder shall not be entitled, without the express prior written approval of the Buyer (which may be

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    withheld on reasonable grounds by the Buyer), to change any Subcontractor referred to in the Makers’ List or to engage any new Subcontractor for the same element of the Work or the supply of the same Parts or any replacements for such Parts. Nor shall the Builder permit any of such approved Subcontractors to subcontract any of their Work or supply obligations in a manner that is inconsistent with the other provisions of this Clause 5.
5.5   Where more than one Subcontractor is named in the Makers’ List in relation to an element of the Work or a Part, the Builder must nominate its choice of Subcontractor by notice in writing to the Buyer as soon as possible and at the same time provide the Buyer with the relevant technical specifications for Work or the Part in question.
 
5.6   The Buyer will have up to ten (10) Working Days from its receipt of each written nomination and the related specifications within which to accept or to reject the Builder’s nomination and instead select a different Subcontractor from the Makers’ List.
 
5.7   Before purchasing any major Parts from, or subcontracting any major elements of the Work (apart from the Parts and Work elements referred to in Clause 5.2) to, Subcontractors who are not named in the Makers’ List, the Builder will notify the Buyer in writing of its proposal and provide the Buyer with the relevant technical specifications in order to allow the Buyer to submit its comments to the Builder. The Buyer will have ten (10) Working Days within which to object to such proposal on the grounds of the availability of spares and the quality of post-delivery services support in North America.
 
5.8   If the Buyer wishes the Builder to select a Subcontractor other than the one nominated by the Builder then the difference, if any, between that Subcontractor’s price and the price of the Subcontractor nominated by the Builder shall be added to or (as the case may be) subtracted from the Contract Price in accordance with the provisions of Article 3, Clause 1. Any other differences between the supply and warranty conditions offered by the Subcontractor selected by the Buyer and the conditions offered by the Subcontractor nominated by the Builder shall be accepted and borne by the Buyer.
 
5.9   The Builder and the Buyer will work together closely in good faith, and each will use all reasonable commercial efforts, to avoid, minimise and mitigate the effects of any cost differentials between competing Subcontractors.
 
5.10   The Builder’s appointment, contracting, employment or use of any workmen, Subcontractors, agents and other representatives (including, without limitation, any such persons appointed or employed or contracted by the Builder with the Buyer’s approval) shall not in any manner or to any extent relieve the Builder from (or otherwise reduce) any of the Builder’s obligations and/or liabilities under or in connection with this Contract nor diminish the Builder’s responsibility to the Buyer to manage, supervise and conduct such persons in a workmanlike manner and in accordance with the practices and standards referred to in Clause 1.1.
 
5.11   Save as otherwise agreed between the parties, all contacts with Subcontractors shall be made through the Builder. However, the Buyer may at any time contact and contract with Subcontractors in relation to post-delivery maintenance and support arrangements only.

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5.12   The Builder covenants with the Buyer that:
  (i)   it shall ensure that there is not and will not be created by the Builder any legal relationship between the Buyer and any Subcontractors appointed or otherwise used by the Builder (save for such relationships as may be created by reason of the warranty and guarantee assignments to be made by the Builder under Clause 2.9 of Article 7 or by mandatory operation of law);
 
  (ii)   it shall take reasonable care in the selection, employment, appointment and supervision of all Subcontractors who supply Parts, and shall procure their employment or appointment on terms consistent with the Buyer’s rights, and the Builder’s obligations and liabilities, under this Contract including, without limitation, such matters as (a) the nature of guarantees and warranties, and liberty for the Builder to assign all or any part(s) of such guarantees and warranties to the Buyer, (b) good service of the Subcontractors, (c) reliability of the Subcontractors, (d) availability and quality of pre-delivery training, and (e) availability of spares and quality of post-delivery service support as these matters are contemplated by the Specification;
 
  (iii)   it shall prevent its Subcontractors from exercising any rights to arrest, attach, detain or encumber the Ship, the Parts, or any of the Buyer’s Supplies;
 
  (iv)   it shall promptly provide the Buyer with such information and access as it may require from time to time in order to verify the performance of the supplies, services and Work provided or carried out by the Builder’s Subcontractors;
 
  (v)   it shall promptly take all necessary steps to ensure the proper performance of any such Subcontractors;
 
  (vi)   without prejudice to the operation of Article 10, Clause 2, it shall be fully, directly and solely responsible (as between the Builder, the Buyer and the other protected parties) for the acts, omissions and defaults of the Builder’s Subcontractors (including, without limitation, any persons appointed, employed or contracted by the Builder with the approval of the Buyer) and for the acts, omissions and defaults of the respective officers, employees, workmen, agents and other representatives of the Builder and its Subcontractors; and
 
  (vii)   upon the Buyer’s reasonable request from time to time, it shall promptly provide the Buyer with information relating to any subcontract.
5.13   All labour costs (including overtime costs) of the Builder and of the workmen, Subcontractors, and others used by the Builder shall be for the account of the Builder.
 
6.   BUYER’S SUPPLIES
 
6.1   The Buyer, at its own risk and expense, shall supply and deliver the Buyer’s Supplies to the Shipyard on a DDP (Incoterms 2000) basis, free of any encumbrances, and in proper condition for installation or incorporation in, or stowage on board, the Ship in accordance with the agreed delivery schedule in Part G of the Specification as the same is updated and amended by agreement of the parties during the construction period.

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6.2   The Builder shall, at its own risk and expense, receive, check as to visual compliance with transport documents, inspect the packaging, insure (in accordance with Clause 2 of Article 4), clearly mark as the property of the Buyer, safely store and keep well protected and completely segregated from Parts and other materials owned by the Builder or other parties, and properly put on board and thereafter install or incorporate in or stow on the Ship, all of the Buyer’s Supplies from time to time delivered to the Shipyard, and (whenever so requested by the Supervisor) the Builder shall also assist the Buyer to clear any Buyer’s Supplies through French customs. If any packaging is discovered damaged, the Builder will promptly inform the Buyer and the parties’ representatives will jointly unpack and inspect the content of the package. In addition, the Buyer’s personnel may unpack any other consignment of Buyer’s Supplies in order to check its conformity with the related orders and transport documents.
6.3   In order to facilitate the installation and incorporation of the Buyer’s Supplies by the Builder, the Buyer shall furnish the Builder with all plans, instruction books, test reports and certificates provided to the Buyer by its suppliers. Upon request by the Builder, the Buyer’s available personnel at the Shipyard will assist — or cause the Buyer’s relevant suppliers to assist — the Builder and its Subcontractors with the installation of the Buyer’s Supplies. If any Buyer’s Supplies (including relevant technical documentation and any Buyer’s Supplies to be replaced by the Buyer pursuant to this Clause 6) have not been delivered within five (5) Working Days after the Supervisor’s receipt of a notice from the Builder under Clause 6.4(ii), the Builder shall be entitled to proceed with the construction of the Ship without installing or incorporating such Buyer’s Supplies in or on the Ship and the lack of any such installation or incorporation shall not be treated as a defect in the Ship provided that if the relevant Buyer’s Supplies may be installed or incorporated in or on the Ship at a later date without any additional cost to the Builder or any delay in delivery of the Ship then the Builder will accommodate any request by the Supervisor to extend the date for delivery and installation or incorporation of the relevant Buyer’s Supplies.
6.4   The Builder:
  (i)   shall be liable to the Buyer for any damage to or loss of any Buyer’s Supplies caused by Builder’s default and occurring or arising after delivery of such Buyer’s Supplies under Clause 6.1; and
 
  (ii)   shall notify the Supervisor as soon as practicable of any loss of, damage to, or deficiency in the supply or performance of, any of the Buyer’s Supplies or any late delivery thereof in accordance with Clause 6.3.
6.5   Where the Builder is liable to the Buyer for any damage to or loss of any Buyer’s Supplies, the Builder will promptly replace the relevant Supplies with identical items at its risk and expense, in which case any insurance proceeds paid in respect of such loss and damage will be paid to and retained by the Builder. In all other cases where the Builder gives notice to the Buyer under Clause 6.4(ii), the Buyer will as soon as may reasonably be practicable replace the relevant Buyer’s Supplies at its risk and expense. For the avoidance of doubt, the other provisions of this Clause 6 shall apply to such replacements.

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6.6   The Buyer acknowledges and agrees that the Builder shall not be responsible for the design, performance or quality of Buyer’s Supplies.
6.7   The Contract Price includes an allowance of [**] [Confidential Treatment] which may be used by the Buyer for the payment of Buyer’s Supplies ordered by the Buyer. This allowance will be paid for the Buyer, through each payment of the Contract Price under Article 8 Clause 2.1, in the following five tranches:
  (i)   the Contract Price payment under Article 8, Clause 2.1 (i) will include the sum of [**] [Confidential Treatment] in respect of the first tranche of the allowance;
 
  (ii)   the Contract Price payment under Article 8, Clause 2.1 (ii) will include the sum of [**] [Confidential Treatment] in respect of the second tranche of the allowance;
 
  (iii)   the Contract Price payment under Article 8, Clause 2.1 (iii) will include the sum of [**] [Confidential Treatment] in respect of the third tranche of the allowance;
 
  (iv)   the Contract Price payment under Article 8, Clause 2.1 (iv) will include the sum of [**] [Confidential Treatment] in respect of the fourth tranche of the allowance; and
 
  (v)   subject to Clause 6.9, the Contract Price payment under Article 8, Clause 2.1 (i) will include the sum of [**] [Confidential Treatment] in respect of the fifth tranche of the allowance.
6.8   As soon as each pre-delivery payment of the Contract Price has been made by the Buyer under Article 8 Clause 2.1, the Builder shall pay the relevant tranche of the allowance to the Buyer.
6.9   Upon delivery and acceptance of the Ship in accordance with this Contract, the Builder shall pay the fifth tranche of the allowance to the Buyer in or towards payment for Buyer’s Supplies ordered for the Ship provided that if the aggregate total cost of Buyer’s Supplies ordered for the Ship shall be less than the amount of the allowance, the amount of the fifth tranche of the allowance payable by the Buyer — and hence the amount of the Contract Price payable under Article 8 Clause 2.1(v) — shall be reduced accordingly.
6.10   Within fifteen (15) days after the Ship has been delivered by the Builder and accepted by the Buyer in accordance with the express provisions of this Contract, the Buyer will remove from the Shipyard any of the Buyer’s Supplies which have not been used in the construction of, or otherwise delivered with, the Ship.
7.   BUILDER’S TALLY OF BUYER’S SUPPLIES
7.1   The Builder shall make and keep fully itemised and up-to-date records of all Buyer’s Supplies from time to time delivered to the Shipyard and/or other premises of the Builder (and/or its Subcontractors) and, without prejudice to the generality of the foregoing, the

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    Builder shall ensure that such records are made and kept in the form used by the Builder for its own stocks and show:
  (i)   the date of delivery to the Builder (or its Subcontractors) of each batch or consignment of Buyer’s Supplies;
 
  (ii)   where and how such Buyer’s Supplies are stored;
 
  (iii)   when such Buyer’s Supplies are incorporated or installed in, or stowed on, the Ship; and
 
  (iv)   the balance (in usual units) of any unused Buyer’s Supplies.
7.2   The Builder shall provide the Supervisor, on a monthly basis, with a complete set of the records described in Clause 7.1 and all amendments of, or supplements to, such records.
(End of Article 1)

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ARTICLE 2: SUPERVISION
1.   SUPERVISOR
 
1.1   The Buyer may retain a supervisor (the “Supervisor”) and a supervision team of a reasonable size at the Shipyard to maintain close contact with the Builder and, on behalf of the Buyer, to supervise the Work. The Buyer shall be responsible for obtaining and maintaining any necessary French permissions and authorisations for the Supervisor and his team to carry out their duties, and the Builder will assist the Buyer in this regard.
 
1.2   The Supervisor and his team shall carry out their inspections and supervision in an efficient manner and in such a way as to avoid any increase in the building costs or delays to the Work.
 
1.3   All salaries and, subject to Clause 1.4, costs and expenses of the Supervisor and his team shall be for the Buyer’s account.
 
1.4   The Builder shall provide, free of charge to the Buyer, the Supervisor and his team suitably equipped and maintained changing rooms and offices in close proximity to the Shipyard and all such other facilities within such offices as may be necessary to enable the Supervisor and the Supervisor’s team effectively to carry out their Work including, without limitation, direct call national and international telephone lines (in respect of which the Builder will pay for line rentals and local calls and the Buyer will pay the actual cost of all other calls plus a 5% administration fee), fax lines and machines, broadband computer connections, and laser printers. The Builder will also: allow the Supervisor and his team to use the refectory at the Shipyard; and assist the Supervisor to find lodgings for his team by introducing him to local rental agents.
 
1.5   A written statement confirming the Supervisor’s appointment and the scope of his actual authority shall be given by the Buyer to the Builder within thirty (30) days after the Effective Date. Written notice of revocation of appointment of the Supervisor and/or any change in the scope of his actual authority shall be given by the Buyer to the Builder as soon as reasonably practicable after any such revocation and/or change has been decided upon by the Buyer.
 
1.6   The Supervisor and his team shall be given notice of and shall observe the safety and security precautions and other rules and regulations in force from time to time at the Shipyard and at the premises of the Builder’s Subcontractors.
 
1.7   The Builder may request the Buyer to replace a representative who is deemed unsuitable and unsatisfactory for the proper progress of the Ship’s construction. The Buyer shall investigate any such request (if necessary, by sending its representative(s) to the Shipyard). If the Buyer considers the Builder’s request to be justified, it will effect the replacement as soon as may be conveniently arranged.
 
1.8   The Buyer may request the Builder to replace any representative in the Builder’s equivalent of the Supervisor’s team who is deemed unsuitable and unsatisfactory for the proper progress of the Ship’s construction. The Builder shall investigate any such request and, if the Builder considers the request to be justified, it will effect the replacement as soon as may be conveniently arranged.

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1.9   Each of the Builder and the Buyer agrees to work closely with the other and to act reasonably and in good faith with a view to agreeing, by no later than the first anniversary of the Effective Date, the terms necessary to regulate the timetable, conditions and procedures for the advance occupation of certain parts of the Ship by the Buyer for crew familiarisation, training and lodging purposes.
 
1.10   The Builder shall allow key representatives of the Buyer for the Ship to attend the Shipyard upon reasonable prior written notice to the Builder, and to be present during tests and for familiarisation, training and lodging purposes
 
2.   PLANNED PROGRAMME AND PLAN APPROVAL
 
2.1   Each of the Builder and the Buyer acknowledges and agrees that successful completion of the construction of the Ship in accordance with this Contract, the Plans and the Specification will require a high degree of co-operation and flexibility on the part of both parties.
 
2.2   Notwithstanding the generality of Clause 2.1, the Work shall be carried out in strict accordance with the express provisions of this Contract, the Specification and the Plans, and on the Effective Date the Builder will provide the Supervisor with: a planned programme containing a critical path treatment of the major and significant elements of the Work, in their proper sequence, which must be completed to ensure delivery of the Ship (the “Planned Programme”); and the schedule of inspections and tests referred to in Part G.11 of the Specification (the “Tests Schedule”).
 
2.3   Without prejudice to the Builder’s express obligations under the other provisions of this Contract, if the Builder considers it necessary to make any material alterations in the Planned Programme the Builder shall promptly provide the Supervisor with written details of and reasons for the proposed alterations. Without prejudice to the Builder’s express rights under the other provisions of this Contract, no alterations to the Planned Programme shall delay completion of the Work or delivery of the Ship in accordance with this Contract, nor shall any such alterations accelerate the performance or change the tenor of any of the Buyer’s obligations under this Contract.
 
2.4   The Builder shall submit to the Buyer each month, commencing on the date falling three (3) months after the Effective Date, until delivery, the following documentation (the reasonable accuracy of which the Builder hereby warrants):
  (i)   a status report (in form acceptable to the Buyer) of the Work as compared with the Planned Programme, including the critical path;
 
  (ii)   a report (in form acceptable to the Buyer) setting out the actual progress of the Work during the previous month as compared with the Planned Programme;
 
  (iii)   a list of modifications (if any) agreed or determined during the previous month;
 
  (iv)   a report in proper form on the delivery of Parts and Buyer’s Supplies during the previous month.

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2.5   Without prejudice to the Builder’s other obligations under this Contract, if the construction of the Ship should, for any reason whatsoever, be materially delayed beyond the time-frame indicated in the Planned Programme, the Builder shall promptly notify the Buyer and thereafter keep the Buyer regularly informed about the steps being planned and taken by the Builder in order to try to overcome the delay.
 
2.6   All plans, drawings and other documents required by the Specification to be developed and supplied by the Builder to the Buyer for approval shall be delivered by the Builder in their proposed final form in three (3) hard copies (and, if so requested, electronically) to the Supervisor for approval by and on behalf of the Buyer. The Builder agrees to submit all such plans, drawings and documents in such timely manner that the Buyer may have a reasonable opportunity to review and approve or comment on the same within the periods provided for in Clauses 2.7 and 2.9.
 
2.7   Within six (6) Working Days after the Supervisor’s receipt of each set of plans, drawings and other documents submitted to the Supervisor for approval pursuant to the Specification one (1) copy of each such plan, drawing and other document shall be returned by the Buyer to the Builder either as approved or as rejected by the Buyer provided that all rejections shall specify with reasons all aspects of the rejected plans, drawings or documents which in the opinion of the Buyer do not, or which provide for Work which does not, comply with the requirements of this Contract, the Plans or the Specification.
 
2.8   If a plan, drawing or other document is approved by the Buyer, the Builder shall proceed with the Work shown therein.
 
2.9   If any aspect of a plan, drawing or other document is rejected by the Buyer under Clause 2.7, and the Builder accepts such rejection, the Builder shall promptly alter the relevant plan, drawing or document without charge to the Buyer and resubmit it as altered for approval by the Buyer in accordance with the procedure and timetable referred to in Clause 2.7. For the avoidance of doubt, if any plans, drawings or other documents rejected by the Supervisor contain any error, omission, ambiguity, inconsistency, inadequacy or other deficiency they and the related Work shall be remedied by the Builder (if the Builder accepts such rejection) without any increase in the Contract Price or any extension of the Delivery Date.
 
2.10   All Work performed by the Builder prior to approval by the Buyer of all plans, drawings or documents relating to such Work shall be at the sole risk and expense of the Builder without prejudice to the Builder’s right to dispute any rejection by the Buyer under Article 13.
 
2.11   If the Buyer (or the Supervisor on the Buyer’s behalf) fails to return to the Builder or (in the case of any rejections) fails to give reasons, in accordance with the time limits referred to in Clause 2.7 and Clause 2.9, any plan or drawing or other document and this failure is not remedied within two (2) Working Days after the Supervisor’s receipt of a written notice from the Builder specifying such failure, such plan or drawing or other document shall be deemed to have been automatically and expressly approved by the Buyer without any comments.

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2.12   Although the Buyer’s approval (or deemed approval) of plans, drawings and other documents shall preclude the Buyer from subsequently requiring any changes therein (except pursuant to Article 3), such approval or deemed approval shall not in any manner or to any extent relieve the Builder from (or otherwise reduce) any of the Builder’s obligations and/or liabilities under or in connection with the Contract.
 
2.13   If the Builder discovers any aspect of the Plans, the Specification or the Work that does not conform with the Class Rules or the Regulatory Rules or the shipbuilding and marine engineering practices referred to in Article 1, Clause 1.1 the Builder shall promptly notify the Supervisor and submit a proposal to the Supervisor for the Buyer’s approval (such approval not to be unreasonably withheld or delayed) for the removal of the non-conformity without any cost to the Buyer, without any increase in the Contract Price and without any extension of the Delivery Date.
 
3.   WORK APPROVAL
 
3.1   Throughout the period during which the Ship is being built the Builder will conduct its usual quality control programme of inspections, testing and supervision by a team of the Builder’s staff specially designated for this purpose but the Work and all Parts, as the same may at any time and at any place be completed or be in progress, shall also be subject to inspection by and the approval of the Buyer (acting through the Supervisor and his team) and the Classification Society.
 
3.2   Subject only to the proviso at the end of this Clause 3.2, the Builder shall at all times during normal working hours and subject to the usual regulations of the Shipyard give the Supervisor and the Supervisor’s team free and ready access to (and a free right to inspect) the Ship and Parts at any place where Work is being done or tests are being carried out or Parts are being processed or stored in connection with the building of the Ship including the Shipyard and other yards, workshops and stores of the Builder, and the premises of the Builder’s Subcontractors who are doing Work in connection with the building of the Ship or assembling, manufacturing, processing or storing of Parts, and the Builder shall ensure that provisions equivalent to the provisions of this Clause 3.2 are inserted into all subcontracts from time to time made by it in connection with the Work provided that the Supervisor or any member of his team must be accompanied by a representative of the Builder during all visits to the design offices of the Builder and any Subcontractors.
 
3.3   The Buyer shall be entitled but not obliged to reject any Work or Parts that do not comply with the requirements of this Contract, the Plans and the Specification unless and to the extent that such non-compliance is the direct result of the Builder seeking to avoid (in a manner approved by the Buyer, such approval not to be unreasonably withheld) any non-conformities referred to in Clause 2.13 provided that all rejections shall be made in writing, and shall specify with reasons those aspects of the Work or Parts inspected which in the opinion of the Buyer do not comply with the requirements of this Contract, the Plans or the Specification.
 
3.4   If any Work or Parts shall be rejected by the Buyer as not complying with the Contract, the Plans or the Specification, the Builder shall promptly remedy or replace such Work or Parts without any increase in the Contract Price or any extension of the Delivery Date

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    unless the Builder does not accept the validity of the Buyer’s rejection in which case the provisions of Clause 4 below shall apply.
3.5   The Builder shall not cover up any Part or element of the Work that the Supervisor or his team are entitled to inspect so as to render impossible any proper inspection thereof by the Supervisor without giving the Supervisor sufficient advance written notice and a reasonable opportunity to inspect the relevant Part or Work. If any such covering up occurs the Buyer may require the Builder to uncover the relevant Part or Work so that the Supervisor may make its inspection. For the avoidance of doubt, if the Supervisor receives sufficient advance written notice and reasonable opportunity to inspect the relevant Part or Work but fails to do so, the Buyer will be deemed to have waived its right to require the Builder to uncover such Part or Work.
 
3.6   If the conduct of subsequent Work invalidates the results of earlier inspections, tests or trials on previously completed Work, the Supervisor may require the Builder to carry out further inspections, tests and trials on such Work.
 
3.7   The inspection, supervision and testing from time to time carried out by the Supervisor and his team shall not in any manner or to any extent relieve the Builder from (or otherwise reduce) any of the Builder’s obligations and/or liabilities under or in connection with the Contract.
 
4.   TECHNICAL DISPUTES
 
4.1   If, at any time before delivery of the Ship, there is a difference of opinion between the Builder and the Buyer in relation to any technical matter regarding the Specification and/or the Plans (including any dispute concerning compliance with any of the quality requirements and other technical standards provided for in this Contract), then either party may give a notice to the other party and if the parties do not resolve the difference of opinion within five (5) Working Days after the date of service of such a notice, the Builder or the Buyer may require that the difference of opinion be treated as a Dispute of a technical nature to be resolved in accordance with Clause 1 of Article 13.
(End of Article 2)

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ARTICLE 3: MODIFICATIONS
1.   MODIFICATIONS
 
1.1   This Contract, the Plans and the Specification may be modified from time to time by agreement of the parties provided that all reasonable and timely modifications requested by the Buyer, and/or any modifications required to be made under Clause 2 which are occasioned by any changes in the Class Rules or in any of the Regulatory Rules after the Signing Date, shall be implemented by the Builder if the Buyer agrees to necessary modifications to the Contract Price, the Delivery Date and any other relevant provisions of this Contract, the Builder agreeing to act in good faith and use all reasonable efforts to accommodate any such reasonable requests by the Buyer so that all such modifications shall be made:
  (i)   at the lowest cost reasonably possible agreed or determined in accordance with Clause 1.2;
 
  (ii)   within the shortest period of time reasonably possible; and
 
  (iii)   without any loss in the relative priority of the Work for the Ship compared to other construction Work in the Shipyard,
provided that nothing in this Clause 1.1 shall require the Builder to jeopardise its contracted building schedule(s) for other ships.
1.2   Any adjustment of the Contract Price to be made pursuant to this Clause shall be in a fixed amount, not subject to any escalation and shall reasonably reflect the Builder’s increased costs (or savings in costs) directly, necessarily and reasonably occasioned by the proposed modification. If the parties cannot agree on the amount of such increased costs (or savings in costs), the same shall be deemed to be the sum of:
  (i)   the net positive or negative change in the Builder’s newbuilding labour costs (excluding profit) as a direct and necessary result of the modification, (including the direct cost of any necessary design and engineering services not otherwise charged to the Buyer) as of the date when the requirement to effect the modification is proposed;
 
  (ii)   the net positive or negative change in the Builder’s cost of materials (excluding profit) as a direct and necessary result of the modification; and
 
  (iii)   the Builder’s agreed profit, which shall be a positive number equal to [**] [Confidential Treatment] per cent. [**] [Confidential Treatment] of the sum of the amounts determined in accordance with paragraphs (i) and (ii), in the case of increased costs only.
The Builder has provided the Buyer with a table of the Builder’s unit rates for newbuild labour costs and main materials, and these rates shall be used when calculating all adjustments to the Contract Price under this Clause 1.2.
1.3   Any agreement on a modification (“AOM”) of this Contract, the Plans or the Specification shall be agreed by the parties before execution of such alterations and changes, and shall include:

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  (i)   any increase or decrease in the Contract Price agreed or determined in accordance with Clause 1.2;
 
  (ii)   any change in the Delivery Date, and
 
  (iii)   any other adjustment to or amendment of any relevant provisions of this Contract, the Plans or the Specification,
    that is necessarily and reasonably occasioned by such modification.
 
    Whenever so requested by the Buyer, the Builder will verify its calculations by providing to the Buyer, on an open book basis, a reasonably detailed explanation of the Builder’s calculations and details of the man-hours and other data used in connection with any of the alterations or changes occasioned by any modification to be made under this Article 3. For all purposes of this Contract, “open book” basis means the provision by or on behalf of the Builder of all such invoices and other supporting information, and of all such calculations, determinations and other data as may be required in order to afford complete transparency to the Buyer but it does not entitle the Buyer to make an audit of the Builder’s accounts.
 
1.4   Any agreement on a modification of this Contract, the Plans or the Specification shall be recorded and evidenced by an AOM in the form set out in Schedule 1 of this Contract and signed by the parties’ duly authorised representatives, and following the signature of each AOM the Builder shall modify the building of the Ship in accordance therewith.
 
1.5   If the parties fail to reach agreement on all matters relating to a modification requested by the Buyer within six (6) Working Days from the date on which the Builder has submitted its cost modification proposal to the Buyer or if there is any Dispute between the parties as to the cost of the requested modification then, if the Buyer so requires, the Builder will make the requested modification before the Dispute has been resolved provided the Buyer:
  (i)   makes an AOM pursuant to Clause 1.4 in respect of the agreed non-cost related alterations and changes to this Contract, the Plans and the Specification occasioned by the modification; and
 
  (ii)   undertakes to pay the amount found due to the Builder under Article 13 Clause 1.1.
2. CLASSIFICATION AND REGULATORY CHANGES
2.1   If, after the Signing Date, any Class Rules and/or any Regulatory Rules are changed by the Classification Society or any Regulatory Authority, each party shall promptly notify the other in writing of the relevant change(s) and as soon as reasonably practicable thereafter the Builder shall propose the necessary modifications to be made to this Contract, the Plans and the Specification.
 
2.2   If, following its receipt of a notice under Clause 2.1, the Buyer reasonably considers that the operation of the Ship would permit of a dispensation or waiver, the Builder will at the

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    request of the Buyer apply for a dispensation from, or waiver of compliance with, the relevant change(s).
2.3   If the Buyer does not require the Builder to apply for a dispensation or waiver or it has not been possible to obtain a dispensation or waiver within a period of fifteen (15) days after the Buyer’s receipt of a notice under Clause 2.1 (or such longer period of time as the parties may reasonably agree in the light of all the circumstances then prevailing), the parties shall make an agreement to modify this Contract in accordance with and subject to the conditions of Clause 1 and thereafter the Builder shall make the relevant change(s) in the design or building of the Ship.
 
3.   SUBSTITUTION OF PARTS
 
3.1   The Builder is aware of the commonality of supply and other service related principles by reference to which the Buyer has approved the selection of all main Parts and the related Subcontractors. If (notwithstanding all reasonable efforts on the part of the Builder and provided that orders for the same were placed in good time by the Builder) any Parts are not available at the time required for their installation or incorporation in the Ship, the Builder may (and, if such situation is not directly caused by one or more of the contingencies specified in Clause 1.3 of Article 5, with the prior written approval of the Buyer which is not to be unreasonably withheld) use suitable substitute Parts that are at least the equivalent in standard and quality as the Parts that were not available and that are capable of meeting all of the requirements of:
  (i)   this Contract, the Plans and the Specification; and
 
  (ii)   the Classification Society and the Regulatory Authorities.
3.2   Where a proposed substitution of Parts is approved by the Buyer and (as necessary, by the Classification Society and any relevant Regulatory Authority), the Builder shall bear all additional costs and expenses whatsoever in relation to such substitution.
(End of Article 3)

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ARTICLE 4: TITLE AND INSURANCES
1.   TITLE, RISK AND ENCUMBRANCES
 
1.1   Title to the Ship and all Parts (but not Buyer’s Supplies, title to which will at all times be and remain with the Buyer) shall pass to the Buyer upon the Ship’s delivery to, and acceptance by, the Buyer in accordance with Clause 1 in Article 7 and until such delivery and acceptance shall have occurred all risks connected with the Work — including, without limitation, all risks in relation to the Ship, all Parts and all Buyer’s Supplies from the time when they are taken into the custody of the Builder or any of its Subcontractors — shall lie exclusively with the Builder.
 
1.2   Immediately upon:
  (i)   the receipt by the Builder (or any of its Subcontractors) of any Buyer’s Supplies; and
 
  (ii)   the delivery to, or the assembly fabrication or manufacture by, the Builder (or any of its Subcontractors) of all steel blocks and other main Parts,
    the Builder shall mark (or cause its relevant Subcontractors to mark) the same and the Ship (as it is from time to time built) with hull number D33.
 
1.3   The Builder shall have no authority to create (and waives all rights to create) any encumbrances whatsoever over any of the Buyer’s Supplies, nor shall it permit any encumbrances of any kind (other than permitted encumbrances) to be imposed on or asserted against any of the Buyer’s Supplies.
 
1.4   At any time when a payment is due to the Builder under this Contract, and at all other reasonable times, the Buyer may require the Builder to provide a written statement satisfactory to the Buyer showing what, if any, encumbrances of any kind (other than permitted encumbrances) have been imposed on or asserted against any of the Buyer’s Supplies.
 
1.5   If any encumbrance of any kind (other than any permitted encumbrance) is imposed on or asserted against any of the Buyer’s Supplies as a result of the acts or omissions of the Builder or those for whom the Builder is responsible under this Contract, the Builder shall promptly notify the Buyer and shall, not later than ten (10) days thereafter, secure the discharge or release of such encumbrance provided that if the Builder desires to contest any such encumbrance and such discharge or release is not available under law during such contest (including, without limitation, through the filing of a bond or other security), the Builder shall immediately take such steps to prevent such encumbrance from delaying or otherwise adversely affecting the Work and shall indemnify fully, hold harmless and defend the Buyer and all other protected parties from and against all losses which any of them may sustain or incur as a result of the imposition of any such encumbrance.
 
1.6   Notwithstanding the provisions of Clause 1.5, the Buyer may secure the removal of any such encumbrance in which event the Builder shall reimburse the Buyer in full for its costs (including legal fees) of securing such removal.

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1.7   Prior to the installation of any of the Buyer’s Supplies that have been purchased, paid for or provided by the Buyer, the Buyer shall confirm in writing to the Builder whether any permitted encumbrances have been imposed on or asserted against such Buyer’s Supplies and shall discharge any such permitted encumbrances prior to the installation of such Buyer’s Supplies, and if the Buyer fails to discharge any such permitted encumbrances, the Builder may withhold the installation of the relevant Buyer’s Supplies in which case any resulting delays will be the Buyer’s responsibility.
1.8   The Builder may grant one or more mortgages over the Ship and Parts (a “Mortgage”), but not over the Buyer’s Supplies, to one or more mortgagees as security for the Builder’s construction financing of the Ship and for the financing of the Refund Guarantees provided that:
  (i)   the aggregate total amount to be secured by any such Mortgages shall not exceed the Contract Price (as the same may be increased in accordance with the express provisions of this Contract); and
 
  (ii)   the Builder’s obligations under the construction financing arrangements referred to above, and the related Mortgages and other encumbrances, shall be without recourse to the Buyer and other protected parties.
1.9   All encumbrances (including, without limitation, all Mortgages) over the Ship and Parts, and all associated entries in any registers, shall be cancelled and discharged at the latest simultaneously with the Ship’s delivery to the Buyer.
2. INSURANCES
2.1   From the date when steelwork for the first hull section of the Ship is completed and until delivery to the Buyer the Ship, all Parts, and all Buyers’ Supplies (for their insured value as declared by the Buyer) taken into the custody of the Builder (or any of its Subcontractors) and whether or not built into or installed on or in the Ship, shall be at the exclusive risk of the Builder which shall at its own expense keep the same insured with first class European and / or Lloyd’s of London insurers acceptable to the Buyer against all usual builder’s risks, including protection and indemnity risks, tests risks, and war risks under policy terms that shall be no less favourable than those of the London Institute Builder’s Risks clauses (with appropriate amendment if any sea trial tests are to be conducted more than 250 nautical miles from the Shipyard). All premiums shall be for the sole account of the Builder. Deductibles shall be applied to the Builder or the Buyer in respect of their respective interests in the insurances to be arranged by the Builder under this Article (the “Insurances”). Neither the brokers nor the insurers shall have any rights of recourse against the Ship after her delivery to the Buyer, or against the Buyer or any other of the protected parties at any time whatsoever, or any rights to make any deduction, set-off or other withholding whatsoever from or against any sum payable to the Buyer or its assignees in connection with the Insurances. If, by the time when steel work for the first hull section of the Ship has been completed, the Builder’s insurance arrangement have been consolidated with the insurance arrangements of the AKER YARDS Group, then the Builder may propose an alternative policy based on the AKER YARDS Group standard terms for approval by the Buyer; such approval not to be unreasonably withheld or delayed.

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2.2   The amount of the Insurances shall be not less than (i) the actual value of the Ship as built from time to time, and (ii) the insured value, as declared by the Buyer, of all Buyers’ Supplies from time to time taken into the custody of the Builder or any of its Subcontractors, and whether or not such Supplies are built into or installed on or in the Ship.
 
2.3   All Insurances shall name the Builder as the assured party and the Buyer as the co-insured party for their respective interests. The Insurances shall contain loss payable provisions reasonably acceptable to the Buyer.
 
2.4   All Insurances shall provide that there shall be no recourse against the Ship after her delivery to the Buyer, or against the Buyer or the Buyer’s assignees for the payment of any premiums or commissions and that no cancellation of the Insurances, for any reason whatsoever, shall become effective unless and until fourteen (14) days prior written notice has been given by the relevant brokers or insurers to the Buyer.
 
2.5   Within five (5) days after steelwork for the first hull section of the Ship has been completed the Builder shall supply the Buyer with an original cover note and all related documents specifying the terms of the Insurances and security.
 
2.6   If at any time there is:
  (i)   any lapse in the insurance coverage which the Builder is required to arrange under this Clause 2 and such lapse is not corrected within seven (7) days, the Buyer may effect replacement coverage at the Builder’s expense; or
 
  (ii)   any failure by the Builder to pay any premiums due in respect of the Insurances and such failure is not corrected within seven (7) days, the Buyer may pay the same and recover the relevant payment(s) from the Builder.
3.   LOSS OR DAMAGE
 
3.1   In the event of any partial loss of the Ship before delivery:
  (i)   the loss shall be made good by the Builder as soon as reasonably possible, the Delivery Date shall be extended in accordance with Clause 1 in Article 5 (provided that the cause of the partial loss is excused under that Clause) and the partial loss proceeds referable to the Ship and/or Parts (other than Buyer’s Supplies) subject to the partial loss shall be applied by the Builder in making good the partial loss in accordance with this Contract, the Plans and the Specification; and
 
  (ii)   the partial loss proceeds referable to any Buyer’s Supplies subject to the partial loss shall be paid to the Buyer.
3.2   In the event of the total loss of the Ship before delivery, either the Builder or the Buyer shall be entitled to terminate this Contract by written notice to the other, such notice to be delivered within thirty (30) days after the date (the “Determination Date”) on which it is determined that the Ship has become a total loss pursuant to Clause 3.5 below.

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3.3   If, following the total loss of the Ship, neither party terminates this Contract pursuant to Clause 3.2, the Builder shall receive all total loss proceeds — apart from those referable to any Buyer’s Supplies subject to the total loss, which shall be paid to the Buyer — and thereafter the Builder shall proceed with the building of the Ship in accordance with this Contract and the Delivery Date shall be extended by agreement of the parties.
3.4   If there is a total loss of the Ship before delivery, then:-
  (i)   if either party elects to terminate this Contract pursuant to Clause 3.2, the Builder shall within ninety (90) days from (and including) the Determination Date pay to the Buyer an amount equal to the sum of:
  (a)   all payments on account of the Contract Price previously made by the Buyer to the Builder under this Contract together with interest thereon at the Relevant Rate calculated from the date on which the Builder received each such payment to the date on which the reimbursement is received by the Buyer, and
 
  (b)   the Buyer’s Supply Costs in respect of any Buyer’s Supplies which are subject to the total loss or which cannot be removed in sound condition from the Ship, the Shipyard or other place(s) where they are stored and returned to the Buyer, free from all encumbrances whatsoever, and in addition the Builder will return to the Buyer all Buyer’s Supplies which have not been lost or damaged and which can be removed in sound condition from the Ship, the Shipyard and other place(s) where they are stored, whereupon this Contract shall be deemed to have been rescinded — subject and without prejudice to the rights, duties, liabilities and obligations of either party under any other of the express provisions of this Contract (including, without limitation, Articles 9 to 14) — and the Builder alone shall be entitled to receive and retain any and all amounts recoverable under the Insurances; or
  (ii)   if neither party terminates this Contract pursuant to Clause 3.2, then Clause 3.1 of this Article 4 shall apply.
3.5   A total loss shall be deemed to have occurred:
  (i)   if it consists of an actual loss, on the actual date of loss; or
 
  (ii)   if it consists of a constructive or compromised or arranged or agreed total loss, on the date on which notice of abandonment of the Ship is given to her insurers.
(End of Article 4)

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ARTICLE 5: PERMISSIBLE DELAYS
1.   EXTENSION OF TIME FOR WORK
 
1.1   If the Builder gives notice as provided in Clauses 2.1, 2.2 and 2.3 the Builder shall be entitled to an extension of the Delivery Date but only if the Builder can demonstrate clearly that:
  (i)   there is a specific contingency which is delaying or will delay Work in the updated critical path of delivery of the Ship for more than one Working Day;
 
  (ii)   such delay is being caused or will be caused by one or more of the contingencies specified in Clause 1.3;
 
  (iii)   it has used and is continuing to use all reasonable efforts to avoid, prevent, minimise and overcome the actual delay in delivery of the Ship provided that such reasonable efforts do not jeopardise the Builder’s contracted obligations for the construction of other ships; and
 
  (iv)   the contingency in question occurred before the Delivery Date.
    provided that (a) the length of any such extension shall be the number of days by which the Builder can demonstrate clearly that completion of the Work and delivery of the Ship actually will be delayed by such contingency(ies) and (b) delays attributable to two (2) or more concurrent contingencies shall not be aggregated or counted more than once.
 
1.2   The Builder shall at all times have the burden of demonstrating clearly each of the matters required to be established by this Clause 1 and in the event that it is not possible for it to demonstrate clearly whether, or to what extent, any delay in delivery is caused by any contingency which is excused by the express provisions of this Clause 1, the Builder shall not be entitled to any extension of the Delivery Date.
 
1.3   The Builder shall be entitled to an extension of the Delivery Date, as provided in Clause 1.1, for delay caused by one or more of the following contingencies:
  (i)   by legislation or other action by or on behalf of any government (or any agency or other authority of such government) prohibiting or otherwise preventing the Builder from proceeding with the Work;
 
  (ii)   by war or warlike events (including such acts of terror, sabotage or other hostile acts or preparations therefore as are beyond the Builder’s control) involving any country which is relevant to the building of the Ship;
 
  (iii)   by extraordinary weather conditions not included in normal planning;
 
  (iv)   by such strikes, lockouts and other labour disturbances of or directly affecting the Builder or those of its Subcontractors who supply important Parts (such as engines, major castings, or other major turn-key Parts) as are beyond the Builder’s control provided that the Builder shall not be entitled to any extension of the Delivery Date for delays resulting from strikes, lock outs or other labour

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      disturbances of its personnel occurring after the date falling 90 (ninety) days before the Delivery Date;
 
  (v)   by such accidents, explosions, fires, disruptions of power supplies and other similar occurrences as are beyond the Builder’s control;
 
  (vi)   by the non-compliant or late delivery to the Builder of any Parts, or the non-compliant or late performance of the Builder’s Subcontractors provided that the late delivery or performance resulted from causes which would entitle the Builder (if applying to it) to an extension of the Delivery Date under this Clause 1 and provided that the Builder proves that it has exercised due diligence (a) in contracting for such Parts and with such Subcontractors, (b) in the performance of any acts required of it with respect to such Parts or Subcontractors, (c) in monitoring the acts and circumstances of such Subcontractors, and (d) in expediting deliveries or performance under the Builder’s purchase or subcontracts or procuring equivalent substitute performance in the event of the late delivery of such Parts or the under-performance in such purchase or subcontracts; or
 
  (vii)   to the extent not covered by any of paragraphs (i) to (vi) of this Clause 1.3, by such Acts of God as could not reasonably be foreseen or provided against by the Builder.
1.4   Notwithstanding anything to the contrary in this Clause 1, the Builder shall not be entitled to any extension of the Delivery Date for:
  (i)   any delay resulting from a contingency or other cause of delay which has itself been caused by the acts, omissions, neglect or other default of the Builder;
 
  (ii)   any delay resulting from a contingency or other cause of delay in existence as of the Effective Date; or
 
  (iii)   any delay resulting from a contingency or other cause of delay, which was or reasonably should have been foreseen or anticipated by the Builder by reason of facts which were, or after reasonable enquiry should have become, known to the Builder as of the Effective Date; or
 
  (iv)   any delay resulting from contingencies or other causes of delay which reasonably could have been avoided by the Builder;
 
  (v)   any delay resulting from the non-compliant or late performance or other default of a Subcontractor, if such delay results from a contingency or other cause of delay (a) which is in effect, published and announced as of the date of the award of the relevant purchase contract or subcontract, or (b) which would not entitle the Builder (if applying to it) to an extension of the Delivery Date under this Clause 1; or
 
  (vi)   any delay due to increased labour or material costs or other financial stress of the Builder or any Subcontractors;

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  (vii)   any delay resulting from a contingency or other cause of delay occurring after the Delivery Date.
    In this Clause 1.4 references to the Builder shall include the Builder and all officers, employees, workmen and other representatives of the Builder.
 
1.5   The Builder may claim an extension of the Delivery Date for and equivalent to any actual delay to Work in the updated critical path of delivery of the Ship if such delay is caused by any failure on the part of the Buyer to perform its obligations under this Contract (unless any such failure is caused or excused by any failure on the part of the Builder to perform any of its obligations under this Contract) provided that the Builder gives written notice of such claim to the Buyer within five (5) days after the date on which the Builder first had knowledge of the cause of the delay. If the parties do not agree upon the length of the extension claimed by the Builder, the Builder’s entitlement to claim extension of the Delivery Date shall be determined as a Dispute pursuant to Article 13
 
2.   DELAY NOTICES
 
2.1   The Builder shall give written notice to the Buyer of a contingency pursuant to Clause 1.3 as soon as practicable and no later than five (5) days after the date on which the Builder first has knowledge of such contingency and in such notice the Builder shall describe the cause of the delay, the date of commencement (or first occurrence) of the cause, its expected duration and its expected effect on Work in the updated critical path of delivery of the Ship.
 
2.2   The Builder will provide the Buyer with regular written status reports (at such reasonable intervals as the Buyer may request) with respect to any delay in respect of which the Builder has given notice pursuant to Clause 2.1 and as to the steps being taken (and planned) by the Builder to minimise and overcome any actual delay in delivery of the Ship.
 
2.3   Within five (5) days after any cause of delay set forth in Clause 1.3 has ceased to exist, the Builder shall notify the Buyer of such cessation and give the Buyer a written statement of the actual or estimated delay in the completion of the Work resulting from such cause together with such detailed information and documentation as is then available to it justifying such extension, and any such detailed information and documentation thereafter becoming available to the Builder shall be promptly be given to the Buyer.
 
2.4   On the basis of the notices, reports, statements and information given to the Buyer by the Builder relating to any actual or estimated delay in delivery (and such further information and documentation as the Buyer may reasonably request), the Buyer and the Builder shall confer and attempt to agree upon the number of days by which the Delivery Date shall be extended provided that if the Buyer and the Builder cannot so agree within thirty (30) days after the completion of any such conference, the extension of the Delivery Date (if any) shall be determined as a Dispute pursuant to Article 13.

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2.5   The extension of the Delivery Date provided for in this Article shall be the only remedy for delay to which the Builder shall be entitled (subject and without prejudice to the express provisions of Article 6, Clauses 1.4 and 1.5) and, by way of illustration but not limitation, the Builder shall not be entitled to damages or any increase in the Contract Price or other compensation for delay.
(End of Article 5)

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ARTICLE 6: TESTS AND LIQUIDATED DAMAGES
1.   TESTS
 
1.1   At its sole and direct risk and expense, the Builder shall subject the Ship and specified Parts to the tests in order to ascertain whether the Ship and such Parts have been completed in full accordance with this Contract, the Plans and Specification. In connection with the sea trials tests, the Builder shall provide at its own expense the required quantities of ballast water (if any), fresh water, fuel oil, lubricating oil, greases and other consumables as well as the crew required to ensure safe navigation. By the time of commencement of the tests, the Ship shall have been substantially completed so as to enable the tests to be performed as specified.
 
1.2   The Buyer shall be entitled to have the Supervisor and his team present at all tests and the Builder shall give the Supervisor:
  (i)   two (2) Working Days’ prior written notice of all tests (except sea trials tests) (a) designated for such notice by the Supervisor following delivery by the Builder of the Schedule of Tests and (b) scheduled to take place on week-ends or other non-Working Days; and
 
  (ii)   one (1) Working Day’s prior written notice of all other tests (except sea trials tests).
1.3   The Builder shall give the Supervisor fifteen (15) Working Days estimated, and seven (7) Woking Days’ definite, prior written notice of the time and the place for the sea trials tests provided that only one (1) day’s prior written notice need be given to the Supervisor with respect to retrials at sea conducted within three (3) days after completion of a previous sea trial test at or upon which the need for such retrial was determined.
1.4   The course to be followed during the sea trials tests shall be determined by the Builder but shall be [**] [Confidential Treatment]. If the weather conditions on the date specified for the sea trials tests are (in the reasonable opinion of the Builder) so unfavourable that they would prevent the Builder from carrying out such tests in a proper manner then the same shall take place on the first available day thereafter that weather conditions permit. If, during the sea trials tests unexpected changes in the weather occur which, in the reasonable opinion of the Builder, are such as to prevent the continuation of such tests in a proper manner then such tests shall be discontinued and postponed until the next following favourable day unless the Buyer shall (in its option) agree in writing to accept the Ship on the basis of the tests made. If commencement of the sea trials tests is postponed or such tests are discontinued pursuant to the provisions of this Clause 1.4 and the aggregate total delay to such tests exceeds twenty four (24) hours, then the Delivery Date shall thereafter be postponed by the period of delay in excess of twenty four (24) hours.
1.5   The failure of the Supervisor to be present at any test, after due notice, shall be deemed to be a waiver of the Supervisor’s right to be present at the relevant test and the Buyer shall be obliged to accept the results of such test on the basis of a certificate of the Builder and the Classification Society that the Ship and specified Parts, after due

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    completion of the tests, were found to have been completed in full accordance with this Contract, the Plans and the Specification provided that if the Supervisor’s failure to attend any test, after due notice, is due to an event or combination of events outside the Supervisor’s control which arose not later than forty-eight (48) hours before commencement of the relevant test and the Buyer or the Supervisor so notifies the Builder before commencement of the test in question, then the test shall be postponed until the Supervisor (or substitute) is able to attend or the expiration of forty-eight (48) hours from the time at which the originally scheduled test was due to commence, whichever first occurs and the Delivery Date shall be postponed by the period for which commencement of the test is delayed.
1.6   All tests to which the Supervisor has, by endorsement of the Schedule of Tests, indicated his wish to attend but which are conducted without due notice to the Supervisor shall be reconducted by the Builder on due notice to the Supervisor at the sole risk and expense of the Builder.
 
1.7   Within three (3) Working Days after completion of the tests, the Builder shall notify the Buyer in writing of the results of the tests and shall, when appropriate, confirm to the Buyer that the Ship complies with the requirements of this Contract, the Plans and the Specification.
 
1.8   Within three (3) Working Days after its receipt of the Builder’s notice under Clause 1.7, the Buyer shall notify the Builder in writing of its technical acceptance of the Ship or its technical rejection of the Ship. If the Buyer notifies the Builder of its technical rejection of the Ship, the Buyer’s notice shall specify the respects in which, in the Buyer’s opinion, the Ship fails to comply with this Contract, the Plans and Specification. The Builder acknowledges and agrees that the Buyer may reject the Ship not only for defects discovered during or as a result of tests but also defects discovered and previously notified to the Builder that have not yet been remedied.
 
1.9   If and to the extent that the Builder accepts the Buyer’s technical rejection of the Ship, the Builder shall at its sole risk and expense forthwith take all such steps as may be necessary to remedy the defects and all such tests as may be necessary to demonstrate to the Buyer, the Classification Society and the Regulatory Authorities the full and final remedy of such defects. When appropriate, the Builder shall notify the Buyer in writing that the necessary remedial steps and tests have been completed and that the Ship complies with the requirements of this Contract, the Plans and the Specification
 
1.10   Within three (3) Working Days after its receipt of the Builder’s notice under Clause 1.9, the Buyer shall notify the Builder in writing of its technical acceptance of the Ship or its technical rejection of the Ship. If the Buyer notifies the Builder of its technical rejection of the Ship, the Buyer’s notice shall specify the respects in which, in the Buyer’s opinion, the Ship still fails to comply with this Contract, the Plans and Specification in which case the provisions of Clause 1.9 and 1.10 shall again apply.
 
1.11   If the Buyer fails to notify the Builder of its technical acceptance or technical rejection of the Ship together with its reasons for any rejection, within the time periods specified in Clauses 1.8 and 1.10 above, the Buyer shall be deemed to have technically accepted the Ship.

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1.12   The above process shall be repeated as often as necessary until the earlier of the time at which the Buyer notifies the Builder in writing of its technical acceptance of the Ship, and the valid and lawful termination of this Contract by either party. If there is any difference of opinion between the Builder and the Buyer as to whether the Ship complies with the requirements of this Contract, the Plans or the Specification either party may require that the difference of opinion be treated as a Dispute to be resolved in accordance with the provisions of Article 13.
 
1.13   The Buyer’s technical acceptance of the Ship shall be final and binding on the Buyer insofar as compliance of the Ship (as she is then built and equipped) with this Contract, the Plans and the Specification as demonstrated by the tests is concerned (with the exception of any outstanding defects or disputed defects) and shall preclude the Buyer from refusing formal tender of the Ship for delivery provided that:
  (i)   the Builder then maintains the Ship, as technically accepted by the Buyer, in full accordance with this Contract, the Plans and the Specification; and
 
  (ii)   the Builder fully complies with all preconditions and other requirements for delivery as provided in this Contract.
1.14   For the avoidance of doubt, all time used and costs expended in removing or otherwise remedying any defects, in making any necessary alterations and in carrying out all necessary tests and retests shall be for the Builder’s account and shall not result in any extension of the Delivery Date or increase in the Contract Price.
1.15   If: (i) the Ship has been completed in full accordance with this Contract, the Plans and Specification apart from defects of a minor nature (each a “minor defect”) meaning defects that in and of themselves, and also in the process of being remedied: (a) do not and will not adversely affect the seaworthiness of the Ship; or (b) do not and will not prevent the unrestricted use of the Ship in its intended service and purpose as described in the Plans and the Specification; or (c) do not and will not prevent the commercial functional use of any of the Ship’s passenger accommodation or any of the areas designated in the Specification as public spaces, or in any other way adversely affect the comfort or safety of the Ship’s passengers; or (d) do not and will not affect the safety of the Ship’s crew or their ability to carry out their duties in a safe working environment and with appropriate accommodation; or (e) do not and will not adversely affect the operational efficiency of the Ship; or (f) do not and will not involve any condition, qualification, recommendation, reservation or restriction in relation to any certificate issued (or to be issued) by the Classification Society or any Regulatory Authority which in the opinion of the Buyer (acting in good faith and being reasonable) is or could be material in a commercial or technical sense; and (ii) the Builder undertakes in writing to remedy defects at the Builder’s entire risk and expense, without any interruption to the Ship’s service to passengers, and with all convenient speed in accordance with a remedial plan and timetable approved by the Buyer (acting in good faith and being reasonable), then the Buyer shall not be entitled to withhold its technical acceptance of the Ship. From the time when the first Work inspections and approvals are to be made and given on behalf of the Buyer, the Builder and the Buyer shall jointly maintain a written record (the “Defects List”) in the form of a list of defects (including minor defects) noted on

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    behalf of the Buyer. The Builder and the Buyer, each acting reasonably and in good faith, shall update the Defects List at regular intervals to reflect the addition and removal of defects.
1.16   All defects in the Ship at the time of her final acceptance, whether or not recorded in the Defects List, shall qualify as defects covered by the Builder’s guarantee and shall be remedied pursuant to Clause 2 of Article 7. However, if before delivery and final acceptance of the Ship under Clause 1.4 of Article 7, a duly authorised representative of the Buyer expressly in writing waives its right to require the Builder to remedy a particular defect recorded in the Defects List, or accepts the Builder’s remedy of a particular defect, then the defect in question will be outside the scope of the Builder’s guarantee unless it recurs during the Guarantee Period notwithstanding the Builder’s remedial works before of after delivery or a new defect arises in the same Part.
 
1.17   The tests that are to be carried out after delivery shall be performed in the manner, under the conditions and in accordance with the timetable provided for in the Specification. Defects discovered during such tests shall qualify as defects covered by the Builder’s guarantee and shall be remedied pursuant to Clause 2 of Article 7.
 
2.   LIQUIDATED DAMAGES
 
2.1   The Builder agrees that certain deficiencies and certain delays in the delivery of the Ship shall oblige it to pay to the Buyer, by way of agreed and final liquidated damages and not as penalties, the compensation provided for in this Clause 2.
 
2.2   The speed of the Ship shall be demonstrated and tested during the sea trials tests under the conditions described in [**] [Confidential Treatment] of the Specification.
 
2.3   (A) If the Builder before delivery fails to remedy any deficiency in the Guaranteed Service Speed or GSS, the Builder shall have no liability to the Buyer if the actual speed of the Ship as determined during the final sea trials tests is up to [**] [Confidential Treatment] of a knot below GSS but commencing with a deficiency of more than [**] [Confidential Treatment] of a knot below the GSS the Builder shall pay liquidated damages to the Buyer as follows for a speed between:
  (i)   [**] [Confidential Treatment] knots, a total sum of [**] [Confidential Treatment];
 
  (ii)   [**] [Confidential Treatment] knots, a total sum of [**] [Confidential Treatment]; and
 
  (iii)   [**] [Confidential Treatment] knots, a total sum of [**] [Confidential Treatment];
provided that if the speed deficiency is more than [**] [Confidential Treatment] knot below the GSS, then the Buyer may, at its option, accept the Ship upon payment by the Builder of liquidated damages for such deficiency of [**] [Confidential Treatment] or reject the Ship and terminate this Contract pursuant to Clause 2 in Article 9.
(B) The Builder acknowledges and agrees that the Buyer has agreed to order the Ship in reliance on the Builder’s assurance that C33 is capable of achieving the GSS specified in the C33 Contract. If C33 is delivered and accepted with a service speed below the GSS specified in the C33 Contract, the Builder shall promptly develop a proposal for the complete correction of this deficiency and thereafter the Builder shall take all such steps

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as may be necessary to ensure that the Ship achieves the GSS specified in this Contract without cost to the Buyer, without extension of the Delivery Date and without increase in the Contract Price.
2.4   The fuel consumption of each main engine of the Ship shall be demonstrated and tested in tests conducted at the engine manufacturers’ test bed under the conditions described in [**] [Confidential Treatment] of the Specification.
 
2.5   If the Builder before delivery fails to remedy any deficiency in the fuel consumption of any of the Ship’s main engines, the Builder shall have no liability to the Buyer if such fuel consumption as determined during the final tests is more than the Guaranteed Fuel Consumption or GFC provided such excess is not more than [**] [Confidential Treatment] over the GFC but commencing with an excess of more than [**] [Confidential Treatment] in actual fuel consumption the Builder shall pay liquidated damages to the Buyer for each such engine in the sum of [**] [Confidential Treatment] for each full [**] [Confidential Treatment] (provided that if the Builder’s back to back position against its against the engine supplier entitles the Builder to claim fractions of a % calculated in proportion, the Buyer shall have the same entitlement against the Builder under this provision) increase in fuel consumption above such [**] [Confidential Treatment] level up to a maximum of [**] [Confidential Treatment] over the GFC provided that if the fuel consumption is more than [**] [Confidential Treatment] above the GFC, the Buyer may, at its option, accept the Ship upon payment by the Builder of liquidated damages for such deficiency of [**] [Confidential Treatment] or reject the relevant engine.
 
2.6   The deadweight capacity of the Ship shall be demonstrated by the Builder in the specified deadweight capacity test under the conditions described in [**] [Confidential Treatment] of the Specification.
 
2.7   If the Builder fails to remedy any deficiency in the Ship’s deadweight capacity before delivery, the Builder shall have no liability to the Buyer if the actual deadweight capacity of the Ship as determined in accordance with the Specification is less than [**] [Confidential Treatment] metric tons below the Guaranteed Deadweight capacity but the Builder shall pay liquidated damages to the Buyer in the sum of [**] [Confidential Treatment] for each full metric ton of such deficiency being more than [**] [Confidential Treatment] metric tons up to a maximum deficiency of [**] [Confidential Treatment] metric tons at a draft of not more than [**] [Confidential Treatment] metres even keel provided that if the actual deadweight deficiency at a draft of not more than [**] [Confidential Treatment] even keel is more than [**] [Confidential Treatment] metric tons, the Buyer may, at its option, accept the Ship against the Builder’s payment of liquidated damages in the amount of [**] [Confidential Treatment] for such deficiency or reject the Ship and terminate this Contract pursuant to Clause 2 in Article 9.
 
2.8   The guaranteed cabin capacity of the Ship shall be as defined in [**] [Confidential Treatment] of the Specification and no change shall be made to such cabin capacity without the Buyer’s prior written consent.
 
2.9   If the actual number of either the passenger or crew cabins is lower than the number of passenger and crew cabins as defined in [**] [Confidential Treatment] of the Specification, the Builder shall pay liquidated damages to the Buyer in the sum of [**] [Confidential Treatment]

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    [**] [Confidential Treatment] for each passenger or crew cabin deficiency. If any such cabin deficiency:
  (a)   exceeds [**] [Confidential Treatment] passenger cabins the Buyer may, at its option, accept the Ship against the Builder’s payment of liquidated damages in the amount of [**] [Confidential Treatment] euros for such deficiency or reject the Ship and terminate this Contract pursuant to Clause 2 in Article 9; and/or
 
  (b)   exceeds [**] [Confidential Treatment] crew cabins the Buyer may, at its option, accept the Ship against the Builder’s payment of liquidated damages in the amount of [**] [Confidential Treatment] euros for such deficiency or reject the Ship and terminate this Contract pursuant to Clause 2 in Article 9.
2.10   The columns under the heading of Column A in Schedule 7 describe: the maximum sound and vibration levels and related tolerances and graces defined by the Classification Society notation DNV Comf V (1) (the “S & V Notation”); and the application of the S & V Notation to and between the suites, cabins and other public spaces on board the Ship (the “spaces”) referred to in such columns.
 
2.11   The Builder shall carry out the Works so that, at delivery, the Ship achieves the S&V Notation.
 
2.12   If any of the sound and vibration levels in the spaces — as tested and measured in accordance with the testing and measurement procedures referred to in [**] [Confidential Treatment] of the Specification — exceed any of the sound or vibration level or space number or area tolerances and graces defined by the S & V Notation, before the Delivery Date the Builder shall take all such remedial steps and make all such further tests and measurements as may reasonably be required (i) to reduce the levels, numbers and areas to within the applicable S & V Notation tolerances and graces referred to in the columns under the heading of Column A in Schedule 7, and (ii) to demonstrate the complete and permanent correction of the relevant deficiencies.
 
2.13   If the Builder is unable to reduce the relevant levels, numbers and areas to within the applicable S & V Notation tolerances and graces, and to demonstrate the complete and permanent correction of the relevant deficiencies, the Builder shall be obliged to pay liquidated damages to the Buyer at the applicable rates per space specified in the Liquidated Damage columns under the heading of Column B in Schedule 7 for every space in which the measured levels of sound or vibration exceed the peak level for such space specified in the Limit column under the heading of Column B of Schedule 7.
 
2.14   If, after taking into account the applicable S & V Notation space, number and area tolerances and graces, the measured levels of sound or vibration in any space exceed the peak level for such space specified in the Limit column under the heading of Column B of Schedule 7 and the peak number and area allowance specified in the Number(s) and Area columns under the heading of Column B of Schedule 7 then the Buyer may, at its option, accept the Ship against the Builder’s payment of the aggregate total liquidated damages for all sound and vibration deficiencies calculated in accordance with Schedule

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    7 or the Buyer may reject the Ship and terminate this Contract pursuant to Clause 2 in Article 9.
2.15   For the avoidance of doubt, the parties agree that the tolerances referred to in the columns under the heading of Column B in Schedule 7 shall be read and applied as overlapping with — and not as additional to — the tolerances and graces defined by the S & V Notation in the columns under the heading of Column A in Schedule 7.
 
2.16   The Buyer intends to arrange for the Ship’s first cruise with fare paying passengers to be held on the [**] [Confidential Treatment]. The Builder:
  (i)   acknowledges that it is imperative for the Ship to be ready at the time, and in the condition, provided for in this Contract so as to enable the Buyer to fulfil its commitments in relation to the Ship’s first cruise; and
 
  (ii)   agrees to do all it can to assist the Buyer to fulfil its commitments in relation to the Ship’s first cruise.
2.17   If delivery of the Ship is not made on the Compensation Date, the Buyer will suffer loss and damage (including reputational damage) in amounts which are extremely difficult to quantify in advance but it is agreed by the Builder and the Buyer that the per day sums set out in paragraphs (i) to (iv) below represent a genuine and reasonable estimate of the Buyer’s loss and damage for each day of delay in delivery of the Ship beyond the Compensation Date and that they constitute the final compensation payable by the Builder to the Buyer for delay in delivery of the Ship beyond the Compensation Date. If delivery of the Ship is delayed beyond the Compensation Date, the Builder shall be obliged to pay to the Buyer by way of the liquidated damages for each calendar day (or pro-rata for each part of a calendar day) at the per rates set out at paragraphs (i) to (iv) below from (and including) the Compensation Date until delivery of the Ship is actually made or this Contract is terminated:-
  (i)   if the Builder shall have given to the Buyer less than or equal to thirty (30) days notice of the delay in delivery prior to the Delivery Date:
  (a)   for the [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;
 
  (b)   for the [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;
 
  (c)   for the [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;
 
  (d)   for the [**] [Confidential Treatment] the rate shall be [**] [Confidential Treatment] per day;
  (ii)   if the Builder shall have given to the Buyer more than thirty (30) days but less than or equal to ninety (90) days notice of the delay in delivery prior to the Delivery Date:

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  (a)   for the [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;
 
  (b)   for the [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;
 
  (c)   for the [**] [Confidential Treatment] days the rate shall [**] [Confidential Treatment] per day;
 
  (d)   for [**] [Confidential Treatment] the rate shall be [**] [Confidential Treatment] per day;
  (iii)   if the Builder shall have given to the Buyer more than ninety (90) days but less than or equal to one hundred and eighty (180) days notice of the delay in delivery prior to the Delivery Date:
  (a)   for the [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;
 
  (b)   for the [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;
 
  (c)   for the [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;
 
  (d)   for [**] [Confidential Treatment] the rate shall be EUR [**] [Confidential Treatment] per day;
  (iv)   if the Builder shall have given to the Buyer more than one hundred and eighty (180) days notice of the delay in delivery prior to the Delivery Date:
  (a)   for the [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;
 
  (b)   for the [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;
 
  (c)   for the [**] [Confidential Treatment] days the rate shall be [**] [Confidential Treatment] per day;
If the delay in delivery of the Ship continues for 240 (two hundred and forty) days after the Compensation Date then, in such event, the Buyer may at any time thereafter terminate this Contract pursuant to Clause 2 in Article 9. If the delay in delivery of the Ship continues for [**] [Confidential Treatment] days after the Compensation Date, and provided the Buyer has not by then elected to terminate this Contract, the Builder may (by written notice) require the Buyer to make an election in which case the Buyer shall — within 15 (fifteen) days after its receipt of the Builder’s notice — notify the Builder in writing of its intention either to terminate this Contract or to consent to the acceptance of the Ship at an agreed future date on the basis that the Buyer shall remain entitled to all liquidated damages which would otherwise have been payable or allowable by the Builder in accordance with the provisions of this Contract; it being further understood

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that, if the Ship is not delivered by such agreed future date, the Buyer shall have the same right of termination upon the same terms and conditions as set out above. If the Buyer fails to make an election as specified above within the relevant 15 (fifteen) days period, the Buyer shall be deemed to have consented to the Ship being delivered at the future date proposed by the Builder.
2.18   In no event shall the aggregate of final liquidated damages payable by the Builder to the Buyer in accordance with this Clause 2 exceed [**] [Confidential Treatment].
 
2.19   The amounts of all liquidated damages payable under this Clause 2 shall be determined and paid to the Buyer on delivery of the Ship or when applicable on termination of the Contract.
 
2.20   The parties acknowledge and agree that:
  (i)   the liquidated damages provided for in the sub-clauses of Clause 2 in respect of speed, deadweight, fuel consumption, sound and vibration, and delay are cumulative and not exclusive so that, when applicable, the Buyer may claim under one or more of such sub-clauses in respect of the same event; and
 
  (ii)   subject always and without prejudice to the guarantee provisions in Article 7 Clause 2 and to the termination provisions in Article 9 Clause 2, the liquidated damages provided for in this Clause 2 shall be the only compensation recoverable by the Buyer in respect of the breaches of Contract to which they relate and, in particular, the Builder shall not be liable for any loss of profit, loss of revenue or other consequential losses resulting from such breaches.
2.21   The Builder hereby irrevocably and unconditionally waives all rights whatsoever to claim that the any of the entitlements intended to be conferred on the Buyer to claim liquidated damages under any of the express provisions of this Contract are in any manner or to any extent void, invalid or unenforceable as being in the nature of penalties. However, if for any reason the enforcement of any of the Buyer’s claims for liquidated damages is prohibited by any applicable law or if any express provision of this Contract relating to liquidated damages is rendered void, invalid or enforceable by applicable law, the Builder shall nonetheless be liable to pay general damages in respect of the relevant breach of its obligations under this Contract provided that the Builder’s liability in such circumstances shall not exceed the liability that the Builder would have had to pay liquidated damages for such breach under the express provisions of this Contract.
(End of Article 6)

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ARTICLE 7: DELIVERY AND GUARANTEE
1.   DELIVERY AND ACCEPTANCE
 
1.1   The Ship shall be ready for delivery at the Shipyard on the 31 May 2010 (the “Delivery Date”). The Ship shall not be delivered before this date without the express written approval of the Buyer. When:
  (i)   the Builder has completed the Work in compliance with this Contract, the Plans and the Specification;
 
  (ii)   all tests have been performed and completed in accordance with this Contract, the Plans and the Specification, the parties have agreed the Defects List, and the remedial plan and timetable referred to in Article 6, Clause 1.15;
 
  (iii)   the Ship (a) (in accordance with the Builder’s usual practices and to their usual standards for ships of this type) has been cleaned and prepared so that she is ready to take on a full complement of passengers, officers, crew and staff, and (b) is in all other respects ready to enter service as a passenger cruise ship;
 
  (iv)   the Builder has removed from the Ship all unused construction materials and debris, and otherwise left the Ship in a clean and safe ready for sea condition,
    the Builder shall tender the Ship for delivery to the Buyer safely afloat alongside a safe and accessible quay at the Shipyard where there must be sufficient water for the Ship always to remain afloat and from where there must be direct, free, unimpeded, safe and lawful access to international waters provided that the Builder shall have given to the Buyer not less than 15 (fifteen) Working Days definite, prior written notice of delivery.
 
1.2   The Builder shall deliver the Ship to the Buyer with full title guarantee, and free and clear of all encumbrances (including, without limitation, all Mortgages) whatsoever.
 
1.3   On delivery of the Ship the Builder shall also deliver the following documents (together, the “Delivery Documents”):
  (i)   a Protocol of Delivery and Acceptance in the form of Schedule 2 confirming delivery of the Ship to, and acceptance and taking possession of the Ship by, the Buyer pursuant to this Contract, executed in two original counterparts by the Builder and the Buyer and stating the date and (local) time of such delivery and acceptance;
 
  (ii)   a declaration of warranty by the Builder in a mutually agreed form confirming that the Ship is delivered to the Buyer free and clear of all encumbrances whatsoever (including, without limitation, all Mortgages and other obligations and all liabilities of the Builder arising from the financing, the construction or the operation of the Ship for the purposes of the tests or otherwise before delivery) and that the Ship is absolutely free of all burdens in the nature of imposts, taxes or other charges imposed by the national, provincial, local or port authorities of France;

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  (iii)   a detailed inventory showing the machinery and equipment installed on the Ship and the spares, stores and other consumable items delivered with the Ship;
 
  (iv)   the makers’ certificates, Subcontractors’ instruction books, and all of the Classification Society, trading and other certificates (each free of conditions, qualifications, recommendations, reservations and restrictions) required to be supplied upon delivery of the Ship pursuant to this Contract and the Specification, and the Buyer will accept provisional certificates provided that: (a) they do not to any extent impair the Buyer’s ability to register, finance, insure or operate the Ship in its intended service; and (b) the Builder undertakes to deliver fully compliant permanent certificates as soon as they are available from the relevant issuing authority;
 
  (v)   a protocol showing the results of the tests;
 
  (vi)   a non-registration or deletion certificate issued by the competent French authorities;
 
  (vii)   a commercial invoice for the Ship and all other amounts payable by the Buyer on delivery;
 
  (viii)   a builder’s certificate in a form acceptable to the Buyer, notarised and legalised in accordance with the Buyer’s instructions, and such other written instruments as may be strictly necessary, to confirm that full and clean title in the Ship has been vested in the Buyer and to enable the Buyer to register the Ship under the Flag State;
 
  (ix)   a full set of the drawings, plans and other construction documents provided for in the Specification;
 
  (x)   if required by the Buyer’s financiers, such documents as may be necessary to prove the authority of the parties’ respective representatives to sign the documents to be executed on behalf of the Builder and the Buyer in connection with delivery of the Ship.
1.4   Acceptance of the Ship by the Buyer shall be accomplished by:
  (i)   the signature by the Buyer and the Builder of two (2) original counterparts of the Protocol of Delivery and Acceptance; and
 
  (ii)   payment by the Buyer to the Builder of that part of the Contract Price and all other sums that the Buyer is required to pay upon delivery of the Ship pursuant to the provisions of this Contract.
1.5   The Buyer shall be afforded five (5) days free of any wharfage or any other charge, and up to three (3) further days at the usual wharfage fee charged by the relevant port authority, within which to remove the Ship from her point of delivery.
1.6   The following consumables remaining on board at delivery of the Ship shall be jointly inventoried by the Builder and the Buyer, and the Buyer shall pay for them at the Builder’s actual cost price: lubricating oils in storage tanks, fresh water, diesel oils and

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    fuel oils. The Builder shall remove all waste-oil and sludge from the Ship at the Builder’s risk and expense prior to delivery. The Buyer shall not be obliged to pay for the Ship’s ballast.
1.7   Acceptance of the Ship and the related Delivery Documents by the Buyer under this Clause 1:
  (i)   shall signify that the Buyer has taken possession and the risk of loss of the Ship and the related Delivery Documents as of the time and date set out in the Protocol of Delivery and Acceptance and that the Builder may terminate the Insurances; and
 
  (ii)   shall not be deemed to constitute a waiver of or otherwise prejudice any of the Buyer’s rights under Clause 2 of this Article 7 with respect to any defect, whether known or unknown, and whether or not noted in any document delivered in connection with delivery and acceptance of the Ship, which may exist in the Ship at the time it is accepted by the Buyer, and any such defect may be reported to, and shall be remedied at the sole and direct risk and expense of, the Builder under the guarantee provided in Clause 2.
1.8   At the time of the Ship’s delivery to the Buyer under this Contract, the Buyer will register the Ship under the flag and laws of the Bahamas (the “Flag State”), with Nassau as the Ship’s home port, and all fees and charges relating to such registration shall be for the account of the Buyer.
 
2.   GUARANTEE
 
2.1   Subject to the express provisions of this Clause 2, the Builder guarantees the Ship and all Parts against all defects for the period of [**] [Confidential Treatment], (subject to any extension thereof as provided for in this Clause 2) from the date of the Ship’s actual delivery to the Buyer under Article 7, Clause 1.4 (the “Guarantee Period”).
 
2.2   In calculating the length of the Guarantee Period there shall be excluded any day(s) during which the Ship is prevented from entering or is taken out of service solely on account of any defect in the Ship or in any Part for which the Builder is responsible under this Clause 2.
 
2.3   Where any defect in the Ship or any Part is remedied during or after the Guarantee Period, the Builder’s guarantee under this Clause 2 shall apply to such remedial Work for the longer of [**] [Confidential Treatment] from the date on which the remedial Work was completed and the end of the period specified in Clause 2.1 above so that the Guarantee Period for such items shall not exceed [**] [Confidential Treatment]. The [**] [Confidential Treatment] time limit shall apply to the Guarantee Period as calculated under the provisions of this Clause 2.
 
2.4   If any remedial works made or agreed to be made by or on behalf of the Builder before, during or within 30 days after the Guarantee Period (or any extension thereof under this Clause 2) indicate any recurring defect (meaning any defect that requires two (2) or more

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    repairs, replacements or modifications due to the same cause), the Builder shall take the following steps as soon as reasonably possible:
  (i)   promptly perform a root cause analysis; and
 
  (ii)   ascertain the root cause of such recurring defect and the design modification or other remedial Work required to implement a full and final solution; and
 
  (iii)   remedy such recurring defect, and its root cause, in order to avoid a continuation or repetition of such recurring defect.
    If it is not possible for any defect covered by the Builder’s guarantee under this Clause 2 to be fully and finally remedied within the Guarantee Period defined above, both the Guarantee Period and the Builder’s guarantee obligations under this Clause 2 shall be deemed to be extended in respect of such defect until either the Builder has implemented a remedial solution or the Builder has made a commercial settlement with the Buyer which is (in either case) reasonably satisfactory to the Buyer.
 
2.5   The Builder shall not be responsible for the remedy of any defect if it is due to:
  (i)   perils of the sea, accident (subject to Builder’s responsibility under Clause 2.12), negligence (but excluding negligence on the part of the Builder), or improper maintenance or handling (including, without limitation, overloading) of the Ship or any Parts;
 
  (ii)   use of fuels or lubricants not recommended by the relevant manufacturer; or
 
  (iii)   normal wear and tear;
 
  (iv)   any fault in (or caused by) any Buyer’s Supplies which were properly (a) received, (b) handled, (c) installed or incorporated in, (d) stowed on, or (e) otherwise delivered with the Ship by the Builder in accordance with all of the requirements of this Contract, the Plans and the Specification; or
 
  (v)   subject to the other express provisions of this Clause 2, repairs carried out by anyone other than the Builder, its Subcontractors or other persons nominated or approved by the Builder.
2.6   The Buyer shall give written notice to the Builder as soon as possible and in any event within fourteen (14) days after the discovery of any defect for which a claim is made under this Clause 2 and, a copy of each such notice shall also be given to the guarantee engineer, who shall acknowledge receipt by his signature thereof. The Buyer’s notice shall give full details (so far as possible) as to the nature of the defect and the extent of any damage caused thereby.
2.7   Within thirty (30) days after the end of the first [**] [Confidential Treatment] referred to in Clause 2.1 as extended by the operation of Clause 2.2, the Buyer (in consultation with the guarantee engineer) will draw up, and send to the Builder, a list identifying every defect for which a claim which is existing on the last day of such period is to be made under this Clause 2 provided that this Clause 2.7 will not preclude

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    the Buyer from giving notice to the Builder of, and making claims in respect of, any defect which is covered by the Builder’s extended guarantee under Clause 2.3.
2.8   Each defect will be remedied by the Builder as soon as reasonably practicable (and the necessary remedial works shall be scheduled so as to minimise disruption to the Ship’s service and the availability of cabins, public rooms and areas, and other passenger facilities) or, at the Buyer’s option, under the instruction or supervision of the Builder at a suitably qualified shipyard or workshop selected by the Buyer and approved by the Builder (such approval not to be unreasonably withheld or delayed), and in each case the Builder shall bear and pay:
  (i)   the cost of all equipment, parts, tools and materials reasonably required and incurred to remedy the defect (including, without limitation, the cost of delivering the same to the selected shipyard or workshop by airfreight if the Buyer reasonably so requires, and the cost of returning any defective equipment, parts and materials);
 
  (ii)   the cost of all labour reasonably required and incurred to remedy the defect including, without limitation, the expenses of independent contractors in travelling to the Ship;
 
  (iii)   the cost of any necessary underwater inspection of the Ship by divers; and
 
  (iv)   where the Ship is drydocked exclusively on account of the need to remedy any defect in the Ship’s external underwater parts at any time before the Ship’s first scheduled drydocking after delivery (provided that the remedy of such defect cannot reasonably be postponed until the Ship’s first scheduled drydocking), the drydocking costs and the costs of remedying any defect that is covered by the Builder’s guarantee obligations under this Clause 2.
The Buyer agrees to use the normal diligence and business practices of a competent shipowner with a view to minimising the cost of remedial works carried out by anyone other than the Builder, its Subcontractors or other persons nominated by the Builder.
For the avoidance of doubt, in view of the intended area of the Ship’s operation during the Guarantee Period, the Builder will not be entitled to require the Ship to be returned to any of the Builder’s facilities for the remedy of any defects.
If the Buyer discovers any defect which (in the reasonable opinion of the Buyer) requires remedial action on an urgent basis, the Buyer will (acting in good faith) give such notice to the Builder as is practicable in the circumstances then prevailing (the intention being that, circumstances permitting, the Builder shall have a reasonable opportunity to take necessary actions to remedy the defect on an urgent basis, to obtain necessary remedial instructions from the relevant Subcontractor(s) and to relay such instructions to the Buyer) and thereafter the necessary remedial works (if not carried out by the Builder) may be carried out by the Ship’s crew or, if practicable having regard to the degree of urgency, by the nearest suitably qualified shipyard or workshop selected by the Buyer, and in each such case the Builder shall reimburse the Buyer for the costs described in Clause 2.8(i), (ii), (iii) and (iv) above. The Buyer agrees to use the normal diligence and

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business practices of a competent shipowner with a view to minimising the cost of such remedial works.
2.9   At the Buyer’s request after final completion of the remedial works to be made or paid for by the Builder under this Clause 2 in respect of a particular aspect of the Work or any Part, the Builder will:
  (i)   assign to the Buyer, to the fullest extent possible and without any charge to the Buyer, that part of every contractual warranty or guarantee given by any Subcontractor with respect to the particular aspect of the Work or Part which extends beyond the Guarantee Period or which is otherwise more favourable to the Buyer than the guarantee of the Builder under this Clause 2; or
 
  (ii)   if it is not possible fully and effectively to assign the relevant part of any such contractual warranty or guarantee, hold and enforce the relevant contractual warranty and guarantee as trustee and agent for the Buyer and promptly account to the Buyer for all monies received in or pursuant to the holding or enforcement of any such contractual warranty or guarantee.
2.10   The Builder shall, at its sole risk and expense (except for the cost of suitable accommodation and food on board the Ship which shall be supplied free of charge by the Buyer), employ and place a suitably qualified and experienced English-speaking guarantee engineer acceptable to the Buyer on board the Ship for so long as the Buyer may reasonably require during the Guarantee Period and thereafter until the Builder has remedied every defect to which this Clause 2 applies but in any event no more than 180 (one hundred and eighty) days in aggregate. Not later than fifteen (15) days before delivery of the Ship, the Builder shall provide to the Buyer for its approval (which is not to be unreasonably withheld) the name and credentials of the proposed guarantee engineer. If at any time the Buyer considers the guarantee engineer’s performance of his duties to be unsatisfactory, the Buyer may by notice to the Builder request the replacement of the guarantee engineer. The Builder shall promptly investigate the Buyer’s complaint and, if the complaint is justified, the Builder shall (without any cost or liability to the Buyer) effect a suitable replacement acceptable to the Buyer as soon as may be practicable in the prevailing circumstances.
 
2.11   If:
  (i)   any defect in the Ship’s external underwater parts is discovered during the Guarantee Period or the period of thirty (30) days referred to in Clause 2.7; or
 
  (ii)   any defect in the Ship’s external underwater parts is discovered either during the Ship’s first scheduled drydocking after delivery provided that the first scheduled dry-docking occurs within twenty-four months after delivery of the Ship or, if there is no scheduled dry-docking within this period, under a joint underwater inspection under Classification Society supervision which is to be carried out as close to the end of such twenty four months period as may be convenient having regard to the Ship’s itinerary and the need to select a suitable location for such under water inspection. The costs (including the costs of attendance of the Classification Society’s representative) of such inspection shall be borne by the

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      Builder if any defect is discovered for which the Builder is responsible under this Clause 2 and otherwise such costs shall be borne by the Buyer,
    and if the Classification Society imposes a condition in respect of a defect in such underwater parts for which the Builder is responsible under this Clause 2 and requires the defect to be remedied before the next Ship’s scheduled drydocking the Builder shall be responsible for the necessary remedial works and the associated drydocking costs. Otherwise, the Buyer shall bear and pay for the haul day and any associated drydocking costs incurred in the ordinary course of the Ship’s next scheduled drydocking maintenance and the Builder, in addition to the costs of all necessary remedial works, shall bear and pay for such additional drydocking day(s) as may be required to remedy such defect.
 
2.12   Without prejudice to the Builder’s obligations and liabilities under the other express provisions of this Clause 2, the Builder shall not be responsible for any loss or damage caused by any defect except:
  (i)   that, in addition to the other guarantee obligations specified in this Clause 2, the Builder shall be obliged to remedy (or, as provided for in the preceding paragraphs of this Clause 2, to pay for the remedy of) any equipment or part of the Ship that is physically damaged as a direct and proximate result of any defect covered by the Builder’s guarantee under this Clause 2;
 
  (ii)   for any physical damage directly caused by the Builder’s remedy of any defect; and
 
  (iii)   for any physical damage directly caused by the wrongful refusal or failure of the Builder or its Subcontractors to remedy (or authorise the remedy) of any defect.
2.13   Any sum(s) payable by the Builder under this Clause 2 shall be due and payable as set out in Article 8.
 
2.14   Except as otherwise expressly provided in Clause 2.11, the Builder shall not be responsible or liable for any defect discovered after the expiry of the Guarantee Period (as the same is defined and extended pursuant to this Clause 2), loss of time due to repair or for any loss of profit, loss of revenue or other consequential losses suffered by the Buyer by reason of any defect. Furthermore, the guarantee under this Clause 2 replaces and excludes any warranty, liability, term and/or condition imposed or implied by any law, custom or usage and — save as otherwise expressly provided for in this Contract, the Plans or the Specification — the Builder makes no warranty/condition of merchantability or fitness of the Ship or any Part thereof for any particular purpose.
(End of Article 7)

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ARTICLE 8: CONTRACT PRICE AND PAYMENT TERMS
1.   CONTRACT PRICE
 
1.1   The Contract Price for the Ship:
  (i)   shall be EUR735,000,000 (seven hundred and thirty five million euros); and
 
  (ii)   is a fixed price and may be adjusted only in strict accordance with, and subject to, the express provisions of this Contract.
1.2   For the avoidance of doubt:
  (i)   the Contract Price includes the cost of the Ship, completed in accordance with the requirements of this Contract, the Specification and the Plans;
 
  (ii)   the Contract Price includes the cost of all Work and the cost of all surveys, tests and trials of the Ship to be performed by, or on behalf of, the Builder or any third parties including the Classification Society and the Regulatory Authorities;
 
  (iii)   the Contract Price includes the cost of procuring the classification notation for the Ship, and of obtaining all certificates and other documents which are required to be delivered pursuant to this Contract, the Specification and the Plans;
 
  (iv)   the Contract Price includes all other costs and expenses of the Builder as provided for herein or otherwise incurred by the Builder unless expressly provided for in this Contract as being for the Buyer’s account;
 
  (v)   without prejudice to the express rights and obligations of either party under the other provisions of this Contract (including, without limitation, in relation to AOM’s agreed between the parties), the Buyer shall have no liability for any increases in the Builder’s costs of performing the Contract of any nature whatsoever; and
 
  (vi)   all fees and charges incidental to the registration of the Ship under the flag and laws of the Flag State shall be for the account of the Buyer.
2.   PAYMENTS
 
2.1   Payment of the Contract Price shall be made to the Builder as follows:
  (i)   [**] [Confidential Treatment], within 3 (three) Working Days after the Effective Date;
 
  (ii)   [**] [Confidential Treatment], on first steel cutting but not before [**] [Confidential Treatment];
 
  (iii)   [**] [Confidential Treatment], on completion of keel laying (and for these purposes keel laying will be deemed to have taken place when the first prefabricated steel block has been completed

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      and located in its final position in the building dock at the Shipyard) but not before [**] [Confidential Treatment];
  (iv)   [**] [Confidential Treatment], on the date the Ship is launched into the water at the Shipyard (and for these purposes launching will be deemed to have taken place when the Ship is safely afloat provided that the Ship’s hull and primary internal structural parts are by then fully welded out and that the Classification Society has confirmed in writing that there is adequate completion of the hull for launching) but not before [**] [Confidential Treatment]; and
 
  (v)   the balance of the Contract Price, on the date of delivery and acceptance of the Ship and the Delivery Documents in accordance with the express provisions of this Contract.
2.2   The Builder shall by not less than fourteen (14) days advance written notice advise the Buyer of the date upon which each of the payments referred to sub-clauses 2.1(ii) to (iv) shall become due and payable and, in addition, the notice given in relation to sub-clause 2.1(v) will show (in reasonable detail and on an “open-book” basis as this expression is defined in Article 3) the Builder’s calculation of the balance of the Contract Price payable on delivery of the Ship and, in particular, the amounts of any reductions in or additions to the Contract Price occasioned by the terms and conditions of this Contract.
 
2.3   The Buyer’s obligations to make the payments referred to in sub-clauses 2.1(i) to (iv) shall, in the case of each such payment, be subject to and conditional upon the Buyer’s receipt of:
  (i)   the Builder’s invoice for the relevant payment; and
 
  (ii)   an irrevocable refund guarantee (“Refund Guarantee”) issued in favour of the Buyer in the form set out in Schedule 2 by a first class bank, insurance company or financial institution (“Refund Guarantor”) acceptable to the Buyer (such acceptance not to be unreasonably withheld) securing the refund to the Buyer of the relevant payment together with interest thereon at the Relevant Rate calculated from the date of the Builder’s receipt of such payment to the date of the Buyer’s receipt of the refund.
    The Buyer’s obligation to make the payment referred to in sub-clause 2.1(v) shall be subject to and conditional upon the Buyer’s receipt of the Builder’s invoice for the relevant payment and signature of the Protocol of Delivery and Acceptance on behalf of the Buyer and the Builder.
 
2.4   The other payments from time to time due under this Contract shall be made as follows:
  (i)   any amount for which a specific payment date is stipulated in this Contract shall be paid on such date;
 
  (ii)   payment or credits for any modifications pursuant to Article 3 (together with an appropriate interest payment or credit, calculated at the Relevant Rate, from the date(s) specified in the relevant AOM’S or as determined under Article 13,

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      Clause) shall be made simultaneously with delivery of the Ship and the relevant amounts shall be shown in the invoices to be issued and delivered by the Builder in respect of the Contract Price under Clause 2.1 (v);
  (iii)   payment of any other amounts accruing prior to delivery shall be made simultaneously with delivery of the Ship, and the relevant amounts shall be shown in the invoice to be issued and delivered by the Builder in respect of the Contract Price payment referred to in Clause 2.1(v) and
 
  (iv)   for any amount accruing after delivery in respect of a defect covered by the Builder’s guarantee under this Contract, payment shall be made as follows:
  (a)   if the parties agree that the defect in question is covered by the Builder’s guarantee under this Contract, not later than fifteen (15) days after the Builder’s receipt of an invoice for the defect remedied pursuant to Clause 2 in Article 7; or
 
  (b)   if there is a Dispute as to whether or not the defect is covered by the Builder’s guarantee under this Contract, on the date on which it is finally determined or adjudged to be a defect under Article 13, together with interest thereon at the Relevant Rate calculated from the date of the Builder’s receipt of an invoice for the defect remedied pursuant to Clause 2 in Article 7 up to and including the date of the Buyer’s receipt of the relevant amount.
2.5   Every amount from time to time due under this Contract but unpaid for longer than three (3) days from (and excluding) the due date shall bear interest at the Relevant Rate from the due date up to and including the date of receipt by the party to which the amount is owed.
 
2.6   If the Buyer fails to make any payment when it is due under sub Clauses 2.1(i), (ii), (iii) or (iv), such failure is not due to a default or breach of this Contract by the Builder, and such failure continues for longer than seven (7) days from (and excluding) the due date, then without prejudice to its other obligations under this Contract the Builder shall be entitled (after giving written notice to the Buyer) to suspend performance of all Work from the date on which the notice is given until the date of receipt of the unpaid sum in the Builder’s Account. In the event of such a suspension, the Delivery Date shall be automatically extended by the actual period of suspension of the Work.
 
2.7   All amounts payable to the Builder under this Contract shall be paid direct to the Builder’s Account, and the Builder and the Buyer shall consult with each other about the mode of payment with a view to reducing the amount of any applicable bank transfer charges.
 
2.8   All payments made by the Buyer to the Builder on account of the Contract Price before delivery and acceptance of the Ship shall be in the nature of advances to the Builder.
 
2.9   Neither party shall be entitled to set off any claims against payments due to the other under this Contract.

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2.10   Payments made by either party to the other under this Contract shall not be construed as a waiver of the right of one party to challenge the other as to the amount due or the due date of any such payments.
 
2.11   All fees, costs and other charges (including taxes and other amounts payable in respect of bank transfers) whatsoever arising in connection with:
       (i)   each guarantee issued under Clause 2.3 (including, without limitation, fees and other costs or charges payable to the relevant bank(s) and/or insurance company(ies) in respect of the issuance and maintenance thereof) shall be borne and paid by the Builder; and
 
       (ii)   the remittance of payments made under this Contract shall be borne and paid by the paying party.
2.12   The euro is the currency of account and payment for each and every sum at any time due from either party to the other under or in connection with this Contract.
(End of Article 8)

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ARTICLE 9: TERMINATION
1.   TERMINATION BY BUILDER
 
1.1   Each of the following events shall be a “Builder Termination Event” for the purposes of this Contract:
    (i)   if the Buyer fails to pay any part of the Contract Price under any of Clauses 2.1 (i), (ii), (iii) or (iv) in Article 8 on the due date for such payment and such failure is not remedied within ten (10) Working Days after the receipt by the Buyer of a written notice from the Builder notifying the Buyer of such failure and requesting remedial action; or
 
    (ii)   if the Buyer fails to accept delivery of (and pay the balance of the Contract Price for) the Ship within two (2) Working Days after the Ship and the related Delivery Documents have been duly tendered for delivery by the Builder in compliance with this Contract, the Plans and the Specification; or
 
    (iii)   if any of the following events or circumstances shall occur before the Buyer has accepted delivery of the Ship and paid the balance of the Contract Price (a) a final order shall be made or an effective resolution shall be passed for the winding up of the Buyer (otherwise than by a members’ voluntary winding up for the purpose of an amalgamation or reconstruction on terms previously approved by the Builder, which approval shall not be unreasonably withheld) or (b) a receiver shall be appointed in respect of the whole or any substantial part of the undertaking of the Buyer or (c) the Buyer shall suspend the payment of its debts or (d) the Buyer shall make an arrangement or composition with its creditors generally or (e) the Buyer shall apply to any court for protection from its creditors generally or (f) the Buyer shall be unable, or shall admit its inability, to pay its debts as they fall due or it shall become or shall be declared insolvent under any applicable law or (g) the Buyer defaults the loan agreement relating to the purchase of the Ship for reasons not attributable to the Builder as a result of which the Buyer’s financiers terminate their commitment to finance the Ship unless the relevant financing arrangements are reconstituted in a manner reasonably acceptable to the Builder within thirty (30) days or (h) any distress, execution, attachment or other process shall affect the whole or any substantial part of the Buyer’s business and assets and shall remain undischarged for a period exceeding 21 (twenty one) days or (i) the whole or any substantial part of the Buyer’s business and assets shall be subject to Compulsory Acquisition by the Bermudian government or any agency thereof for a period exceeding 30 (thirty) days or (j) the Buyer’s Performance Guarantee or the security thereby given is or becomes wholly or partially invalid, ineffective or unenforceable or the Buyer’s Guarantor becomes insolvent or enters into proceedings similar to any of those referred to in any of paragraphs (a) to (f) of this Clause 1.1(iii) and the Buyer is unable to propose a substitute guarantee and / or guarantor acceptable to the Builder (such acceptance not to be unreasonably withheld) within ten (10) Working Days after the receipt by the

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      Buyer of a written notice from the Builder requiring replacement of the Buyer’s Guarantor; or
  (iv)   if the Buyer commits a material breach of any of its material obligations under this Contract and fails to remedy any such breach within 60 (sixty) days after receipt of written notice from the Builder requesting remedial action.
1.2   At any time after a Builder Termination Event shall have occurred and be continuing, the Builder may, by written notice to the Buyer, terminate this Contract whereupon:
  (i)   title in the Buyer’s Supplies owned by the Buyer which have been installed or incorporated in the Ship before termination shall pass to the Builder; and
 
  (ii)   the Builder shall retain and apply (in the manner provided for in Clauses 1.4 and 1.5) all payments previously made by the Buyer to the Builder under this Contract.
1.3   If the Builder terminates this Contract under Clause 1.2, it may in its free discretion decide either to complete or not to complete the Ship and thereafter the Builder shall endeavour to obtain the best market price reasonably obtainable for the Ship, the Parts and the Buyer’s Supplies referred to in Clause 1.2 (i) by sale at public auction or tender or private sale.
1.4   If the Builder elects to sell the Ship in its completed state the proceeds of sale received by the Builder, and all amounts retained by the Builder under Clause 1.2 (ii) plus a credit for the value of Buyer’s Supplies previously delivered by the Buyer and either retained by the Builder or its Subcontractors or sold by any of them, shall be applied as follows:
  (i)   firstly, in payment of all unpaid instalments of the Contract Price as at the date of termination together with interest thereon at the Relevant Rate from the respective due dates for payment thereof to the date of application;
 
  (ii)   secondly, in payment of any other amounts payable by the Buyer to the Builder under the express provisions of this Contract as at the date of termination together with interest thereon at the Relevant Rate from the respective due dates for payment thereof to the date of application;
 
  (iii)   thirdly, in payment of the Builder’s loss of profit being the proved difference (if any) between the profit that the Builder could reasonably have expected to earn if the Contract had not been terminated and the profit actually earned from the sale of the Ship in its completed state; and
 
  (iv)   finally, in payment of any remaining balance to the Buyer,
    provided that if the total of such proceeds of sale, such retained amounts and such credit shall be less than the balance due to the Builder under paragraphs (i), (ii) and (iii) of this Clause 1.4, the difference shall be paid by the Buyer to the Builder.
 
1.5   If the Builder elects to sell the Ship in its incomplete state the proceeds of sale received by the Builder, and all amounts retained by the Builder under Clause 1.2(ii) plus a credit

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    for the value of Buyer’s Supplies previously delivered by the Buyer and either retained by the Builder or its Subcontractors or sold by any of them, shall be applied as follows:
  (i)   firstly, in payment of all costs necessarily and reasonably incurred by the Builder in preparing the Ship for sale (to the extent not already covered by the payments referred to in Clause 1.2(ii) above) together with interest thereon at the Relevant Rate;
 
  (ii)   secondly, in payment of the Builder’s loss of profit being the proved difference (if any) between the profit that the Builder could reasonably have expected to earn if the Contract had not been terminated and the profit actually earned from the sale of the Ship in its incomplete state; and
 
  (iii)   finally, in payment of any remaining balance to the Buyer,
    provided that if the total of such proceeds of sale, such retained amounts and such credit shall be less than the balance due to the Builder under paragraphs (i) and (ii) of this Clause 1.5, the difference shall be paid by the Buyer to the Builder.
 
2.   TERMINATION BY BUYER
 
2.1   Each of the following events shall be a “Buyer Termination Event” for the purposes of this Contract:
  (i)   if (a) at any time the Buyer can demonstrate clearly that delivery will not be made, for whatever reason or combination of reasons (excepting reasons which entitle the Builder to extension of the Delivery Date under Article 5 or reasons attributable to the Buyer), by the date falling [**] [Confidential Treatment] from [**] [Confidential Treatment] or (b) delivery has not been made, for whatever reason or combination of reasons (excepting only one or more independent defaults by the Buyer), by the date falling [**] [Confidential Treatment] from [**] [Confidential Treatment];
 
  (ii)   if the Buyer becomes entitled to terminate this Contract under Clause 3.2 in Article 4 or any of Clauses 2.3, 2.7, 2.9, 2.12, 2.14 or 2.17 in Article 6;
 
  (iii)   if the Builder commits a material breach of any of its material obligations under this Contract and fails to remedy any such breach within 60 (sixty) days after receipt of written notice from the Buyer requesting remedial action;
 
  (iv)   if (a) any guarantee issued in favour of the Buyer under this Contract, or the security thereby given, is or becomes wholly or partially invalid, ineffective or unenforceable or (b) the issuer of any such guarantee becomes insolvent or enters into or is subject to any proceedings similar to any of those referred to in any of paragraphs (a) to (g) of Clause 2.1(vi), unless the Builder replaces any such guarantee and (as the case may be) issuer with a new guarantee and (as the case may be) issuer complying with Clause 2.3(ii) of Article 8 within ten (10) Working Days after receipt of written notice from the Buyer requiring such replacement; or

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  (v)   if either (a) the Builder shall fail at any time to effect or maintain the Insurances, or any insurer shall avoid or cancel the Insurances or the Builder shall commit any breach of or make any misrepresentation in respect of the Insurances the result of which is to entitle the insurers to avoid the cover or otherwise to be excused or released from any or all of their liabilities thereunder, or (b) any of the Insurances shall cease for any reason whatsoever to be in full force and effect, unless the Insurances are re-instated or reconstituted in a manner meeting the requirements of this Contract within seven (7) days; or
  (vi)   if (a) a final order shall be made or an effective resolution shall be passed for the winding up of the Builder (otherwise than by a members’ voluntary winding up for the purposes of amalgamation or reconstruction on terms previously approved by the Buyer, which approval shall not be unreasonably withheld) or (b) a receiver shall be appointed in respect of the whole or any substantial part of the undertaking of the Builder or (c) the Builder shall suspend the payment of its debts or (d) the Builder shall make an arrangement or composition with its creditors generally or (e) the Builder shall apply to any court for protection from its creditors generally or (f) the Builder shall be unable, or shall admit its inability, to pay its debts as they fall due or it shall become or shall be declared insolvent under any applicable law or (g) any distress, execution, attachment or other process shall affect the whole or any substantial part of the Builder’s business or assets and shall remain undischarged for a period exceeding 21 (twenty one) days or (h) the Builder defaults any loan agreement relating to the construction of the Ship for reasons not attributable to the Buyer as a result of which the Builder’s financiers (including the holder of any mortgage or the beneficiary of any other security granted by the Builder over the Ship, any Parts or the Insurances) terminate their commitment to finance the construction of the Ship or commence the enforcement of their rights against the Builder, the Ship, the Parts or the Insurances) unless the relevant financing arrangements are reconstituted in a manner reasonably acceptable to the Buyer within thirty (30) days or (i) the Ship or the whole or any substantial part of the Builder’s business or assets shall be subject to Compulsory Acquisition by the French government or any agency thereof for a period exceeding 30 (thirty) days.
2.2   At any time after a Buyer Termination Event shall have occurred and be continuing the Buyer may by notice to the Builder terminate this Contract and thereafter the Buyer may (in its free discretion) exercise any of the remedies provided for in Clause 2.3.
 
2.3   The Buyer may:
  (i)   retain and/or claim from the Builder all liquidated damages paid or payable by the Builder to the Buyer under Clause 2.17 in Article 6 subject to the following limits:
  (a)   if the Builder shall have given the Buyer more than one hundred and eighty (180) days notice of the delay in delivery prior to the Delivery Date, in no event shall the aggregate final liquidated damages payable by the Builder to the Buyer in respect of such delay exceeds the sum of

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[**] [Confidential Treatment]

  (b)   if the Builder shall have given the Buyer more than ninety (90) days and less than or equal to one hundred and eighty two (182) days notice of the delay in delivery prior to the Delivery Date, in no event shall the aggregate final liquidated damages payable by the Builder to the Buyer in respect of such delay exceeds the sum of [**] [Confidential Treatment];
 
  (c)   if the Builder shall have given the Buyer less than or equal to ninety (90) days notice of the delay in delivery prior to the Delivery Date, in no event shall the aggregate final liquidated damages payable by the Builder to the Buyer in respect of such delay exceeds the sum of [**] [Confidential Treatment];
  (ii)   may also claim from the Builder the aggregate of (a) all payments previously made by the Buyer to the Builder under this Contract on account of the Contract Price together with interest thereon at the Relevant Rate calculated from the date upon which the Builder received each such payment to the date on which the refund is received by the Buyer, (b) the return, free of all encumbrances whatsoever, of any Buyer’s Supplies that have not been built into or installed on or in the Ship or which may be removed from the Ship, the Shipyard or other place(s) where they are stored and the Buyer’s Supply Costs for all other such Buyer’s Supplies that cannot be returned to the Buyer, and (c) all other amounts payable by the Builder to the Buyer under the express provisions of this Contract together with interest thereon at the Relevant Rate from the respective due dates until the date of actual payment of each such amount; and
 
  (iii)   if the Buyer’s right to terminate the Builder’s engagement under this Contract (whether under Articles 4 and/or 9 or otherwise) becomes exercisable as a result of any gross negligence or wilful misconduct on the part of the Builder the Buyer shall, in addition to the payments referred to in sub-clauses 2.3(i) and (ii), be entitled to claim from the Builder, as agreed liquidated damages for loss of this Contract and not as a penalty, an amount equivalent to [**] [Confidential Treatment].
3.   TERMINATION BY EITHER PARTY
 
    The Builder’s receipt of all payments to be made by the Buyer under the express provisions of Article 9 or, as the case may be, the Buyer’s receipt of all payments to be made by the Builder under the express provisions of Article 9 shall operate as a full and final settlement and discharge of all obligations and liabilities of the relevant party to the other under this Contract save for any obligations and liabilities of either party in respect of any costs payable in connection with any references or proceedings under Article 13.
(End of Article 9)

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ARTICLE 10: REPRESENTATIONS, COVENANTS AND INDEMNITIES
1.   REPRESENTATIONS, WARRANTIES AND COVENANTS
 
1.1   Each party acknowledges that the other has entered into this Contract in full reliance on the representations set out in this Clause 1 and each party (in either case, the “warrantor”) warrants that such representations are in all respects true, accurate and not misleading in any respect.
 
1.2   The Warrantor represents and warrants to the other party that:
  (i)   all acts, conditions and things required to be done, fulfilled and performed in order (a) to enable it lawfully to enter into, exercise its rights under and perform and comply with the obligations expressed to be assumed by it in this Contract and (b) to ensure that the obligations expressed to be assumed by it in this Contract are legal, valid and binding have been done, fulfilled and performed; and
 
  (ii)   no legal proceedings have been started or (to the best of the warrantor’s knowledge and belief) threatened which might have a material adverse effect on the warrantor’s ability to perform its obligations under this Contract.
1.3   The Builder further represents and warrants to the Buyer:
  (i)   that neither the execution of this Contract nor the exercise by the Builder of its rights and performance of its obligations under this Contract will result in any breach of any French or European Union law, regulation, rule, directive or treaty;
 
  (ii)   that it shall obtain, comply with the terms of and do all that is necessary to maintain in full force and effect all authorisations, approvals, licences and consents required in or by the laws, regulations, rules, directives and treaties of France and the European Union to enable it lawfully to enter into and perform its obligations under this Contract.
1.4   The Buyer further represents and warrants to the Builder:
  (i)   that neither the execution of this Contract nor the exercise by the Buyer of its rights and performance of its obligations under this Contract will result in any breach of any law, regulation, rule, directive or treaty applicable to the Buyer or any of the protected parties; and
 
  (ii)   that it shall obtain, comply with the terms of and do all that is necessary to maintain in full force and effect all authorisations, approvals, licences and consents required in or by the laws, regulations, rules, directives and treaties of Bermuda to enable it lawfully to enter into and perform its obligations under this Contract.

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2.   EXCLUSION OF LIABILITIES
 
2.1   The Builder shall not be liable to the Buyer, any other protected parties or any of its or their respective representatives, agents or employees for personal injury, including death, during such time as they or any of them are on board the ship, at the Shipyard or within the premises of Subcontractors or suppliers of the Builder unless such injury, including death is caused by the gross negligence or wilful misconduct of the Builder or the representatives, agents or employees of the Builder. Nor shall the Builder be liable to the Buyer, any other protected parties or any of its or their respective representatives, agents or employees for damage to, or loss or destruction of property of the Buyer, the other protected parties or its or their representatives, agents or employees in France or elsewhere unless such damage, loss or destruction is caused by the gross negligence or wilful misconduct of the Builder or the representatives, agents or employees of the Builder.
 
2.2   Neither the Buyer nor any other of the protected parties shall be liable to the Builder, its representatives, agents or employees for personal injury, including death, during such time as they or any of them are on board the ship, at the Shipyard or within the premises of Subcontractors or suppliers of the Builder unless such injury, including death is caused by the gross negligence or wilful misconduct of the Buyer, other protected parties or the representatives, agents or employees of the Buyer or other protected parties. Nor shall the Buyer or any other of the protected parties be liable to the Builder, its representatives, agents or employees for damage to, or loss or destruction of property of the Builder, its representatives, agents or employees in France or elsewhere unless such damage, loss or destruction is caused by the gross negligence or wilful misconduct of the Buyer, other protected parties or the representatives, agents or employees of the Buyer or other protected parties.
(End of Article 10)

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ARTICLE 11: INTELLECTUAL PROPERTY RIGHTS
1.   PATENTS, TRADE MARKS AND COPYRIGHTS
 
1.1   The Builder shall procure all such approvals and licenses, and pay all such royalties, licence fees or other similar charges, on or in connection with:
  (i)   the Ship;
 
  (ii)   any Parts (other than Buyer’s Supplies) installed or incorporated in, stowed on or otherwise delivered with the Ship; and
 
  (iii)   any part of the Work,
    as may be necessary to ensure that the same are delivered to the Buyer and may be owned and operated by the Buyer (and its successors, assignees and counterparties) without infringement of any patent, patent right, copyright, trademark, trade secret or other intellectual property right.
 
1.2   The Builder shall indemnify fully, hold harmless and defend the Buyer and the other protected parties from and against all actions, claims, costs, liabilities and direct losses (subject to Article 14, Clause 14) that any of them may suffer or incur as a result of any actual or alleged infringement of any patents, patent rights, copyrights, trademarks, trade secrets or other intellectual property rights of any kind or nature on or in connection with the Ship, the Parts (other than Buyer’s Supplies) or any part of the Work or the ownership or the proper use thereof by the Buyer provided that this indemnity shall not apply to any such infringement if the management of the Buyer or the management of any other protected party knew of the relevant infringement (at any time between the Effective Date and the date of actual delivery of the Ship) but failed to notify the Builder.
 
1.3   If by reason of any claim for which the Builder is responsible under this Clause 1:
  (i)   the Ship or any Part (other than Buyer’s Supplies) shall be held to constitute an infringement of any patent, patent right, copyright, trademark, trade secret or other intellectual property right; or
 
  (ii)   the Buyer’s free use and possession or quiet enjoyment of the Ship or any such Part shall be in any manner or to any extent disturbed, interfered with, limited, restricted or restrained (whether by reason of an actual or threatened arrest, detention or claim or as a result of any other encumbrance or for any other reasons whatsoever),
    the Builder shall, at its own expense, promptly take all such steps as may be necessary fully to restore to the Buyer the free use and possession and quiet enjoyment of the Ship or such Part including (without limitation) if the Buyer shall so require, by replacing any infringing Part with a non-infringing Part which is satisfactory to the Buyer and/or the Classification Society and/or the Regulatory Authorities.
 
1.4   The Buyer shall indemnify fully, hold harmless and defend the Builder from and against all actions, claims, costs, liabilities and direct losses (subject to the exclusions referred to in Article 14, Clause 14) that that it may suffer or incur as a result of any actual or

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    alleged infringement of any patents, patent rights, copyrights, trademarks, trade secrets or other intellectual property rights of any kind or nature on or in connection with any Buyer’s Supplies, plans, designs and engineering and design data supplied by the Buyer to the Builder under or in connection with this Contract provided that this indemnity shall not apply to any such infringement if the management of the Builder knew of the relevant infringement (at any time between the Effective Date and the date of actual delivery of the Ship) but failed to notify the Buyer.
 
2.   RIGHTS TO ENGINEERING AND DESIGN DATA
 
2.1   All plans, designs and engineering and design data supplied by the Buyer to the Builder which are the property of the Buyer shall remain the property of the Buyer, and such plans, designs and engineering and design data may be used by the Builder only as permitted by this Clause 2.
 
2.2   All plans, designs and engineering and design data supplied by the Builder to the Buyer which are the property of the Builder shall remain the property of the Builder, and such plans, designs and engineering and design data may be used by the Buyer only as permitted by this Clause 2.
 
2.3   The Builder hereby grants to the Buyer and the other members from time to time of the Buyer’s Group an irrevocable, non-exclusive, perpetual, royalty-free, worldwide license to use the plans, designs, and engineering and design data referred to in Clause 2.2 in connection with the operation, maintenance, modification, redesign, refurbishment, repair, sale or other use of the Ship after delivery and such licence to use may be transferred to any charterer or other operator, to any manager or to any buyer of the Ship for such purposes without the need to seek or obtain any consent from the Builder, its successors or assigns.
 
2.4   Each party shall take all reasonable precautions to maintain in confidence, and will not use or permit the use of except as may be necessary for the purposes of the Work — or as otherwise permitted by the express provisions of this Clause 2 — any of the designs, plans and engineering and design data owned by the other party.
 
2.5   Nothing contained in this Contract shall be construed as transferring any patent, patent right, copyright, trademark, trade secret or other intellectual property right created or used in the performance of this Contract, all of which are hereby expressly reserved to the true and lawful owners thereof.
(End of Article 11)

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ARTICLE 12: TAXES AND CONTRACT EXPENSES
1.   TAXES AND CONTRACT EXPENSES
 
1.1   The Builder shall be solely responsible for and shall pay or cause to be paid, without recourse to the Buyer or any member of the Buyer’s Group, all taxes of any kind whatsoever that are imposed, determined or assessed in any of the following jurisdictions (the “relevant jurisdictions”) France or (if different) the country of the Shipyard or the country of any Subcontractor, in connection with: (i) the making, execution and performance of this Contract by the Builder; (ii) the construction, sale, delivery and export of the Ship in and from any of the relevant jurisdictions; (iii) the manufacture in, and importation and exportation of any Parts (other than Buyer’s Supplies) into or out of, any of the relevant jurisdictions; and (iv) the receipt of the payment of the Contract Price in France, and the Builder shall indemnify fully, hold harmless and defend the Buyer and other protected parties from and against any actions, claims, costs, liabilities and losses which any of them may suffer or incur in relation to any such taxes.
 
1.2   The Buyer shall be solely responsible for and shall pay or cause to be paid, without recourse to the Builder, all taxes of any kind whatsoever that are imposed, determined or assessed in connection with: (i) the making, execution and performance of this Contract by the Buyer (other than any taxes imposed, determined or assessed in any of the relevant jurisdictions for which the Builder is responsible); (ii) the importation into any of the relevant jurisdictions of any Buyer’s Supplies delivered by the Buyer to the Builder or any Subcontractor; (iii) the importation of the Ship or any Parts into the country of the Buyer; and (iv) the residence or activities of any of the Buyer’s representatives in France, and the Buyer shall indemnify fully, hold harmless and defend the Builder from and against any from and against any actions, claims, costs, liabilities and losses which the Builder may suffer or incur in relation to any such taxes.
 
1.3   Each party shall bear and pay all costs and expenses incurred by it in connection with the negotiation, preparation and execution of this Contract.
(End of Article 12)

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ARTICLE 13: DISPUTES
1.   TECHNICAL DISPUTES
 
1.1   Except where a Dispute of a technical nature is determined by the Classification Society under Clause 4.2 in Article 1 or, as appropriate, by a Regulatory Authority under Clause 4.4 in Article 1, any Dispute of a technical nature giving rise to issues purely of fact (including, without limitation, any difference of opinion relating to the costs and time effects of any modifications proposed under Article 3 or to questions as to the existence, degree or extent of any alleged non-compliance of the Ship or any Part to the Contract, the Plans, the Specification, or the Class or Regulatory Rules) shall be referred to the Head Office of the Classification Society for its final decision provided that if the Head Office of the Classification Society declines to accept any such referral, or if either party reasonably considers that it is not appropriate to refer the Dispute in question to the Head Office of the Classification Society, with the agreement of both parties the Dispute shall be referred to a mutually acceptable technical expert for his final decision.
 
1.2   The procedure applicable to the resolution of any Dispute of a technical nature (whether by the Classification Society or by a mutually agreed technical expert) shall be as follows:
  (i)   the person or body to whom the Dispute is referred (the “Expert”, which term shall also apply to any substitute appointed by mutual agreement of the parties) shall be requested to make a final decision within 21 (twenty one) Working Days after it has accepted the appointment;
 
  (ii)   within 10 (ten) Working Days after the Expert has confirmed to both parties that it has accepted the appointment, each party will send to the Expert (and simultaneously to the other party), by email, telefax or registered courier, its submissions and supporting evidence in relation to the Dispute ;
 
  (iii)   if a party fails to submit its submissions and supporting evidence within the time limit laid down in paragraph (ii), it shall be deemed to have admitted the correctness of the other party’s submissions;
 
  (iv)   the Expert shall act as an expert and not as an arbitrator;
 
  (v)   the decision of the Expert shall be final and binding on both parties (except in the case of fraud, bad faith or manifest error or unless otherwise agreed in writing by the parties); and
 
  (vi)   the parties shall bear the Expert’s costs equally.
1.3   If within 10 (ten) Working Days after receipt by a party of a notice of a Dispute from the other party:
  (i)   the Head Office of the Classification Society has failed to accept a referral pursuant to Clause 1.1; or

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  (ii)   a party reasonably considers that it is not appropriate to refer any Dispute of a technical nature to the Head Office of the Classification Society or to a technical expert; or
 
  (iii)   the parties have failed to agree upon the identity of a mutually acceptable technical expert and obtain written acceptance of its appointment,
    the Dispute shall be determined in accordance with Clause 2.
 
2.   JURISDICTION
 
2.1   Except where a Dispute is determined under Clause 1.1, the English courts shall have exclusive jurisdiction to settle and determine all Disputes.
 
2.2   Each party agrees that the English courts are the most appropriate and convenient courts to settle and determine Disputes and that accordingly no party will argue to the contrary; and each party hereby irrevocably submits itself to the jurisdiction of the English courts for the purposes of this Contract.
 
2.3   A judgment relating to this Contract that is given or enforceable by the English courts may be enforced without review (subject to mandatory law) in any other jurisdiction and each party waives all of its rights to apply for or require any such review.
 
2.4   Subject to Clause 2.6 in Article 8, no Dispute shall entitle the Builder to cease or suspend any part of the Work or to withhold delivery of the Ship, nor shall any Dispute entitle the Buyer to withhold the payment of any part of the Contract Price due under any of Clauses 2.1(i), (ii), (iii) or (iv) in Article 8 beyond the relevant due date for payment provided that nothing in this provision shall prejudice any right which:
  (i)   the Builder may have to retain possession of the Ship on account of non-payment of the Contract Price; or
 
  (ii)   the Buyer may have to dispute the due date for payment of any part of the Contract Price under Clause 2.1(v) in Article 8.
2.5   For the avoidance of doubt, if any Dispute arises before delivery of the Ship and is referred for determination under any of the express provisions of Clauses 1 or 2 hereof, the Builder shall not be entitled to dispose of the Ship pending the final determination of such Dispute.
 
3.   GOVERNING LAW
 
3.1   This Contract is governed by and shall be construed in accordance with English law.
 
3.2   Each party irrevocably agrees before the Effective Date to appoint and thereafter to maintain Clifford Chance Secretaries Limited (“CCSL”) as agent for service of process in relation to any proceedings before the English courts in connection with this Contract and all related agreements, securities and other documents including (without limitation) the Builder’s Performance Guarantee, the Buyer’s Guarantee and the Option Agreement.
 
3.3   Without prejudice to any other mode of service allowed under any relevant law, service of any proceedings or process or judgment issued out of, or made or granted by, the

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    English courts may be served by being delivered to the last known address in London of CCSL or to the relevant party itself at the address for such party set out in Clause 4.
3.4   The Builder (for itself, its successors and assignees) irrevocably and unconditionally agrees that, notwithstanding the appointment of CCSL referred to in Clause 3.2 above, Clifford Chance LLP may act as legal advisors and attorneys of the Buyer and other members of the Buyer’s Group for all purposes whatsoever under or in connection with this Contract and all related agreements, securities and other documents including, without limitation, for the purposes of any legal proceedings arising out of or in connection with this Contract or such agreements, securities and other documents.
 
4.   NOTICES
 
4.1   Any notice or other communication in relation to material matters in connection with this Contract shall be in writing in the English language and shall be given to the addressee at the address set out below or sent by telefax to the telefax number given below, marked for the attention of the relevant individual listed in the “Attention” lines set out below provided that all notices and communications relating to technical matters (including, without limitation, those concerning the approval of Plans and tests) shall be given to the Supervisor at the address set out in paragraph (ii) below or sent by telefax to the telefax number specified in paragraph (ii) below.
                 
 
  (i)   If to the Buyer, to:   F3 Two, Ltd. c/o
 
          665 Corporate Centre Drive
 
          Miami, Florida 33126
 
      Telefax:   + 1 305 436 4113
 
      Attention:   Mr Colin Veitch, President & CEO
 
      with a copy to telefax:   +1 305 436 4117
 
      Attention:   Mr Mark Warren, General Counsel
 
 
  (ii)   If to the Supervisor, to:   the Supervisor
 
          c/o the Supervisor’s designated office
 
          at the Shipyard
 
 
      Telefax:   To be advised
 
      Attention:   To be advised
 
 
  (iii)   If to the Buyer’s UK newbuilding office, to:        
 
          NCL (Bahamas) Ltd. c/o
 
          1 Derry Street
 
          London
 
          W8 5NN
 
 
      Telefax:   + 44 20 7938 4515
 
      Attention:   Mr Trond Sorensen
 
 
  (iv)   If to the Builder, to:   Aker Yards, S.A.
 
          Avenue Bourdelle — B.P. 90180
 
          44613  

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          Saint-Nazaire
 
          Cedex
 
          France
 
 
      Telefax:   +33 (0) 2 51 10 91 61
 
      Attention:   Chief Executive Officer
 
 
      with copy to:        
 
 
      Telefax:   +33 (0) 2 51 10 99 94
 
      Attention:   Contract Director
 
 
      And with a copy to:        
 
 
      Telefax:   +358 10 670 24 04
 
      Attention:   Chief Legal Counsel
  or to such other person, address or telefax number as either party may (by not less than five (5) Working Days’ notice in writing) specify to the other.
 
4.2   In the absence of evidence of earlier receipt, any notice or other communication shall be deemed to have been duly given:
  (i)   if correctly addressed and marked for the attention of the appropriate individual and delivered personally, when left at the appropriate address of the addressee;
 
  (ii)   if correctly addressed and marked for the attention of the appropriate individual and sent by pre-paid registered mail (or registered airmail if international) or courier, upon acknowledgement of receipt by return telefax; and
 
  (iii)   if correctly addressed and marked for the attention of the appropriate individual and sent by telefax to the correct number, upon acknowledgement of receipt by return telefax.
4.3   Communications in relation to matters other than those referred to in Clause 4.1 may be given by email.
(End of Article 13)

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ARTICLE 14: GENERAL MATTERS
1.   COMPUTATION OF TIME
1.1   Except as otherwise provided in this Contract, all periods of time shall be computed by including Saturdays, Sundays and holidays except that if any period terminates on:
  (i)   any day which is not a Working Day in London or Paris (in the case of periods applicable to action by the Buyer); or
 
  (ii)   any day which is not a Working Day in Paris (in the case of periods applicable to action by the Builder),
    such period shall be deemed to be extended to the next following Working Day in such place.
2.   ASSIGNMENTS
 
2.1   The Buyer may:
  (i)   grant to its financiers of the Ship, or the other financiers of the Buyer’s Group, assignments of (or other security interests in) this Contract, the Insurances (in respect of Buyer’s Supplies), and the Refund Guarantees and any other securities that may be issued to the Buyer under and in connection with this Contract;
 
  (ii)   assign, novate or transfer this Contract to any member of the Buyer’s Group or to any other person connected with the financing of the Ship (with the prior approval of the Builder, which is not to be unreasonably withheld); and
 
  (iii)   assign its post-delivery rights under this Contract to any purchaser, lessee or bareboat charterer of the Ship,
    provided that the Buyer’s Guarantee shall remain in full force and effect or, if legally necessary to replicate the security intended to be conferred by such guarantee, shall be replaced with another guarantee acceptable to the Builder (such acceptance not to be unreasonably withheld) notwithstanding any such assignment, novation or transfer.
2.2   As and when so requested by the Buyer, the Builder will provide the Buyer’s financiers and permitted assignees with all such information and documentation as they may reasonably request without depriving the Builder of its rights and interest under this Contract.
 
2.3   The Builder may assign its rights under this Contract and its interest in the Insurances to its financiers for the Builder’s pre-delivery construction financing of the Ship and the Refund Guarantors. Otherwise, the Builder shall not assign or novate or transfer, or purport to assign or novate or transfer, any of its rights or obligations under this Contract.
 
3.   PARTIAL ILLEGALITY
 
3.1   If any provision of this Contract or the application thereof to any person or in any circumstances shall to any extent be illegal, invalid or unenforceable, such illegality,

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    invalidity or unenforceability shall not prejudice the effectiveness of the remainder of this Contract or the application of such provision to other persons or in other circumstances and each other provision of this Contract shall be legal, valid and enforceable to the fullest extent permitted by law.
4.   CONFIDENTIALITY
 
4.1   After the date of this Contract, the parties will agree the terms and publication date(s) of press announcements in relation to the construction of the Ship.
 
4.2   Save as provided in Clause 4.1, each party agrees that at all times before or after delivery of the Ship it shall hold this Contract, the Plans and the Specifications in strict confidence and shall not disclose (or allow to be disclosed) to any third party any information or documentation in relation to this Contract provided that:
  (i)   each party may, with the prior written consent of the other, disclose to any third party information relating to the matters referred to in this Clause 4.2;
 
  (ii)   each party shall be entitled to disclose information about the Contract strictly on a “need to know” basis — and then only to such extent as shall be reasonably necessary to enable each recipient to carry out its work in relation to the Contract — to its employees and other representatives, and also to its shareholders, bankers, auditors and legal advisors; and
 
  (iii)   each party shall be entitled to disclose information about the Contract to such extent as may from time to time be required by law or the rules or regulations of any applicable stock exchange or similar body.
5.   AMENDMENTS
 
5.1   No amendment, modification, supplement or other variation of this Contract, the Plans or the Specification shall be of any effect unless made in writing and signed by the Builder and the Buyer or their respective duly authorised representatives.
 
6.   NO WAIVER
 
6.1   No failure or delay on the part of either party in exercising any right, power or remedy under this Contract shall operate as a waiver thereof or a waiver of any other rights, powers or remedies nor shall any single or partial exercise of any such right power or remedy preclude any other or further exercise of any such right, power or remedy or the exercise any other right, power or remedy.
 
6.2   The respective rights, powers and remedies conferred on the parties by this Contract are cumulative and (save where the contrary is expressly stated) are in addition to (and not exclusive of) any rights, powers and remedies provided by law.
 
7.   CONSENTS
 
7.1   Subject to Clause 1.6 in Article 2, where any matter:
  (i)   requires an instruction from the Buyer, a waiver by the Buyer or the approval, authority or consent of the Buyer any such instruction, waiver, approval,

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      authority or consent shall not be deemed to have been given or to any extent effective unless it is given in writing by a duly authorised representative of the Buyer; and
 
  (ii)   is required to be acceptable or satisfactory to the Buyer, the Buyer shall not be deemed to have accepted, or to be satisfied with such matter, unless its acceptance or satisfaction is communicated in writing to the Builder by a duly authorised representative of the Buyer.
7.2   Subject to the other express provisions of this Contract, where any matter:
  (i)   requires an instruction from the Builder, a waiver by the Builder or the approval, authority or consent of the Builder any such instruction, waiver, approval, authority or consent shall not be deemed to have been given or to any extent effective unless it is given in writing by a duly authorised representative of the Builder; and
 
  (ii)   is required to be acceptable or satisfactory to the Builder, the Builder shall not be deemed to have accepted, or to be satisfied with such matter, unless its acceptance or satisfaction is communicated in writing to the Buyer by a duly authorised representative of the Builder.
8.   LANGUAGE
 
8.1   The official text of this Contract (and all plans, drawings, test and Work schedules, reports, protocols, certificates, instruction booklets, notices, communications and other materials or documents to be drawn up, developed or supplied under this Contract) shall be in the English language.
 
9.   MODELS
 
9.1   The Builder shall, at its cost and without charge to the Buyer, build, supply and deliver to the Buyer (and place on board the Ship before delivery) the models of the Ship referred to in Part G.6.4 of the Specification.
 
10.   COUNTERPARTS
 
10.1   This Contract may be executed in up to two (2) counterparts each of which when dated and signed by (or on behalf of) both parties shall be an original, but all counterparts together shall constitute one and the same instrument.
 
11.   EFFECTIVE DATE
 
11.1   This Contract shall not have any legal effect whatsoever until the time on the date (the “Effective Date”) when all of the following conditions have been satisfied:
(i) the Buyer shall have confirmed by written notice to the Builder that it has obtained binding written commitments (in terms reasonably satisfactory to the Buyer) for the financing arrangements that will be required to enable the Buyer to fund all Contract Price payments in accordance with Article 8;

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(ii) the Buyer shall have confirmed by written notice to the Builder that it has approved (a) the table referred to in Article 3, Clause 1.2, and (b) the final version of the Specification section relating to the public spaces in the Ship;
(iii) Star Cruises Limited shall have received the approval of its shareholders for the transactions contemplated by this Contract and shall have complied with the requirements of the applicable rules of Stock Exchange of Hong Kong Limited and of the Singapore Exchange Securities Trading Limited;
(iv) the formats of each of the AOM form, the Refund Guarantee, the Builder’s Performance Guarantee and the Buyer’s Performance Guarantee shall have been finally agreed by the parties;
(v) the Buyer’s Performance Guarantee shall have been delivered to the Builder;
(vi) the Builder’s Performance Guarantee shall have been delivered to the Buyer; and
(vii) the Option Agreement shall have been signed by the Builder and the Buyer’s Guarantor.
11.2   The Parties intend that the conditions referred to in Clause 11.1 (i), (ii), (iv), (v), (vi) and (vii) shall be satisfied by 11 September 2006 and that the conditions referred to in Clause 11.1 (iii) shall be satisfied by 31 October 2006. If this Contract has not come into effect by 4pm (Paris time) on 31 October 2006 either party may, by written notice given to the other within ten (10) days thereafter, cancel this Contract.
 
11.3   In the event of the exercise by either party of its right to cancel this Contract under Clause 11.2, this Contract shall, with effect from such cancellation, be null and void without any liability whatsoever on the part of either party.
 
11.4   Notwithstanding any provision to the contrary in this Contract, the Buyer shall not be obliged to make any payment to the Builder hereunder until such time as all of the conditions set out in Clause 11.1 have been fulfilled or expressly waived in writing by both parties.
 
12.   PROTECTED PARTIES
 
12.1   Any of the protected parties may enforce only the provisions of this Contract that are expressed to confer any rights on them, subject to and in accordance with the Contracts (Rights of Third Parties) Act 1999.
 
12.2   The Builder and the Buyer may at any time, by agreement between them, rescind this Contract or vary it without the consent of the protected parties.
 
12.3   If any protected party becomes entitled to bring a claim against the Builder under or in respect of this Contract, the Buyer shall bring such claim against the Builder on behalf of the relevant protected party and all communications, notices and proceedings shall be channelled through the Buyer.
 
12.4   If any claim is made against the Builder by the Buyer on behalf of a protected party under Clause 12.3, the Builder shall have available to it by way of defence only such matters as would have been available to it by way of defence if the relevant protected party had been a party to this Contract. For the avoidance of doubt, this means that in

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    respect of any claim by the Buyer on behalf of a protected party the Builder shall be entitled to raise any defence that the Builder would have been entitled to raise if the relevant claim had been brought by the Buyer for itself.
12.5   Save as provided above the operation of the Contracts (Rights of Third Parties) Act 1999 is hereby excluded.
 
13.   RELATIONSHIP OF PARTIES, PREVIOUS NEGOTIATIONS
 
13.1   The Contract does not create any partnership, joint venture or other joint relationship between the Builder or the Buyer.
 
13.2   This Contract supersedes all prior negotiations, representations, undertakings and agreements between the parties in relation to the subject matter of this Contract.
 
14.   EXCLUSIONS
 
14.1   Subject to the obligations and liabilities of either party to pay the liquidated damages and other compensation amounts expressly provided for in this Contract, each party agrees that neither party shall be liable to the other under or in connection with this Contract for any form of consequential, exemplary, incidental, indirect or special losses and/or damages of any nature whatsoever, howsoever caused and whensoever arising.
 
14.2   Save as otherwise expressly provided in this Contract, all implied terms and conditions are hereby excluded.
 
14.3   Nothing in this Contract shall operate to exclude, limit or restrict any liability arising as a result of fraud, or death or personal injury resulting from gross negligence or wilful misconduct.
 
15.   FAIR DEALING AND BUSINESS STANDARDS
 
15.1   Each party agrees: to use all reasonable efforts to make timely decisions in a speedy and effective way; to deal fairly with each other; and at all times to act in good faith. In this context, “good faith” includes, without limiting the duty of each party to co-operate with the other, a duty of honesty to the other party and a duty not to intentionally mislead the other party.
 
15.2   Each party, in performing its obligations under the Contract, shall maintain appropriate business standards, procedures, precautions and controls, including those necessary to avoid any real or apparent impropriety or adverse impact on the interests of the other party. Each party shall implement (and shall ensure that its employees and other representatives comply with) a policy which prohibits the giving or receiving of any inappropriate favours, gifts, entertainment, payments, loans or other consideration of any kind directly or indirectly connected with the Contract or the Work or any other activities that might influence individuals to act contrary to the best interests of their principal or applicable law.
 
15.3   Each party warrants and represents that all financial settlements, reports and billings rendered to the other party under or in connection with the Contract shall properly reflect the facts of all activities and transactions handled for the other party’s account and may

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    be relied upon as being complete and accurate in any further recording or reporting made by the such party or any other member of the corporate group to which such party belongs.
15.4   Save for the commission payable by the Builder to brokers whose identity has previously been disclosed in writing by the Builder to the Buyer, no commission of any kind whatsoever is or will be payable (whether directly or indirectly) by or to the Builder in relation to or in connection with the Contract or any of the business transactions described in or contemplated by the Contract. Any breach of this Clause by the Builder may be treated by the Buyer as a material breach of the Builder’s obligations for the purposes of Article 9, Clause 2.1 (iii).
 
16.   COST SAVINGS
    The Builder and the Buyer will co-operate and Work closely together on an “open-book” basis in order to reduce costs and generate savings.
17.   PRIORITY OF CONTRACT, PLANS AND SPECIFICATION
 
17.1   This Contract, the Plans, and the Specification are intended to complement and supplement one another. All general language or requirements embodied in the Specification are intended to amplify, explain and implement the requirements of this Contract. The Specification and the Plans are also intended to explain each other, and anything shown in the Plans but not stipulated in the Specification or stipulated in the Specification and not shown in the Plans shall be deemed and considered as if embodied in both.
 
17.2   If there is any conflict between any provisions of the following documents, priority between them shall be determined as follows:
  (i)   this Contract and the Specification or Plans, the former shall prevail;
 
  (ii)   the Specification and the Plans, the former shall prevail;
 
  (iii)   the GA Plan and other Plans, the former shall prevail; and
 
  (iv)   one or more Plans (other than the GA Plan), the latest in time shall prevail.
(End of Article 14)

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ARTICLE 15: SISTER SHIP
The Ship is to be built as a sister to C33 and according to the same Specification and Appendices (as the same may from time to time be amended by agreement of the parties) of which the Buyer declares having and being always in a position to have full knowledge and therefore, notwithstanding the other provisions of this Contract, the Plans and the Specification upon which the provisions of this Article 15 shall prevail, the Buyer and the Builder have expressly agreed that:
  (i)   Approval by the C33 Buyer for the C33 of any document, drawing, or supplier shall be considered valid and binding upon the Buyer for the Ship unless the parties make an agreement to the contrary.
 
  (ii)   All modifications and/or changes agreed by the Builder and the C33 Buyer for the C33, will be deemed agreed by the Buyer for the Ship as well unless the parties make an agreement to the contrary. Adjustments of the Contract Price, extension of time for delivery, and/or of other terms of this Contract may be different from adjustments for the C33, taking into consideration work progress status, design and other work that will not have to be repeated, etc. However, such adjustments will be communicated to the Buyer and shall have to be approved simultaneously for both the C33 and the Ship.
 
  (iii)   Except as provided in the following paragraphs of this Clause 1.1, any modifications and changes required by the Buyer for the Ship compared to the C33 will be treated as modification or change as per Article 3, Clause 1 of this Contract.
 
  (iv)   Acceptable modifications as compared to C33.
 
      Within the Ship definition, the Buyer can alter the following, which shall not be considered as modifications or changes under Article 3, Clause 1 of this Contract:
  (a)   Changes of pieces of art and decoration to be supplied by the Buyer (as far as they do not lead to change in the arrangement of foundations, room arrangement, etc. as compared to the C33).
 
  (b)   Changes of colors in crew common spaces.
 
  (c)   For the passenger public spaces:
 
  (d)   Changes of colors and finishes (minor decorative elements) of the ceiling, walls, pillars and furniture.
 
  (e)   Changes of patterns and colors of the carpets
 
  (f)   Changes of reference of the marble/tiles/wooden flooring (provided that the Builder purchase prices remain the same as for the C33 corresponding elements).
 
  (g)   Changes of the fabric for the seats, the curtains, bedspreads.

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  (h)   Changes of the furnished materials for the tables
 
  (i)   Changes in names of the rooms.
 
  (j)   Any other changes to public spaces that do not modify the coordination drawings of the C33 and/or of the Ship.
  (v)   Changes in equipment, material, suppliers
 
      As a general rule, equipment, materials and suppliers for the Ship will be the same as for the C33. The Builder will be entitled to propose to use new techniques and/or materials on the Ship as compared to the C33. Buyer’s approval will not be refused where such changes are proposed to accommodate the application of new techniques and/or materials, provided that they afford at least the same reliability/quality/warranty and performances as on the C33 and if they do not and will not involve any adverse change in the Ship’s operations or services to passengers nor any additional costs (initial or of an ongoing operational nature) or other adverse effects (initial or ongoing) to or for the Buyer.
 
      If and only in case of deficiency of suppliers chosen for the C33, the Builder shall be entitled to propose for the Ship changes in materials, equipments, and/or suppliers, in which case the selection of materials, equipment and/or suppliers will be made in accordance with Article 1, Clause 5 of this Contract
  (vi)   Calculations, trials, test, mock-up, models:
 
      The following calculations, trials, tests, mock-ups and models when approved for the C33, shall be considered acknowledged, validated and approved by the Buyer and will not be repeated for the Ship.
  (a)   All calculations and analysis, studies, for structure, noises, vibrations, etc. (only adjustments for loading cases resulting from possible difference in light ship weight will be carried out).
 
  (b)   Wind-tunnel tests, model basin tests and propeller tests.
 
  (c)   Mock-up apartments working models, toilet unit etc
 
  (d)   Preliminary sea trials (but not main sea trials)
 
  (e)   Maneuvering tests, if approved by flag administration and Class and the Buyer. Any test/trial specific to a prototype ship and which the Buyer acknowledges that they have not to be repeated on the Ship which is a second ship in the series.
  (vii)   Noise and vibrations levels tests shall be carried out on the Ship unless taking into consideration results of noise and vibration levels measurements made for the C33 during dock and sea trials, the Buyer agrees with the Builder’s proposal to choose a limited number of measuring points for the Ship in significant locations to check that levels on the Ship are within the required levels.

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  (viii)   Buyer’s Supplies
 
      All Buyer’s Supplies to be installed by the Builder will be of the same types and quantity as for the C33 provided that the Buyer shall be entitled to make changes in Buyer’s Supplies to reflect changes made under paragraph (iv) above so long as such changes would not unavoidably result in the Builder exceeding its original budget for installation of the relevant Buyer’s Supplies.
(End of Article 15)

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SCHEDULE 1
Form of AOM
         
AKER FRANCE S.A   PROJECT:   AOM No:
St.Nazaire   Calculation +/- costs   Date:
Subject:
       
 
       
Reference:
       
 
       
Description:
       
                                 
        ED   ID                    
        (External   (Internal   Work   Design   Weight   Longitudinal   Vertical
        Delivery)   Delivery)   hours   Hours   +   Position   position
BGR   Description of work   (Euro)   (Euro)   (Hours)   (Hours)   (Tonnes)   (Metres)   (Metres)
 
                               
 
                               
SUM:
                               
Calculation:
Sum ED + ID
Builders Margin ( 8 % ):
Sum ED + ID + Builders Margin:
Labour Cost: Hours x                             /hour
Design Cost: Hours x                             /hour
Sum Fabrication costs:
Interest:          % Interest days:          days                     Interest cost:
(Note: Interest is paid from the day the AOM related work is completed and handed over)
Calculation Price:
Quotation to Owner:          Yes O          Date:          No O
Negotiated with Owner:    Yes O          Date:          No O
Final Price:
Other non-cost related modifications:
  Guaranteed Deadweight
 
  Guaranteed Service Speed
 
  Delivery Date
 
  Other Contractual Matters
         
Name:
  Phone:   Department:
(End of Schedule 1)

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SCHEDULE 2
Form of Protocol of Delivery and Acceptance
It is this day agreed that the m.v. [ ] built by Aker Yards S.A. (the “Builder”) as Hull No.[C] 33 at the Builder’s Shipyard in Saint-Nazaire, France under the Shipbuilding Contract dated [ ] 2006 and made between the Builder and [ ] (the “Buyer”) has today, [ ], at [am/pm] local time been delivered by the Builder and accepted by the Buyer.
         
Signed by
       
 
 
 
   
for and on behalf of [Buyer]    
 
       
Signed by
       
 
 
 
for and on behalf of AKER YARDS S.A.    
(End of Schedule 2)

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SCHEDULE 3
Form Of Refund Guarantee
[Letterhead of Refund Guarantor]
To:   [insert name of Buyer]
Date:   []
[NB This format is provisional and is subject to written approval of both parties]
Refund Guarantee No. [] (the Guarantee)
We refer to the shipbuilding contract dated as of [] 2006 (as amended or supplemented at any time, the “Contract”) and made between [] (the “Buyer”) and AKER YARDS SA (the “Builder”) in relation to the construction of the Builder’s Hull [] (the “Ship”). Terms used in this Guarantee shall bear the same meaning as in the Contract. Under the Contract, the Contract Price is to be paid in 5 (five) instalments and the Buyer’s obligation to pay each of the 4 (four) pre-delivery instalments of the Contract Price is conditional upon (amongst other things) the Buyer receiving an irrevocable refund guarantee from a first class bank, insurance company or other financial institution reasonably acceptable to the Buyer securing the refund of the instalment together with interest thereon at the Relevant Rate.
In consideration of the Buyer agreeing to pay the sum of EUR [] corresponding to the [first] / [second] / [third] / [fourth] instalment (the “Instalment”) of the Contract Price payable under Article 8, Clause 2.1 of the Contract, and of the Buyer agreeing to accept this Guarantee under Article 8, Clause 2.3 of the Contract as security for the refund of the Instalment, at the request of the Builder we, [] hereby unconditionally and irrevocably: (i) guarantee to the Buyer to refund the Instalment to the Buyer (less the amount received by the Buyer from the Builder under Article 1, Clause 6.8 of the Contract) and to pay interest thereon at the Relevant Rate from the date of the Builder’s receipt of the Instalment to the date of the Buyer’s receipt of the refund, subject to an overall limit of EUR [] [corresponding to the Instalment plus interest equivalent to a % of the Instalment amount to be approved by the Buyer] in respect of such Instalment and interest, and without prejudice to the Buyer’s right to claim and recover interest in excess of this limit from the Builder or its other guarantors, against the Buyer’s simple written demand (a) specifying the amount claimed by the Buyer in respect of the Instalment together with interest thereon at the Relevant Rate, and (b) specifying the account to which the amount demanded is to be paid; and (ii) undertake to the Buyer that (a) payment will be made by us forthwith, subject to a fifteen (15) running day notification period under paragraph 3 below, upon our receipt of such simple written demand, without any counterclaim, deductions, set-off, withholdings or any objection whatsoever, and (b) if we are required by law to make any deduction or withholding from any payment to the Buyer under this Guarantee, our payment to the Buyer will be increased by such amount as may be necessary to ensure that, after all of the required deductions and withholdings have been made, the Buyer receives a payment equal to the amount it would have received had no such deductions or withholdings been made.
Notwithstanding paragraph 2 above, if, within fifteen (15) running days following our receipt of a written demand from the Buyer, the Builder has (i) confirmed to us in writing that the Builder is disputing the Buyer’s entitlement to make a claim under this Guarantee and (ii) delivered to us

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a copy of a written notice served on the Buyer stating the grounds upon which the Builder is disputing the Buyer’s entitlement to make a claim under this Guarantee, we shall not effect payment under this Guarantee pending settlement of the dispute between the parties or determination of the dispute in accordance with the Contract. If the Builder subsequently accepts all or any part of the Buyer’s claim, or if the Buyer obtains a final order from the English courts (meaning a judgment or court order in respect of which there is no right of appeal or in respect of which the time limit for submitting an application to appeal has expired without such application having been made by either party to the Contract) adjudging that all or any part of the claim is payable to the Buyer, we will pay the relevant amount to the Buyer (together with interest thereon as provided in paragraph 2 above) upon our receipt of a certified true copy of a settlement agreement signed on behalf of the Builder and the Buyer or (as the case may be) upon our receipt of a certified true copy of the relevant court order.
This Guarantee shall become effective upon the Builder’s receipt of the Instalment. Save in respect of any demand made hereunder before the termination or expiry of this Guarantee, this Guarantee shall terminate upon the first to occur of (i) the Buyer’s acceptance of the Ship in accordance with the Contract, (ii) the date when we have received a written notice from the Buyer stating that it has (a) received, from another guarantor acceptable to the Buyer, a substitute guarantee securing the refund of the Instalment which is in form and substance satisfactory to the Buyer or (b) received a refund of the Instalment together with interest thereon as provided for in paragraph 2 above, (iii) our payment to you of the Instalment together with interest thereon as provided for in paragraph 2 above, (iii) the valid and lawful termination of the Contract by the Builder pursuant to the terms and conditions thereof, and (iv) the date falling [**] [Confidential Treatment] days after the Delivery Date provided that if either party commences legal proceedings in the English courts pursuant to the Contract before the termination or expiry of this Guarantee or within 45 (forty five) days after termination of the Contract, this Guarantee shall remain in full force until the date falling 45 (forty five) days after the date of the final order in such proceedings.
Our obligations under this Guarantee are those of a sole primary obligor (as and for our own debt and independent from any obligations of the Builder) and not merely as surety, and we agree that the Buyer is not obliged to make any prior demand of the Builder under the Contract or to seek to enforce any remedies against the Builder before making a claim under this Guarantee.
Our obligations under this Guarantee shall not be in any respect discharged, impaired or otherwise affected by reason of any events or circumstances whatsoever including without limitation (i) any invalidity, irregularity or unenforceability of any of the Builder’s obligations under or in connection with the Contract, (ii) the granting to the Builder of any time, waiver, consent, indulgence or other forbearance in relation to the Contract, (iii) any bankruptcy, insolvency or similar proceedings related to any party to the Contract, (iv) any amendments or supplements to the Contract, or (v) any other events or circumstances that might otherwise constitute a legal or equitable discharge of or defence to a surety or guarantor under applicable law, and we hereby irrevocably and unconditionally waive any and all defences at law or in equity that may be available to us by reason of any such events or circumstances.

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This Guarantee shall be in addition to any other security granted by the Builder in favour of the Buyer under the Contract, and shall not be affected by any action taken by the Buyer under any such other security.
This Guarantee may be assigned by the Buyer to any of the banks and financial institutions from time to time providing the Buyer with financial support for its payment obligations under or in connection with the Contract, and to any other permitted assignees of the Buyer’s rights under the Contract, provided that written notice of any such assignment shall be given to us promptly thereafter.
We unconditionally and irrevocably (i) agree that this Guarantee shall be governed by and construed in accordance with English law, (ii) agree that the English courts shall have exclusive jurisdiction to hear and determine any suit, action or proceeding, and to settle any disputes, that may arise out of or in connection with this Guarantee, and (iii) submit to the jurisdiction of the English courts for the purposes of any proceedings under or in connection with this Guarantee.
All correspondence, claims and demands under or in connection with this Guarantee shall be marked for the attention of [insert name] and delivered to us at [insert address]. Any legal process issued out of the English courts may be served on us by being delivered to our agent for service of process in London, [insert name] at [insert London address].
Yours faithfully
For and on behalf of [insert name of Refund Guarantor]
(End of Schedule 3)

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SCHEDULE 4
Form Of Builder’s Performance Guarantee
[Letterhead of Builder’s Performance Guarantor]
[NB This format is provisional and is subject to written approval of both parties]
To:   [Buyer]
Date:   []
Gentlemen:
HULL NUMBER [] (THE SHIP)
We have been informed that on [], 2006 a shipbuilding contract (as the same may be supplemented, amended, changed or otherwise modified at any time hereafter, the “Contract”) was concluded between AKER YARDS SA a French société anonyme having its registered office at Avenue Bourdelle 44613 Saint-Nazaire, France (the “Builder”), and yourselves for the construction and delivery of one cruise ship having the Builder’s Hull No. [] (hereinafter called the “Ship”). Terms used in this Guarantee shall bear the same meaning as in the Contract.
In consideration of your entering into the Contract and the payment to ourselves of EUR 1 (receipt of which is hereby acknowledged) the undersigned AKER YARDS ASA (the “Guarantor”) hereby unconditionally and irrevocably guarantees to you, your successors and permitted assigns (the "Beneficiary”) the payment of all such monies (whether principal or interest) and other liabilities or any part thereof (collectively, the “Debts") as may become due to the Beneficiary under or in respect of Article 9, Clause 2.3(i) and (iii) of the Contract and under Article 9, Clause 2.3(ii) of the Contract for any interest not recovered by the Buyer from the Refund Guarantors.
Our obligations under this Guarantee shall not be in any respect discharged, impaired or otherwise affected by reason of any events or circumstances whatsoever including without limitation, (i) any invalidity, irregularity or unenforceability of any of the Builder’s obligations under or in connection with the Contract, (ii) the granting of any time, waiver, consent, indulgence or other forbearance in relation to the Contract, (iii) any bankruptcy, insolvency or similar proceedings related to any party to the Contract, (iv) any amendments or supplements or any other variation whatsoever to the Contract including (without limitation) any assignment, novation or other partial or total transfer of the Contract whatsoever, (v) any modification, disposal of all or part of our direct or indirect investment, interest, control or management (without limitation) of the Builder or (vi) any other events or circumstances that might otherwise constitute a legal or equitable discharge of or defence to a surety or guarantor under applicable law, and we hereby irrevocably and unconditionally waive any and all defences at law or in equity that may be available to us by reason of any such events or circumstances.
Our liability to make payment hereunder shall be conditional upon receipt of the Beneficiary’s signed written demand (i) stating that demand has been made upon the Builder for payment of Debts due by the Builder under the Contract (ii) specifying the amount claimed by the

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Beneficiary in respect of the Debts and/or interest thereon at the Relevant Rate, and (iii) confirming that the Builder has within fifteen (15) days of service of such demand failed to comply with the same.
We shall effect any payment under this Guarantee within a period of fifteen (15) running days following our receipt of the Beneficiary’s written demand without any counterclaim, deductions, set-off, withholdings or any objection whatsoever, and if we are required by law to make any deduction or withholding from any payment to the Beneficiary under this Guarantee, our payment to the Beneficiary will be increased by such amount as may be necessary to ensure that, after all of the required deductions and withholdings have been made, the Beneficiary receives a payment equal to the amount it would have received had no such deductions or withholdings been made.
However, if within the period of fifteen (15) running days following our receipt of the Beneficiary’s written demand, the Builder has (i) confirmed to us in writing that the Builder is disputing the Buyer’s entitlement to make a claim under this Guarantee and (ii) delivered to us a copy of a written notice served on the Buyer stating the grounds upon which the Builder is disputing the Buyer’s entitlement to make a claim under this Guarantee, we shall not effect payment under this Guarantee pending settlement of the dispute between the parties or determination of the dispute in accordance with the Contract. If the Builder subsequently accepts all or any part of the Buyer’s claim, or if the Buyer obtains a final order from the English courts (meaning a judgment or court order in respect of which there is no right of appeal or in respect of which the time limit for submitting an application to appeal has expired without such application having been made by either party to the Contract) adjudging that all or any part of the claim is payable to the Buyer, we will pay the relevant adjudged amount to the Buyer (together with interest thereon at the Relevant Rate) upon our receipt of a certified true copy of a settlement agreement signed on behalf of the Builder and the Buyer or (as the case may be) upon our receipt of a certified true copy of the relevant court order.
This Guarantee shall become effective on the Effective Date. Save in respect of any demands in relation to valid and lawful claims made hereunder before the termination or expiry of this Guarantee, this Guarantee shall terminate upon the earlier of (a) delivery and acceptance of the Ship in accordance with the Contract, (b) the valid and lawful termination of the Contract by the Builder pursuant to the terms thereof, (c) the date of the Beneficiary’s receipt from another guarantor acceptable to the Beneficiary of a guarantee in replacement for this Guarantee pursuant to the Contract in a form and substance acceptable to the Beneficiary, and (d) the date falling [**] [Confidential Treatment] days after the Delivery Date provided that if either party commences legal proceedings in the English courts pursuant to the Contract before the termination or expiry of this Guarantee or within 45 (forty five) days after termination of the Contract, this Guarantee shall remain in full force until the date falling 45 (forty five) days after the date of the final order in such proceedings.
The benefit of this Guarantee shall be capable of assignment without our consent to any permitted and lawful assignee of your benefit of this Contract provided that written notice of any such assignment shall be given to us as soon as reasonably practicable thereafter.
We shall not assign or transfer our obligations under this Guarantee without the prior written consent of the Beneficiary.

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This Guarantee shall be governed by the laws of England and shall be subject to the exclusive jurisdiction of the English Courts.
All correspondence, claims and demands under or in connection with this Guarantee shall be marked for the attention of [insert name] and delivered to us at [insert address]. Any legal process issued out of the English courts may be served on us by being delivered to our agent for service of process in London, [insert name] at [insert London address].
Yours faithfully
         
 
Duly Authorised Signatory
       
For and on behalf of AKER YARDS ASA
       
 
       
 
       
 
       
 
       
 
 
 
   
                    
       
[name and position]
  [name and position]    
(End of Schedule 4)

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SCHEDULE 5
Form Of Buyer’s Performance Guarantee
[NB This format is provisional and is subject to written approval of both parties]
[Letterhead of the Buyer’s Performance Guarantor]
AKER YARDS SA
Date []
Gentlemen:
YOUR HULL NUMBER [] (THE “SHIP”)
We have been informed that on [], 2006 a shipbuilding contract (the “Contract”) was concluded between [], Ltd having its registered office at Milner House, 18 Parliament Street, Hamilton HM12, Bermuda (the “Buyer”), and yourselves for the construction and delivery of one cruise ship having the Builder’s Hull No. [] (hereinafter called the “Ship”). Terms used in this Guarantee shall bear the same meaning as in the Contract.
In consideration of your entering into the Contract and the payment to ourselves of EUR 1 (receipt of which is hereby acknowledged) the undersigned NCL Corporation having its registered office in at Milner House, 18 Parliament Street, Hamilton HM12, Bermuda (the “Guarantor”) hereby unconditionally and irrevocably guarantees to you, your successors and permitted assigns (the “Beneficiary”) the payment of any such monies (whether principal or interest) and other liabilities or any part thereof (the “Debts”) as may become due to the Beneficiary under or in respect of the Contract (as the same may be supplemented, amended, changed or otherwise modified hereafter).
Our obligations under this Guarantee shall not be in any respect discharged, impaired or otherwise affected by reason of any events or circumstances whatsoever including without limitation, (i) any invalidity, irregularity or unenforceability of any of the Buyer’s obligations under or in connection with the Contract, (ii) the granting of any time, waiver, consent, indulgence or other forbearance in relation to the Contract, (iii) any bankruptcy, insolvency or similar proceedings related to any party to the Contract, (iv) any amendments or supplements or any other variation whatsoever to the Contract including (without limitation) any assignment, novation or other partial or total transfer of the Contract whatsoever, (v) any modification, disposal of all or part of our direct or indirect investment, interest, control or management (without limitation) of the Buyer or (vi) any other events or circumstances that might otherwise constitute a legal or equitable discharge of or defence to a surety or guarantor under applicable law, and we hereby irrevocably and unconditionally waive any and all defences at law or in equity that may be available to us by reason of any such events or circumstances.
Our liability to make payment hereunder shall be conditional upon receipt of the Beneficiary’s signed written demand (i) stating that demand has been made upon the Buyer for payment of the Debts due by the Buyer under or in respect of the Contract (ii) specifying the amount claimed by the Beneficiary in respect of any of the Debts and/or interest thereon at the Relevant Rate, and (iii) confirming that the Buyer has within fifteen (15) running days of service of such demand failed to comply with the same.

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We shall effect any payment under this Guarantee within the period of fifteen (15) running days following our receipt of the Beneficiary’s written demand without any counterclaim, deductions, set-off, withholdings or any objection whatsoever, and if we are required by law to make any deduction or withholding from any payment to the Beneficiary under this Guarantee, our payment to the Beneficiary will be increased by such amount as may be necessary to ensure that, after all of the required deductions and withholdings have been made, the Beneficiary receives a payment equal to the amount it would have received had no such deductions or withholdings been made.
However, if within the period of fifteen (15) running days following our receipt of the Beneficiary’s written demand, the Buyer has (i) confirmed to us in writing that the Buyer is disputing the Builder’s entitlement to make a claim under this Guarantee and (ii) delivered to us a copy of a written notice served on the Builder stating the grounds upon which the Buyer is disputing the Builder’s entitlement to make a claim under this Guarantee, we shall not effect payment under this Guarantee pending settlement of the dispute between the parties or determination of the dispute in accordance with the Contract. If the Buyer subsequently accepts all or any part of the Builder’s claim, or if the Builder obtains a final order from the English courts (meaning a judgment or court order in respect of which there is no right of appeal or in respect of which the time limit for submitting an application to appeal has expired without such application having been made by either party to the Contract) adjudging that all or any part of the claim is payable to the Builder, we will pay the relevant adjudged amount to the Builder (together with interest thereon at the Relevant Rate) upon our receipt of a certified true copy of a settlement agreement signed on behalf of the Builder and the Buyer or (as the case may be) upon our receipt of a certified true copy of the relevant court order.
This Guarantee shall become effective on the Effective Date. Save in respect of any demands in relation to valid and lawful claims made hereunder before the termination or expiry of this Guarantee, this Guarantee shall terminate upon the earlier of (a) delivery and acceptance of the Ship in accordance with the Contract, (b) the valid and lawful termination of the Contract by the Buyer pursuant to the terms thereof, (c) the date of the Beneficiary’s receipt from another guarantor acceptable to the Beneficiary of a guarantee in replacement for this Guarantee pursuant to the Contract in a form and substance acceptable to the Beneficiary, and (d) the date falling [**] [Confidential Treatment] days after the Delivery Date provided that if either party commences legal proceedings in the English courts pursuant to the Contract before the termination or expiry of this Guarantee or within 45 (forty five) days after termination of the Contract, this Guarantee shall remain in full force until the date falling 45 (forty five) days after the date of the final order in such proceedings.
The benefit of this Guarantee shall be capable of assignment without our consent to any permitted and lawful assignee of your benefit of this Contract provided that written notice of such assignment shall be given to us promptly thereafter.
We shall not assign or transfer any of our obligations under this Guarantee without the prior written consent of the Beneficiary.
This Guarantee shall be governed by the laws of England and shall be subject to the exclusive jurisdiction of the English Courts.

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All correspondence, claims and demands under or in connection with this Guarantee shall be marked for the attention of [insert name] and delivered to us at [insert address]. Any legal process issued out of the English courts may be served on us by being delivered to our agent for service of process in London, [insert name] at [insert London address].
Yours faithfully
         
 
Duly Authorised Signatory
       
For and on behalf of NCL Corporation Ltd
       
 
       
 
       
 
       
 
       
 
 
 
   
                    
       
[name and position]
  [name and position]    
(End of Schedule 5)

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SCHEDULE 6
Definition Of Certain Terms
1.   DEFINITION OF CERTAIN TERMS
 
1.1   In this Contract:
 
    AOM” has the meaning given in Article 3, Clause 1.3;
 
    Builder’s Account” means the euro denominated account with IBAN number: [**] [Confidential Treatment] or as further modified by notice given by the Builder to the Buyer, and held by the Builder’s Bank at its office in Paris;
 
    Builder’s Bank” means Société Générale, Agence Opéra or as further modified by notice given by the Builder to the Buyer;
 
    Buyer’s Group” means (i) NCL Corporation Ltd, and its subsidiaries and (ii) all other associated or affiliated companies;
 
    Buyer’s Performance Guarantee” means the guarantee to be given by Buyer’s Guarantor in the form set out in Schedule 5;
 
    Buyer’s Guarantor” means NCL Corporation Ltd., a company incorporated in Bermuda and having its registered office at Milner House, 18 Parliament Street, Hamilton, HM12, Bermuda;
 
    Builder’s Performance Guarantee” means the guarantee to be given by Aker Yards ASA in the form set out in Schedule 4;
 
    Buyer’s Supplies” has the meaning given in Article 1, Clause 1.1(i)(b);
 
    Buyer’s Supply Costs” means at any given time the aggregate of (i) the costs incurred by the Buyer in relation to the delivery and transportation to the Shipyard, Ship or relevant Subcontractor, and all related incidental costs including insurance up to the point of delivery, of all Buyer’s Supplies and (ii) the Buyer’s reasonably estimated costs of acquiring and obtaining delivery of replacements for such Supplies at such time;
 
    C33” means the ship, project number PB 6847, having Hull Nr C33 to be built by the Builder for F3 ONE Ltd (the “C33 Buyer”) under a shipbuilding contract signed on even date (the “C33 Contract”);
 
    Class Rules” has the meaning given in Article 1, Clause 4.1;
 
    Classification Society” has the meaning given in Article 1, Clause 4.1;
 
    commission” includes any advantage or benefit (whether monetary or not), brokerage, consideration, gift, gratuity, inducement, introduction fee, payment (other than any payment made or to be made in accordance with the express provisions of this Contract), promise, reward or success fee of any kind whatsoever payable to any broker, agent, intermediary or other person in relation to or in connection with the placing and/or performance of any activities connected with this Contract;

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    Compensation Date” means (i) the 7th (seventh) day from (and including) the Delivery Date or (ii) the 3rd (third) day from (and including) the Delivery Date if the Ship has not been delivered by the intended delivery date mentioned in the 15 (fifteen) days definite notice given by the Builder under Clause 1.1 in Article 7;
 
    Compulsory Acquisition” means a requisition or other compulsory acquisition (including seizure, detention, confiscation or appropriation) by or on behalf of any government or governmental agency or by any persons acting or purporting to act on behalf of any government or governmental agency;
 
    Contract” means this shipbuilding contract and (save in the context of Article 14, Clause 18) includes the Plans, the Specification and the schedules, each of which forms an integral part of this Contract;
 
    Contract Price” means the fixed price for the Ship specified in Clause 1.1 of Article 8;
 
    Defects List” has the meaning given in Article 6, Clause 1.15;
 
    Delivery Date” means the fixed delivery date for the Ship specified in Clause 1.1 of Article 7, it being acknowledged and agreed by the parties that such date may be reset only in strict accordance with, and subject to, the express provisions of this Contract;
 
    Design Draft” has the meaning given in Article 1, Clause 2.12(ii);
 
    Dispute” means any dispute or difference whatsoever arising at any time out of or in connection with this Contract including a dispute regarding the existence, validity or termination of this Contract, and “Disputes” shall be construed accordingly;
 
    Effective Date” has the meaning given in Article 14, Clause 11.1;
 
    encumbrance” means (i) any claim or demand (whether in personam or in rem and including any arrest or other detention in connection with any claim) and any debt, and/or (ii) any mortgage, charge, pledge, maritime or possessory or other lien, assignment, hypothecation, trust arrangement, encumbrance, or other security interest securing any obligation of any person or any other type of preferential arrangement (including, without limitation, title transfer and retention arrangements) having a similar effect but does not include any permitted encumbrance;
 
    EUR” and “euro” mean the lawful currency of France.
 
    EURIBOR” means the percentage rate per annum for euro deposits determined by the Banking Federation for Europe for the relevant period displayed on the appropriate page of the Telerate or the Reuters screen from time to time or, if such display is not available at any time, as certified by the head office of the Builder’s Bank at Paris;
 
    Flag State” has the meaning given in Article 7, Clause 1.8;
 
    GA Plan” means the general arrangement plan [**] [Confidential Treatment] dated [•] 2006 and initialled by the parties for the purposes of identification;
 
    Guaranteed Deadweight” has the meaning given in Article 1, Clause 2.1(ii);

- 83 -


 

    Guaranteed Fuel Consumption” or “GFC” has the meaning given in Article 1, Clause 2.1(vii);
 
    Guaranteed Service Speed” or “GSS” has the meaning given in Article 1, Clause 2.1(vi);
 
    Insurances” has the meaning given in Article 4, Clause 2.1;
 
    Manuals” has the meaning given in Article 1, Clause 1.1(i)(c);
 
    Makers’ List” has the meaning given in Article 1, Clause 5.3;
 
    Mortgage” has the meaning given in Article 4, Clause 1.8 and “Mortgages” shall be construed accordingly.
 
    minor defect” has the meaning given in Article 6, Clause 1.15;
 
    Option Agreement” means an agreement to be made on mutually acceptable terms between the Builder and the Buyer’s Guarantor for the construction of one further passenger cruise ship;
 
    Parts” has the meaning given in Article 1, Clause 1.1(i)(b);
 
    partial loss” means any loss of or damage to the Ship (including Buyer’s Supplies and other Parts) which does not constitute a total loss and “partial loss proceeds” means any insurance proceeds paid and/or payable in respect of any partial loss;
 
    permitted encumbrance” means any encumbrance (i) created by the Buyer or (ii) arising by operation of law in connection with claims against the Buyer by any person other than the Builder for which the Buyer would not be entitled to compensation or indemnification from the Builder under this Contract;
 
    Plans” means the GA Plan, and the other plans and drawings described or referred to in the Specification;
 
    protected parties” means (i) the Buyer and NCL (Bahamas) Ltd. (“NCLB”), and (ii) the respective agents, officers, employees, workmen, suppliers and other representatives of the Buyer and NCLB provided that, in the context of Article 12, Clause 1.1 “protected parties” means the Buyer and any other affected members of the Buyer’s Group;
 
    Protocol of Delivery and Acceptance” has the meaning given in Article 7, Clause 1.3(i);
 
    Refund Guarantee” has the meaning given in Article 8, Clause 2.3(ii);
 
    Refund Guarantor” has the meaning given in Article 8, Clause 2.3(ii);
 
    Regulatory Authorities” means the authorities, bodies and entities having regulatory responsibility and authority in respect of the Ship or specific areas or parts of the Ship, before or after delivery of the Ship, including those identified in Part G3 of the Specification;

- 84 -


 

    "Regulatory Rules” has the meaning given in Article 1, Clause 4.3;
 
    "Relevant Rate” means the aggregate of (i) [**] [Confidential Treatment] and (ii) EURIBOR;
 
    "remedy” shall be construed (with reference to defects and deficiencies referred to in Articles 6 and 7) so as to mean and include correct, rectify, redesign, remedy, repair, replace or otherwise make good, and test to prove the efficacy of the relevant remedial Work, every defect and deficiency, and any other physical damage, for which the Builder is liable under Articles 6 and 7, and “remedial” shall be construed accordingly;
 
    "Ship” has the meaning given in Article 1, Clause 1.1(i)(a);
 
    Shipyard” means the Builder’s shipyard at Saint-Nazaire, France;
 
    Signing Date” means the date on which this Contract is signed by or on behalf of each party;
 
    Specification” means Specification [**] [Confidential Treatment] dated [] 2006 and, unless the context otherwise requires, “specified” means stipulated in the Specification or in the Appendices;
 
    Subcontractor(s)” shall include each of the Builder’s makers and suppliers and any other person, company or other entity to whom any part of the Work is subcontracted directly or indirectly by the Builder;
 
    tests” means (i) the shop and dock inspections, measurements and tests, (ii) the sea trials, (iii) the other inspections and tests referred to in the Specification and the Plans, and (iv) all such other commissioning, tests, trials and inspections (or retests, retrials and reinspections) as may reasonably be required in order to demonstrate and confirm compliance of the Ship with the Contract, Plans and Specification and the full and final remedy of any defects;
 
    "total loss” means any actual, constructive, compromised or arranged or agreed total loss of the Ship (including Buyer’s Supplies or other Parts);
 
    "Work” means all of the Parts to be provided and all of the services, labour and other Work to be supplied and carried out by the Builder and its Subcontractors under and in connection with this Contract, as more particularly described in the Specification and the Plans;
 
    Working Day” means any day, other than a Saturday or Sunday, on which banks are generally open for business in each of London and Paris; and
INTERPRETATION OF CERTAIN REFERENCES
1.2   Save where the contrary is expressly stated, any reference in this Contract to:
  (iii)   this Contract, the Specification, the Plans or any other agreements or documents shall be construed as a reference to this Contract, the Specification, the Plans or, as the case may be, such other agreements or documents as the same may have

- 85 -


 

      been, or may from time to time be, amended, modified, varied, novated or supplemented by agreement of the parties;
  (iv)   an Article or the schedule shall be construed as a reference to an Article or the schedule of this Contract;
 
  (v)   an award shall be construed as a reference to any award, decision, declaration, injunction, judgement, order or other relief;
 
  (vi)   a claim shall be construed as a reference to any action, claim, demand, proceeding, process or suit, whether in arbitration or court or otherwise;
 
  (vii)   a clause shall be construed as a reference to a clause of the Article in which the reference appears;
 
  (viii)   a person shall be construed as a reference to any individual, firm, company, corporation, unincorporated body of persons, or any state or state agency,
 
  (ix)   a party to this Contract shall include a reference to such party’s successors and permitted assigns;
 
  (x)   a tax shall be construed as a reference to any tax, assessment, levy, impost, customs, stamp or other duty, or other charge of a similar nature (including, without limitation, any fine or penalty or interest payable in connection with any failure to pay or any delay in paying any of the same), whether national, provincial or local;
 
  (xi)   a judgment shall be construed so as to include any court order, injunction, declaration, decision and any other form of judicial relief;
 
  (xii)   a receiver shall be construed so as to include any liquidator, trustee, administrator, receiver, administrative receiver, manager or similar officer; and
 
  (xiii)   the winding up of a party to this Contract shall be construed so as to include the bankruptcy or liquidation of the party or any equivalent or analogous proceedings under the law of the jurisdiction in which such party is incorporated or any other jurisdiction in which such party carries on business.
1.3   The Index, Article, Clause and schedule headings and sub-headings are inserted for convenience only and shall not affect the interpretation of this Contract.
(End of Schedule 6)

- 86 -


 

SCHEDULE 7
Sound and Vibration
[**] [Confidential Treatment]

- 87 -


 

[**] [Confidential Treatment]
(End of Contract)

- 88 -


 

AOM No. 1 under the Contract for D33
IT IS HEREBY AGREED:
(1) that the Contract Price shall be increased by the amount of 3,435,000 (three million four hundred and thirty five thousand euros) on account of the agreed increase in the overall length of the Ship to [**] [Confidential Treatment] metres (with a tolerance of +/- half a metre) and all related modification Works;
(2) that the Contract Price increase referred to above shall be paid in accordance with Article 8, Clause 2.4 (ii) of the Contract; and
(3) that the modifications referred to in this AOM shall not change the Delivery Date or any other provision of the Contract.
     
Signed for F3 Two, Ltd.
   
/s/ Colin Veitch 
   
 
on 7th September 2006
   
 
   
Signed for Aker Yards S.A.
   
/s/ signatures illegible 
   
 
on 7th September 2006
   

 


 

AOM No. 2 under the Contract for D33
IT IS HEREBY AGREED:
(1) that the Contract Price shall be increased by the amount of 400,000 (four hundred thousand euros) in order to take account of the set-off made in respect of (i) the agreed cost increases resulting from the space increase modifications agreed between the parties for decks 14 and 15, and (ii) the agreed cost decreases resulting from the space decrease modifications agreed between the parties for decks 7 and 16;
(2) that the Contract Price increase referred to above shall be paid in accordance with Article 8, Clause 2.4 (ii) of the Contract; and
(3) that the modifications referred to in this AOM shall not change the Delivery Date or any other provision of the Contract.
     
Signed for F3 Two, Ltd.
   
/s/ Colin Veitch
   
 
on 7th September 2006
   
 
   
Signed for Aker Yards S.A.
   
Signature Illegible 
   
 
on 7th September 2006
   

 


 

Description of modification
  Deck 7 breadth of public spaces remains at [**] [Confidential Treatment] meters.
 
  Area of public spaces on deck 14 and on deck 15 is increased to accommodate [**] [Confidential Treatment] at the aft part of the Ship.

- 2 -


 

AOM No. 3 under the Contract for D33
IT IS HEREBY AGREED:
(1) that the Contract Price shall be increased by the amount of 2,850,000 (two million eight hundred and fifty thousand euros) in respect of the agreed increase in GSS from [**] [Confidential Treatment] knots and all related modificationWorks;
(2) that the Contract Price increase referred to above shall be paid in accordance with Article 8, Clause 2.4 (ii) of the Contract; and
(3) that the modifications referred to in this AOM shall not change the Delivery Date or any other provision of the Contract.
     
Signed for F3 Two, Ltd.
   
/s/ Colin Veitch 
   
 
on 7th September 2006
   
 
   
Signed for Aker Yards S.A.
   
signature illegible 
   
 
on 7th September 2006
   

 


 

AOM No. 4 under the Contract for D33
IT IS HEREBY AGREED:
(1) that the Contract Price shall be increased by the amount of 400,000 (four hundred thousand euros) in order to take account of the set-off made in respect of (i) the agreed cost increases resulting from the [**] [Confidential Treatment] modifications agreed between the parties for decks [**] [Confidential Treatment], and (ii) the agreed cost decreases resulting from the space decrease modifications agreed between the parties for decks [**] [Confidential Treatment];
(2) that the Contract Price increase referred to above shall be paid in accordance with Article 8, Clause 2.4 (ii) of the Contract; and
(3) that the modifications referred to in this AOM shall not change the Delivery Date or any other provision of the Contract.
     
Signed for F3 Two, Ltd.
   
/s/ Colin Veitch 
   
 
on 7th September 2006
   
 
   
Signed for Aker Yards S.A.
   
signatures illegible 
   
 
on 7th September 2006
   

 


 

Description of modification
  Deck 7 breadth of public spaces remains at [**] [Confidential Treatment] meters.
 
  Area of public spaces on deck 14 and on deck 15 is increased to accommodate [**] [Confidential Treatment] at the aft part of the Ship.

- 2 -

EX-4.45 22 g05791exv4w45.htm EX-4.45 SIDE LETTER AGREEMENT EX-4.45 Side Letter Agreement
 

Exhibit 4.45
[Confidential Treatment]
PRIVATE AND CONFIDENTIAL
F3 One, Ltd. (“FOL”) and F3 Two, Ltd. (“FTL”),
Milner House,
18, Parliament Street
HAMILTON HM12
BERMUDA
Dated as of 7th September 2006
Dear Sirs,
We refer to the memorandum of meeting dated 12 July 2006 (a copy of which is attached as Appendix A) and to the following Shipbuilding Contracts (the “Contracts” and each a “Contract”): the Contract for the construction of a 2100 cabins passenger cruise ship with Hull Number C33 signed earlier today between the Builder and FOL; and the Contract for the construction of a 2100 cabins passenger cruise ship with Hull Number D33 signed earlier today between the Builder and FTL (FOL and FTL being hereafter referred to as the “Buyers”).
Terms used in this letter shall bear the same meanings as in the Contracts.
We hereby confirm the agreement made between the Builder and each Buyer in relation to the following matters.
1. Makers’ List
The Buyers have informed the Builder that each of the Parts and categories of Parts referred to in Appendix B are “Key Parts” for the purposes of the agreement defined in paragraph 4 below.
The Builder’s appointment of suppliers for Key Parts shall be regulated by the applicable provisions of each Contract and by the following overriding rules.
The Builder shall obtain the best and final offer for the supply of each Key Part from its preferred supplier.
Before appointing any such supplier, the Builder will notify the Buyers’ Supervisors of the name of the proposed supplier and provide the Supervisors with full details of the offered supply terms including pricing, terms relating to spares, warranties and other pre / post delivery support matters, and technical specifications.
The Buyers shall then be entitled to seek offers for the supply of the relevant Key Part from one or more of their preferred suppliers.
If any offer from a preferred supplier of the Buyers beats the offer notified by the Builder’s preferred supplier by [**] [Confidential Treatment]% or more, the Buyers may require the Builder to appoint the Buyers’ preferred supplier.

 


 

If the Buyers require the Builder to order a Key Part from a supplier other than the supplier preferred by the Builder then: (following the procedures laid down in Article 1, Clause 5.8 and Article 3, Clause 1 of each Contract) the differential if any between the price offered by the Buyers’ preferred supplier and the Builder’s preferred supplier shall be added to or (as the case may be) subtracted from the Contract Price in accordance with the provisions of Article 3, Clause 1 of each Contract; and any other differences between the supply conditions offered by the supplier preferred by the Buyers and the conditions offered by the supplier preferred by the Builder shall be accepted and borne by the Buyers.
If the Buyers do not agree to pay the cost differential referred to above then, subject to the other applicable provisions of the Contracts, the Builder may appoint its preferred supplier rather than the relevant preferred supplier of the Buyers.
Notwithstanding any provisions to the contrary in the Contracts, the Builder agrees that after a supplier of a Key Part has been selected and an order has been placed for the Part, the Buyers may communicate directly with the relevant supplier in order to negotiate a life cycle maintenance arrangements.
The parties further agree that they shall work closely together in good faith and respectively use all reasonable commercial efforts: (i) to develop and implement a joint strategy in regard to makers and suppliers, the main objectives of which strategy shall be to optimise the supply and warranty terms for the relevant Parts and to minimise the supply costs; and (ii) without prejudice to the generality of (i), to obtain extended warranties for the engines, motors and other components of the propulsion system of each Ship without any increase in the Contract Price.
2. Lump Sums
The following lump sums are included in the base Contract Price for each Ship (excluding the allowance for Buyer’s Supplies) and, save where specified to the contrary below, all installation and other Works to be carried out by the Builder in relation to the Parts, studies and other services referred to below are included in the Contract Price for each Ship.
[**] [Confidential Treatment] for sound and light equipment, as described in the Specification.
[**] [Confidential Treatment] for galleys and pantries, as described in the Specification, being the agreed budget price (i) for the necessary equipment and related studies provided by galleys and pantries integrator ([**] [Confidential Treatment] or equivalent) and (ii) including workshop tests, packing, documentation and certificates. Installation costs and all other costs are responsibility of the Builder. However, juice dispensers, coffee machines and detergent or chemical systems for sinks and washing machines (including those in accommodation) are not included in this budget price and shall be provided by the Buyer as “Buyer’s Supplies” galley equipment.
[**] [Confidential Treatment] for the supply and installation of special water features, including auxiliaries, to be installed on the pool deck aqua park, as described in the Specification.

-2-


 

[**] [Confidential Treatment] for the availability assessment studies as described in the Specification.
[**] [Confidential Treatment] for studies to be carried out to develop potential energy savings in the cabin areas.
[**] [Confidential Treatment] for the complement to operating manual, as described in the Specification.
If the aggregate total cost to the Builder of purchasing the above Parts, studies or services from the selected makers and suppliers on a DDP Saint-Nazaire basis is higher than the relevant lump sum budget referred to above, the relevant Buyer’s obligation will be limited to payment of the actual incremental increased cost in excess of the lump sum budget without any handling charges or other mark-ups on the part of the Builder provided that if the Builder is required to carry out any additional Works in connection with installation of any of the Parts referred to above, the increased cost of such additional Works shall be determined pursuant to Article 3, Clause 1 of the applicable Contract.
If the aggregate total cost to the Builder of purchasing the above Parts, studies or services from the selected makers and suppliers on a DDP Saint-Nazaire basis is lower than the relevant lump sum budget referred to above, the difference shall be credited to the relevant Buyer.
3. Other Matters
Under each Contract the Builder has incorporated into the inside cabin areas a net increase of [**] [Confidential Treatment] inside cabins of a new design of between [**] [Confidential Treatment] square metres for single or double occupancy but without increasing the overall cabin capacity of 2,100 under each Contract.
By [**] [Confidential Treatment] the Builder will develop, to the satisfaction of the Buyers, small common areas for [**] [Confidential Treatment] of these new inside cabins without any increase in the Contract Price or any other additional charges to the Buyers under each Contract.
By [**] [Confidential Treatment] the Builder will also propose solutions satisfactory to the Buyers to increase the [**] [Confidential Treatment] of the balconies on [**] [Confidential Treatment] and [**] [Confidential Treatment] and to deliver the [**] [Confidential Treatment] cabins in other parts of the Ships referred to in the Specification for each Ship.
[**] [Confidential Treatment]
[**] [Confidential Treatment]

-3-


 

[**] [Confidential Treatment]
The parties intend that both Contracts shall become effective at the same moment, and they have agreed that neither Contract shall become effective unless the other Contract also becomes effective.
4. Effect of this Letter Agreement
The legally binding agreement constituted by the countersignatures below on behalf of each Buyer shall take effect as an integral part of each Contract, and all of the terms and conditions of Contracts (including, without limitation, those relating to confidentiality, governing law and jurisdiction) shall therefore apply between the parties with respect to the matters set out above as if such terms and conditions were fully set out herein.
Could each of FOL and FTL please confirm their agreement to the matters set out above by countersigning in the spaces provided below.
Yours faithfully,
Signed by
     
Name: Hardelay
  Name: Signature Illegible
Title: General Manager
  Title: SUP
 
   
Aker Yards S.A. Hardelay
  Signature Illegible 
 
   
Agreed as of 7th September 2006:
   
 
   
F3 One, Ltd.
  F3 Two, Ltd.
 
   
/s/ Colin Veitch
  /s/ Colin Veitch
Name: Colin Veitch
  Name: Colin Veitch
Title:
  Title:

-4-


 

Appendix a
[**] [Confidential Treatment]

-5-


 

Appendix b
Key Parts
[**] [Confidential Treatment]

-6-


 

[**] [Confidential Treatment]

-7-

EX-4.46 23 g05791exv4w46.htm EX-4.46 OFFICE LEASE AGREEMENT EX-4.46 Office Lease Agreement
 

Exhibit 4.46
[Confidential Treatment]
OFFICE LEASE AGREEMENT
BY AND BETWEEN
HINES REIT AIRPORT CORPORATE CENTER LLC,
AS LANDLORD
AND
NCL (BAHAMAS) LTD. D/B/A NORWEGIAN CRUISE LINE,
AS TENANT

 


 

BASIC LEASE INFORMATION
     
Lease Date:
  December 1, 2006
 
   
Tenant:
  NCL (Bahamas) Ltd. d/b/a Norwegian Cruise Line
 
   
Address of Tenant:
  7665 Airport Corporate Center Drive,
Miami, Florida 33126
 
   
Primary Contact:
  George Chesney
 
   
Landlord:
  Hines REIT Airport Corporate Center LLC
 
   
Address of Landlord:
  c/o 2800 Post Oak Boulevard
Houston, Texas 77056-6190
Attention: Profit Center Office/Central Division
 
   
Leased Premises:
  208,737 Rentable Square Feet consisting of: (A) 125,806 Rentable Square Feet in the building known as 7665 Corporate Center Drive (N.W. 19th Street), Miami, Florida, and (B) 82,931 Rentable Square Feet in the building known as 7650 Corporate Center Drive (N.W. 19th Street), Miami, Florida
 
   
Commencement Date:
  December 1, 2006 as to all of the Leased Premises other than the Building 10 Sixth Floor Premises and April 1, 2007 as to the Building 10 Sixth Floor Premises
 
   
Lease Term:
  one hundred forty six (146) months
 
   
Base Rental:
  Initially [**] [Confidential Treatment] per Rentable Square Foot (net) escalating on each anniversary of the Commencement Date by [**] [Confidential Treatment].
 
   
Tenant Improvement Allowance:
  up to [**] [Confidential Treatment] per Rentable Square Foot within the Leased Premises totaling [**] [Confidential Treatment].
 
   
Real Estate Broker(s):
  Studley, Inc. (as Agent) and Travers Realty, Inc. (as subagent of Studley, Inc.) representing Tenant, Hines Interests Limited Partnership, representing Landlord
 
   
Guarantor:
  NCL Corporation Ltd., a Bermuda corporation
The foregoing Basic Lease Information is hereby incorporated into and made a part of the Lease identified above. In the event of any conflict between any Basic Lease Information and the Lease, the Lease shall control.

 


 

TABLE OF CONTENTS
                     
                Page
ARTICLE I.         1  
 
    1.1     Leased Premises     1  
 
    1.2     Lease Term     3  
 
    1.3     Use     3  
 
    1.4     Other Use Rights     4  
 
    1.5     Surrender of Premises     4  
 
    1.6     Survival     5  
 
    1.7     Termination of Original Lease     5  
ARTICLE II.         5  
 
    2.1     Rental Payments     5  
 
    2.2     Base Rental     6  
 
    2.3     Additional Rental     6  
 
    2.4     Operating Expenses     8  
 
    2.5     Security Deposit     10  
 
    2.6     Sales Tax     11  
 
    2.7     Guaranty     11  
ARTICLE III.         11  
 
    3.1     Services     11  
 
    3.2     Keys and Locks     14  
 
    3.3     Graphics, Building Directory and Name     14  
 
    3.4     Parking     15  
ARTICLE IV.         16  
 
    4.1     Care of Leased Premises     16  
 
    4.2     Entry for Repairs and Inspection     16  
 
    4.3     Nuisance     16  
 
    4.4     Laws and Regulations; Encumbrances; Rules of Building     16  
 
    4.5     Legal Use and Violations of Insurance Coverage     17  
 
    4.6     Hazardous Substances     17  
 
    4.7     Tenant Taxes     17  
ARTICLE V.         17  
 
    5.1     Leasehold Improvements; Allowances     17  
 
    5.2     Repairs by Landlord     19  
 
    5.3     Repairs by Tenant     19  
ARTICLE VI.         19  
 
    6.1     Condemnation     19  
 
    6.2     Damages from Certain Causes     20  
 
    6.3     Casualty Clause     20  
 
    6.4     Casualty Insurance     22  
 
    6.5     Liability Insurance     22  
 
    6.6     Hold Harmless     23  
 
    6.7     Waiver of Subrogation Rights     23  
ARTICLE VII.         23  
 
    7.1     Default and Remedies     23  
 
    7.2     Insolvency or Bankruptcy     27  
 
    7.3     Late Payments     27  
 
    7.4     Attorneys’ Fees     27  
 
    7.5     Waiver of Homestead     27  
 
    7.6     No Waiver of Rights     27  
 
    7.7     Holding Over     27  
 
    7.8     Subordination     28  
 
    7.9     Estoppel Certificate     29  

(i)


 

                     
                Page
ARTICLE VIII.         29  
 
    8.1     Sublease or Assignment by Tenant     29  
 
    8.2     Assignment by Landlord     33  
 
    8.3     Peaceful Enjoyment     33  
 
    8.4     Limitation of Landlord’s Personal Liability     33  
 
    8.5     Force Majeure     33  
ARTICLE IX         33  
 
    9.1     Notices     33  
 
    9.2     Miscellaneous     34  
 
    9.3     OFAC     37  
 
    9.4     Waiver of Landlord’s Lien     37  
 
    9.5     Recordation     37  
 
    9.6     Generator     38  
ARTICLE X.         38  
 
    10.1     Right of First Offer     38  
 
    10.2     Renewal Option     39  
 
    10.3     Available Space     39  
                   
LIST OF EXHIBITS        
EXHIBIT A
  -   SITE PLAN AND LOCATION OF PROPERTY 11 AND PROPERTY 10
EXHIBIT A-1
  -   DESCRIPTION OF PARCEL 11
EXHIBIT A-2
  -   DESCRIPTION OF PARCEL 10
EXHIBIT B
  -   SITE PLAN AND LOCATION OF THE PROJECT
EXHIBIT B-1
  -   DESCRIPTION OF THE PROJECT
EXHIBIT C
  -   FLOOR PLAN OF BUILDING 11 PREMISES
EXHIBIT C-1
  -   FLOOR PLAN OF BUILDING 10 PREMISES
EXHIBIT D
  -   BASE BUILDING SHELL CONDITION
EXHIBIT E
  -   TENANT IMPROVEMENTS
EXHIBIT F
  -   OPERATING EXPENSES EXCLUSIONS
EXHIBIT G
  -   BUILDING RULES AND REGULATIONS
EXHIBIT H
  -   LETTER OF CREDIT FORM
EXHIBIT I
  -   BASE RENTAL
EXHIBIT J
  -   MARKET TERMS
EXHIBIT K
  -   FORM OF SNDA
EXHIBIT L
  -   SATELLITE DISH AGREEMENT
EXHIBIT M
  -   GUARANTY
EXHIBIT N
  -   JANITORIAL SPECIFICATIONS

(ii)


 

AIRPORT CORPORATE CENTER
OFFICE LEASE AGREEMENT
     THIS LEASE AGREEMENT (“Lease”) is made and entered into as of the 1st day of December, 2006 (the “Effective Date”), by and between HINES REIT AIRPORT CORPORATE CENTER LLC, a limited liability company organized under the laws of the State of Delaware (hereinafter called “Landlord”), and NCL (BAHAMAS) LTD., a Bermuda company D/B/A NORWEGIAN CRUISE LINE (hereinafter called “Tenant”).
     The Basic Lease Information rider (the “BLI Rider”) attached to the front of this Lease is hereby incorporated herein and made a part hereof.
ARTICLE I
     1.1 Leased Premises.
          (a) Landlord’s predecessor has constructed certain improvements on two certain tracts or parcels of land described in Exhibit A-1 (“Parcel 11”) and Exhibit A-2 (“Parcel 10,” and together with Parcel 11, the “Land”) attached hereto and incorporated herein by this reference. The improvements include (i) an office building commonly referred to as “Building 11,” located at 7665 Corporate Center Drive (N.W. 19th Street), Miami, Florida on Parcel 11 (“Building 11”), (ii) an office building commonly referred to as “Building 10,” located at 7650 Corporate Center Drive (N.W. 19th Street), Miami, Florida on Parcel 10 (“Building 10”), and (iii) the Parking Areas (as defined hereinafter). Building 11 and Building 10 may be collectively referred to hereinafter as the “Buildings” or individually as a “Building.” Building 11 and all other improvements located on Parcel 11 are hereinafter referred to as “Property 11.” Building 10 and all other improvements located on Parcel 10 are hereinafter referred to as “Property 10.” A site plan showing Property 11 and Property 10 is attached hereto as Exhibit A. The Buildings, the Parking Areas, and the Land are located within, and constitute a portion of, “Airport Corporate Center” (the “Project”). A site plan showing the Project is attached hereto as Exhibit B and a legal description of the real property comprising the Project is attached hereto as Exhibit B-1.
          (b) Subject to and upon the terms hereinafter set forth, and in consideration of the sum of Ten Dollars ($10.00), the premises, and the mutual covenants set forth herein, the receipt and sufficiency of which are hereby acknowledged, Landlord does hereby lease and demise to Tenant and Tenant does hereby lease and take from Landlord (subject to all matters of record in Miami-Dade County, Florida, that affect the Land and the Project) those certain premises located in the Buildings, and more particularly described as follows:
(A) 125,806 Rentable Square Feet in Building 11 as follows: (i) 22,033 RSF consisting of the entire RSF of the sixth (6th) floor, (ii) 22,109 RSF consisting of the entire RSF of the fifth (5th) floor, (iii) 22,109 RSF consisting of the entire RSF of the fourth (4th) floor, (iv) 22,109 RSF consisting of the entire RSF of the third (3rd) floor, (v) 20,825 RSF consisting of the entire RSF of the second (2nd) floor, and (vi) 16,623 RSF consisting of the entire RSF of the first (1st) floor, all as generally described or depicted on Exhibit C, attached hereto and incorporated herein (collectively, the “Building 11 Premises”); and
(B) 82,931 Rentable Square Feet in Building 10 as follows: (i) 22,046 RSF consisting of the entire RSF of the sixth (6th) floor (the “Building 10 Sixth Floor Premises”), (ii) 22,118 RSF consisting of the entire RSF of the fifth (5th) floor, (iii) 22,118 RSF consisting of the entire RSF of the third (3rd) floor, and (iv) 16,649 RSF consisting of the entire RSF of the first (1st) floor, all as generally described or depicted on Exhibit C-1, attached hereto and incorporated herein (collectively, the “Building 10 Premises”).

 


 

The Building 11 Premises and the Building 10 Premises may be collectively referred to hereinafter as the “Leased Premises.” Notwithstanding anything contained herein to the contrary, however, Landlord is not leasing to Tenant, and the Leased Premises do not include, any of the following: vertical penetrations (such as elevator shafts, stairwells, mechanical shafts, and risers), the ground floor lobbies, the roofs, the space above the finished ceilings of each floor of the Leased Premises, the mechanical, electrical, storage, and janitorial rooms or any other areas included within the “Building Common Areas” (as defined in ANSI/BOMA 265.1 2006).
          (c) The terms “Rentable Square Feet,” “Rentable Square Foot” and “RSF,” as used herein, shall mean the figures which Landlord and Tenant have agreed to use for calculation of Rental (as defined hereinafter) and Tenant’s Additional Rental (as defined hereinafter) and other matters referenced in this Lease. The Rentable Square Feet of the Leased Premises is set forth in Section 1.1(b) above, and the Rentable Square Feet of Building 11 is 125,806 and the Rentable Square Feet of Building 10 is 125,822 (all such figures referenced in this subparagraph (c) have been agreed upon by Landlord and Tenant prior to the date hereof, are conclusive for all purposes of this Lease, and are not subject to change for any reason whatsoever).
          (d) “Parking Areas” shall mean the parking structure(s) that are constructed and located on the Land and the surface parking spaces located on the Land, all as shown and labeled on Exhibit A, together with any connecting walkways or other means of access to said structures, the grounds related thereto and any additional improvements at any time related thereto. The Parking Areas may be operated by a parking contractor designated from time to time by Landlord.
          (e) “Declaration” shall mean that certain Declaration of Covenants, Conditions, Restrictions and Easements of Airport Corporate Center, made on December 31, 1986, by The Prudential Insurance Company of America, a New Jersey corporation, filed on January 2, 1987 and recorded in the Public Records of Miami-Dade County, Florida, in Official Records Book 13134, Page 1116, as amended in Official Records Book 14810, Page 1122, as re-recorded in the Public Records of Miami-Dade County, Florida, in Official Records Book 14940, Page 565, as amended in Official Records Book 15382, Page 2381, and as amended in Official Records Book 16256, Page 923.
          (f) “Original Lease” shall mean that certain Office Lease dated September 19, 1996, by and between Norwegian Cruise Line Limited, as tenant (“Original Tenant”), and John Alden Life Insurance Company, as landlord (“Original Landlord”), under which Tenant currently leases certain office space consisting of the entire Building 11 and certain space in Building 10, as amended by that certain First Addendum dated March 24, 1997, by and between Original Landlord and Original Tenant, that certain Second Amendment dated March 18, 2003 by and between Miami RPFIV Airport Corporate Center Associates Limited Liability Company (“RPFIV”), as successor to Original Landlord, and Original Tenant, that certain Third Amendment dated August 30, 2004, by and between RPFIV and Tenant, as successor to Original Tenant, and that certain Fourth Amendment dated June 1, 2005, by and between RPFIV and Tenant.
          (g) This Lease does not grant Tenant any rights to light, air or view over or about the Land or any other real property. Landlord specifically excepts and reserves to itself all rights to, and the use of, any roofs, the exterior portions of the Leased Premises, the Land, improvements and air and other rights below the improved floor level of the Leased Premises, the improvements and air and other rights above the improved ceiling of Leased Premises, the improvements and air and other rights located outside the demising walls of the Leased Premises and such areas within the Leased Premises as are required for installation of utility lines and other installations required to serve the Buildings or any occupants of the Buildings, and Landlord specifically reserves to itself the right to enter the Leased Premises to use, maintain and repair same, and no rights with respect thereto are conferred upon Tenant, unless otherwise specifically provided herein. If Landlord enters the Leased Premises as provided in this subparagraph (g), it shall use its commercially reasonable efforts to minimize interruption to Tenant’s business. Except in the case of emergency, any entry within the Leased Premises for such purposes that would materially interfere with Tenant’s use and occupancy shall be performed any time on weekends and holidays or during non-Building Operating Hours on weekdays.
          (h) Tenant’s taking possession of the Leased Premises or any portion thereof shall be conclusive evidence against Tenant that such portion of the Leased Premises was then in good order and satisfactory condition and in full compliance with this Lease. Tenant acknowledges that no promise by or on behalf of Landlord,

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any of Landlord’s beneficiaries, the managing agent of the Buildings, the leasing agent of the Buildings or any of their respective agents, partners or employees to alter, remodel, improve, repair, decorate or clean the Leased Premises has been made to or relied upon by Tenant, and that no representation respecting the condition of the Leased Premises or the Buildings by or on behalf of Landlord, any of Landlord’s beneficiaries, the managing agent of the Buildings, the leasing agent of the Buildings or any of their respective agents, partners or employees has been made to or relied upon by Tenant, except to the extent expressly set forth in this Lease. Notwithstanding any other term, covenant, or condition of this Lease, Tenant hereby irrevocably and unconditionally agrees and stipulates that it leases the Leased Premises as herein provided in its AS-IS, WHERE-IS condition, with all faults, and without any warranty from Landlord whatsoever with respect thereof, except as specifically provided herein and as shown on Exhibit D “Base Building Shell Condition” (which exhibit is attached hereto and made a part hereof by reference).
     1.2 Lease Term.
          (a) Subject to and upon the terms and conditions set forth herein, or in any exhibit hereto, the Lease Term shall commence on the Commencement Date (as defined hereinafter) and shall expire on January 31, 2019 (the “Lease Term”).
          (b) As used herein, “Commencement Date” means (i) December 1, 2006 as to all portions of the Leased Premises other than the Building 10 Sixth Floor Premises, subject to subparagraph (c) below, and (ii) the earlier of (y) the date Tenant occupies the Building 10 Sixth Floor Premises for the purpose of conducting business, or (z) April 1, 2007, as to the Building 10 Sixth Floor Premises, subject to subparagraph (d) below.
          (c) Suite 150 of Building 10 (“Ground Floor Suite”) is currently occupied by another tenant (“Ground Floor Existing Tenant”) under a lease that expires on January 11, 2007 (“Ground Floor Suite Expiration Date”). If the Ground Floor Existing Tenant does not vacate the Ground Floor Suite prior to December 1, 2006, the Commencement Date as to the Ground Floor Suite shall be delayed until such time as Landlord delivers the Ground Floor Suite to Tenant. In the event of holdover by the Ground Floor Existing Tenant beyond the Ground Floor Suite Expiration date, Landlord shall use commercially reasonable efforts to cause the Ground Floor Existing Tenant to vacate the Ground Floor Suite (including, if necessary, instituting eviction proceedings) before the Commencement Date and the Commencement Date shall be delayed until the Ground Floor Existing Tenant vacates the Ground Floor Suite, but Landlord shall not incur any liability to Tenant nor have any further responsibility or obligation with respect to, or arising from such holdover.
          (d) The Building 10 Sixth Floor Premises are currently occupied by another tenant (the “Existing Tenant”) under a lease that expires on March 31, 2007 (the “Prior Lease Expiration Date”). If the Existing Tenant does not vacate the Building 10 Sixth Floor Premises on or before the Prior Lease Expiration Date, then the Commencement Date shall be delayed only with respect to the Building 10 Sixth Floor Premises until such time as Landlord delivers the Building 10 Sixth Floor Premises to Tenant. In the event of holdover by the Existing Tenant, Landlord shall use commercially reasonable efforts to cause the Existing Tenant to vacate the Building 10 Sixth Floor Premises (including if necessary instituting eviction proceedings) but Landlord shall not incur any liability to Tenant nor have any further responsibility or obligations with respect to, or arising from, such holdover.
     1.3 Use. The Leased Premises are to be used and occupied by Tenant (and its permitted assignees and subtenants) solely for the purpose of (a) office space for general business purposes consistent with Class A office buildings in the Airport/West Dade market, which includes as ancillary uses the following: the use of conference and computer facilities, employee kitchen, employee gym (but only on the ground floor of either Building), employee store, credit union branch office for Tenant’s employees, management information systems department, employee training center, employee healthcare facility, copy centers, mail rooms, and other ancillary uses typical for a corporate headquarters office; and (b) as to the ground floor of Building 10, a cafeteria (which shall be open to all tenants of Building 10 but, with respect to the Ground Floor Suite only, at Tenant’s option, may be open to the general public if and to the extent legally permissible). The Leased Premises shall not be used for any purpose which would create unreasonable elevator loads or otherwise unreasonably interfere with Building operations, and Tenant shall not engage in any activity which is not in keeping with the first class standards of the Buildings. In no event shall the Leased Premises be used for the purpose of installing, marketing, operating, or providing electronic telecommunications, information or data processing, storage or transmissions, or other

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electronic office services or equipment for tenants or other occupants of the Buildings on a shared-usage basis through a central switch or a local area network. Without limiting the generality of this Section 1.3, the Leased Premises shall not be used as or for (i) any health care professionals or service organization, except for administrative offices where no diagnostic treatment or laboratory services are performed; (ii) schools or other training facilities that are not ancillary to executive, professional or corporate administrative office use; (iii) retail or restaurant uses (except as specifically permitted by subparagraph (b) above); (iv) broadcast studios or other broadcast production facilities such as radio and/or television stations except, however, for any such facilities which are used for broadcast only to Tenant’s ships, including ship-to-shore broadcasts; (v) product display or demonstration facilities (i.e., use of the Leased Premises for product displays or demonstrations more than twice in any one week); (vi) offices at which deposits or bills are regularly paid in person by customers of Tenant; or (vii) personnel agencies, except offices of executive search firms; provided, however, the restrictions in the preceding sentence shall not apply to Tenant if such uses are ancillary uses and are primarily for the benefit of Tenant’s employees.
     1.4 Other Use Rights. Tenant shall have the non-exclusive right to use the common areas of the Buildings from time to time made available by Landlord, including, without limitation, the lobbies, public entrances, public stairways, public rest rooms and public elevators of the Buildings. The common areas serving the Buildings, including those referenced above, the Parking Areas, and others shall at all times be subject to Landlord’s exclusive control and management. Tenant shall be permitted to use the common area breezeway between Building 10 and Building 11 on a periodic basis for Tenant’s gatherings and functions, subject to the Buildings’ Rules and Regulations, provided that such use does not unreasonably disturb other tenants, and Tenant pays all costs of clean-up and maintains such insurance as Landlord may reasonably require. Tenant shall have the right to run its communication and other wires and cables through existing risers in the Buildings (but leaving a pro rata share of space available for other tenants) and ceiling crawl spaces as well as any existing underground conduits running between Buildings. Tenant may install and maintain up to four (4) satellite dishes and antennae and other communication equipment on the roofs of the Buildings, all of which shall be used solely for Tenant’s business operations and shall not be used by third parties, subject to (a) Landlord’s approval, which shall not unreasonably be withheld, (b) Tenant’s screening of such equipment from view in a manner approved by Landlord, (c) Tenant’s execution of a Satellite Dish Agreement in the form of Exhibit L hereto; and (d) Tenant’s obtaining all required governmental approvals and complying with all legal requirements. All such satellite dishes and equipment shall be installed in locations approved by Landlord, which approval shall not unreasonably be withheld. Landlord agrees that the satellite dishes and equipment existing on the Effective Date are approved by Landlord and may remain as presently located, subject to Tenant’s execution of a Satellite Dish Agreement with respect thereto.
     1.5 Surrender of Premises.
          (a) Upon the termination of this Lease by lapse of time or otherwise or upon the earlier termination of Tenant’s right of possession, Tenant shall quit and surrender possession of the Leased Premises to Landlord, broom clean, in as good condition as existed at the commencement of Tenant’s occupancy, ordinary wear and tear and damage by fire or other casualty excepted. Before surrendering possession of the Leased Premises, Tenant shall, without expense to Landlord, remove all signs (including interior and exterior signs and monument signs), furnishings, equipment (including all communication cables and other cables other than the “Initial Cabling”), trade fixtures, satellite dishes and communications equipment, merchandise and other personal property installed or placed in the Leased Premises by Tenant or its permitted subtenants and all debris and rubbish, and Tenant shall repair all damage to the Leased Premises and the Buildings resulting from such removal, and shall repair the Buildings, including the exterior, to the condition that existed prior to Tenant’s installation thereof (including exterior signage). Tenant shall not be obligated to remove the “Initial Cabling,” which shall mean all cables and wires that exist on the Effective Date and the wires and cables installed by Tenant during the first thirty six (36) months following the Commencement Date and made as part of the Leasehold Improvements (as hereinafter defined) that was not included in the Original Lease. If Tenant fails to remove any of the signs, furnishings, equipment, trade fixtures, merchandise and other personal property installed or placed in the Leased Premises by the expiration or termination of this Lease, then Landlord may, at its sole option, (i) deem any or all of such items abandoned and the sole property of Landlord, or (ii) remove any and all such items and dispose of same in any manner. Tenant shall pay Landlord on demand any and all reasonable out-of-pocket expenses incurred by Landlord in the removal of such items, including, without limitation, the cost of repairing any damage to the Leased Premises

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or the Buildings caused by such removal and storage charges (if Landlord, in its sole discretion, elects to store such property).
          (b) All installations, additions, partitions, hardware, cables, wires, fixtures and improvements, temporary or permanent (including, but not limited to, any work performed by or on behalf of Tenant in excess of Tenant’s initial Leasehold Improvements described in Section 5.1(a) hereof (“Tenant’s Extra Work”)), except for Tenant’s signs, furnishings, equipment, communication cables (other than Initial Cabling), telephone switches, trade fixtures, merchandise and other personal property, in or upon the Leased Premises, whether placed there by Tenant or Landlord, shall, upon the termination of this lease by lapse of time or otherwise or upon the earlier termination of Tenant’s right of possession, become Landlord’s property and shall remain upon the Leased Premises, all without compensation, allowance or credit to Tenant. With respect to any improvements or alterations made after the Effective Date, if at the time Landlord consents to Tenant’s installation thereof, Landlord advises Tenant that Landlord will require removal of the same upon termination, then Tenant, at Tenant’s sole cost and expense, upon termination of this Lease by lapse of time or otherwise or upon the earlier termination of Tenant’s right of possession, shall promptly remove such designated items placed in or upon the Leased Premises by or on behalf of Tenant and repair any damage to the Leased Premises or the Buildings caused by such removal, failing which Landlord may remove the same and repair the Leased Premises or the Buildings, as the case may be, and Tenant shall pay the cost thereof to Landlord on written demand; provided, however, that Landlord shall not require removal of any leasehold improvement existing as of the Effective Date (except as otherwise specifically provided herein, e.g. signage) or any Leasehold Improvements made after the Effective Date but which are consistent with general office space in Class A buildings or of the Initial Cabling (but as to Initial Cabling, outlets, termination panels and wiring diagrams shall also remain if the Initial Cabling is not removed). Tenant hereby agrees and acknowledges that the generator in place at the time of Tenant’s occupancy as well as the UPS system are considered base building materials and shall remain the property of Landlord.
     1.6 Survival. Any claim, cause of action, liability or obligation arising under the provisions hereof in favor of either party hereto against or obligating the other party hereto and all of Tenant’s indemnification obligations hereunder shall survive the expiration or any earlier termination of this Lease.
     1.7 Termination of Original Lease. Tenant and Landlord hereby agree that the Original Lease shall be terminated effective at midnight on November 30, 2006 as to all of the leased premises described therein except Suite 230 and Suite 250 of Building 10 (the “Suite 230 and 250 Space”), which consists of 4,534 RSF. As to the Suite 230 and 250 Space, the Original Lease shall remain in full force and effect through and including June 30, 2007 (“Final Termination Date”) in accordance with all terms and provisions thereof except for the following modifications: Base Rental for the Suite 230 and Suite 250 Space shall be adjusted to an amount equal to [**] [Confidential Treatment] per RSF per annum together with Tenant’s Percentage Share of Additional Rent with respect to such space, which shall be determined pursuant to Section 2.3 of this Lease. Tenant shall pay Base Rental and Forecast Additional Rental in equal monthly installments of [**] [Confidential Treatment] (plus sales tax) commencing on December 1, 2006 and continuing on the first day of each month thereafter to and including June 1, 2007 (plus applicable sales tax). Tenant shall also be subject to Tenant’s Additional Rental Adjustment with respect to such space when the Annual Operating Statements are available. Any default by Tenant under the Original Lease with respect to Suite 230 and Suite 250 shall constitute a default hereunder.
ARTICLE II
     2.1 Rental Payments.
          (a) Subject to subparagraph (d) below, commencing on the Commencement Date and continuing thereafter throughout the full Lease Term, Tenant hereby agrees to pay the Base Rental (as defined hereinafter) and Tenant’s Forecast Additional Rental (as defined hereinafter) and Tenant’s Additional Rental Adjustment (as defined hereinafter) in accordance with this Article. The Base Rental and Tenant’s Forecast Additional Rental shall be due and payable in equal monthly installments on the first day of each calendar month during the initial Lease Term and any extensions or renewals hereof, and Tenant hereby agrees to so pay such rent to Landlord at Landlord’s address as provided herein (or such other address as may be designated by Landlord from time to time) monthly in advance.

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          (b) If the Commencement Date is other than the first day of a calendar month, then the installments of Base Rental and Tenant’s Forecast Additional Rental for such month shall be prorated and the installment or installments so prorated shall be paid in advance. Said installments for such prorated month shall be calculated by multiplying the equal monthly installment by a fraction, the numerator of which shall be the number of days of the Lease Term occurring during said commencement month, and the denominator of which shall be the total number of days in the commencement month. If the Lease Term commences or expires on a day other than the first day of a calendar year, Tenant’s Forecast Additional Rental and Tenant’s Additional Rental (as defined hereinafter) shall be prorated for such commencement or expiration year, as the case may be, by multiplying Tenant’s Forecast Additional Rental and Tenant’s Additional Rental by a fraction, the numerator of which shall be the number of whole and partial months of the Lease Term during the commencement or expiration year, as the case may be, and the denominator of which shall be twelve (12). In such event Tenant’s Additional Rental Adjustment shall be made as soon as reasonably possible after the termination of this Lease.
          (c) For purposes hereof, the term “Rental” shall mean and collectively refer to the Base Rental, Tenant’s Forecast Additional Rental, Tenant’s Additional Rental Adjustment and all other sums payable by Tenant hereunder. Tenant agrees to pay all Rental at the times and in the manner provided in this Lease, without abatement, demand, notice, setoff, deduction or counterclaim (except as may be otherwise expressly provided herein with respect to any of the foregoing), and all sums payable under this Lease by Tenant shall be deemed to be Rental due and owing hereunder. All Rental shall bear interest from the fifth (5th) day after the date due thereof until paid at the lesser of (i) a per annum rate equal to the “prime rate” announced by Chase Manhattan Bank, New York, New York, or its successor (or if the “prime rate” is discontinued, the rate announced as that being charged to the most creditworthy commercial borrowers) plus two percent (2%) or (ii) the maximum interest rate per annum allowed by law.
          (d) Notwithstanding anything to the contrary, provided Tenant is not in default under this Lease beyond any applicable notice or cure period at the time that abatement is otherwise scheduled to occur (or if default exists, then upon cure):
  (i)   Base Rental, Tenant’s Forecast Additional Rental, and Tenant’s Additional Rental Adjustment shall be abated as to the Building 10 Sixth Floor Premises for the period commencing on [**] [Confidential Treatment] for the Building 10 Sixth Floor Premises [**] [Confidential Treatment] thereafter; and
 
  (ii)   Base Rental (but not Tenant’s Forecast Additional Rental nor Tenant’s Additional Rental Adjustment) shall be abated for the [**] [Confidential Treatment]. The abatement provided in this subparagraph (ii) shall apply to the entire Leased Premises described in Section 1.1(b) hereof (including the Building 10 Sixth Floor Premises and the Ground Floor Suite) but shall not apply to any space added to the Leased Premises subsequent to the Effective Date nor to any renewal or extension of the initial Lease Term.
     2.2 Base Rental. Throughout the full Lease Term, Tenant hereby agrees to pay a base annual rental (the “Base Rental”) in accordance with the schedule attached hereto as Exhibit I, as such amount may be adjusted from lease year to lease year pursuant to the terms of this Lease.
     2.3 Additional Rental.
     (a) Commencing with the calendar year in which the Commencement Date occurs and continuing thereafter for each calendar year during the full Lease Term, Landlord shall present to Tenant prior to the beginning of said calendar year (or for the calendar year in which the Lease Term commences, on or before the Commencement Date) a statement of Tenant’s Forecast Additional Rental. Landlord’s failure to deliver such a statement of Tenant’s Forecast Additional Rental shall not operate to excuse Tenant from the payment of the

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monthly installment of Tenant’s Forecast Additional Rental due under Section 2.1(a). Rather, Tenant shall continue to pay the monthly installment of Tenant’s Forecast Additional Rental based on Landlord’s most recent calculation thereof until such a statement is delivered to Tenant, with such statement being applied retroactively to the beginning of the calendar year and Tenant making up any under payments (or Landlord refunding any overpayment or affording Tenant a credit against the next ensuing Rental obligations) immediately upon its receipt of such statement. Landlord may, from time to time, recalculate Tenant’s Forecast Additional Rental in order to more accurately reflect Landlord’s good faith estimate of Tenant’s Additional Rental, and Tenant shall commence paying the recalculated Tenant’s Forecast Additional Rental, in accordance with Section 2.1(a) hereof, upon the later of the next monthly payment date of Rental or ten (10) days after receiving notice thereof.
          (b) As used herein, “Tenant’s Forecast Additional Rental” shall mean Landlord’s reasonable estimate of Tenant’s Additional Rental for the coming calendar year (or, in the calendar year in which the Lease Term commences, for such calendar year).
          (c) As part of Tenant’s Additional Rental, Tenant shall be responsible for paying its pro rata share of the Operating Expenses of each Building for each calendar year. For purposes hereof, “Tenant’s Additional Rental” for each year shall mean Tenant’s Percentage Share (as defined hereinafter) of the Operating Expenses for each Building for such calendar year. As used herein, “Tenant’s Percentage Share” shall be determined separately for each Building and shall mean a fraction, the numerator of which is the total number of Rentable Square Feet within the Leased Premises within the applicable Building and the denominator of which is the greater of (i) ninety-five percent (95%) of the total Rentable Square Feet in such Building, or (ii) the total Rentable Square Feet in such Building actually leased or occupied by tenants.
          (d) Landlord shall use reasonable efforts to provide Tenant, within ninety (90) days after the end of the calendar year in which the Commencement Date occurs and of each calendar year thereafter during the Lease Term, with a statement detailing the Operating Expenses for each such calendar year (the “Annual Operating Expense Statement”) and a statement prepared by Landlord comparing Tenant’s Forecast Additional Rental with Tenant’s Additional Rental. Separate statements shall be provided as to Building 10 and Building 11. In the event that Tenant’s Forecast Additional Rental exceeds Tenant’s Additional Rental for said calendar year, Landlord shall pay Tenant (at Tenant’s option, in the form of a credit against rentals next due or in the form of Landlord’s check) an amount equal to such excess. In the event that the Tenant’s Additional Rental exceeds Tenant’s Forecast Additional Rental for said calendar year, Tenant shall pay Landlord, within thirty (30) days of receipt of the statement, an amount equal to such difference (“Tenant’s Additional Rental Adjustment”). Landlord shall not be permitted to make a subsequent adjustment in Annual Operating Expenses for further back than the calendar year preceding the calendar year for which the most recent Annual Operating Expense Statement was furnished except to the extent attributable to bills or invoices received by Landlord after the Annual Operating Expense Statement for such year was prepared.
          (e) Tenant, at Tenant’s sole cost and expense, shall have the right, to be exercised by written notice given to Landlord within one hundred fifty (150) days after receipt of the Annual Operating Expense Statement for any calendar year, to audit Landlord’s books and records pertaining only to the Operating Expenses for such calendar year, provided such audit must commence within sixty (60) days after Tenant’s notice to Landlord and thereafter proceed diligently and continuously to conclusion and, provided, further, that such audit must be conducted by (i) a nationally recognized independent public accounting firm; or (ii) other well-established accounting firm acceptable to Landlord and in a manner that does not unreasonably interfere with the conduct of Landlord’s business. Notwithstanding the foregoing, Tenant shall not have the right to audit Landlord’s books and records regarding the Operating Expenses for any calendar year at any time when Tenant is in monetary default beyond any applicable cure period under the terms of this Lease. Landlord agrees to cooperate in good faith with Tenant in the conduct of any such audit. Tenant (and its agents, employees and accountants) shall use good faith efforts to hold the results of such audits in strict confidence and not disclose the same to any third party, except as is necessary during any dispute between Landlord and Tenant related thereto or as required by law. A copy of the results of any such audit shall be promptly provided to Landlord, and Landlord may conduct an independent review of the same. If there is any disagreement regarding the results of any such audit, the parties shall select a third party auditor to resolve the dispute. Tenant shall not employ any person or entity to audit Landlord’s books and records whose compensation is based, in whole or in part, on a contingency fee or the results of the audit. If it is ultimately determined by agreement of Landlord and Tenant or through final court decision that Tenant’s Additional Rent for

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any calendar year is less than the Tenant’s Additional Rent as shown in the Annual Operating Expense Statement furnished by Landlord to Tenant, at Tenant’s option, Landlord shall credit the overpayment to future rent payments or shall promptly refund the overpayment to Tenant, and, if Tenant’s Additional Rent was overstated by more than five percent (5%), Landlord shall reimburse Tenant for the reasonable actual costs incurred by Tenant in engaging the accounting firm to render the audit.
     2.4 Operating Expenses.
          (a) “Operating Expenses” for each calendar year, shall consist of (i) all Operating Costs (as defined hereinafter) for Property 11 and Property 10, and (ii) an amount equal to the sum of the total ownership, management, maintenance, repair, replacement and operating costs accruing during each such calendar year for other portions of the Project that are designated or maintained from time to time as common areas, including those areas which are for the benefit of the occupants of the Project whether or not so designated or maintained as common areas (net of any contribution received from time to time from the owners of the other portions of the Project for such expenses), including, without limitation, any amounts imposed upon Property 11 and Property 10 pursuant to the Declaration.
          (b) For the purposes of this Lease, “Operating Costs” shall mean all expenses, costs and accruals (excluding therefrom, however, specific costs billed to or otherwise incurred for the particular benefit of specific tenants of the Buildings) of every kind and nature, computed on an accrual basis, incurred or accrued in connection with, or relating to, the ownership, operation, management, maintenance, repair and replacement of the Buildings during each calendar year, including, but not limited to, the following:
  (i)   wages and salaries, including taxes, insurance and benefits, of all on and off-site employees engaged in operations, management, maintenance, repair, replacement or access control (including, without limitation, the senior property manager and the senior accountant), as reasonably allocated by landlords and rent for, and expenses associated with, the Project’s management office;
 
  (ii)   cost of all supplies, tools, equipment and materials to the extent used in operations, management, maintenance, repairs or replacements, as reasonably allocated by Landlord;
 
  (iii)   cost of all utilities, including, but not limited to, the cost of electricity, the cost of water and the cost of power for heating, lighting, air conditioning and ventilating;
 
  (iv)   the cost of trash and garbage removal, cleaning, vermin extermination and debris removal, and other services;
 
  (v)   cost related to and fees payable under all maintenance, management and service agreements, including, but not limited to, a management fee contribution equal to three percent (3%) of the gross revenues of the Buildings (and excluding any other management fee in excess thereof);
 
  (vi)   costs related to those agreements related to access control services, garage operations, window cleaning, elevator maintenance, janitorial service, pest control and landscaping maintenance;
 
  (vii)   cost of inspections, repairs, maintenance and replacements (except to the extent covered by proceeds of insurance); provided, however, any contrary provision in this Section 2.4 notwithstanding, the cost of capital repairs and replacements (other than those contemplated by Section 2.4(b) (ix)) shall be limited to an aggregate of [**] [Confidential Treatment] per event (and without subcategories) and shall be amortized over such reasonable period of time as Landlord shall determine and only the portion of such costs allocable to any calendar year (plus interest on the

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      unpaid balance of such costs) may be included in the Operating Costs for such calendar year;
 
  (viii)   the cost of legal and accounting services incurred by Landlord relating to management and maintenance of the Project but not including any such expenses related to leasing of space in the Project;
 
  (ix)   amortization of the cost over the useful life as determined by GAAP (plus interest on the unpaid balance of such costs) of any system, apparatus, device, or equipment which is installed for the principal purpose of (i) reducing Operating Expenses, (ii) promoting safety, or (iii) complying with governmental requirements which are first imposed or enforced after Tenant’s initial occupancy of the applicable premises;
 
  (x)   the cost of all insurance, including, but not limited to, the cost of casualty, rental loss and liability insurance, and insurance on Landlord’s personal property, plus the cost of all deductible and co-insurance payments made by Landlord in connection therewith or in connection with any damage or casualty; provided, however, with respect to any calendar year in which a casualty loss occurs, in lieu of paying Tenant’s Percentage Share of the deductible in a lump sum cash payment, Tenant may amortize Tenant’s payment obligation [**] [Confidential Treatment]. Such amortization shall require payments of equal monthly installments sufficient to pay in full the amount amortized and the finance charge over the amortization term. To be entitled to such right of amortization, Tenant shall be obligated to provide Landlord with a letter of credit equal to the amount to be amortized, in form and substance acceptable to Landlord and issued by a financial institution acceptable to Landlord (which letter of credit may be reduced annually to the remaining balance of Tenant’s obligation);
 
  (xi)   amounts due under easements, operating agreements, parking operating agreements, declarations (including the Declaration), covenants or instruments encumbering Parcel 11 and Parcel 10;
 
  (xii)   subject to Section 2.4(b)(vii) with respect to capital repairs and capital replacements, cost of maintaining, striping, repairing, replacing, repaving and lighting grounds, streets, parking areas, sidewalks, curbs, walkways, landscaping, drainage and lighting facilities with respect to Parcel 10 or Parcel 11; and
 
  (xiii)   all taxes, assessments and governmental charges, whether or not directly paid by Landlord, whether federal, state, county or municipal and whether they be by taxing districts or authorities presently taxing the Land, Buildings, Project, Parking Areas and related common areas or by others subsequently created or otherwise, and any other taxes, assessments and governmental charges attributable to the Land, Buildings, Project, Parking Areas and that portion of the common areas or their operation, excluding, however, taxes and assessments attributable to the personal property of other tenants, federal and state taxes on income, death taxes, franchise taxes, and any taxes imposed or measured on or by the income of Landlord from the operation of the Buildings or imposed in connection with any change of ownership of the Buildings; provided, however, that if at any time during the Lease Term, the present method of taxation or assessment shall be so changed that the whole or any part of the taxes, assessments, levies, impositions or charges now levied, assessed or imposed on

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      real estate and the improvements thereon shall be discontinued and as a substitute therefor, or in lieu of or in addition thereto, taxes, assessments, levies, impositions or charges shall be levied, assessed or imposed, wholly or partially, as a capital levy or otherwise, on the rents received from the Buildings or the rents reserved herein or any part thereof, then such substitute or additional taxes, assessments, levies, impositions or charges, to the extent so levied, assessed or imposed with respect to the Buildings, shall be deemed to be included within the Operating Costs. Tenant acknowledges and agrees that Landlord shall have the exclusive right to contest, protest and/or appeal taxes, assessments, levies, impositions on the Project, including the Buildings. Consultation, legal fees and costs resulting from any challenge of tax assessments as reasonably allocated by Landlord shall also be included in Operating Costs; provided, however, if Landlord does not intend to appeal the tax assessments with respect to either Parcel, Landlord shall do so if Tenant so requests in writing and agrees to pay all fees and costs in connection therewith (subject to reimbursement for such payments to the extent of any tax savings resulting from such appeal for the year for which the appeal was made). Tenant will be responsible for ad valorem taxes on its personal property and on the value of the Leasehold Improvements in the Leased Premises to the extent that the same exceed the Tenant Improvement Allowance (and if the taxing authorities do not separately assess Tenant’s Leasehold Improvements, Landlord may make a reasonable allocation of the ad valorem taxes allocated to the Buildings to give effect to this sentence). In the case of special taxes and assessments which may be payable in installments, only the amount of each installment accruing during a calendar year shall be included in the Operating Costs for such year.
          (c) Notwithstanding any language contained herein to the contrary, as to Building 10 Tenant hereby agrees that, during any calendar year in which the Building is less than 95% occupied, Landlord shall compute all Variable Operating Costs (as defined hereinafter) for such Building for such calendar year as though such Building were 95% occupied and provided with Building Standard Services. For purposes of this Lease, the term “Variable Operating Costs” shall mean any operating cost that is variable with the level of occupancy of a Building, in Landlord’s commercially reasonable judgment. In the event that Landlord excludes from Operating Costs any specific costs billed to or otherwise incurred for the particular benefit of specific tenants of a Building or to other buildings or projects on the Land, Landlord shall have the right to increase Operating Costs by an amount equal to the cost of providing Building Standard Services similar to the services for which such excluded specific costs were billed or incurred. In no event shall Landlord receive from all tenants of a Building more than one hundred percent (100%) of any Operating Costs.
          (d) Notwithstanding any language contained herein to the contrary, Landlord hereby agrees that Operating Expenses shall not include those items set forth on Exhibit F attached hereto.
     2.5 Security Deposit. Tenant, concurrently with the execution of this Lease, has delivered to Landlord a clean, irrevocable letter of credit (the “Letter of Credit”) established in Landlord’s (and its successors’ and assigns’) favor in the amount of [**] [Confidential Treatment] (the “Letter of Credit Amount”), issued by a federally insured banking or lending institution acceptable to Landlord in the form of Exhibit H attached hereto as a security deposit (the “Security Deposit”). The Letter of Credit specifically provides for partial draws and shall by its terms be transferable by the beneficiary thereunder. If Tenant fails to make any payment of Rental, or otherwise defaults hereunder, beyond any applicable notice and cure period, Landlord, at Landlord’s option, may make a demand for payment under the Letter of Credit in an amount equal to the amounts then due and owing to Landlord under this Lease. In the event that Landlord draws upon the Letter of Credit or if at any time Landlord determines in its reasonable discretion that the issuer of the Letter of Credit is not acceptable, Tenant shall present to Landlord a replacement Letter of Credit in the full Letter of Credit Amount satisfying all of the terms and conditions of this paragraph issued by a financial institution acceptable to Landlord (in its reasonable opinion), and in substantially the same form as Exhibit H within twenty (20) days after receipt of notice from Landlord of such draw or of Landlord’s determination that the issuer is no longer acceptable. If Tenant shall fail to do so within such twenty (20) day period Landlord shall immediately be entitled to draw the entire amount of the Letter of Credit and hold the proceeds as a

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cash security deposit. In the event that the Letter of Credit has an expiration date earlier than the expiration date of this Lease and Tenant has not presented to Landlord a replacement Letter of Credit which complies with the terms and conditions of the Lease on or before thirty (30) days prior to the expiration date of any such Letter of Credit then held by Landlord, then Landlord shall have the right to draw upon the Letter of Credit then held by Landlord and any such amount paid to Landlord by the issuer of the Letter of Credit shall be held by Landlord as security for the performance of Tenant’s obligations hereunder. Any interest earned on any proceeds of the Letter of Credit shall be the property of Landlord. If Landlord elects to draw under the Letter of Credit and to hold the proceeds of the drawing under the Letter of Credit as a cash security deposit, such action shall not be deemed a cure of any default by Tenant hereunder (other than the failure to deliver a replacement letter of credit) but, upon delivery of an acceptable replacement letter of credit, Landlord shall release the cash proceeds then held by Landlord to Tenant. Tenant acknowledges that any proceeds of a draw made under the Letter of Credit and thereafter held by Landlord may be used by Landlord to cure or satisfy any obligation of Tenant hereunder as if such proceeds were instead proceeds of a draw made under a Letter of Credit that remained outstanding and in full force and effect at the time such amounts are applied by Landlord to cure or satisfy any such obligation of Tenant. Tenant hereby affirmatively disclaims any interest Tenant has, may have, claims to have, or may claim to have in any proceeds drawn by Landlord under the Letter of Credit and held in accordance with the terms hereof. Without limiting the generality of the foregoing, Tenant expressly acknowledges and agrees that at the end of the Lease Term (whether by expiration or earlier termination hereof), and if Tenant is not then in default under this Lease, Landlord shall return to the issuer of the Letter of Credit or its successor (or as such issuer may direct in writing) any remaining and unapplied proceeds of any prior draws made under the Letter of Credit, and Tenant shall have no rights, residual or otherwise, in or to such proceeds. On February 1, 2010 and on February 1 of each of the four calendar years thereafter, Tenant shall be entitled to reduce the Letter of Credit by [**] [Confidential Treatment] provided that Tenant is not then in default under this Lease beyond any applicable notice or cure period. In no event, however, shall the Letter of Credit Amount be reduced below [**] [Confidential Treatment]. Any reduction permitted hereby shall be accomplished by Tenant’s delivery of a replacement letter of credit in the required amount approved by Landlord as to form and issuing bank (and otherwise in compliance with the provisions of this Section 2.5 and in substantially the same form as the Letter of Credit being replaced). Simultaneously upon receipt of an acceptable replacement letter of credit, Landlord shall return to Tenant the Letter of Credit then held by Landlord.
     Landlord shall release the letter of credit in the amount of [**] [Confidential Treatment], which Landlord is holding pursuant to the Original Lease, upon receipt of the Letter of Credit required hereunder.
     2.6 Sales Tax. Simultaneously with each payment by Tenant of Base Rental, Tenant’s Additional Rental and any other amount due pursuant to this Lease, Tenant shall also pay to Landlord all applicable sales tax, use tax or other tax imposed by any governmental entity thereon. Such tax shall be collectable by Landlord and payment thereof shall be enforced in the same manner provided herein for enforcing payment of Base Rental and Tenant’s Additional Rental.
     2.7 Guaranty. Tenant shall cause NCL Corporation Ltd., a Bermuda corporation, to duly execute and deliver a Guaranty of this Lease in the form of Exhibit M hereto and to maintain such Guaranty in full force and effect during the entire Lease Term and any renewals or extensions thereof.
ARTICLE III
     3.1 Services. Landlord shall furnish the following services to Tenant during the Lease Term (“Building Standard Services”):
          (a) Hot and cold domestic water to common use restrooms and toilets, in such amounts as are customary in other Class A office buildings in the Airport/Miami-Dade submarket (“Comparable Buildings”).
          (b) Subject to curtailment as required by governmental laws, rules or mandatory regulations, central heat and air conditioning in season, at such temperatures and in such amounts as are customary in Comparable Buildings.
          (c) Electric lighting service for all public areas and special service areas of the Buildings in such amounts and locations as are reasonably determined by Landlord.

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          (d) Janitorial service five (5) days per week, exclusive of holidays, in accordance with janitorial specifications attached hereto as Exhibit N; provided, however, if Tenant’s floor coverings or other improvements are other than building standard commercial grade, and require more than the standard janitorial services for building standard floor coverings (e.g., other than carpet or standard tile floor coverings), Tenant shall pay one hundred percent (100%) of the actual additional cleaning cost, if any, attributable thereto. Tenant shall have the right to request janitorial services in excess of those set forth in Exhibit N. Landlord shall then request such additional services from its janitorial service provider and Tenant shall pay all additional costs for such excess services.
     If Tenant is dissatisfied with the janitorial services provided by Landlord, Tenant may, no more than three occasions in any calendar year, request in a written notice to Landlord a meeting (which meeting shall occur no later than fifteen (15) days from the date of such notice) to discuss possible solutions. If the problems persist and acceptable service is not provided, Landlord shall terminate the existing service provider (but only in compliance with the terms of the existing contract with such service provider without incurring penalties) and replace such service provider with a new service provider, the identity of which shall be determined by Landlord after consultation with Tenant.
          (e) Access control for the Buildings twenty-four (24) hours per day, seven (7) days per week; provided, however, Landlord shall have no responsibility to prevent, and shall not be liable to Tenant for, any liability or loss to Tenant, its agents, employees and visitors arising out of losses due to theft, burglary, or damage or injury to persons or property caused by persons gaining access to the Leased Premises, and Tenant hereby releases Landlord from all liability for such losses, damages or injury unless such loss, damage or injury is caused by Landlord’s gross negligence or willful misconduct. The Leased Premises shall be accessible to Tenant and its employees twenty-four hours per day, seven days per week (except in case of emergency, Force Majeure, governmental curtailment, or other circumstances beyond Landlord’s reasonable control).
     With respect to Building 11 (and also Building 10 if Tenant leases the entire RSF of Building 10) the following provisions shall apply:
For the desk (“Building Information Desk”) to be located in the ground floor lobby, Tenant shall be allowed to staff up to three (3) Tenant employees at the Building Information Desk during Building Operating Hours for the purposes of providing general information, security clearance and other relevant information to Tenant’s employees, visitors, and contractors only and for no other purposes. Tenant agrees at all times to cooperate with Landlord’s property management and security services provider. Tenant’s employees and its activities at the Building Information Desk shall not interfere at any time with Landlord’s employees, contractors or agents or prevent the foregoing from performing their duties relevant to Building access control, safety, repair and maintenance, and other such duties as may be assigned by Landlord. Landlord shall not be responsible for the acts and/or omissions of Tenant’s employees or agents assigned to the Building Information Desk. Landlord shall cooperate with Tenant to locate the personnel of the security provider during Building Operating Hours in locations acceptable to Tenant and Landlord so long as the performance of security services will not be adversely affected.
          (f) Facilities to provide electrical current for general office use consistent with Comparable Buildings. Should Tenant’s total rated electrical design load exceed the Building Standard rated electrical design load for low and high voltage electrical consumption, or if Tenant’s electrical design requires low voltage or high voltage circuits in excess of Tenant’s share of the Base Building Shell Condition circuits, Landlord will (at Tenant’s expense) install additional high voltage panel(s) and/or additional low voltage panels with associated transformer if and to the extent space is available in the base building electrical closets (which additional panels and transformers

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shall be hereinafter referred to as the additional electrical equipment (the “Additional Electrical Equipment”). If the Additional Electrical Equipment is installed because Tenant’s low or high voltage rated electrical design load exceeds the applicable building standard rated electrical design load or if Tenant’s hours of operation exceed Building Operating Hours, then a meter shall also be added (at Tenant’s expense) to measure the electricity used through the Additional Electrical Equipment. The foregoing provision shall apply only to Building 10 (and not Building 11) so long as Tenant’s Percentage Share with respect to Building 11 is 100% and Tenant is paying all such costs with respect to Building 11 as part of Operating Costs.
     The design and installation of any Additional Electrical Equipment (or any related meter) required by Tenant shall be subject to the prior approval of Landlord (which approval shall not be unreasonably withheld). All reasonable expenses incurred by Landlord in connection with the review and approval of any Additional Electrical Equipment shall also be reimbursed to Landlord by Tenant. Tenant shall also pay on demand the actual metered cost of electricity consumed through the additional electrical equipment (if applicable).
     If Tenant requires that certain areas within the Leased Premises operate in excess of the Building Operating Hours (as defined hereinafter), the electrical service to such areas shall be separately circuited and metered such that Tenant shall be billed the actual costs associated with electricity consumed during hours other than Building Operating Hours.
     If any of Tenant’s electrical equipment requires conditioned air in excess of Base Building Shell Condition air conditioning, the same shall be installed by Landlord (on Tenant’s behalf), and Tenant shall pay all design, installation, metering, utility service and operating costs relating thereto.
          (g) Building Standard fluorescent bulb replacement in all areas and all incandescent bulb replacement in the common areas, and in the Leased Premises (but only for Building standard bulbs).
          (h) Non-exclusive multiple cab passenger service to the Leased Premises consistent with that provided in Comparable Buildings during Building Operating Hours and at least one (1) cab passenger service to the Leased Premises twenty-four (24) hours per day and non-exclusive freight elevator service during Building Operating Hours (all subject to temporary cessation for ordinary repair and maintenance and during times when life safety systems override normal building operating systems) with freight elevator service available at other times upon reasonable prior notice by Tenant to Landlord.
          (i) If Tenant requires heating, ventilating and air conditioning within the Leased Premises during periods in excess of the hours of 7:30 a.m. to 6:00 p.m., Monday to Friday, and 8:00 a.m. to 1:00 p.m. Saturday, excluding legal holidays (the “Building Operating Hours”), Landlord shall bill Tenant for the number of hours used as Tenant’s Additional Rental at an initial rate equal to [**] [Confidential Treatment] per hour per floor (“HVAC Fee”), subject to increase from time to time in Landlord’s reasonable discretion, to provide such services taking into account electrical consumption, wear and tear on equipment and systems, labor and administrative costs. Notwithstanding the foregoing, so long as Building 11 is fully leased by Tenant and that Tenant is paying all cost of all utilities servicing Building 11 as part of Operating Costs since Tenant’s Percentage Share is 100% as to Building 11, the HVAC Fee with respect to Building 11 only shall be reduced to an initial rate equal to [**] [Confidential Treatment] per hour per floor. Tenant recognizes and agrees that Landlord’s HVAC system is not designed to cool the air to comply with requirements of heavy machinery or other than normal office equipment. To request after-hour HVAC, Tenant shall contact the on-site Property Management office with commercially reasonable advance notice as determined by Landlord. Any and all costs to acquire, maintain, and replace any supplemental air conditioning equipment shall be the sole obligation of Tenant.
     To the extent the services described in subsection (a), (b), (c), (e), (f), (h) and (i) above require electricity and water supplied by public utilities, Landlord’s covenants thereunder shall only impose on Landlord the obligation to use its good faith, reasonable efforts to cause the applicable public utilities to furnish the same. Failure by Landlord to furnish the services described in this Section, or any cessation thereof, shall not render Landlord liable for damages to either person or property, nor be construed as an eviction of Tenant, nor (except as specifically provided below in this paragraph) work an abatement of Rental, nor relieve Tenant from fulfillment of any covenant or agreement hereof. In addition to the foregoing, should any of the equipment or machinery, for any cause, fail to operate or function properly, Tenant shall have no claim for rebate of Rental or damages on account of an

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interruption in service occasioned thereby or resulting therefrom; provided, however, Landlord agrees to use reasonable efforts to repair said equipment or machinery promptly and to restore said services. Notwithstanding the foregoing, if the Leased Premises (or portions thereof) are untenantable for a period of more than five (5) consecutive business days because “Critical Services” (hereby defined as electricity, HVAC, water/sewer and elevator service) are interrupted due to the negligence of Landlord, as Tenant’s sole remedy, Base Rental (or in the case only a portion of the Leased Premises is untenantable, an equitable portion of Base Rental) shall be abated thereafter until the Leased Premises or portions thereof are again tenantable.
     3.2 Keys and Locks. Landlord has previously supplied Tenant with pass-cards or keys that provide access to the Leased Premises from the public areas. Additional pass-cards or keys will be furnished by Landlord upon an order signed by Tenant and at Tenant’s expense. All such pass-cards shall remain the property of Landlord. No additional locks shall be allowed on any door of the Leased Premises without Landlord’s permission, and Tenant shall not make or permit to be made any duplicate keys or pass-cards. Upon termination of this Lease, Tenant shall surrender to Landlord all keys and pass cards to any locks on doors entering or within the Leased Premises, and give to Landlord the explanation of the combination of all locks for safes, safe cabinets and vault doors, if any, in the Leased Premises.
     3.3 Graphics, Building Directory and Name.
          (a) Subject to the provisions of this Section 3.3, Tenant shall have the right to:
  (i)   maintain in a first class manner its two (2) existing signs on the exterior of Building 11;
 
  (ii)   install and maintain in a first class manner two (2) exterior signs on the top and sides of Building 10 similar to those on Building 11 with Tenant’s name (and at Tenant’s option, its logo) in size and appearance similar to the exterior signs on Building 11 and in locations acceptable to Landlord and Tenant; and
 
  (iii)   maintain in a first class manner the existing monument sign outside of Building 10 and Building 11.
     All signage rights granted in this subparagraph (a) shall be subject to and conditioned upon Tenant’s obtaining all required governmental approvals. The signage rights referenced in 3.3(a)(i) and 3.3(a)(ii) shall contain only the name of the initial Tenant hereunder or any entity comprising NCL (as hereinafter defined), or any Successor; provided, however, that if Tenant, any entity comprising NCL, or any Successor, wants to change the name contained in any of the signs described in Section 3.3(a)(i) and 3.3(a)(ii) above, such name change shall be subject to Landlord’s prior written approval. The signage referenced in 3.3(a)(iii), however, may be used by any permitted subtenant or assignee or NCL. Tenant shall install all signage at Tenant’s sole cost and expense and in compliance with all governmental requirements and Landlord’s requirements as to insurance and manner of installation. Tenant shall maintain all signage in good and attractive condition consistent with exterior signage on Comparable Buildings. Upon expiration or termination of the Lease or upon termination of Tenant’s signage rights as to any of the signage, Tenant shall cause such signage to be removed promptly and shall repair the Building and the monument signs to the condition which existed prior to Tenant’s installation thereof.
     Tenant’s signage rights under subparagraph 3.3(a)(i) shall expire and shall thereafter be void and of no force and effect (and Tenant shall promptly remove the exterior signs on Building 11 and restore the Building to the condition that existed prior to installation) if at any time NCL (Bahamas) Ltd. and its Affiliates or Successors [as such terms are defined in Section 8.1(l)] (“NCL”) does not occupy at least [**] [Confidential Treatment] of the total RSF of Building 11.
     Tenant’s signage rights under subparagraph 3.3(a)(ii) shall expire and shall thereafter be void and of no force or effect (and Tenant shall promptly remove the exterior signs on Building 10 and restore the Building to the condition that existed before installation) if at any time NCL does not occupy at least [**] [Confidential Treatment] of total RSF of Building 10).

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     The aforesaid percentages represent percentages of the total RSF in the applicable Building and are not percentages of the Leased Premises within such Building.
          (b) Tenant shall also be entitled to install signage as follows: (i) within the Leased Premises so long as such signage is not visible from the exterior, (ii) at entrances to the Leased Premises provided such signage is consistent with Comparable Buildings and is approved by Landlord as to size, location, and appearance, such approval not to be unreasonably withheld; (iii) in the northern portion of the Building 10 ground floor lobby for the employee store, conference center, and cafeteria (including a list of daily specials) provided that all of the foregoing are consistent with signage for Comparable Buildings and are approved by Landlord as to size, location, and appearance, such approval not to be unreasonably withheld; and (iv) within the lobby of any Building wholly occupied by Tenant provided that such signage is consistent with lobby signage for Comparable Buildings and is approved by Landlord as to size, location and appearance, which approval shall not unreasonably be withheld. Any signage installed on any multi-tenant floor, however, shall be in building standard graphics.
          (c) Tenant shall also be entitled to a proportionate share (which shall be [**] [Confidential Treatment] as to Building 11) of the listings on the directory that shall be maintained by Landlord in the lobby of each Building. The content of Tenant’s listings shall be at Tenant’s discretion.
          (d) Tenant agrees that Landlord shall not be liable for any inconvenience or damage occurring as a result of any error or omission in any directory or graphics. Except as specified in this Section 3.3, no signs, numerals, letters or other graphics shall be used or permitted on the exterior of, or may be visible from outside, the Leased Premises, unless approved in writing by Landlord.
          (e) Provided that Tenant fulfills its obligations under this Section 3.3 and maintains its signage rights under Section 3.3(a)(i) and 3.3(a)(ii), Landlord shall not: (i) rename the Project (i.e., Airport Corporate Center) after Carnival Cruise Lines, Royal Caribbean Cruise Lines or MSC Cruises or any Affiliate or successor thereof (the “Competitors”); nor (ii) grant any signage rights in favor of the Competitors for signs on the exterior sides or on top of Building 9, Building 10 or Building 11 or the exterior sides or on top of the building to be developed on the Vacant Parcel, as such parcel is identified on the site plan attached hereto as Exhibit B (but monument signs shall not be prohibited).
     3.4 Parking.
          (a) Subject to the other provisions hereof, during the entire Lease Term Landlord hereby agrees to make available, or to cause the lessee or operator of the Parking Areas, if any (the “Parking Operator”), to make available to Tenant and Tenant shall take and lease five (5) non-reserved parking permits (“Parking Permits”) per each 1,000 square feet of Rentable Square Feet within the Leased Premises (rounded to the nearest 100 square feet). The Parking Permits shall entitle Tenant and its permitted subtenants, assigns and occupants and their principals and employees to park in the structured parking decks and surface parking areas in Parcel 11 and Parcel 10, of which 410 shall be allocated to Parcel 10 and the remaining parking permits to Parcel 11, upon the terms and conditions set forth here. Of the foregoing Parking Permits, Tenant shall have the option to designate up to twenty (20) parking spaces as reserved spaces (of which up to five (5) may be allocated by Tenant to the Building 10 parking garage and the balance shall be in the Building 11 parking garage). There shall be no charge for fifteen (15) of the reserved spaces. Tenant shall pay for any spaces in excess of fifteen (15) that Tenant elects to designate as reserved spaces, at the market rate as from time to time reasonably determined by Landlord for comparable reserved spaces in Comparable Buildings but not exceeding the amount generally charged for reserved spaces for other tenants in the Project (which on the date hereof is [**] [Confidential Treatment] per month per space plus applicable sales tax). Landlord shall also provide (or cause the Parking Operator to provide) visitor parking at all times during the Lease Term in a portion of the Parking Areas on a “first come-first served” upon such conditions as Landlord or the Parking Operator, as applicable, shall reasonably establish from time to time but at no charge. Tenant shall not be obligated to pay for Parking Permits for non-reserved spaces.
          (b) Landlord or the Parking Operator may make, modify and enforce reasonable rules and regulations relating to the parking of vehicles in the Parking Areas, and Tenant agrees to abide by such rules and regulations. Except as expressly provided herein, this Lease does not grant Tenant (or its agents, employees, contractors and visitors) the right to use the Parking Areas or any other parking areas located on the Land or serving

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the Buildings or parking areas in any other portion of the Project. So long as Landlord provides sufficient parking available in the Parking Areas to accommodate the holders of the Parking Permits and visitor parking, Landlord or the Parking Operator may, from time to time, designate specific portions of the Parking Areas as reserved areas and Tenant shall have no right to park in such reserved areas, except Tenant may park in reserved areas made available to tenants of the Building to the extent Landlord has made available to Tenant, and Tenant has purchased, Parking Permits specifically entitling Tenant to use the same. Tenant’s principals and employees shall not park in any of the surface parking spaces located around the Building designated as visitor parking.
          (c) Tenant shall have the right to request that Landlord make enhancements to the Building 11 Parking Garage (and also the Building 10 Parking Garage if Tenant is then leasing the entire RSF of Building 10). Landlord shall not unreasonably withhold approval of such enhancements provided that Tenant pays the costs associated therewith (and upon expiration or termination of the Lease, all removal and restoration costs if required by Landlord).
ARTICLE IV
     4.1 Care of Leased Premises. Tenant shall not commit or allow to be committed by Tenant’s employees, agents or contractors, any waste or damage to any portion of the Leased Premises or the Buildings. Upon the expiration or any earlier termination of this Lease, Landlord shall have the right to re-enter and resume possession of the Leased Premises immediately.
     4.2 Entry for Repairs and Inspection. Tenant shall permit Landlord and its contractors, agents or representatives to enter into and upon any part of the Leased Premises during reasonable hours to clean the same and, upon reasonable prior notification, to inspect or make repairs, alterations or additions thereto, and for the purpose of showing the same to prospective tenants (during the last twenty-four (24) months of the Lease Term only), purchasers or lenders, and Tenant shall not be entitled to any abatement or reduction of Rental by reason thereof. Landlord shall use its reasonable efforts not to interfere materially with the operation of Tenant’s business during any such entry. Except in the case of emergency, any repairs or alterations, or additions within the Leased Premises that would materially interfere with Tenant’s business operations shall be performed any time on weekends and holidays and during non-Building Operating Hours on weekdays.
     4.3 Nuisance. Tenant shall conduct its business and control its agents, employees, invitees, contractors and visitors in such a manner as not to create any nuisance, or interfere with, annoy or disturb any other tenant or Landlord in its operation of the Buildings.
     4.4 Laws and Regulations; Encumbrances; Rules of Building. Tenant shall comply with, and Tenant shall cause its employees, contractors and agents to comply with, and shall use its commercially reasonable efforts to cause its visitors and invitees (while in the Leased Premises) to comply with, (i) all laws, ordinances, orders, rules and regulations of all state, federal, municipal and other governmental or judicial agencies or bodies relating to Tenant’s specific use or occupancy of the Leased Premises or to any leasehold improvements made by or for Tenant, including without limitation, the Americans with Disabilities Act, 42 U.S.C. §12101 et seq., and those for the correction, prevention and abatement of nuisance, unsafe conditions, or other grievances arising from or pertaining to the use or occupancy of the Leased Premises, (ii) all recorded easements, operating agreements, parking agreements, declarations, covenants and instruments encumbering the Leased Premises, and (iii) the rules of the Buildings reasonably adopted and altered by Landlord from time to time for the safety, care and cleanliness of the Leased Premises and Buildings and for the preservation of good order therein. Landlord agrees that the rules and regulations shall be reasonably, non-discriminatory and uniformly applied. The initial rules of the Buildings are attached hereto and incorporated herein as Exhibit G. In the event of any conflict between the Lease and Exhibit G, this Lease shall prevail. Any new rules and regulations adopted after the Effective Date shall be reasonable and shall not be in conflict with any provisions of this Lease. With respect to costs related to complying with requirements of any state, federal, municipal and other governmental or judicial agencies or bodies which involve capital items, to the extent they are included in Operating Expenses pursuant to Section 2.4(b)(ix) the portions of the cost thereof attributable to the Lease Term shall be paid by Tenant each year (amortized over the useful life of such capital item) together with interest at [**] [Confidential Treatment] per annum on the unamortized balance).

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     4.5 Legal Use and Violations of Insurance Coverage. Tenant shall not occupy or use the Leased Premises, or permit any portion of the Leased Premises to be occupied or used, for any business or purpose which is unlawful, disreputable or deemed to be hazardous in any manner, or permit anything to be done (other than uses permitted by Section 1.3) which would in any way increase the rate of fire, liability, or any other insurance coverage on the Building or its contents.
     4.6 Hazardous Substances. Tenant shall comply, at its sole expense, with all laws, ordinances, orders, rules and regulations of all state, federal, municipal and other governmental or judicial agencies or bodies relating to the protection of public health, safety, welfare or the environment (collectively, “Environmental Laws”) in the use, occupancy and operation of the Leased Premises, but excluding any violations existing on the Effective Date not caused by Tenant, its agents, contractors or employees and excluding any violations by Landlord or any party other than Tenant or Tenant’s agents, contractors or employees. Tenant agrees that no Hazardous Substances (as defined hereinafter) shall be used, located, stored or processed on the Leased Premises or be brought onto any other portion of the Buildings by Tenant or any of its agents, employees, contractors, assigns, subtenants, guests or invitees, except for minimal quantities customarily associated with office use in first class office buildings and required for Tenant’s business, and no Hazardous Substances will be released or discharged from the Leased Premises (including, but not limited to, ground water contamination). The term “Hazardous Substances” shall mean and include all hazardous and toxic substances, waste or materials, any pollutant or contaminant, including, without limitation, PCB’s, asbestos and raw materials that include hazardous constituents or any other similar substances or materials that are now or hereafter included under or regulated by any Environmental Laws or that would pose a health, safety or environmental hazard. Tenant hereby agrees to indemnify, defend and hold harmless Landlord from and against any and all losses, liabilities (including, but not limited to, strict liability), damages, injuries, expenses (including, but not limited to, court costs, litigation expenses, reasonable attorneys’ fees and costs of settlement or judgment), suits and claims of any and every kind whatsoever paid, incurred or suffered by, or asserted against, Landlord by any person, entity or governmental agency for, with respect to, or as a direct or indirect result of any Hazardous Substances placed on or discharged from the Leased Premises or the Buildings by Tenant or any of its agents, employees, contractors, assigns or subtenants, including, without limitation, any losses, liabilities (including, but not limited to, strict liability), damages, injuries, expenses (including, but not limited to, court costs, litigation expenses, reasonable attorneys’ fees and costs of settlement or judgment), suits and claims asserted or arising under the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”), any so-called federal, state or local “Superfund” or “Superlien” laws or any other Environmental Law.
     4.7 Tenant Taxes. Tenant shall pay promptly when due all taxes directly or indirectly imposed or assessed upon Tenant’s gross sales, business operations, machinery, equipment, trade fixtures and other personal property or assets, whether such taxes are assessed against Tenant, Landlord or the Buildings. In the event that such taxes are imposed or assessed against Landlord or the Buildings, Landlord shall furnish Tenant with all applicable tax bills, public charges and other assessments or impositions and Tenant shall forthwith pay the same either directly to the taxing authority or, at Landlord’s option, to Landlord.
ARTICLE V
     5.1 Leasehold Improvements; Allowances.
          (a) Tenant shall receive a tenant improvement allowance in the amount set forth in the BLI Rider (the “Tenant Improvement Allowance”) to apply towards cover the costs of Tenant’s architectural, engineering, design, construction (including all costs of refurbishment and reconstruction of the Leased Premises, including utilities, security, and other building services (above and beyond services that are already provided under this Lease)), permitting, construction supervision costs, and moving costs; provided, however, it shall be a condition to the obligation of Landlord to pay amounts pursuant to this Section 5.1 that Tenant shall have provided Landlord with appropriate requests for payment, invoices, contractors’ affidavits and sworn statements, contractors’ and subcontractors’ lien waivers, and other documents as may be reasonably required (i) by Landlord to demonstrate the correctness of the amount requested by Tenant, and (ii) to satisfy any other conditions as may be reasonably imposed by Landlord or any Mortgagee. Tenant may apply up to (but not exceeding) [**] [Confidential Treatment] of the Tenant Improvement Allowance towards its furniture, fixtures and equipment (“FF&E”) costs. Tenant hereby agrees that the provisions of Exhibit E attached hereto shall govern the construction of Tenant’s leasehold improvements and renovations or refurbishment of existing improvements (the “Leasehold Improvements”). Tenant shall not install

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any improvements which are not compatible with Landlord’s plans and specifications for the Buildings or which are not approved by Landlord or Landlord’s architect (which approval shall not be unreasonably withheld so long as these do not affect the Building structure, the Building systems, and are not visible from the exterior of the Leased Premises). The Tenant Improvement Allowance shall be disbursed in monthly installments to reimburse Tenant for payment of (or to pay for) the costs incurred by Tenant for the purposes permitted by this Section 5.1, subject to all terms and limitations of this Section 5.1. The amounts disbursed to Tenant shall not, however, exceed the sum of [**] [Confidential Treatment] per month for each month which has elapsed subsequent to the Commencement Date (i.e., Tenant shall be entitled to a disbursement of [**] [Confidential Treatment] per month, cumulative). If Tenant requests a disbursement of less than [**] [Confidential Treatment] for any month, Tenant may request that the deficiency be added to subsequent monthly installments). Each disbursement shall be made only after Landlord’s receipt of such invoices, lien releases, approvals, payment receipts and other documentation as Landlord shall reasonably require. Except as provided in the penultimate sentence of Section 5.1(c) below, any portion of the Tenant Improvement Allowance that has not been disbursed prior to April 1, 2010 shall be forfeited and Tenant shall not be entitled to further disbursements. Landlord shall cooperate with Tenant to agree upon procedures for Landlord’s disbursement of portions of the Tenant Improvement Allowance directly to Tenant’s contractors and suppliers upon written authorization from Tenant and Landlord’s receipt of such lien releases, invoices, architect’s approval and other supporting information as Landlord shall reasonably require. In making any such direct disbursements, Landlord shall rely solely upon Tenant’s authorization and shall have no obligation to inquire as to whether such payment is due or appropriate (and Tenant shall have no claims against Landlord if Landlord makes disbursements in accordance with Tenant’s written authorization).
          (b) Tenant shall have the right to designate general contractors and architects, subject to Landlord’s approval, which approval shall not be unreasonably withheld.
          (c) Subject to the terms and limitations of Section 5.1(a) above, Tenant will be allowed to draw from the Tenant Improvement Allowance up to [**] [Confidential Treatment] per RSF (of which [**] [Confidential Treatment] per RSF may be applied to FF&E), but will be allowed to draw the remaining [**] [Confidential Treatment] per RSF only after Tenant has invested [**] [Confidential Treatment] per RSF of its own funds (proof of which has been submitted to and approved by Landlord) in the improvement of the Leased Premises. Tenant shall have the right to utilize the last portion of the Tenant Improvement Allowance [**] [Confidential Treatment] during the entire term of the Lease provided that the funds are used for building improvements or Alterations in the Leased Premises. Tenant shall be entitled to commence space refurbishment upon the execution of this Lease by all parties hereto.
          (d) Notwithstanding any language contained herein or in Exhibit E to the contrary, if for any reason the Leased Premises (or any portion thereof) should not be ready for occupancy by the Commencement Date, Landlord shall not be liable or responsible for any claims, damages or liabilities in connection therewith or by reason thereof.
          (e) Tenant shall not make or allow to be made any alterations, additions or improvements in or to the Leased Premises, of any kind or nature, including, without limitation, alterations, additions or improvements in, to or on, telephone or computer installations (any and all of such alterations, additions or improvements, except for the Leasehold Improvements, are collectively referred to as the “Alterations”), without the prior written consent of Landlord, which consent shall not be unreasonably withheld; provided, however, that Landlord’s consent shall not be required for painting, wallpaper or carpeting or for non-structural decorations or non-structural Alterations that are not visible from the exterior of the Leased Premises and not affecting Building systems which do not cost more than [**] [Confidential Treatment] in any instance. Moving telephone or computer installations which do not include altering or penetrating walls, floors, or ceilings do not require prior consent of Landlord. Tenant further specifically agrees that no food, soft drink or other vending machine will be installed within the Leased Premises without the written consent of Landlord; provided, however, that Landlord’s consent is not required if such vending machine is for Tenant’s employees and business invitees only. Tenant shall submit to Landlord detailed drawings and plans of the proposed Alterations at the time Landlord’s consent is sought. Should Landlord consent to any proposed Alterations by Tenant, such consent may be conditioned as Landlord deems appropriate including, without limitation, upon Tenant’s agreement to comply with (i) all reasonable requirements established by Landlord, including, without limitation, safety requirements, and (ii) the matters referenced in Section 4.4 of this Lease. Tenant shall deliver to Landlord a copy of the “as built” plans and specifications for all Alterations made in or to the Leased Premises. Safes, vaults and other heavy furniture or equipment shall only be placed in the Leased Premises in

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locations approved by Landlord (such approval not to be unreasonably withheld) and only if they do not exceed the load-bearing limits of the structure.
          (f) Tenant shall indemnify and hold Landlord harmless from and against all costs (including reasonable attorneys’ fees and costs of suit), losses, liabilities, or causes of action arising out of or relating to any alterations, additions or improvements made by Tenant to the Leased Premises, including, but not limited to, any mechanics’ or materialmen’s liens asserted in connection therewith. No portion of Landlord’s interest in the Buildings, the Project and/or this Lease shall be subject to liens (whether pursuant to Florida Statutes Chapter 713 or common law or otherwise) on account of any work performed by or on account of Tenant, and Tenant’s contracts with such contractors shall include notice thereof.
          (g) Should any mechanic’s or other liens be filed against any portion of the Buildings or the Project by reason of Tenant’s acts or omissions or because of a claim against Tenant, Tenant shall cause the same to be canceled or discharged of record by bond or otherwise within thirty (30) days after notice by Landlord. If Tenant shall fail to cancel or discharge said lien or liens, within said thirty (30) day period, Landlord may, at its sole option, cancel or discharge the same and upon Landlord’s demand, Tenant shall promptly reimburse Landlord for all reasonable costs incurred in canceling or discharging such liens.
          (h) Tenant shall promptly deliver to Landlord copies of any and all building permits and any similar or related documentation required by any applicable law, ordinance, rule, regulation, or governmental or quasi-governmental authority in connection with any Alteration performed by or on behalf of Tenant, regardless of whether or not Landlord’s approval is required for such Alteration.
     5.2 Repairs by Landlord. All repairs, alterations, replacements or additions that affect the common areas, a Building’s structural components or the Building’s roof, plate glass, or mechanical, electrical, HVAC, and plumbing systems (including any of the same located in the Leased Premises) shall be made solely by Landlord or its contractor. In the event of any damage to such components or systems or any other portion of the Building caused by Tenant or Tenant’s agents, contractors or employees or visitors or invitees (but as to visitors and invitees, only when they are within the Leased Premises), the cost of repair or restoration of such damage shall be paid for solely by Tenant in an amount equal to Landlord’s costs plus [**] [Confidential Treatment] for administrative cost recovery, which costs shall constitute Tenant’s Additional Rental. Landlord shall make such repairs, alterations, replacements or additions to Base Building Shell Condition improvements as may be deemed necessary by Landlord for normal maintenance operations and, except as otherwise provided in this Section 5.2 or this Lease, Landlord shall not otherwise be obligated to make improvements to, or repairs of, the Leased Premises. Landlord’s Repairs shall be performed to the extent and in a manner consistent with Comparable Buildings.
     5.3 Repairs by Tenant. Subject to Section 5.2, Tenant shall, at its own cost and expense, keep the Leased Premises and all Leasehold Improvements in a condition similar to the condition on the Commencement Date, or as to Alterations, similar to the conditions as existed upon completion thereof, normal wear and tear and loss by fire or other casualty excepted, and Tenant shall perform all maintenance, repairs and replacements necessary to accomplish the same. In addition, Tenant shall perform all maintenance, repairs, replacements and improvements required by any governmental law, ordinance, rule or regulation to the extent required by Section 4.4. If Tenant fails to commence any maintenance, repairs, replacements or improvements which it is required to perform hereunder within ten (10) days after written notice from Landlord to Tenant and thereafter diligently proceed with such work until completion, Landlord may, at its option, perform any such maintenance, repairs, replacements or improvements deemed necessary by Landlord, and Tenant shall pay to Landlord on demand Landlord’s cost thereof plus a charge of [**] [Confidential Treatment] for administrative cost recovery, which amount shall be deemed Tenant’s Additional Rental.
ARTICLE VI
     6.1 Condemnation. If all or substantially all of the Leased Premises, or such portion of the Leased Premises or the Building as would render, in Landlord’s reasonable judgment, the continuance of Tenant’s business from the Leased Premises impracticable, shall be permanently taken or condemned for any public purpose, then this Lease, at the option of Tenant or Landlord upon the giving of written notice to the other party within ten (10) days from the date of such condemnation or taking, shall forthwith cease and terminate. The foregoing shall also apply

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with respect to the Parking Facilities unless Landlord provides alternate parking. If less than all or substantially all of the Leased Premises or any portion of the Buildings shall be permanently taken or condemned for any public purpose and such portion is material and will have a material adverse affect upon the continued operation of a Building, then Landlord shall have the option of terminating this Lease with respect to such Building by written notice to Tenant within ten (10) days from the date of such condemnation or taking, provided Landlord also terminates all other similarly affected leases in the Building. If this Lease is terminated as provided above, this Lease shall cease and expire as if the date of transfer of possession of the Leased Premises, the Buildings, or any portion thereof, was the expiration date of this Lease. In the event that this Lease is not terminated by either Landlord or Tenant as aforesaid, Tenant shall pay the Rental up to the date of transfer of possession of such portion of the Leased Premises so taken or condemned and this Lease shall thereupon cease and terminate with respect to such portion of the Leased Premises so taken or condemned as if the date of transfer of possession of the Leased Premises was the expiration date of the Lease Term relating to such portion of the Leased Premises. Thereafter the Base Rental, Tenant’s Forecast Additional Rental and Tenant’s Additional Rental shall be adjusted on a pro rata, Rentable Square Foot basis. In the event of any such condemnation or taking and this Lease is not so terminated, Landlord shall promptly repair the Leased Premises or the Buildings, as the case may be, to Base Building Shell Condition so that the remaining portion of the Leased Premises or Buildings, as the case may be, shall constitute an architectural unit, fit for Tenant’s occupancy and business; provided, however, that Landlord’s obligation to repair hereunder shall be limited to the extent of the net proceeds made available to Landlord for such repair from any such condemnation or taking. In the event of any temporary taking or condemnation for any public purpose of the Leased Premises or any portion thereof, then this Lease shall continue in full force and effect except that Base Rental, Tenant’s Forecast Additional Rental, and Tenant’s Additional Rental shall be adjusted on a pro rata Rentable Square Foot basis for the period of time that the Leased Premises are so taken as of the date of transfer of possession of the Leased Premises and Landlord shall be under no obligation to make any repairs or alterations. In the event of any condemnation or taking of the Leased Premises, Tenant hereby assigns to Landlord the value of all or any portion of the unexpired Lease Term and all Leasehold Improvements and Tenant may not assert a claim for a condemnation award therefor; provided, however, Tenant may pursue a separate attempt to recover an award or compensation against or from the condemning authority for (i) the value of any fixtures, furniture, furnishings, Tenant’s Extra Work and other personal property which were paid for by Tenant and not by Landlord and which were condemned but which under the terms of this Lease, Tenant is permitted to remove at the end of the Lease Term, (ii) relocation and moving expenses, and (iii) compensation for loss to Tenant’s business. In the event Landlord has not repaired the condemned property as required herein within [**] [Confidential Treatment] days of the date of taking (the “Outside Date”), subject to extension by reason of Section 8.5 hereof, then Tenant shall have the option to terminate this Lease by delivering written notice to Landlord; provided, however, if Tenant gives written notice of termination, Landlord may negate such termination by completing the work within thirty (30) days (subject to Section 8.5) after the Outside Date.
     6.2 Damages From Certain Causes. Landlord shall not be liable or responsible to Tenant for any loss or damage to any property or person occasioned by theft, fire, act of God, public enemy, riot, strike, insurrection, war, act or omission of any tenant or occupant of the Buildings, any nuisance or interference caused or created by any tenant or occupant of the Buildings, requisition or order of governmental body or authority, court order or injunction, or any cause beyond Landlord’s control or, except in the case of the gross negligence or intentional misconduct of Landlord, for any damage or inconvenience which may arise through repair or alteration of any part of the Buildings. Tenant shall notify Landlord of any damage to the Leased Premises of which Tenant has actual knowledge, regardless of the cause of such damage.
     6.3 Casualty Clause.
          (a) In the event any portion of the Leased Premises or any portion of the common areas of the Buildings are damaged by fire or other casualty, earthquake or flood or by any other cause of any kind or nature (hereinafter collectively referred to as the “Damaged Property”), Landlord shall proceed to rebuild the Damaged Property to Base Building Shell Condition if (i) in the opinion of Landlord’s architect, the Damaged Property can be fully restored and rebuilt within one year from the date of notice of Landlord’s architect; and (ii) the “Available Funds” (as hereafter defined) shall be adequate to pay all costs of restoration and repair. In the event that Landlord has not received confirmation that the condition of subparagraph (ii) will be met, Landlord shall have the right to terminate this Lease by written notice to Tenant within sixty (60) days following receipt of Landlord’s architect’s opinion. As used herein, the term “Available Funds” shall mean (determined separately for each Building) the sum

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of (x) the net insurance proceeds available to Landlord (and not retained by any Mortgagee or Ground Lessee); (y) the applicable deductible that constitutes Operating Costs to be paid by the tenant(s) of such Building; and (z) the amount which Landlord has agreed to pay. If the sum of (x) and (y) are not adequate to fully restore and rebuild the Damaged Property, Landlord may in its sole discretion pay the entire deficiency but in no event shall Landlord’s contribution with respect to Damaged Property in the Building in question be less than the lesser of the following (determined on a per Building basis): (a) the total deficiency with respect to such Building; or (b) [**] [Confidential Treatment]; provided, however, the [**] [Confidential Treatment] figure shall be subject to adjustment on December 1, 2007 and on each anniversary of such date (each, an “Adjustment Date”) as follows:
     On each Adjustment Date the [**] [Confidential Treatment] figure shall be multiplied by a fraction, the numerator of which is the CPI Index for month in which the Adjustment Date occurs and the denominator of is the CPI Index for the month of December 2006. As used herein “CPI” shall mean the Consumer Price Index for All Urban Consumers, All Items (1982 — 1984 = 100) published by the Department of Labor, Bureau of Labor Statistics for the area in which the Leased Premises are located. If the Bureau of Labor Statistics substantially revises the manner in which the CPI is determined, an adjustment shall be made in the revised index which would produce results equivalent to those which would be obtained hereunder if the CPI were not so revised. If the CPI is discontinued or becomes unavailable, Landlord shall substitute a comparable index to measure changes in the cost of living or purchase power of consumers, published by a governmental agency, major bank, or recognized financial publisher.
     In the event of any insured casualty, Landlord agrees to use good faith efforts (but without incurring any additional liability or cost) to convince the Mortgagee or Ground Lessor to make the net insurance proceeds available to Landlord for purposes of restoration.
     (b) In the event that either of the Buildings is damaged and the cost of repairing and restoring the same exceeds [**] [Confidential Treatment] of the replacement costs of the improvements comprising such Building, then Landlord, at Landlord’s option, shall have the right to terminate this Lease with respect to such Building (and if Landlord so terminates the Lease with respect to such Building, Tenant may elect to terminate the entire Lease by providing written notice of termination no later than thirty (30) days thereafter).
     (c) If, in the opinion of Landlord’s architect, the Damaged Property cannot be repaired [**] [Confidential Treatment] from the date of notice of Landlord’s architect, then both Landlord and Tenant shall have the right to terminate this Lease by written notice to the other party of such termination within thirty (30) days of receipt of Landlord’s architect’s opinion. If neither party terminates but the Damaged Property is not substantially repaired or restored within [**] [Confidential Treatment] after the date specified by Landlord’s architect as the estimated completion date for the repairs, or [**] [Confidential Treatment] after receipt of Landlord’s architect’s opinion, whichever is later, subject to extension pursuant to Section 8.5, then Tenant shall have the option to terminate this Lease by delivering written notice to Landlord (“Tenant’s Notice”); provided, however, that if on the date that Landlord receives Tenant’s Notice Landlord is diligently performing repairs and restoration, Landlord shall have an additional thirty (30) days, subject to Section 8.5, in which to finish such work and if Landlord does finish the work, the Lease shall not be terminated and Tenant’s Notice shall be void. If at the time any damage to the Leased Premises occurs there is less than one year remaining in the Lease Term and in Landlord’s architect’s opinion the damage cannot be repaired within [**] [Confidential Treatment], either party shall have the right to terminate this Lease by written notice to the other within thirty (30) days after receipt of Landlord’s architect’s opinion.
     (d) With respect to any portion of the Damaged Property that is the Leased Premises, Landlord shall only be obligated to rebuild or restore to Base Building Shell Condition and to make available to Tenant any net insurance proceeds received by Landlord that are attributable to such leasehold improvements that were damaged or destroyed (not exceeding the full costs of restoration); provided, however, Tenant shall have the right to require Landlord to rebuild or restore the Leased Premises substantially to the condition which existed immediately prior to such damage if, but only if, within thirty (30) days of receipt of the opinion of Landlord’s architect, Tenant agrees in writing to pay all additional costs that Landlord will incur in excess of such proceeds to restore such leasehold improvements and Tenant deposits with Landlord an amount [**] [Confidential Treatment] acceptable to Landlord in form, substance and issuer pursuant to which draws may be made by Landlord thereunder as progress is made in construction of the Tenant

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Improvements. Tenant shall be entitled to a pro rata (based upon the RSF which has been damaged) abatement of Rental for a period commencing upon the date of the casualty and continuing until the first to occur of (i) (y) [**] [Confidential Treatment] days after the damage to the Leased Premises has been restored to Base Building Shell Condition; (if Tenant is constructing its own Tenant Improvements) or, (z) if Landlord is constructing the Tenant Improvements, the date when the Tenant Improvements have been substantially completed or such earlier date that the Tenant Improvements would have been substantially completed if there had been no delays caused by Tenant; or (ii) the date that Tenant resumes occupancy of the Lease Premises (or portion thereof).
          (e) If any portion of Tenant’s leasehold improvements (including, but not limited to, Tenant’s Extra Work), alterations, additions, improvements, fixtures, furnishing, equipment or trade fixtures are damaged by fire or other casualty, hurricane, earthquake or flood or by any other cause of any kind or nature, Tenant shall restore the same to the condition existing immediately prior to such damage, unless this Lease is terminated or Tenant has elected to have Landlord complete the restoration pursuant to, and in compliance with the requirements of, subparagraph (d) above. If Tenant restores the leasehold improvements, the portion of the insurance proceeds which Landlord makes available to Tenant shall be disbursed as construction progresses and in accordance with such terms, conditions and requirements customarily imposed by Landlord in connection with disbursement of tenant improvement allowances for leasehold improvements.
          (f) Landlord’s architect’s opinion shall be delivered to both Landlord and Tenant within sixty (60) days from the date of any such damage, which opinion shall be objective and informed and state the estimated completion date for the repairs. In the event of any termination of this Lease under this Section 6.3, this Lease shall cease and terminate as if the date of such damage were the expiration date of the term of this Lease. If Landlord or Tenant terminates the Lease pursuant to subparagraph (a), (b), or (c) above, Tenant shall be entitled to remain in occupancy for a period not exceeding six (6) months after the date of termination (but in no event beyond Lease Term) as to any portion of the Leased Premises that is tenantable and may be lawfully occupied; provided, however, that such six (6) month period shall be extended to twelve (12) months from the date of termination (but not beyond the Lease Term) if Tenant remains in occupancy of [**] [Confidential Treatment] RSF or more. Tenant shall continue to pay Rental and shall continue to be bound by this Lease with respect to all such space during such period of occupancy.
     6.4 Casualty Insurance. Landlord shall maintain all-risk property insurance on the Buildings and on all Base Building Shell Condition improvements. Said insurance shall be maintained with an insurance company authorized to do business in Florida and having a rating of A minus VII or better by A.M. Best and Company, at full replacement cost and payments for losses thereunder shall be made solely to Landlord. Tenant shall maintain at its expense (a) business interruption insurance (or Tenant shall self-insure for business interruption) and (b) all-risk property insurance on the full replacement cost of all its personal property, including removable trade fixtures, located in the Leased Premises and on Tenant’s Extra Work and all other additions and improvements (including fixtures) made by Tenant and not required to be insured by Landlord above, regardless of whether such improvements were made at Landlord’s or Tenant’s expense. Said insurance shall be maintained with an insurance company authorized to do business in Florida and having a rating of A minus VII or better by A.M. Best and Company. If the annual premiums to be paid by Landlord shall exceed the standard rates because of Tenant’s operations within, or contents of, the Leased Premises or because the improvements to the Leased Premises are in excess of improvements contemplated by the Tenant Improvement Allowance, Tenant shall promptly pay the excess amount of the premium upon request by Landlord (and if necessary, Landlord may allocate the insurance costs of such Building to give effect to this sentence). Upon the request of Landlord, a duly executed certificate of insurance, reflecting Tenant’s maintenance of the insurance required under this Section 6.4 and Section 6.5, shall be delivered to Landlord. If this Lease is terminated by reason of damage resulting from a casualty, each party shall retain the insurance proceeds of the insurance policies obtained by such party (i.e. Landlord shall retain all proceeds from all policies carried by Landlord and Tenant shall retain all proceeds of policies carried by Tenant). If this Lease is not terminated by reason of any damage caused by a casualty, then each party shall apply the net proceeds of its policies (to the extent made available to such party and not retained by any Mortgagee or Ground Lessor) towards the cost of its restoration obligations hereunder.
     6.5 Liability Insurance. Landlord and Tenant shall each maintain a policy or policies of commercial general liability insurance with the premiums thereon fully paid on or before the due dates, issued by and binding upon an insurance company authorized to transact business in Florida and having a rating of A-VII or better by A.M. Best and Company. Such insurance shall be written on an occurrence basis and shall afford minimum protection

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(which may be affected by primary and/or excess coverage) of not less than $5,000,000 combined single limit for bodily injury and property damage in any one occurrence. During any renewal term of this Lease, Tenant shall carry such greater limits of coverage as Landlord may reasonably request from time to time so long as Landlord maintains similar limits of coverage and if landlords of Comparable Buildings would require similar insurance from similar tenants.
     6.6 Hold Harmless.
          (a) Landlord shall not be liable to Tenant, its agents, servants, employees, contractors, customers or invitees for any damage to person or property caused by any act, omission or neglect of Tenant. Without limiting or being limited by any other indemnity in this Lease, but rather in confirmation and furtherance thereof, Tenant agrees to indemnify, defend by counsel reasonably acceptable to Landlord and hold Landlord, Landlord’s beneficiaries (if Landlord is a land trust), the managing agent of the Buildings, the leasing agent of the Buildings and their respective agents, partners, shareholders, officers, directors and employees of the Building harmless of, from and against any and all losses, damages, liabilities, claims, liens, costs and expenses (including, but not limited to, court costs, reasonable attorneys’ fees and litigation expenses) in connection with injury to or death of any person or damage to or theft, loss or loss of the use of any property occurring in or about the Leased Premises or the Buildings arising from Tenant’s occupancy of the Leased Premises, or the conduct of its business or from any activity, work, or thing done, permitted or suffered by Tenant in or about the Leased Premises or the Buildings, or from any breach or default on the part of Tenant in the performance of any covenant or agreement on the part of Tenant to be performed pursuant to the terms of this Lease, or due to any other act or omission or willful misconduct of Tenant or any of its agents, employees, contractors, assigns, subtenants, guests or invitees (but with respect to such guests and invitees, only while they are in the Leased Premises).
          (b) Tenant shall not be liable to Landlord, its agents, employees, contractors, customers or invitees for any damage to person or property caused by any act, omission or neglect of Landlord. Without limiting or being limited by any other indemnity in this Lease, but rather in confirmation and furtherance thereof, Landlord agrees to indemnify, defend by counsel reasonably acceptable to Tenant and hold Tenant, its officers, directors, shareholders, employees and affiliates harmless of, from and against any and all losses, damages, liabilities, claims, liens, costs and expenses (including, but not limited to, court costs, reasonable attorneys’ fees and litigation expenses) in connection with injury to or death of any person or damage to or theft, loss or loss of the use of any property occurring in or about the Buildings or the Project arising from any activity, work or action done by Landlord in or about the Buildings or the Project or breach or default on the part of Landlord in the performance of any covenant or agreement on the part of Landlord to be performed pursuant to the terms of this Lease, or due to the gross negligence or willful misconduct of Landlord or any of its agents, employees, or contractors.
     6.7 Waiver of Subrogation Rights. Anything in this Lease to the contrary notwithstanding, Landlord and Tenant each hereby waives any and all rights of recovery, claim, action or cause of action, against the other, its agents, servants, partners, shareholders, officers or employees, for personal injury, loss or damage to business, and loss or damage that may occur to the Leased Premises, the Buildings or any improvements thereto or thereon or any personal property of such party therein or thereon by reason of fire, the elements, or any other cause to the extent such loss or damage is covered by terms of the all-risk property insurance policies referred to in Section 6.4 hereof, the commercial general liability insurance referred to in Section 6.5, or any other insurance policy maintained by Landlord or Tenant, as applicable, regardless of cause or origin, including negligence of the other party hereto, its agents, officers, partners, shareholders, servants or employees, and covenants that no insurer shall hold any right of subrogation against such other party. The foregoing waiver shall apply regardless of the cause or origin of such claim, including but not limited to the negligence of a party, or such party’s agents, officers, employees or contractors, but shall not apply if it would have the effect, but only to the extent of such effect, of invalidating any insurance coverage of Landlord or Tenant. Each party shall obtain any special endorsements, if any, required by their respective insurers to evidence compliance with the aforementioned waiver.
ARTICLE II
     7.1 Default and Remedies.

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          (a) The occurrence of any of the following shall constitute an event of default under and breach of this Lease by Tenant (an “Event of Default”):
  (i)   Failure by Tenant to pay any Rental within five (5) days after the same becomes due hereunder; provided, however, on not more than two (2) occasions within each calendar year in the Lease Term, Landlord shall provide Tenant with written notice of such delinquency and Tenant shall have five (5) days from the date of the written notice to cure such delinquency before an event of default shall exist for Tenant’s failure to pay said Rental;
 
  (ii)   Failure by Tenant to observe or perform any of the covenants in respect of assignment and subletting set forth in Article VIII;
 
  (iii)   Failure by Tenant to commence to cure, immediately after receipt of notice from Landlord and thereafter diligently pursue same to completion, any hazardous condition which Tenant has created or permitted in violation of law or of this Lease;
 
  (iv)   Failure by Tenant to complete, execute and deliver any instrument or document required to be completed, executed and delivered by Tenant pursuant to Section 7.8 or Section 7.9 of this Lease, within the applicable time period specified in such sections;
 
  (v)   Failure by Tenant to observe or perform any other covenant, agreement, condition or provision of this Lease, if such failure shall continue for thirty (30) days after written notice thereof from Landlord to Tenant; provided, however, if such default is curable, such thirty (30) day period shall be extended for the time reasonably required to complete such cure, if such failure cannot reasonably be cured within said thirty (30) day period and Tenant commences to cure such failure within said thirty (30) day period and thereafter diligently and continuously proceeds to cure such failure;
 
  (vi)   The levy upon execution or the attachment by legal process of the leasehold interest of Tenant, or the filing or creation of a lien in respect of such leasehold interest, which lien shall not be released or discharged within thirty (30) days from the date of such filing;
 
  (vii)   Any material default under or material breach by any guarantor of the terms of any guaranty of this Lease which continues beyond any applicable cure period specified in the Guaranty, if any;
 
  (viii)   Tenant or any guarantor of Tenant’s obligations under this Lease becomes insolvent or bankrupt or admits in writing its inability to pay its debts as they mature, or makes an assignment for the benefit of creditors, or applies for or consents to the appointment of a trustee or receiver for all or a major part of its property;
 
  (ix)   A trustee or receiver is appointed for Tenant, any guarantor of Tenant’s obligations under this Lease or for a major part of either party’s property and is not discharged within sixty (60) days after such appointment; and
 
  (x)   Any bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding, or other proceeding for relief under any bankruptcy law or similar law for the relief of debtors is instituted (A) by Tenant or any guarantor of Tenant’s obligations under this Lease, or (B) against Tenant or any guarantor of

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      Tenant’s obligations under this Lease and is allowed against it or is consented to by it or is not dismissed within sixty (60) days after such institution.
          (b) Upon the occurrence of an Event of Default, Landlord shall have the option to do and perform any one or more of the following in addition to, and not in limitation of, any other remedy or right permitted it by law or in equity or by this Lease:
  (i)   Landlord, with or without terminating this Lease, may immediately or at any time thereafter re-enter the Leased Premises and correct or repair any condition which shall constitute a failure on Tenant’s part to keep, observe, perform, satisfy, or abide by any term, condition, covenant, agreement, or obligation of this Lease or of the Rules and Regulations now in effect or hereafter adopted or of any notice given Tenant by Landlord pursuant to the terms of this Lease, and Tenant shall fully reimburse and compensate Landlord on demand.
 
  (ii)   Landlord, with or without terminating this Lease, may immediately or at any time thereafter demand in writing that Tenant vacate the Leased Premises and thereupon Tenant shall vacate the Leased Premises and remove therefrom all property thereon belonging to or placed on the Leased Premises by, at the direction of, or with consent of Tenant within ten (10) days of receipt by Tenant of such notice from Landlord, whereupon Landlord shall have the right to re-enter and take possession of the Leased Premises. Any such demand, re-entry and taking possession of the Leased Premises by Landlord shall not of itself constitute an acceptance by Landlord of a surrender of this Lease or of the Leased Premises by Tenant and shall not of itself constitute a termination of this Lease by Landlord.
 
  (iii)   If Tenant does not comply with any demand pursuant to Section 7.2(b)(ii), Landlord, with or without terminating this Lease, may immediately or at any time thereafter, re-enter the Leased Premises and remove therefrom Tenant and all property belonging to or placed on the Leased Premises by, at the direction of, or with consent of Tenant. Any such re-entry and removal by Landlord shall not of itself constitute an acceptance by Landlord of a surrender of this Lease or of the Leased Premises by Tenant and shall not of itself constitute a termination of this Lease by Landlord.
 
  (iv)   Landlord, with or without terminating this Lease, may immediately or at any time thereafter relet the Leased Premises or any part thereof for such time or times, at such rental or rentals and upon such other terms and conditions as Landlord in its sole discretion may deem advisable, and Landlord may make any alterations or repairs to the Leased Premises which it may deem necessary or proper to facilitate such reletting; and Tenant shall pay all costs of such reletting including but not limited to the cost of any such alterations and repairs to the Leased Premises, attorneys’ fees, leasing inducements, and brokerage commissions; and if this Lease shall not have been terminated, Tenant shall continue to pay all Rental and all other charges due under this Lease up to and including the date of beginning of payment of Rental by any subsequent tenant of part or all of the Leased Premises, and thereafter Tenant shall pay monthly during the remainder of the Lease Term the difference, if any, between the Rental and other charges collected from any such subsequent tenant or tenants and the Rental and other charges reserved in this Lease, but Tenant shall not be entitled to receive any excess of any such rents collected over the rents reserved herein.
 
  (v)   Landlord may immediately or at any time thereafter terminate this Lease, and this Lease shall be deemed to have been terminated upon receipt by Tenant of

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      written notice of such termination; upon such termination Landlord shall recover from Tenant all damages Landlord may suffer by reason of such termination including, without limitation, unamortized sums expended by Landlord for leasing commissions and construction of tenant improvements, all arrearages in rentals, costs, charges, additional rentals, and reimbursements, the cost (including court costs and attorneys’ fees) of recovering possession of the Leased Premises, the cost of any alteration of or repair to the Leased Premises which is necessary or proper to prepare the same for reletting and, in addition thereto, Landlord shall have and recover from Tenant an amount equal to the excess, if any, of the total amount of all rents and other charges to be paid by Tenant for the remainder of the Lease Term over the then reasonable rental value of the Leased Premises for the remainder of the Lease Term.
  (vi)   Landlord, may, without re-entering, retaking or resuming possession of the Leased Premises, sue for all rents provided for hereunder, including but not limited to Base Rental and Tenant’s Additional Rental, and all other sums, charges, payments, costs and expenses due from Tenant to Landlord hereunder, either: (i) as they become due under this Lease, or (ii) at Landlord’s option, Landlord may annually (on a recurring basis) accelerate the maturity and due date of the whole or any part of the Base Rental and Tenant’s Additional Rental for the successive twelve (12) month period during the remainder of the Lease Term, as well as all other sums, charges, payments, costs and expenses required to be paid by Tenant to Landlord hereunder, including, without limitation, damages for a breach or default of Tenant’s obligations hereunder in existence at the time of such acceleration, such that all sums due and payable under this Lease for each successive twelve (12) month period during the remainder of the Lease Term shall, following such acceleration, be treated as being and, in fact, due and payable in advance as of the date of such acceleration (but for any such twelve (12) month period first arising after Landlord has relet the Leased Premises or portions thereof, the acceleration of Rental for any successive twelve (12) month periods as applies solely to such relet portions of the Leased Premises, shall be limited to the acceleration of the positive difference between the Rental under this Lease for such relet portion of the Leased Premises and the actual rental proceeds collected pursuant to such reletting of the portion of the Leased Premises so relet) (all accelerated amounts shall be discounted to the then-present value at the discount rate of the Federal Reserve Bank of the district within which the Leased Premises is located). Landlord may recover and collect all such unpaid Base Rental, Tenant’s Additional Rental and other sums due and owing by Tenant by distress, levy, execution or otherwise.
Regardless of which alternative remedy is chosen by Landlord under the foregoing provision of this subparagraph, Landlord shall not be required to relet the Leased Premises nor exercise any other right granted to Landlord pursuant to this Lease, nor shall Landlord be under any obligation to minimize or mitigate Landlord’s damages or Tenant’s loss as a result of Tenant’s breach of or default under this Lease except as follows: if Landlord exercises the remedies set forth in subparagraph (iv) without terminating this Lease, Landlord to the extent required by law, shall use commercially reasonable efforts to relet the Leased Premises (for a term greater or less than the remaining term of this Lease) but Landlord need not give priority to the Leased Premises over other comparable vacant space in the Project in connection with reletting the Leased Premises.
          (c) If Landlord re-enters the Leased Premises or terminates this Lease pursuant to any of the provisions of this Lease, Tenant hereby waives all claims for damages which may be caused by such re-entry or termination by Landlord, provided such entry or termination is in accordance with applicable legal requirements. No such re-entry or termination shall be considered or construed to be a forcible entry.
          (d) The exercise by Landlord of any one or more of the rights and remedies provided in this Lease shall not prevent the subsequent exercise by Landlord of any one or more of the other rights and remedies

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herein provided. All remedies provided for in this Lease are cumulative and may, at the election of Landlord, be exercised alternatively, successively, or in any other manner and are in addition to any other rights provided for or allowed by law or in equity.
          (e) No act by Landlord with respect to the Leased Premises shall terminate this Lease, including, but not limited to, acceptance of the keys, institution of an action for detainer or other dispossessory proceedings, it being understood that this Lease may only be terminated by express written notice from Landlord to Tenant, and any reletting of the Leased Premises shall be presumed to be for and on behalf of Tenant, and not Landlord, unless Landlord expressly provides otherwise in writing to Tenant.
     7.2 Insolvency or Bankruptcy. The appointment of a receiver to take possession of all or substantially all of the assets of Tenant or any guarantor of Tenant’s obligations under this Lease, or any general assignment by Tenant or any guarantor of Tenant’s obligations under this Lease for the benefit of creditors, or any action taken or suffered by Tenant or any guarantor of Tenant’s obligations under this Lease under any insolvency, bankruptcy, or reorganization act, shall, at Landlord’s option, constitute a breach of this Lease by Tenant. Upon the happening of any such event or at any time thereafter, this Lease shall terminate five (5) days after written notice of termination from Landlord to Tenant. In no event shall this Lease be assigned or assignable by operation of law or by voluntary or involuntary bankruptcy proceedings or otherwise and in no event shall this Lease or any rights or privileges hereunder be an asset of Tenant under any bankruptcy, insolvency, or reorganization proceedings.
     7.3 Late Payments. Tenant shall pay, as a one (1) time late charge on each installment of any Rental owed by Tenant hereunder that is not paid within five (5) days after the date when due, the greater of [**] [Confidential Treatment] of the amount due for each and every thirty (30) day period that said amount remains unpaid (but in no event shall the amount of such late charge exceed an amount based upon the highest legally permissible rate chargeable at any time by Landlord under the circumstances). Should Tenant make a partial payment of past due amounts, the amount of such partial payment shall be applied first to reduce all accrued and unpaid late charges, in inverse order of their maturity, and then to reduce all other past due amounts, in inverse order of their maturity. Notwithstanding the foregoing, Landlord shall not impose the late fee set forth in this Section 7.3 for the first time that Tenant is late in any calendar year.
     7.4 Attorneys’ Fees. If Landlord or Tenant initiate any action to enforce its rights under this Lease or the terms hereof, the prevailing party shall be entitled to collect from the other party all court costs, reasonable attorneys fees and litigation expenses, including, but not limited to, costs of depositions and expert witnesses, that the prevailing party incurs in connection with such action at the trial level and at all levels of appeal and in any post judgment, bankruptcy and administrative proceeding.
     7.5 Waiver of Homestead. Tenant hereby waives and renounces all homestead or exemption rights which Tenant may have under or by virtue of the Constitutions and Laws of the United States, the State of Florida, and any other State as against any debt or sum Tenant may owe Landlord under this Lease and hereby transfers, conveys, and assigns to Landlord all homestead or exemption rights which may be allowed or set apart to Tenant, including such as may be set apart in any bankruptcy proceeding, to pay any debt or sum owing by Tenant to Landlord hereunder.
     7.6 No Waiver of Rights. No failure or delay of Landlord or Tenant to exercise any right or power given them herein or to insist upon strict compliance by the other party of any obligation imposed on it herein and no custom or practice of either party hereto at variance with any term hereof shall constitute a waiver or a modification of the terms hereof by Landlord or any right to demand strict compliance with the terms hereof. No waiver of any right of Landlord or Tenant or any default by the other party on one occasion shall operate as a waiver of any of Landlord’s other rights or of any subsequent default. No express waiver shall affect any condition, covenant, rule, or regulation other than the one specified in such waiver and then only for the time and in the manner specified in such waiver. No person has or shall have any authority to waive any provision of this Lease unless such waiver is expressly made in writing and signed by an authorized officer of Landlord.
     7.7 Holding Over. In the event of holding over by Tenant after expiration or termination of this Lease without the written consent of Landlord, Tenant shall pay, solely for such holding over, [**] [Confidential Treatment] of the Rental that would have been payable if this Lease had not terminated or expired for the first

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thirty (30) days of holdover and [**] [Confidential Treatment] of the Rental that would have been payable if this Lease had not so terminated or expired) for the remaining holdover period. No holding over by Tenant after the Lease Term shall be construed to extend this Lease, and Tenant shall be deemed a tenant at will, terminable on five (5) days notice from Landlord, provided, however, if not less than one year prior to the scheduled expiration date of the Lease Term, Tenant provides written notice to Landlord that Tenant has irrevocably waived its Renewal Option and advises that Tenant intends to holdover for a specified period (which period may not exceed one hundred twenty (120) days) Tenant shall be entitled to remain in occupancy for the specified period as an authorized holdover and shall be obligated to pay Rental in an amount equal to 105% of the Base Rental in effect immediately prior to such period for the entire period so specified (plus all Additional Rental). In the event of any unauthorized holding over, Tenant shall indemnify Landlord against all claims for damages by any other tenant to whom Landlord shall have leased all or any part of the Leased Premises effective upon the termination of this Lease. Any holding over with the express written consent of Landlord shall thereafter constitute this Lease to be a lease from month to month (terminable by either party on fifteen (15) days notice) at a Base Rental, Tenant’s Forecast Additional Rental, and all other sums required to be paid by Tenant prior to the expiration or termination of this Lease as may be determined by Landlord.
     7.8 Subordination.
          (a) Landlord may have heretofore or may hereafter encumber with a mortgage, deed of trust, deed to secure debt, financing statement or other security interests (collectively, a “Mortgage”) the Land, the Building, the Project or any part thereof or any interest therein, may sell and lease back the Land, the Project or any part thereof, and may encumber the leasehold estate under such a sale and leaseback arrangement with a Mortgage. (the holder of any Mortgage is herein called a “Mortgagee.” A lease creating Landlord’s interest in the Land, the Building, the Project or part thereof is herein called a “Ground Lease” and the lessor under any such Ground Lease is herein called a “Ground Lessor”). Provided that any Mortgagee or Ground Lessor executes and delivers an SNDA (as hereafter defined), this Lease and the rights of Tenant hereunder shall be and are hereby expressly made subject to and subordinate at all times to any Mortgage and to any Ground Lease now or hereafter existing, and to all amendments, modifications, renewals, extensions, consolidations and replacements thereof, and to all advances made or hereafter to be made upon the security thereof; provided, however, that whether or not an SNDA is executed and delivered, the Mortgagee or Ground Lessor shall not, so long as Tenant shall not be in default under this Lease, disturb Tenant in its possession of the Leased Premises or terminate Tenant’s rights hereunder. With respect to Landlord’s existing Mortgagee, the foregoing subordination of this Lease and non-disturbance of Tenant shall be memorialized in a Subordination, Non-Disturbance and Attornment Agreement, in a form substantially as shown on Exhibit K hereto. With respect to any subsequent Mortgagee or Ground Lessor, the subordination and non-disturbance agreement shall either be substantially in the form of Exhibit K or shall be in the standard form required by such Mortgagee or Ground Lessor but with such changes as are customarily requested by, and granted to, major institutional tenants such as Tenant (in either case, an “SNDA”). Tenant agrees to execute and deliver to Landlord an SNDA reflecting any Mortgagee or Ground Lessor designated by Landlord within ten (10) days after Tenant’s receipt of such written request.
          (b) If any Mortgage is foreclosed, or Landlord’s interest under this Lease is conveyed or transferred in lieu of foreclosure, or if any Ground Lease is terminated:
  (i)   Upon request of any person or entity which as the result of any of the foregoing has succeeded to the interest of Landlord in this Lease (any such person or entity being hereafter called a “Successor”), Tenant will attorn to such Successor, as Landlord under this Lease, subject to the provisions of this Section 7.8(c) and Section 7.8(e), and will execute and deliver such instruments as may be necessary or appropriate to evidence such attornment within ten (10) days after receipt of a written request to do so.
 
  (ii)   No Successor shall be bound to recognize any prepayment by more than thirty (30) days of any Rental payable by Tenant hereunder, as more particularly provided in the SNDA.

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          (c) Notwithstanding anything to the contrary contained herein, any Mortgagee may subordinate, in whole or in part, its Mortgage to this Lease by sending Tenant notice in writing subordinating all or any part of such Mortgage to this Lease, and Tenant agrees to execute and deliver to such Mortgagee such further instruments consenting to or confirming the subordination of all or any portion of its Mortgage to this Lease and containing such other provisions which may be requested in writing by such Mortgagee within ten (10) days after Tenant’s receipt of such written request.
          (d) Whether or not any Mortgage is foreclosed or any Ground Lease is terminated, or any Mortgagee or Ground Lessor succeeds to any interest of Landlord under this Lease, no Mortgagee or Ground Lessor shall have any liability to Tenant for any security deposit paid to Landlord by Tenant hereunder, unless such security deposit has actually been received by such Mortgagee or Ground Lessor.
          (e) Should any prospective Mortgagee or Ground Lessor require a modification or modifications of this Lease, which modification or modifications will not cause an increased cost or expense to Tenant or in any other way materially and adversely change the rights and obligations of Tenant hereunder, in the reasonable judgment of Tenant, then and in such event, Tenant agrees that this Lease may be so modified and agrees to execute whatever documents are reasonably required therefor and deliver the same to Landlord within ten (10) business days following written request therefor. Should any prospective Mortgagee or Ground Lessor require execution of a short form of this Lease for recording (containing, among other customary provisions, the names of the parties, a description of the Leased Premises and the Lease Term), Tenant agrees to execute such short form of lease and deliver the same to Landlord within ten (10) days following the request therefor.
          (f) If Tenant fails within the ten (10) day or ten (10) business day period, as applicable, after initial written demand therefor to execute and deliver any instruments as may be necessary or proper to effectuate any of the covenants of Tenant set forth above in this Section, Tenant hereby makes, constitutes and irrevocably appoints any one of Landlord or any of Landlord’s beneficiaries or partners in such beneficiaries as attorney-in-fact for Tenant (such power of attorney being coupled with an interest) with full power and authority to execute and deliver any such instruments for and in the name of Tenant.
          (g) No Mortgagee or Ground Lessor of which Tenant has been notified, in writing, shall be bound any amendment or modification of this Lease made without the written consent of such Mortgagee or Ground Lessor.
     7.9 Estoppel Certificate. Tenant agrees that, from time to time upon not less than ten (10) business days prior request by Landlord, or any existing or prospective Mortgagee or Ground Lessor, Tenant will, and Tenant will use commercially reasonable efforts to cause any subtenant, licensee, concessionaire or other occupant of the Leased Premises claiming by, through or under Tenant, to complete, execute and deliver to Landlord or Landlord’s designee or to any existing or prospective mortgagee or ground lessor, a written estoppel certificate certifying (i) that this Lease is unmodified and is in full force and effect (or if there have been modifications, that this Lease, as modified, is in full force and effect and setting forth the modifications); (ii) the amounts of the monthly installments of Base Rental, Tenant’s Forecast Additional Rental, Tenant’s Additional Rental Adjustment and other sums then required to be paid under this Lease by Tenant; (iii) the date to which the Base Rental, Tenant’s Forecast Additional Rental, Tenant’s Additional Rental Adjustment and other sums required to be paid under this Lease by Tenant have been paid; (iv) that Landlord is not in default to Tenant’s knowledge under any of the provisions of this Lease, or if in default, the nature thereof in detail and what is required to cure same; and (v) such other information concerning the status of this Lease or the parties’ performance hereunder reasonably requested by Landlord or the party to whom such estoppel certificate is to be addressed.
ARTICLE III
     8.1 Sublease or Assignment by Tenant.
          (a) Subject to subparagraphs (b) and (l) below, Tenant shall not, without Landlord’s prior written consent, (i) assign, convey, mortgage, pledge, encumber, or otherwise transfer (whether voluntarily, by operation of law, or otherwise) this Lease or any interest hereunder; (ii) allow any lien to be placed upon Tenant’s interest hereunder; (iii) sublet the Leased Premises or any part thereof; or (iv) permit the use or occupancy of the

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Leased Premises or any part thereof by any one other than Tenant. Any attempt to consummate any of the foregoing without Landlord’s consent shall be void and of no force or effect. If Tenant is an entity, other than a corporation whose shares are traded on a nationally recognized stock exchange, any change to the structure of such entity or any disposition(s) of any of the interests therein by sale, assignment, operation of law or otherwise, or any change in the power to vote the interests therein, shall be treated as a prohibited assignment of this Lease requiring Tenant to obtain Landlord’s prior written consent.
          (b) Notwithstanding anything contained herein to the contrary, Tenant shall have the ongoing right to sublease all or any portion of the Leased Premises during the Lease Term if Landlord provides its prior written consent, which consent shall not unreasonably be withheld, conditioned, or delayed; except, however, that Landlord may withhold consent to any proposed sublease if, in Landlord’s opinion, the proposed sublease is: (i) not consistent with the tenancy of Comparable Buildings; (ii) for a use not permitted by Section 1.3, (iii) to a governmental agency, (iv) primarily (i.e., excluding ancillary uses provided to Tenant’s employees only as permitted under Section 1.3 above) for medical use, (v) primarily (i.e., excluding ancillary uses provided to Tenant’s employees only as permitted under Section 1.3 above) for an educational, training center or similar use, or (vi) to a current tenant of the Project if Landlord has comparable space available to accommodate such current tenant (but for purposes of the foregoing, if a current tenant of Building 10 wants to expand, any space in a different building shall not be considered comparable to space that is available in Building 10).
          (c) Notwithstanding anything herein to the contrary but subject to Section 8.1(b), if at any time or from time to time during the Lease Term, Tenant desires to sublet all or any portion of the Leased Premises or assign Tenant’s interest in this Lease, Tenant shall notify Landlord in writing (hereinafter referred to in this Section as the “Notice”) of the terms of the proposed subletting or assignment, the identity of the proposed sublessee or assignee, such information as to the business, reputation, and creditworthiness of the proposed assignee or sublessee as shall be sufficient to allow Landlord to form a commercially reasonable judgment with respect thereto, the area proposed to be sublet or covered by the assignment (hereinafter referred to as “Sublet Space”), and such other information as Landlord may request to evaluate Tenant’s request to sublet or assign. Landlord shall then have the option (i) to terminate this Lease as to the Sublet Space as provided in subsection (d) hereof if but only if the proposed sublease is for a term equal to substantially all of the remaining Term of this Lease (not including any unexercised renewal option), (ii) to allow the proposed sublease or assignment subject only to the final review for approval as provided in subsection (e) hereof, or (iii) to refuse to consent, in which case Tenant may not proceed with the sublease or assignment. Landlord’s option to terminate, or to allow the proposed sublease or assignment subject to final review, as the case may be, shall be exercisable by Landlord in writing within a period of thirty (30) calendar days after receipt of the Notice and any failure by Landlord to exercise any of such options within said thirty (30) day period shall be deemed to constitute the election of option (ii) above. If Landlord exercises option (i), Tenant may nullify the termination by rescinding its request to sublet by giving Landlord notice thereof within ten (10) days after receipt of Landlord’s termination notice, in which case Tenant may not thereafter sublease the Sublet Space for one hundred eighty (180) days thereafter. If, however, Landlord is entitled to but does not elect option (i), Landlord shall not have the right to exercise option (i) with respect to the same Sublet Space for a period of one hundred eighty (180) days following the date of Tenant’s Notice.
          (d) If Landlord elects to terminate this Lease pursuant to Landlord’s option set forth in subparagraph (b)(i) above, then this Lease shall terminate as to the Sublet Space on the date set forth in Landlord’s notice to Tenant, which date shall be no less than thirty (30) days and no more than ninety (90) days after the date of such notice. If the Sublet Space does not constitute the entire Leased Premises and Landlord exercises its option to terminate this Lease with respect to the Sublet Space, as to that portion of the Leased Premises which is not part of the Sublet Space, this Lease shall remain in full force and effect except that Base Rental, Tenant’s Forecast Additional Rental, and Tenant’s Additional Rental shall be calculated on the remaining Rentable Square Feet. Notwithstanding anything to the contrary, however, Landlord shall not have the right to exercise the option to terminate under subparagraph (c)(i) unless the term of the proposed sublease is for a period equal to substantially all of the remaining Term of this Lease (not including any unexercised renewal option).
          (e) If Landlord elects or is deemed to have elected to allow the proposed sublease or assignment subject to final review, Tenant shall submit to Landlord, within twenty (20) calendar days after receipt of Landlord’s notice of election (or the expiration of said thirty (30)-day period if no such election is made), a copy of the proposed sublease or assignment, which sublease or assignment must provide for the assumption of all of

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Tenant’s obligations under this Lease, and such additional information as Landlord shall reasonably request. Landlord agrees not to unreasonably withhold its approval of any proposed form of sublease or assignment and, in the event Landlord fails to approve or disapprove any such sublease or assignment within ten (10) days after Landlord’s receipt of such submission from Tenant, such form of sublease or assignment shall be deemed to be approved.
          (f) If Landlord approves any proposed sublease or assignment, Landlord shall be entitled to receive from Tenant as Tenant’s Additional Rental hereunder [**] [Confidential Treatment] of any rents or other sums received by Tenant pursuant to said sublease or assignment in excess of the rentals payable to Landlord by Tenant under this Lease with respect to the Sublet Space (after deducting all of Tenant’s reasonable costs associated therewith, including marketing costs, legal fees, concessions, reasonable brokerage fees and the reasonable cost of remodeling or otherwise improving the Leased Premises for said sublessee or assignee), as such rents or other sums are received by Tenant from the approved sublessee or assignee. Landlord may require that any rent or other sums paid by a sublessee or assignee be paid directly to Landlord. If Landlord approves in writing the proposed sublessee or assignee and the terms of the proposed sublease or assignment, but a fully executed counterpart of such sublease or assignment is not delivered to Landlord within one hundred twenty (120) calendar days after the date of Landlord’s written approval, then Landlord’s approval of the proposed sublease or assignment shall be deemed null and void and Tenant shall again comply with all the conditions of this Section as if the Notice and options hereinabove referred to had not been given, received or exercised. If Landlord fails to approve the form of sublease or assignment or the sublessee or assignee, Tenant shall have the right to submit amended forms or other sublessees or assignees to Landlord to review for approval.
          (g) Notwithstanding the giving by Landlord of its consent to any sublease or assignment with respect to the Leased Premises, no sublessee or assignee may exercise any expansion option, right of first refusal option, or renewal option under this Lease nor be entitled to any signage rights under Section 3.3(a)(i) and 3.3(a)(ii) unless a separate written agreement is entered into directly between such sublessee or assignee and Landlord (and Landlord shall have sole discretion as to whether to enter into such a separate agreement). Tenant may not exercise any such right with respect to any space that Tenant has sublet or assigned for substantially all of the remaining Lease Term (disregarding any unexercised renewal options).
          (h) Notwithstanding the giving by Landlord of its consent to any subletting, assignment or occupancy as provided hereunder or any language contained in such lease, sublease or assignment to the contrary (i) unless this Lease is expressly terminated by Landlord, Tenant shall not be relieved of any of Tenant’s obligations or covenants under this Lease and Tenant shall remain fully liable hereunder; and (ii) no such consent or language shall be deemed to be Landlord’s consent to any future sublease or assignment.
          (i) If, with the consent of the Landlord, the Leased Premises or any part thereof is sublet or occupied by other than Tenant or this Lease is assigned, Landlord may, after default by Tenant, collect rent from the subtenant, assignee or occupant, and apply the net amount collected to the Rental herein reserved. No such subletting, assignment, occupancy, or collection shall be deemed (i) a waiver of any of Tenant’s covenants contained in this Lease, (ii) release of Tenant from further performance by Tenant of its covenants under this Lease, or (iii) a waiver of any of Landlord’s other rights hereunder.
          (j) In no event shall Tenant assign this Lease or enter into any sublease, license, concession or other agreement for use, occupancy or utilization of any part of the Leased Premises which provides for a rental or other payment for such use, occupancy or utilization based in whole or in part on the income or profits derived by any person from the Leased Premises leased, used, occupied or utilized (other than an amount based on a fixed percentage or percentages of gross receipts of sales), and Tenant agrees that all assignments, subleases, licenses, concessions or other agreements for use, occupancy or utilization of any part of the Leased Premises shall provide that the person having an interest in the possession, use, occupancy or utilization of the Leased Premises shall not enter into any lease, sublease, license, concession or other agreement for use, occupancy or utilization of space in the Leased Premises which provides for a rental or other payment for such use, occupancy or utilization based in whole or in part on the income or profits derived by any person from the Leased Premises leased, used, occupied or utilized (other than an amount based on a fixed percentage or percentages of gross receipts of sales) and any such purported assignment, sublease, license, concession or other agreement shall be absolutely void and ineffective as a conveyance of any right or interest in the possession, use, occupancy or utilization of any part of the Leased

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Premises. Notwithstanding anything in this Lease to the contrary, in no event shall Tenant assign this Lease or enter into any sublease, license, concession or other agreement for use, occupancy or utilization of any part of the Leased Premises, or otherwise transfer its rights hereunder, if the same would (i) require the payment of any consideration that would not qualify as “rents from real property,” as that term is defined in Section 856(d) of the Internal Revenue Code of 1986, as amended (the “Code”), or (ii) cause any portion of the amounts payable under this Lease to fail to qualify as rents from real property within the meaning of said Section 856(d) of the Code.
          (k) Tenant shall pay to Landlord, as Landlord’s cost of processing, each proposed assignment or subletting, an amount equal to the sum of (i) Landlord’s reasonable attorneys’ and other professional fees, plus (ii) the sum of $250.00 for the cost of Landlord’s administrative, accounting and clerical time (collectively, “Processing Costs”), and the amount of all direct and indirect costs and expenses incurred by Landlord arising from the assignee or sublessee taking occupancy of the subject space (including, without limitation, costs of freight elevator operation for moving of furnishings and trade fixtures, security service, janitorial and cleaning service, and rubbish removal service). Notwithstanding anything to the contrary herein, Landlord shall not be required to process any request for Landlord’s consent to an assignment or subletting until Tenant has paid to Landlord the amount of Landlord’s estimate of the Processing Costs and all other direct and indirect costs and expenses of Landlord and its agents arising from the assignee or subtenant taking occupancy.
          (l) Notwithstanding anything to the contrary contained in this section, Tenant shall have the right to assign this Lease or sublease the Leased Premises or any portion thereof without Landlord’s prior written consent to any entity that directly or indirectly through one or more intermediaries controls, is controlled by, or is under common control with, Tenant (“Affiliate”) or to any entity which acquires a majority of the stock and voting interest of Tenant or substantially all of the assets of Tenant or into which Tenant merges or consolidates (“Successor”); provided, however that (i) the use of the Leased Premises remains as per the terms of this Lease, (ii) Tenant gives Landlord prior written notice of such assignment in a form reasonably acceptable to Landlord, (iii) Tenant acknowledges that it shall remain liable under the Lease, and (iv) the transferee shall expressly assume Tenant’s obligations under the Lease and shall be jointly and severally liable with Tenant under the Lease. The provisions of subparagraphs (c), (d), (e) and (f) above shall not apply with respect to any such sublease or assignment to an Affiliate or Successor. In addition, the provisions of subparagraph (g) above shall not apply with respect to any sublease or assignment to a Successor (as such term is defined herein) subject to the terms and conditions set forth in Section 3.3. Tenant may enter into contracts with “outsourcing” providers to provide services to Tenant. Employees of such outsourcing providers may occupy portions of the Leased Premises from time to time so long as such outsourcing providers do not pay a fee or any other monetary consideration to Tenant in exchange for occupying space in the Leased Premises. For all purposes of this Lease, all such outsourcing employees shall be considered to be employees of Tenant, and as between Tenant and Landlord, Tenant shall have the same obligations and responsibilities with respect to them as Tenant has with respect to its own employees.
          (m) ERISA and UBTI Restrictions. Notwithstanding anything to the contrary contained herein, including, without limitation, this Section 8.1, no assignment or subletting by Tenant, nor any other transfer or vesting of Tenant’s interest hereunder (whether by merger, operation of law or otherwise), shall be permitted if: (i) Landlord, or any person designated by Landlord as having an interest therein, directly or indirectly, controls, is controlled by, or is under common control with (A) the proposed assignee, sublessee or successor-in-interest of Tenant or (B) any person which, directly or indirectly, controls, is controlled by or is under common control with, the proposed assignee, sublessee or successor-in-interest of Tenant; (ii) the proposed assignment or sublease (A) provides for a rental or other payment for the leasing, use, occupancy or utilization of all or any portion of the Leased Premises based, in whole or in part, on the income or profits derived by any person from the property so leased, used, occupied or utilized other than an amount based on a fixed percentage or percentages of gross receipts or sales or (B) does not provide that such assignee or subtenant shall not enter into any lease, sublease, license, concession or other agreement for the use, occupancy or utilization of all or any portion of the Leased Premises which provides for a rental or other payment for such use, occupancy or utilization based, in whole or in part, on the income or profits derived by any person from the property so leased, used, occupied or utilized other than an amount based on a fixed percentage or percentages of gross receipts or sales; or (iii) in the reasonable opinion of Landlord and Landlord’s counsel, such proposed assignment, subletting or other transfer or vesting of Tenant’s interest hereunder (whether by merger, operation at law or otherwise) will (A) cause a violation of the Employee Retirement Income Security Act of 1974 by Landlord, or by any person which, directly or indirectly, controls, is controlled by, or is under common control with, Landlord or any person who controls Landlord or (B) result or may in the

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future result in Landlord, or any person which, directly or indirectly, has an interest in Landlord, receiving “unrelated business taxable income” (as defined in the Internal Revenue Code).
     8.2 Assignment by Landlord. Landlord shall have the right to transfer and assign, in whole or in part, all its rights and obligations hereunder, in the Building, the Project, the Land and all other property referred to herein, and in such event and upon such transfer (any such transferee to have the benefit of, and be subject to, the provisions of Sections 8.3 and 8.4 hereof) no further liability or obligation shall thereafter accrue against Landlord hereunder and the transferee shall be deemed to have assumed all obligations hereunder arising subsequent to the transfer or assignment.
     8.3 Peaceful Enjoyment. Landlord covenants that Tenant shall and may peacefully have, hold and enjoy the Leased Premises free from hindrance by Landlord or any person claiming by, through or under Landlord but subject to the other terms hereof, provided that Tenant pays the rental and other sums herein recited to be paid by Tenant and performs all of Tenant’s covenants and agreements herein contained. It is understood and agreed that this covenant and any and all other covenants of Landlord contained in this Lease shall be binding upon Landlord and its successors only with respect to breaches occurring during the ownership of the Landlord’s interest hereunder.
     8.4 Limitation of Landlord’s Personal Liability. Tenant specifically agrees to look solely to Landlord’s equity interest in the Buildings for the recovery of any monetary judgment against Landlord, it being agreed that, notwithstanding any contrary provision of this Lease: (i) Landlord, its parent, affiliates, subsidiaries, directors, officers, agents, shareholders or employees, shall not be personally liable for any of the obligations of Landlord under this Lease, and (ii) Tenant expressly agrees that Landlord’s liability hereunder or otherwise shall be limited to, and Tenant shall only have recourse against, the value of Landlord’s fee interest in the Buildings. The provision contained in the foregoing sentence is not intended to, and shall not, limit any right that Tenant might otherwise have to obtain injunctive relief against Landlord or Landlord’s successors in interest or any suit or action in connection with enforcement or collection of amounts which may become owing or payable under or on account of insurance maintained by Landlord.
     8.5 Force Majeure. Landlord and Tenant (except with respect to the payment of Rental or any other monetary obligation under this Lease) shall be excused for the period of any delay and shall not be deemed in default with respect to the performance of any of the terms, covenants and conditions of this Lease when prevented from so doing by a cause or causes beyond the Landlord’s or Tenant’s (as the case may be) control (excluding financial inability to perform), which shall include, without limitation, all labor disputes, governmental regulations or controls, fire or other casualty, inability to obtain any material or services, acts of God, or any other cause not within the reasonable control of Landlord or Tenant (as the case may be).
ARTICLE IV
     9.1 Notices. Any notice or other communications required or permitted to be given under this Lease must be in writing and shall be effectively given or delivered if (i) hand delivered to the addresses for Landlord and Tenant stated below, (ii) sent by certified or registered United States Mail, return receipt requested, to said addresses, or (iii) sent by nationally recognized overnight courier (such as FedEx, UPS Next-day Air or Airborne Express), with all delivery charges paid by the sender and signature required for delivery, to said address. Any notice mailed shall be deemed to have been given upon receipt or refusal thereof. Notice effected by hand delivery shall be deemed to have been given at the time of actual delivery. Either party shall have the right to change its address to which notices shall thereafter be sent and the party to whose attention such notice shall be directed by giving the other party notice thereof in accordance with the provisions of this Section 9.1. The initial addresses of the parties for purposes of this Lease are:
         
 
  If to Landlord:   Hines REIT Airport Corporate Center LLC or its affiliate
 
      2800 Post Oak Boulevard, Suite 5000
 
      Houston, Texas 77056
 
      Attn:       Mr. Charles Hazen
 
      Tel:       (713) 966-2608
 
      Fax:       (713) – 966-2636

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      Hines Interests Limited Partnership
 
      Five Ravinia Drive
 
      Atlanta, Georgia 30346
 
      Attn:       Mr. Michael T. Harrison
 
      Tel:       (770) 206-5300
 
      Fax:       (770) 206-5325
 
       
 
      Hines Interests Limited Partnership
 
      7300 Corporate Center Drive, Suite 100
 
      Miami, Florida 33126
 
      Attn:       Property Manager
 
      Tel:       (305) 468-8200
 
      Fax:       (305) 468-8201
 
       
 
      Hines Interests Limited Partnership
 
      70 West Madison, Suite 440
 
      Chicago, Illinois 60602
 
      Attn:       Mr. C. Kevin Shannahan
 
      Tel:       (312) 419-4900
 
      Fax:       (312) 346-4180
 
       
 
  With a copy to:   Tew Cardenas LLP
 
      Four Seasons Tower, 15th Floor
 
      1441 Brickell Avenue
 
      Miami, Florida 33131
 
      Attn:       Brian P. Tague, Esq.
 
      Tel:       (305) 536-8480
 
      Fax:       (305) 536-1116
 
       
 
  If to Tenant:    NCL (Bahamas) Ltd.
 
      7665 Airport Corporate Center Drive
 
      Miami, Florida 33126
 
      Attn:       George Chesney
 
      Tel:       (305) 436-4701
 
      Fax:
 
       
 
  With a copy to:   NCL (Bahamas) Ltd.
 
      7665 Airport Corporate Center Drive
 
      Miami, Florida 33126
 
      Attn:       General Counsel
 
      Tel:       (305) 436-4397
 
      Fax:       (305) 436-4117
Tenant shall also send a copy of each such notice to each Mortgagee that notifies Tenant in writing of its interest and the address to which notices are to be sent.
     9.2 Miscellaneous.
          (a) This Lease shall be binding upon and inure to the benefit of the successors and assigns of Landlord, and shall be binding upon and inure to the benefit of Tenant, its successors, and its permitted assigns. Where appropriate the pronouns of any gender shall include the other gender, and either the singular or the plural shall include the other. Wherever used in this Lease or any exhibit or schedule hereto, the terms “attorneys’ fees” and “costs” shall include those incurred whether or not suit is instituted and it shall also include those incurred at the trial level, all levels of appeal, and in any bankruptcy, administrative or post-judgment proceeding.

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          (b) All rights and remedies of Landlord and Tenant under this Lease shall be cumulative and none shall exclude any other rights or remedies allowed by law. This Lease is declared to be a Florida contract, and all of the terms hereof shall be construed according to the laws of the State of Florida. Venue shall be in Miami-Dade County, Florida.
          (c) This Lease may not be altered, changed or amended, except by an instrument in writing executed by all parties hereto. Further, the terms and provisions of this Lease shall not be construed against or in favor of a party hereto merely because such party is the “Landlord” or the “Tenant” hereunder or such party or its counsel is the draftsman of this Lease.
          (d) If Tenant is a corporation, partnership or other entity, Tenant warrants that all consents or approvals required of third parties (including but not limited to its Board of Directors or partners) for the execution, delivery and performance of this Lease have been obtained and that Tenant has the right and authority to enter into and perform its covenants contained in this Lease. Likewise, if Landlord is a corporation, partnership or other entity, Landlord warrants that all consent or approvals required of third parties (including but not limited to its Board of Directors or partners) for the execution, delivery and performance of this Lease have been obtained and that Landlord has the right and authority to enter into and perform its covenants contained in this Lease.
          (e) TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE PARTIES HERETO SHALL AND THEY HEREBY DO WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER OF THE PARTIES HERETO AGAINST THE OTHER ON ANY MATTERS WHATSOEVER ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS LEASE, THE RELATIONSHIP OF LANDLORD AND TENANT, TENANT’S USE OR OCCUPANCY OF THE LEASED PREMISES AND/OR ANY CLAIM OF INJURY OR DAMAGE. IN THE EVENT LANDLORD COMMENCES ANY PROCEEDINGS FOR NONPAYMENT OF RENT OR ANY OTHER AMOUNTS PAYABLE HEREUNDER, TENANT SHALL NOT INTERPOSE ANY COUNTERCLAIM OF WHATEVER NATURE OR DESCRIPTION IN ANY SUCH PROCEEDING, UNLESS THE FAILURE TO RAISE THE SAME WOULD CONSTITUTE A WAIVER THEREOF. THIS SHALL NOT, HOWEVER, BE CONSTRUED AS A WAIVER OF TENANT’S RIGHT TO ASSERT SUCH CLAIMS IN ANY SEPARATE ACTION BROUGHT BY TENANT.
          (f) Wherever in this Lease there is imposed upon Landlord or Tenant the obligation to use best or reasonable efforts or due diligence, Landlord or Tenant, as applicable, shall be required to do so only to the extent the same is economically feasible and otherwise will not impose upon such party extreme financial or other burdens.
          (g) If any term or provision of this Lease, or the application thereof to any person or circumstance, shall to any extent be invalid or unenforceable, the remainder of this Lease, or the application of such provision to persons or circumstances other than those as to which it is invalid or unenforceable, shall not be affected thereby, and each provision of this Lease shall be valid and shall be enforceable to the extent permitted by law.
          (h) Time is of the essence in this Lease.
          (i) This Lease Agreement shall not convey any leasehold estate from Landlord to Tenant. Landlord and Tenant hereby agree that this Lease creates only the interest of a usufruct in Tenant which may not be levied upon or assigned without Landlord’s permission.
          (j) Tenant represents and warrants to Landlord that Tenant did not deal with any broker in connection with this Lease other than that broker or those brokers set forth on the BLI Rider (if more than one, collectively, the “Broker”). Landlord shall pay Studley, Inc. pursuant to a separate agreement and Studley in turn shall pay Travers Realty, Inc. pursuant to a separate agreement between Studley, Inc. and Travers Realty, Inc. Tenant shall indemnify, defend and hold Landlord, Landlord’s beneficiaries, the managing agent of the Buildings, the leasing agent of the Buildings and their respective agents, partners and employees and the Buildings harmless of, from and against any and all losses, damages, liabilities, claims, liens, costs and expenses (including, without limitation, court costs, reasonable attorneys’ fees and litigation expenses at all levels) arising from any claims or demands of any other broker or brokers

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or finders for any commission alleged to be due such other broker or brokers or finders claiming to have dealt with Tenant in connection with this Lease or with whom Tenant hereafter deals or whom Tenant employs. Landlord warrants and represents to Tenant that Landlord did not deal with any broker in connection with this Lease other than Broker. Landlord shall indemnify, defend and hold Tenant harmless from and against any and all losses, damages, liabilities, claims, liens, costs and expenses (including, without limitation, court costs, reasonable attorneys’ fees and litigation expenses at all levels) arising from any claims or demand of any other broker or brokers or finders for any commission alleged to be due such other broker or brokers or finder claiming to have dealt with Landlord in connection with this Lease or with whom Landlord hereafter deals or whom Landlord employs. The provisions of this subsection shall survive the expiration or earlier termination of this Lease.
          (k) If Tenant consists of more than one person, corporation, partnership, limited liability company or other entity, the liability hereunder of all such persons, corporations, partnerships or other entities shall be joint and several.
          (l) Landlord’s receipt of any Rental payable by Tenant hereunder with knowledge of the breach of a covenant or agreement contained in this Lease shall not be deemed a waiver of the breach. No acceptance by Landlord of a lesser amount than the installment of Rental which is due shall be considered, nor shall any endorsement or statement on any check or any letter accompanying any check or payment be deemed, an accord and satisfaction. Landlord may accept a check or payment without prejudice to Landlord’s right to recover the balance due or to pursue any other remedy provided in this Lease.
          (m) Wherever Landlord’s consent or approval is required pursuant to the terms of this Lease, Landlord may grant or withhold the same in Landlord’s sole and absolute discretion, except as otherwise expressly provided herein.
          (n) Tenant covenants and agrees to use good faith efforts (i) to keep strictly confidential all of the financial terms of this Lease and (ii) not to disseminate any such information to any third parties, without the prior written consent of Landlord, except as required by law. Tenant further covenants and agrees that, at all times prior to the Commencement Date (excluding the Commencement Date for Building 10 Sixth Floor Premises and Ground Floor Suite), unless consented to in writing by Landlord, no press release or other public disclosure concerning this Lease shall be made by Tenant.
          (o) Submission of this instrument for examination shall not constitute a reservation of or option to lease the Leased Premises or in any manner bind Landlord, and no lease or obligation on Landlord shall arise until this instrument is signed and delivered by Landlord and Tenant; provided, however, the execution and delivery by Tenant of this Lease to Landlord, or the managing agent of the Buildings or the leasing agent of the Building shall constitute an irrevocable offer by Tenant to lease the Leased Premises on the terms and conditions herein contained, which offer may not be revoked for thirty (30) days after such delivery.
          (p) Tenant shall deliver to Landlord annually and within twenty (20) days after Landlord’s written request, Tenant’s most recently prepared monthly, quarterly and annual financial statements including balance sheets, income statements and cash flow statements, prepared in accordance with generally accepted accounting principles consistently applied. Such financial statements shall be certified by the chief financial officer of Tenant as being true, accurate and complete in all material respects. After an Event of Default occurs and while it continues, Landlord shall have the right, exercisable once during each year of the Lease Term, to cause, at Landlord’s expense, an independent certified public accountant to audit Tenant’s annual financial statements. Tenant shall also, upon Landlord’s reasonable requests from time to time, deliver to Landlord such other financial information regarding Tenant as may be reasonably available. Any contrary provisions notwithstanding, as long as NCL is Tenant, Tenant’s obligation to provide financial statements shall be satisfied so long as Tenant’s current 20F and 6K reports are available online at the SEC website.
          (q) Radon Gas. Radon is a naturally occurring radioactive gas that, when it has accumulated in a building in sufficient quantities, may present health risks to persons who are exposed to it over time. Levels of radon that exceed federal and state guidelines have been found in buildings in Florida. Additional information regarding radon and radon testing may be obtained from your county health department.

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          (r) Tenant agrees not to block or cover any of the heating, ventilation or air-conditioning ducts in the Leased Premises or to tamper with the climate controls from within the Leased Premises. Tenant agrees to promptly report to the Landlord upon Tenant’s becoming aware thereof: (i) any evidence of a water leak or excessive moisture in the Leased Premises; and (ii) any evidence of Mold or a Mold Condition that cannot be removed by simply applying a common household cleaner and wiping the area. Provided that Landlord provides HVAC services and Repairs in accordance with Sections 3.1 and 5.2 of this Lease except in connection with any casualty requiring restoration work, Tenant hereby (A) assumes the risks associated with Mold and/or a Mold Condition, (B) waives any claim or cause of action against Landlord arising out of the existence of Mold or a Mold Condition in the Leased Premises and/or the Buildings, and (C) releases the Landlord from any and all liabilities resulting from Mold or any Mold Condition. As used herein, “Mold” means mold, mildew, fungus or other potentially dangerous organisms in amounts sufficient to create a health risk to humans, and “Mold Condition” means the presence or suspected presence of Mold or any condition(s) that reasonably can be expected to give rise to or indicate the presence of Mold, including observed or suspected instances of water damage or intrusion, the presence of wet or damp wood, cellular wallboard, floor coverings or other materials, inappropriate climate control, discoloration of walls, ceilings or floors, complaints of respiratory ailment or eye irritation by residents, employees or any other occupants or invitees in the Buildings, or any notice from a governmental agency of complaints regarding the indoor air quality at the Buildings.
     9.3 OFAC.
          (a) Pursuant to United States Presidential Executive Order 13224 signed on September 24, 2001, and entitled “Blocking Property and Prohibiting Transactions with Persons Who Commit Threaten to Commit, or Support Terrorism” (the “Executive Order”), U.S. companies are required to ensure that they do not transact business with persons or entities determined to have committed, or to pose a risk of committing or supporting, terrorist acts and those identified on the list of Specially Designated Nationals and Blocked Persons (“List”), generated by the Office of Foreign Assets Control of the U.S. Department of the Treasury. The names or aliases of these persons or entities (“Blocked Person”) are updated from time to time. Tenant hereby acknowledges and agrees that Tenant’s inclusion on the List at any time during the Lease Term shall result in the delay of services contemplated by this Lease. If it is determined that Tenant is a Blocked Person, this Lease shall be immediately terminated. The provisions of this paragraph will survive termination of this Lease.
          (b) Tenant represents and warrants to Landlord as follows: (i) neither Tenant nor any person or entity that directly owns ten percent (10%) or greater equity interest in it nor to Tenant’s knowledge any of its officers, directors, or managing members is a person or entity (each, a “Prohibited Person”) with whom U.S. Person or entities are restricted from doing business under regulations of the Office of Foreign Asset Control (“OFAC”) of the Department of the U.S. Treasury (including those named on OFAC’s Specifically Designated and Blocked Person List) or under the Executive Order, or other governmental action, and (ii) Tenant shall comply with the Executive Order throughout the Lease Term.
     9.4 Waiver of Landlord’s Lien. Landlord hereby waives its “landlord’s lien” or any other statutory lien, contractual lien or security interest given by law or this Lease to Landlord in any property (including, but not limited to equipment, furniture, fixtures, inventory and supplies) of Tenant now or hereafter placed in or upon the Leased Premises. Landlord agrees to execute any further required documentation to evidence this waiver of its landlord’s lien or other statutory lien or contractual lien and to acknowledge that Tenant shall have the right to obtain financing on any or all of its property (including, but not limited to, equipment, furniture, fixtures, inventory and supplies) which it brings upon the Leased Premises and to grant a first security or other priority security interest and lien in and to such property in connection therewith. The provisions of this Section 9.4 shall not prevent Landlord from obtaining a judgment lien in connection with any litigation arising between Landlord and Tenant.
     9.5 Recordation. If Tenant elects to obtain a leasehold title insurance policy with respect to this Lease, Tenant may record a memorandum of this Lease in the Public Records of Miami-Dade County and Landlord agrees to execute such memorandum for purposes thereof. Upon termination of this Lease, Tenant shall execute such terminations or notices in the Public Records of Miami-Dade County as shall be reasonably necessary to evidence the termination of the Lease and, if Tenant fails to do so, Landlord is hereby granted the right to do so for and on behalf of Tenant.

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     9.6 Generators. The Leased Premises are currently connected to Landlord’s building generators (one for each Building) to provide back-up electrical power to the Leased Premises. Tenant shall continue to have usage of Landlord’s generators during times of power failure. Landlord shall continue to maintain and repair and replace the generators in good working order and all costs thereof shall be Operating Costs, to the extent permitted by Section 2.4. Provided that there is excess capacity, Landlord may allow such generators to be used by others. Tenant agrees that Landlord shall have no liability or responsibility if for any reason the generator(s) fail to start or to function correctly except for Landlord’s gross negligence or willful misconduct. The back-up generators are intended solely as an accommodation and no liability shall inure to Landlord as a result of Tenant’s use of such generators.
ARTICLE V
     10.1 Right of First Offer. Tenant shall have a continuous right of first offer (the “ROFO”) to lease all space in Building 10 which is not included in the Leased Premises (“ROFO Space”) if and to the extent that such ROFO Space becomes “available for lease.” Space shall not be considered available for lease if it is leased by another tenant or is subject to an expansion option or prior right of first offer held by another tenant or if the existing tenant of such space desires to renew or extend its lease (pursuant to an option existing in its lease).
     Landlord shall notify Tenant when any such ROFO Space is, or is about to become, available for Tenant to lease pursuant to Tenant’s ROFO (“Landlord’s ROFO Notice”). Landlord’s ROFO Notice shall identify the ROFO Space, shall specify the estimated delivery date, and shall specify the rental rate and terms and conditions which will apply if Tenant exercises its ROFO. If Tenant exercises his ROFO, the rental rate to be paid by Tenant with respect to the ROFO Space shall be as follows:
          (a) if the ROFO Space is added to the Leased Premises with a rent commencement date prior to December 1, 2015, the Base Rental shall be at [**] [Confidential Treatment]. Tenant shall also be entitled to a prorated Tenant Improvement Allowance in an amount equal to [**] [Confidential Treatment] per RSF within the ROFO Space multiplied by a fraction, the numerator of which is the number of months remaining in the initial 146 month Lease Term for which Tenant will pay rent for the ROFO Space and the denominator of which shall be 146;
          (b) if the ROFO Space will be added to the Leased Premises with a rent commencement date on or after December 1, 2015, the Base Rental shall be [**] [Confidential Treatment] and terms as reasonably determined by Landlord.
     Upon the date that any ROFO Space is added to the Leased Premises, Tenant’s Percentage Share shall be adjusted to reflect the additional RSF.
     If Tenant does not exercise its ROFO within twenty (20) days of any Landlord’s ROFO Notice, Tenant’s ROFO Rights shall expire and be void, the ROFO Space shall be unencumbered by Tenant’s ROFO and Landlord may thereafter lease the space to any tenant on such terms as Landlord deems acceptable whether or not more favorable than set forth in Landlord’s ROFO Notice for a period of nine (9) months following the date of the ROFO Notice. If such space is leased to another tenant during such nine (9) month period, the ROFO Space shall remain unencumbered by Tenant’s ROFO until such time as such lease expires and is not renewed (pursuant to a lease option), at which time the ROFO shall then again exist for Tenant’s benefit. The aforesaid 9-month period shall be extended through the end of negotiations if Landlord is engaged in good faith negotiations with another tenant for the lease of the ROFO Space at the time of the expiration of such nine (9) month period. Landlord shall not grant any presently existing occupant of ROFO Space any right of first offer or refusal or right to renew or extend its lease which does not exist on the Effective Date, except in connection with any lease entered into during any nine (9) month period following Tenant’s non-exercise of a ROFO for the applicable ROFO Space.
     Notwithstanding the foregoing, Tenant shall not be entitled to its ROFO at any time during which Tenant is in default under this Lease beyond any applicable notice or grace period. Tenant’s ROFO rights are personal to Tenant and may not be exercised by any sublessee or assignee of this Lease.

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     Upon Landlord’s request, Landlord and Tenant shall execute a mutually acceptable amendment to this Lease setting forth the terms under which ROFO Space is leased to Tenant within fifteen (15) business days after Tenant’s exercise thereof.
     10.2 Renewal Option. Subject to the provisions set forth below, Landlord hereby grants to Tenant two (2) options to extend the term of this Lease (each a “Renewal Option”) for a period of five (5) years each (each a “Renewal Term”). If a Renewal Option is properly exercised, the Renewal Term shall commence at the expiration of the original Lease Term or first Renewal Term, as applicable, and shall expire five (5) years thereafter. Tenant shall exercise a Renewal Option by delivering written notice of such election to Landlord not less than fifteen (15) months or more than eighteen (18) months prior to the then-existing expiration of the Lease Term or first Renewal Term (a “Renewal Notice”). If Tenant fails to timely exercise any Renewal Option (time being of the essence), all of Tenant’s subsequent rights to renew shall expire and shall not thereafter be exercisable. If Tenant timely exercises its Renewal Option such renewal shall be upon the same terms and conditions as provided in this Lease except that rental and tenant inducements shall be determined in accordance with Exhibit J hereto (“Market Terms”). The Market Terms shall be determined within sixty (60) days of Landlord’s receipt of a Renewal Notice and in accordance with Exhibit J attached hereto. If, however, Tenant is not satisfied with the final determination of the Market Terms then Tenant may revoke its exercise of the Renewal Option by providing written notice to Landlord within twenty (20) days of the final determination of the Market Terms or twelve (12) months prior to the expiration of the Lease Term, whichever is earlier. If Tenant delivers its notice of revocation, the Renewal Option (and any subsequent Renewal Option) shall be void and the Lease shall expire as if Tenant had never exercised its Renewal Option. Notwithstanding anything to the contrary, Tenant shall not be entitled to exercise its Renewal Option at any time when Tenant is in default under this Lease beyond any applicable notice or cure period. Tenant’s Renewal Option is personal to Tenant and may not be exercised by any sublessee or any assignee of this Lease.
     10.3 Available Space. In January of each year, Tenant may request in writing that Landlord provide a list of space which may become available for lease in Building 10 during such calendar year and the year thereafter. Within ten (10) business days after receipt of such written request, Landlord shall inform Tenant of any available space that would lead to a future expansion of the Leased Premises in Building 10 during such calendar year and the year thereafter. Such list of available space shall be kept confidential by Tenant.
[CONTINUED ON FOLLOWING PAGE]

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[CONTINUED FROM PREVIOUS PAGE]
     IN WITNESS WHEREOF, the parties hereto have executed and sealed this Lease as of the date aforesaid.
         
  LANDLORD:

HINES REIT AIRPORT CORPORATE
CENTER LLC
,
a Delaware limited liability company or its affiliate
 
 
  By:   HINES REIT PROPERTIES, L.P.,    
    a Delaware limited partnership   
    Its Sole Member   
 
         
 
  By:    HINES REAL ESTATE
 
      INVESTMENT TRUST, INC.,
 
      a Maryland corporation
 
      Its General Partner
Witnesses:
     
/s/ David Steinback
 
Print Name: David Steinback
 
Print Name: Melanie Greeley
  By: /s/ Frank Apollo
 
Frank Apollo
Its Chief Accounting Officer

-40-


 

         
  TENANT:  

NCL (BAHAMAS) LTD. D/B/A NORWEGIAN
CRUISE LINE,

a Bermuda company
 
 
     
 
Witnesses:
     
/s/ James Travers
 
Print Name: James Travers
 
/s/ George Chesney
 
Print Name: George Chesney
  By: /s/ Colin Veitch
 
Name: Colin Veitch
 
Title: President & CEO

-41-


 

EXHIBIT A
SITE PLAN AND LOCATION OF PROPERTY 11 AND PROPERTY 10
(SITE PLAN)
Exhibit A — Page 1

 


 

(SITE PLAN)
Exhibit A — Page 2

 


 

EXHIBIT A-1
DESCRIPTION OF PARCEL 11
PARCEL 6
Tract B-1, of ACC-WEST REPLAT, according to Plat thereof, recorded in Plat Book 146, at Page 29, Public Records of Miami-Dade County, Florida.

 


 

EXHIBIT A-2
DESCRIPTION OF PARCEL 10
PARCEL 6
Tract B-1, of ACC-WEST REPLAT, according to Plat thereof, recorded in Plat Book 146, at Page 29, Public Records of Miami-Dade County, Florida.

 


 

EXHIBIT B

SITE PLAN AND LOCATION OF THE PROJECT
(FLOOR PLAN)

 


 

EXHIBIT B-l
DESCRIPTION OF THE PROJECT
     PARCEL 1:
     Lots 1,  2 and 3, to Block 1, and Lot 3, in Block 2, AIRPORT CORPORATE CENTER, according to the Plat thereof, recorded in Plat Book 130, at Page 51, of the Public Records of Miami-Dade County, Florida.
      PARCEL 2:
     Lot 1, Block 2, AIRPORT CORPORATE CENTER, according to the Plat thereof, recorded in Plat Book 130, at Page 51, of the Public Records of Miami-Dade County, Florida.
     PARCEL 2-A:
      Together with a non-exclusive easement for vehicular and pedestrian ingress and egress over and across the West 12 feet of Lot 2, Block 2, AIRPORT CORPORATE CENTER, Plat Book 130, Page 51, created pursuant to that certain Declaration of Restrictive Covenants in Lieu of Unity of Title, Easement and Operating Agreement dated December 31, 1986, filed January 2, 1987, in Official Records Book 13134, page 1105, of the Public Records of Miami-Dade County, Florida.
     PARCEL 3:
     Lot 2, Block 2, AIRPORT CORPORATE CENTER, according to the Plat thereof, recorded in Plat Book 130, at Page 51, of the Public Records of Miami-Dade County, Florida.
     PARCEL 3-A:
      The nonexclusive easement reserved in instrument filed January 2, 1987, in Official Records Book 13134, page 1105, for ingress and egress over the East 12 feet of Lot 1, Block 2, AIRPORT CORPORATE CENTER, according to the Plat thereof, recorded in Plat Book 130, at Page 51, of the Public Records of Miami-Dade County, Florida, for the benefit of Lot 2, Block 2, AIRPORT CORPORATE CENTER, according to the Plat thereof, recorded in Plat Book 130, at Page 51, of the Public Records of Miami-Dade County, Florida.
     PARCEL 4:
      Tract “B-2”, of ACC-WEST REPLAT, according to the Plat thereof, recorded in Plat Book 146, a Page 29, of the Public Records of Miami-Dade County, Florida.
     PARCEL 4-A:
      TOGETHER WITH that certain Driveway Easement created pursuant to Driveway Easement Agreement dated September 5, 1996, filed September 11, 1996, in Official Records Book 17348, at Page 3797.
Exhibit B-l - - Page 1

 


 

     PARCEL 4-B:
      TOGETHER WITH Reciprocal Easement for Ingress and Egress created pursuant to Road Basement and Drainage Easement dated January 30, 1992, filed February 11, 1992, in Official Records Book 15382, page 2352.
     PARCEL 4-C:
     Together with a non-exclusive right, privilege and easement for access over and across the driveway only, legally described and depicted as set forth in Exhibit “C” of that certain Access Easement Agreement filed February 1 i, 1992, in Official Records Book 15382, page 2371, as amended by Amendment to Access Easement Agreement filed June 19, 1996, in Official Records Book 17245, page 1450.
     PARCEL5:
     Tract “A”, of ACC-WEST, according to the Plat thereof, recorded in Plat Book 144, at Page 29, Public Records of Miami-Dade County, Florida.
     PARCEL 5-A:
     Together with that certain Driveway Easement created pursuant to Driveway Basement Agreement dated September 5,1996, filed September 11, 1996, in Official Records Book 17348, page 3797.
     PARCEL 5-B.
     TOGETHER WITH that certain Road Easement and Drainage Easement created pursuant to Road Easement and Drainage Easement Agreement dated January 30, 1992, filed February 11, 1992, to Official Records Book 15382, at Page 2352
     PARCEL 6:
     Tract B-l, of ACC-WEST REPLAT, according to the Plat thereof, recorded in Plat Book 146, at Page 29, Public Records of Miami-Dade County, Florida.
     PARCEL 6-A:
     Together with a non-exclusive right, privilege and easement for access over and across the driveway only, legally described and depicted as set forth in Exhibit “C” of that certain Access Easement Agreement filed February 11, 1992, in Official Records Book 15382, page 2371, as amended by Amendment to Access Easement Agreement filed June 19, 1996, in Official Records Book 17245, page 1450.
Exhibit B-l - -Page 2

 


 

EXHIBIT C
FLOOR PLAN OF BUILDING 11 PREMISES
(FLOOR PLAN)
Exhibit C - - Page 1

 


 

(FLOOR PLAN)
Exhibit C - - Page 2

 


 

(FLOOR PLAN)
Exhibit C - - Page 3

 


 

(FLOOR PLAN)
Exhibit C - - Page 4

 


 

(FLOOR PLAN)
Exhibit C – Page 5

 


 

(FLOOR PLAN)
Exhibit C-Page 6

 


 

EXHIBIT C-1
FLOOR PLAN OF BUILDING 10 PREMISES
(FLOOR PLAN)
Exhibit C-1 - Page 1

 


 

(FLOOR PLAN)
Exhibit C-1 - - Page 2

 


 

(FLOOR PLAN)
Exhibit C-1 - - Page 3

 


 

(FLOOR PLAN)
Exhibit C-1 - - Page 4

 


 

EXHIBIT D
BASE BUILDING SHELL CONDITION
The following Base Building Condition shall be provided by Landlord at Landlord’s sole cost and shall not be deducted from the Tenant Construction Allowance. The Building in the base shell condition described in this Exhibit C may be referred to in the Lease and the exhibits attached to the Lease as either the “Base Building” or the “Base Shell Condition” or the “Building”:
a.   Tenant will provide on-floor panels and distribution as part of the Initial Improvements. Base Building electrical service will accommodate up to 7 Watts (3 Watts @ 120/208 Volts & 4 Watts @277/480 Volts) per Rentable Square Foot.
 
b.   Air conditioning main duct into the space ready for distribution by Tenant. VAV boxes with controls will be included on Tenant’s floor for the use of all occupants on that floor. Each VAV box will serve approximately 800 rentable square feet.
 
c.   Typical multi-tenant floor corridor walls to be completed with common area side only.
 
d.   Life Safety
  i.   In all tenant spaces sprinkler heads, in a code compliant configuration, shall be provided. All required drops, relocation of sprinkler heads or additional heads in Tenant Improvement areas will be provided and installed by Tenant at Tenant’s cost. Base Building fire alarm system shall have sufficient capacity for Tenant to tie in, provided that Tenant’s demand is reasonably within requirements of comparable office space.
 
  ii.   Extinguisher cabinets installed at each stairwell (or as otherwise required by code for an unoccupied floor).
 
  iii.   Exit signs at all stairwells.
 
  iv.   Smoke detectors, fire extinguishers, fire horns, electric door releases, speakers, cameras and any other life safety equipment required by code for an unoccupied floor.
 
  v.   Emergency lighting installed in each stairwell.
e.   Interior face of exterior walls will be taped, floated and sanded gypsum board on metal studs to be finished by the tenant.
 
f.   Mechanical equipment rooms shall be provided and completed.
 
g.   Toilet room materials and finishes will consist of: counter tops; framed mirrors; ceramic tile floors and painted gypsum board walls; metal toilet partitions; recessed toilet accessories; and a lay-in ceiling system with grid.
 
h.   Floor Slab Design Load Capacities as per original specifications of the buildings construction (refer to base building architectural drawings).
 
i.   Building standard blinds to be provided and installed by Tenant.
 
j.   Typical multi-tenant floor corridor materials and finishes will include: gypsum board on corridor side with vinyl wall covering; two-foot by two-foot acoustical lay-in ceiling tile with exposed metal grid; and building standard carpet.
 
k.   Service Core
  i.   Stairways
 
  ii.   Electrical, telephone, and mechanical rooms.
EXHIBIT D - Page 1

 


 

  iii.   Finished men’s and women’s washrooms.
 
  iv.   Domestic water and drainage.
l.   Core Doors
  i.   Building standard core doors for stairwells, electrical, mechanical, and telephone rooms and all washrooms.
 
  ii.   Doors finished and complete with frame, trim, hardware, locking devices, electric door releases and closers (where applicable).
m.   Walls and Windows
  i.   Curtain wall installed and sealed.
 
  ii.   Exterior windows installed and sealed.
 
  iii.   Insulation from slab-to-slab installed and sealed.
 
  iv.   Core walls and elevator lobby walls installed, sheet rocked, taped, sanded, patched, filled, dusted, and ready to be finished by tenant.
n.   Sleeves in core telephone rooms for telephone access.
 
o.   HVAC
The equipment to furnish central heat and air conditioning shall meet specifications designed to maintain during Building Operation Hours a minimum of 72°F dry bulb ±2° in the winter when the outdoor temperature is not lower than 10°F dry bulb and a maximum of 78°F dry bulb ±2° in the summer when the outdoor temperature is not higher than 93°F dry bulb.
Exhibit D - - Page 2

 


 

EXHIBIT E
TENANT IMPROVEMENTS
I.   TENANT’S WORK
  1.   The following provisions shall apply to all Tenant Improvements (the “Tenant’s Work”):
  (a)   Tenant’s Work shall be completed by Tenant in accordance with a space plan and Tenant’s Working Drawings which have been approved by Landlord, which approval shall not unreasonably be withheld. In construction of Tenant’s Work, Tenant shall comply with the terms of Landlord’s construction manual. Landlord shall have no responsibility for construction of any Tenant’s Work.
 
  (b)   The architects, engineers and contractors selected by Tenant to perform Tenant’s Work shall be subject to the reasonable approval of Landlord which approval shall be provided within ten (10) business days after submission. Tenant’s contractor shall perform Tenant’s Work in a first-class, workmanlike manner, using only good commercial grades of materials, in accordance with this Lease and the plans and specifications approved hereunder, Landlord’s insurance requirements and with all applicable governmental laws, ordinances, codes, rules and regulations, and Tenant’s Work shall be subject to Landlord’s reasonable administrative supervision. Tenant’s Work shall not commence until Tenant’s contractor has delivered to Landlord a copy of the building permit issued for the Tenant’s Work and evidence of insurance, both of which are satisfactory to Landlord in all respects. Upon completion of Tenant’s Work, Tenant shall deliver to Landlord evidence of payment, contractors’ affidavits and sworn statements, full and final waivers of lien from contractors and subcontractors for labor, services and materials and all other documents reasonably required by Landlord, together with record drawings, in both electronic and paper form, reflecting as built conditions of the Leased Premises.
 
  (c)   Tenant shall indemnify, defend by counsel reasonably acceptable to Landlord and hold harmless Landlord, Landlord’s beneficiaries, the managing agent of the Project and their respective agents, partners, members and employees and the Project of, from and against any and all liabilities, losses, costs, charges, claims, damages, liens, fees and expenses, including, without limitation, reasonable attorneys’ fees and expenses, relating to the Tenant’s Work. Landlord shall permit Tenant’s contractor to have reasonable access to the Leased Premises (other than the Building 10 Sixth Floor Premises which shall be available upon delivery of such space) immediately upon execution of this Lease and submission to Landlord of appropriate insurance certifications for purposes of constructing Tenant’s Work, provided that Tenant and Tenant’s contractor shall abide by the rules of the site applicable to all contractors, shall coordinate and schedule their access to the Leased Premises for labor and materials delivery through the managing agent of the Project and shall not interfere with or delay the work of any other contractor working in connection with the Project.
 
  (d)   Any entry to the Project, the Building or the Leased Premises by or on behalf of Tenant or Tenant’s contractor shall be under and subject to all of the terms and provisions of this Lease. To the extent not prohibited by law, all entry to the Project, the Building or the Leased Premises by or on behalf of Tenant or Tenant’s contractor shall be solely at the risk of Tenant and Tenant’s contractor, and Landlord, Landlord’s beneficiaries, the managing agent of the Project and their respective agents, partners and employees shall not be liable in any way, and Tenant hereby waives and releases them from any liability, for any injury or damage to or theft, robbery, pilferage, loss or loss of the use of any property of Tenant, Tenant’s contractor or any other person or entity or any of the Tenant’s Work in or about the Leased Premises or the Project which occurs during such

Exhibit E - Page 1


 

      period; provided, however, Landlord, Landlord’s beneficiaries, the managing agent of the Project and their respective agents, partners, members and employees shall be liable, and Tenant does not waive or release them from liability, for their respective gross negligence or willful misconduct which occurs during such period and causes any injury to or death of any person. The foregoing waiver and release of claim shall be in addition to and shall not limit or be limited by any other releases or waivers of claims in this Lease.
  2.   Except as provided in Paragraph 3 below, Tenant shall pay the cost of all the Tenant’s Work, including without limitation the cost of all items necessary or desirable to complete the Tenant’s Work, such as the fees and expenses arising out of the preparation of Tenant’s Plans and Specifications, the fees and expenses of Tenant’s contractor.
 
  3.   To the extent reasonably required by Tenant during the construction of Tenant’s Work, Tenant shall be permitted to undertake the following provided same: (i) are in accordance with all laws, (ii) are in a location determined by Landlord at its sole discretion, which designated location may be changed by Landlord at any time, and (iii) are only in place for a reasonable period of time as necessary to facilitate the Tenant’s Work:
      (A)park a portable construction building or trailer in the location designated by Landlord; and
 
      (B) park a storage container or semi trailer in the location designated by Landlord for purposes of temporarily storing building materials or FF&E which will be incorporated into the Leased Premises.
      Notwithstanding the foregoing, Tenant agrees that (i) at no time shall there be more than two (2) semi trailers on the designated location, (ii) all trailers shall be maintained in a neat and orderly manner, (iii) the trailers shall not affect other tenants in the Project, and (iv) if the trailers are powered, Tenant shall be solely responsible for all costs of utilities and connections associated therewith.
II.   MINIMUM INFORMATION REQUIRED FOR THE SPACE PLAN
 
    The space plan for Tenant’s Work shall include drawings, plans and specifications prepared by Tenant’s architect showing the intended design, character and finishes of the Leased Premises, including partitions and door locations, all in sufficient detail to enable the Working Drawings to be prepared.
 
III.   MINIMUM INFORMATION REQUIRED OF INITIAL WORKING DRAWINGS
 
    Floor Plans Indicating (to the extent relevant to scope of Tenant’s Work):
  1.   Location and type of all partitions.
 
  2.   Location and types of all doors — indicate hardware and provide keying schedule.
 
  3.   Location and type of glass partitions, windows and doors — indicate framing if not part of Base Building Shell Condition.
 
  4.   Location of telephone equipment room accompanied by an approval of the telephone company if required.
 
  5.   Indicate critical dimensions necessary for construction, such as millwork, special partitions, etc.
 
  6.   Location of all electrical items — outlets, switches, telephone outlets.
 
  7.   Location and type of all non-building electrical items, including lighting.

Exhibit E - Page 2


 

  8.   Location and type of equipment that will require special electrical requirements. Provide manufacturers’ specifications for use and operation.
 
  9.   Location, weight per square foot and description of any exceptionally heavy equipment or filing system exceeding 50 psf live load except in areas designed specifically for special Tenant loads.
 
  10.   Requirement for special air conditioning or ventilation.
 
  11.   Type and locations of all finishes.
 
  12.   Location and type of plumbing equipment and services.
 
  13.   Location and type of kitchen equipment and services.
 
  14.   Location of all HVAC controls, fire alarm, security and life safety equipment.
 
  15.   Location and type of all graphics and signage.
 
  16.   Location of all Tenant fixtures, furniture and equipment (“FF&E”).
 
  17.   Location and size of any floor openings required. Also include structural loading data for vaults, vault walls, slab depressions, special stairs, elevators, file rooms, libraries, etc.
     Details Showing:
  1.   All millwork with dimensions and dimensions of all equipment to be built-in.
 
  2.   Corridor entrance.
 
  3.   Bracing or support of special walls, glass partitions, etc., if desired. If not included with the Initial space plan, the Building architect will design, at Tenant’s expense, all support or bracing required.

Exhibit E - Page 3


 

EXHIBIT F
OPERATING EXPENSES EXCLUSIONS
     Notwithstanding anything to the contrary contained in the Lease, Operating Expenses shall not include any of the following:
  A.   repairs or other work occasioned by fire, windstorm or other casualty, the costs of which are reimbursed to Landlord by insurers or by governmental authorities in eminent domain or by others;
 
  B.   leasing commissions, broker fees, legal fees, space planning fees, costs and disbursements and other expenses incurred in connection with negotiations or disputes with tenants, other occupants, or prospective tenants of the Buildings;
 
  C.   costs incurred in renovating or otherwise improving or decorating or redecorating space for tenants or other occupants in the Buildings or vacant tenant space in the Buildings (including without limitation any allowances or inducements made to any tenants or other occupants);
 
  D.   costs of correcting defects in the construction of the Buildings (including latent defects in the Buildings) or in the Buildings equipment except that for the purposes of this subparagraph, maintenance and repair (including painting of common areas, replacement of carpet in elevator lobbies and the like, even though capital for accounting purposes) and ordinary wear and tear and use shall not be deemed defects;
 
  E.   Landlord’s costs of electricity and other utilities and services furnished to tenants for which Landlord is entitled to be reimbursed by tenants (whether or not actually collected by Landlord) as a separate additional charge;
 
  F.   costs incurred by Landlord for alterations and replacements which are considered capital expenditures under generally accepted cash basis accounting principles, consistently applied, except as otherwise expressly provided in Section 2.4(b) of the Lease;
 
  G.   amortization (except as set forth in Section 2.4(b) of the Lease) and depreciation;
 
  H.   expenses in connection with services or other benefits of a type which are not building standard but which are provided to another tenant or occupant;
 
  I.   costs incurred due to the violation by Landlord or any tenant of any applicable legal requirement, building code, regulation or law existing as of the Commencement Date or costs incurred due to the Project being in violation of any such legal requirement, building code, regulation or law existing as of the Commencement Date or costs incurred due to acts of any tenant causing an increase in the rate of insurance on the Project or its contents as a result of any use other than office use;
 
  J.   overhead and profit increment paid to subsidiaries or affiliates of Landlord or its partners for services on or to the Project, to the extent that the costs of such services exceed competitive costs for such services rendered by persons or entities of similar skill, competence and experience;
 
  K.   principal and interest on any debt or rental under any ground or underlying leases or lease affecting the Project or any part thereof (other than payments which would have been incurred if Landlord were the fee owner, such as taxes and insurance);
 
  L.   any compensation paid to clerks, attendants, maintenance workers or other persons in commercial concessions operated by Landlord;

Exhibit F - Page 1


 

  M.   costs incurred in installing, operating and maintaining any specialty facility such as an observatory, broadcasting facility (other than the Buildings’ music system and life support and security system), luncheon club, athletic or recreational club, except for the express benefit of the tenants;
 
  N.   any costs and expenses relating to any off site parking facility;
 
  O.   any expenses relating to replacements of the foundation, exterior or interior structural walls, or roof of the Building;
 
  P.   Financing and refinancing costs;
 
  Q.   Advertising and promotional expenditures for marketing space in the Project;
 
  R.   Remediation and other costs required by breach of environmental laws that exist on the Commencement Date;
 
  S.   Landlord’s general corporate overhead and general administrative expenses;
 
  T.   Tax penalties incurred as a result of Landlord’s failure to make payments and/or to file any tax or informational returns when due;
 
  U.   Costs arising from the negligence or fault of other tenants or Landlord or its agents, or any vendors, contractors, or providers of materials or services selected, hired or engaged by Landlord or its agents including without limitation, the selection of Building materials;
 
  V.   Costs arising from Landlord’s charitable or political contributions;
 
  W.   Costs associated with the operation of the business of the partnership or entity which constitutes Landlord as the same are distinguished from the costs of operation of the Buildings.
 
  X.   Any “above-standard” cleaning, including, but not limited to construction cleanup or special cleanings associated with parties/events and specific tenant requirements in excess of service provided to Tenant, including related trash collection, removal, hauling and dumping;
 
  Y.   Reserves for bad debts or for future improvements, repairs, additions, etc.; and
 
  Z.   Any other costs that would not be considered as operating costs in accordance with industry standards, except as otherwise specifically provided in Section 2.4(b).
It is understood that Operating Expenses shall be reduced by all cash discounts, trade discounts, quantity discounts, rebates or other amounts received by Landlord or Landlord’s managing agent in the purchase of any goods, utilities, or services in connection with the operation of the Buildings and Project.
In the event any facilities, services or utilities used in connection with the Buildings are provided from another building owned or operated by Landlord or vice versa, the costs incurred by Landlord in connection therewith shall be allocated to Operating Expenses by Landlord on a reasonably equitable basis.

Exhibit F - Page 2


 

EXHIBIT G
BUILDING RULES AND REGULATIONS
PURPOSE:   The purpose of these Rules and Regulations is to provide each business within the Project with a quality of environment and visual appeal consistent with the high standards of a “Class A” office building in the Airport/West Dade submarket of Miami.
A.   PARKING:
Parking of automotive trucks and other vehicles shall be restricted to areas designated for such purpose by Landlord.
Landlord reserves the right to remove by towing any vehicle which may be obstructing any door or driveway, is improperly parked, obstructing other parked vehicles or is parked in a restricted area. All towing expenses shall be paid by the vehicle owner.
Each vehicle owner shall be responsible for any damage caused by the operation or parking of such vehicle which causes damages to Landlord’s property.
Parking after normal business hours shall conform and comply with all laws, ordinances and regulations of any agency or any regulatory authority.
Tenant shall not make any repairs to nor maintain its vehicles, including, without limitation, washing and waxing, within the Project.
The foregoing rules regarding parking shall be subject to the terms and conditions set forth in Section I, paragraph 3 of Exhibit E attached hereto.
B.   OUTDOOR STORAGE:
Tenant shall not store any materials, supplies, equipment, etc., outside the Leased Premises.
Storage in trailers, whether attached to or detached from a driving unit is prohibited (except as is usual and customary for loading and unloading such trailers). Parking of any vehicle within the Project for more than five continuous days is prohibited.
C.   WASTE REMOVAL:
With respect to waste other than customary office waste generated by Tenant, Tenant shall furnish its own sealable waste and refuse containers which must be located at all times within the area designated by Landlord. No other containers are permitted on site. Enclosures provided by Landlord and container lids shall remain closed at all times when not actively in use. Tenant is responsible for maintaining the assigned waste and refuse areas free and clean of all litter, obnoxious odors, insects, rodents, etc. Any medical waste produced by Tenant or its employees, licensees, invitees, etc. shall be disposed of in accordance with all applicable guidelines. Any activity or expense incurred by Landlord in cleaning, maintaining, or otherwise preserving the concept of a clean environment shall be reimbursed to Landlord by Tenant plus fifteen percent (15%) for Landlord’s overhead and expenses and shall constitute Rental.
Tenant shall comply with Landlord’s recycling program for the Building, or in the absence thereof, Tenant shall institute and maintain a recycling program for its waste in compliance with all applicable laws and requirements of any governmental agency or department having jurisdiction over the Leased Premises.
D.   SIGN CONTROLS:
Painting or affixing signs on any part of the outside of the Leased Premises, the Building, the Parking Areas, windows or doors is prohibited. Free standing signs are not permitted outside of the Leased Premises. No sign,

Exhibit G - Page 1


 

advertisement, notice or other lettering shall be exhibited, inscribed, painted or affixed by Tenant on the inside of the Leased Premises if the same can be seen from outside of the Leased Premises without the prior written consent of Landlord (which consent may be withheld by Landlord in its sole discretion), and then only of such color, size, character, style and material and in such places as shall be approved and designated by Landlord. In the event of a violation of the foregoing by Tenant, Landlord may remove same without any liability and may charge the expense incurred by such removal to Tenant. Signs at entrances to the Leased Premises shall be placed thereon by a contractor designated by Landlord and shall be paid for by Tenant.
E.   TRADE FIXTURES AND SECURITY SYSTEMS:
The installation of any trade fixtures or security systems shall be subject to the prior written approval of Landlord. which shall not be unreasonably withheld. Tenant shall remain liable for the cost of removing all such fixtures and systems upon the expiration or earlier termination of the Lease, as well as the cost of curing any and all damages to the Leased Premises caused by the installation of such fixtures and systems.
F.   ON-SITE IMPROVEMENTS:
Tenant shall not be permitted to alter, move, maintain or disturb any part of the landscaping or other improvements located on or adjacent to the Building, the common areas or the Project.
G.   MISCELLANEOUS:
In addition to the Rules and Regulations hereinabove set forth, Tenant shall comply with the following:
     1. Tenant, its officers, agents, servants and employees shall not block or obstruct any of the entries, passages, doors, hallways or stairways of the Building or the Parking Areas, or place, empty or throw any rubbish, litter, trash or material of any nature into such areas, or permit such areas to be used at any time except for the ingress or egress of Tenant, its officers, agents, servants, employees, patrons, licensees, customers, visitors or invitees.
     2. The movement of furniture, equipment, machines, merchandise or materials within, into or out of the Leased Premises, the Building or the Parking Areas shall be restricted to time, method and routing of movement as determined by Landlord upon request from Tenant and Tenant shall assume all liability and risk to property, the Leased Premises, the Building and the Project in such movement. Tenant shall not move furniture, machines, equipment, merchandise or materials within, into or out of the Building, the Leased Premises or the Parking Areas without having first obtained a written permit from Landlord at least twenty-four (24) hours in advance. Safes, large files, electronic data processing equipment and other heavy equipment or machines shall be moved into the Leased Premises, the Building, or the Parking Areas only with Landlord’s prior written consent and shall be placed where directed by Landlord.
     3. Landlord will not be responsible for lost or stolen personal property, equipment, money or any article taken from the Leased Premises, the Building or the Parking Areas regardless of how or when such loss occurs.
     4. Tenant, its officers, agents, servants and employees shall not install or operate any refrigerating, heating or air conditioning apparatus without Landlord’s prior written approval not to be unreasonably withheld, or bring into the Leased Premises, the Building or the Parking Areas any inflammable fluids or explosives without written permission of Landlord.
     5. Tenant, its officers, agents, servants or employees shall not use the Leased Premises, the Building or the Parking Areas for housing, lodging or sleeping purposes or, except for the cafeteria on the ground floor of Building 10, for the cooking or preparation of food without the prior written consent of Landlord except for the heating of food in microwaves and toaster ovens in the kitchen areas within the Leased Premises.
     6. Tenant, its officers, agents, servants, employees, patrons, licensees, customers, visitors or invitees shall not bring into the Parking Areas, the Building or the Leased Premises, or keep on the Leased Premises any fish,

Exhibit G - Page 2


 

fowl, reptile, insect or animal, or any bicycle or other vehicle without the prior written consent of Landlord, wheelchairs and baby carriages excepted.
     7. No additional locks shall be placed on any door in the Building without the prior written consent of Landlord. Landlord will furnish two (2) keys to each lock on doors in the Leased Premises. Landlord may at all times keep a pass key to the Leased Premises. All keys shall be returned to Landlord promptly upon the expiration or earlier termination of the Lease.
     8. Except for permitted Alterations and as provided in the Lease, Tenant, its officers, agents, servants, employees, patrons, licensees, customers, visitors or invitees shall do no painting or decorating in the Leased Premises, or mark, paint or cut into, drive nails or screw into, nor in any way deface any part of the Leased Premises or the Building without the prior written consent of Landlord. If Tenant desires signal, communication, alarm or other utility or service connections installed or changed, such work shall be done at the expense of Tenant, with the prior written approval and under the direction of Landlord.
     9. Landlord reserves the right to close the Building at 6:00 p.m. on weekdays (except for holidays generally recognized by state and federal governments), and at 1:00 p.m. on Saturdays, subject, however to Tenant’s right to admittance under regulations prescribed by Landlord, and to require that all persons entering the Building identify themselves and establish their right to enter or to leave the Building.
     10. Tenant, its officers, agents, servants, employees, patrons, licensees, customers, visitors or invitees shall not permit the operation of any musical or sound-producing instruments or device which may be heard outside the Leased Premises, the Building or the Parking Areas, or which emanate electrical waves which will impair radio or television broadcasting, or reception from or in the Building.
     11. Tenant, its officers, agents, servants, employees, patrons, licensees, customers, visitors or invitees shall, before leaving the Leased Premises unattended, close and lock all doors and shut off all utilities; damage resulting from failure to do so shall be paid for by Tenant. Tenant, before the closing of the day and leaving the Leased Premises, and shall see that all doors are locked.
     12. Tenant shall give Landlord prompt notice of all accidents to, or defects in air conditioning equipment, plumbing, electric facilities, or any part or appurtenance of the Leased Premises or the Building.
     13. The plumbing facilities shall not be used for any purpose other than that for which they are constructed, and no foreign substance of any kind shall be thrown therein, and the expense of any breakage, stoppage or damage resulting from a violation of this provision shall be borne by Tenant.
     14. All contractors and/or technicians performing work for Tenant within the Leased Premises, the Building or Parking Areas shall be referred to Landlord for approval (which shall not unreasonably be withheld) before performing such work. This shall apply to all work including, without limitation, installation of telephones, telegraph equipment, electrical devices and attachments, and all installations affecting floors, walls, windows, doors, ceilings, equipment, or any other physical feature of the Building, the Leased Premises or Parking Areas. None of this work shall be done or caused to be done by Tenant without Landlord’s prior written approval.
     15. No showcases or other articles shall be put in front of or affixed to any part of the exterior of the Building, nor placed in the common areas, halls, corridors or vestibules without the prior written consent of Landlord.
     16. No space in the Building or the Parking Areas shall, without the prior written consent of Landlord, be used for manufacturing, public sales, or for the storage of merchandise, or for the sale of merchandise, goods or property of any kind, or auction.
     17. Canvassing, soliciting and peddling in the Building or the Parking Areas is prohibited and Tenant shall cooperate to prevent the same.

Exhibit G - Page 3


 

     18. There shall not be used in any space, or in the public halls of the Building, either by Tenant or by jobbers or others, in the delivery or the receipt of merchandise, any hand trucks except for those which are equipped with rubber tires.
     19. Neither Tenant nor any officer, agent, employee, servant, patron, customer, visitor, licensee or invitee of Tenant shall go upon the roof of the Building without the prior written consent of Landlord or Landlord’s designated representative.
     20. In the event Tenant must dispose of crates, boxes, etc., which will not fit into office wastepaper baskets, it will be the responsibility of Tenant to dispose of same in a manner consistent with the Lease and these Rules and Regulations. In no event shall Tenant set such items in the public hallways or other areas of the Building, Parking Areas or the Project, excepting Tenant’s own Premises for disposal.
     21. Tenant is cautioned in purchasing furniture and equipment in that the size of same should be limited to such as will pass through the doors of the Leased Premises. Large pieces should be made in parts and set up in the Leased Premises. Landlord reserves the right to refuse to allow any furniture or equipment of any description not complying with the above conditions to be placed in the Building.
     22. Tenant will be responsible for any damage to the Leased Premises, including, without limitation, carpeting and flooring, as a result of rust or corrosion of file cabinets, roller chairs, metal objects, or spills of any type of liquid.
     23. Tenants employing laborers or others outside of the Building shall not have their employees paid in the Building or in the Project, but shall arrange to pay their payrolls elsewhere.
     24. If the Leased Premises should become infested with vermin as a result of Tenant’s operation of the cafeteria or other activities other than general office use, Landlord, at Tenant’s sole cost and expense, shall cause the Leased Premises to be exterminated at such time and from time to time, to the satisfaction of Landlord.
     25. Tenant shall not install any antenna, aerial wires, satellite dishes, radio or television equipment, inside or outside of the Building without Landlord’s prior written approval and upon such terms and conditions as may be specified by Landlord in each and every instance.
     26. Tenant shall not make or permit any use of the Leased Premises, the Building or the Parking Areas which, directly or indirectly, is forbidden by law, ordinance or governmental or municipal regulation, code or order, or which may be disreputable or dangerous to life, limb or property.
     27. Tenant shall not advertise the business, profession or activities of Tenant in any manner which violates the letter or spirit of any code of ethics adopted by any recognized association or organization pertaining thereto, nor shall Tenant use the name of the Building or the Project for any purpose other than that of the business address of Tenant, or use any picture or likeness of the Building or the Project, or the name of the Building or the Project on any circular, notice, advertisement, container or wrapping material other than Tenant’s business address, without Landlord’s prior written consent thereto.
     28. Tenant, its officers, agents, employees, servants, patrons, customers, licensees, invitees and visitors shall not solicit business in the Building (outside of the Leased Premises), the Parking Areas, or the Project, nor shall Tenant distribute any handbills or other advertising matter in automobiles parked in the Parking Areas.
     29. Tenant shall not conduct its business and/or control its officers, agents, employees, servants, patrons, customers, licensees and visitors (but with respect to patrons, customers, licensees, invitees and visitors only during such time as they are in the Leased Premises) in such a manner as to create any nuisance, or interfere with, annoy or disturb any other tenant or Landlord in its operation of the Building, or commit waste, or suffer or permit waste to be committed in the Leased Premises, the Building, or the Project.
     30. Tenant, without the prior written consent of Landlord, shall not install any linoleum or similar floor covering.

Exhibit G - Page 4


 

     31. Access to the Building, or to the halls, corridors, elevators or stairways to the Leased Premises may be refused from 1:00 p.m. Saturday until 7:30 a.m. Monday, on holidays generally recognized by state and federal governments, and during the rest of the week between the hours of 6:00 p.m. and 7:30 a.m., unless the person seeking access has a pass or is properly identified. Landlord shall in no event be liable for damages for the admission to, or exclusion from, the Building of any person whom Landlord has the right to exclude hereunder. Tenant’s employees, agents and visitors shall be permitted to enter and leave the Building whenever appropriate arrangements have been previously made between Landlord and Tenant with respect thereto. Tenant shall be responsible for all persons for whom Tenant requests such permission, and Tenant shall be liable to Landlord for all acts of such persons. Any person whose presence in the Building at any time shall, in the judgment of Landlord, be prejudicial to the safety, character, reputation and interest of the Building, or its tenants, may be denied access to the Building, or may be ejected therefrom. In case of invasion, riot, public excitement or other commotion, Landlord may prevent all access to the Building during the continuance of same, by closing the doors or otherwise, for the safety of the tenants of the Building, and for the protection of property in the Building. Landlord may require any person leaving the Building with any package or other object to exhibit a pass from Tenant.
     32. Tenant acknowledges that Landlord has designated the Building as a “non-smoking” building, and Tenant, its officers, agents, employees, servants, patrons, customers, licensees and visitors shall at all times refrain from smoking in the Building except for those areas of the Building, if any, specifically designated by Landlord as “smoking” areas.
     33. Tenant shall comply with all indoor air quality standards and requirements pertaining to the Building and the Leased Premises, including those regulations promulgated by OSHA, as same may be amended from time to time.
     34. As to the cafeteria, the utilities should be separately metered.
H.   SPECIAL RULES AND REGULATIONS FOR FOOD SERVICES AREAS (INCLUDING CAFETERIA).
     1. Tenant will at its expense: (i) keep the inside and outside of all glass in the doors and windows of the food services areas (the “Premises”) clean; (ii) keep all exterior store surfaces of the Premises clean; (iii) replace promptly any cracked or broken glass of the Premises with glass of like grade and quality; (iv) maintain the Premises in a clean, orderly and sanitary condition and free of insects, rodents, vermin and other pests, including cleaning, repairing or replacing as needed all floor covering within the public areas of the Premises; (v) keep any garbage, trash, rubbish or other refuse in rat-proof containers within the interior of the Premises until removed; (vi) have such garbage, trash, rubbish and refuse removed on a daily basis; (vii) keep all mechanical apparatus free of vibration and noise which may be transmitted beyond the Premises; (viii) comply with all laws, ordinances, rules and regulations of governmental authorities and all recommendations of Landlord’s fire insurance rating organization now or hereafter in effect; (ix) comply with and observe all rules and regulations established by Landlord from time to time; and (x) conduct its business in all respects in a dignified manner consistent with other food service areas in Comparable Buildings.
     2. Tenant shall perform or cause to be performed, at its own cost and expense, all janitorial services in the Premises necessary to keep the Premises in good, sanitary and clean order and condition. Such janitorial services shall be performed by Tenant’s employees in a manner equivalent to the janitorial services performed in all other Class A buildings. Landlord reserves the right to monitor the performance of such janitorial service and if Landlord, in its reasonable judgment, determines that such service is being inadequately performed, then Landlord shall give Tenant written notice thereof, stating with reasonable specificity the instances or examples of such inadequate performance.
     3. Tenant shall handle exhaust in a manner approved by Landlord to prevent odors and to prevent any disturbance to other tenants in the Project.
     4. Tenant shall furnish (at its sole expense) its own trash compactor to dispose of trash which must be located at all times within the area designated by Landlord. Tenant shall remove all trash, garbage and debris in the Buildings prior to the end of the Business Operating Hours.

Exhibit G - Page 5


 

     5. Tenant shall promptly “bus” any tables and/or other furnishings in the Premises, thereby removing any plates, glasses, food, trash and other debris and litter remaining on any tables and wiping clean any spills or other litter from the Premises or on or under any of the furniture promptly following the departure of any customer or patron of Tenant or other person using any of the facilities.
     6. Tenant will not place or suffer to be placed or maintained on the exterior of the Premises or in any part of the Building any sign, advertising matter or any other thing of any kind, and will not place or maintain any decoration, letter or advertising matter on the glass of any window or door of the Premises or interior sign visible from outside the Premises without first obtaining Landlord’s prior written approval, which approval shall not be unreasonably withheld. Tenant will, at is sole cost and expense, maintain such sign, decoration, lettering, advertising matter or other thing as may be permitted hereunder in good condition and repair at all times. Accordingly, Tenant, subject to strikes, acts of Gods, and other events beyond its control, covenants and agrees with Landlord as follows:
          (i) Tenant shall apply for and maintain all licenses and permits required in the operation of its facilities in the Premises and do all other things necessary to comply with all laws and ordinances relating to its operation.
          (ii) No auction, fire, distress, or bankruptcy sale may be conducted within the Premises without the express written consent of the Landlord.
          (iii) Tenant shall receive and deliver goods and merchandise only in the manner at such times, and in such areas, as may be designated by Landlord, in its reasonable discretion, and in this connection Tenant specifically agrees, (A) to use Tenant’s best efforts to complete or cause to be completed, all deliveries, loading, unloading and services to the Premises prior to ten o’clock a.m. (10:00 a.m.) each day and (B) to abide by such further reasonable regulations as Landlord shall implement to regulate the activities of tenants of the Building with respect to deliveries to and servicing of premises occupied by such tenants.
          (iv) Tenant shall not display or sell merchandise or allow carts, devices, or any other objects to be stored or to remain outside the defined exterior walls and permanent doorways or store front of the Premises.
          (v) Tenant acknowledges and agrees that the sale of alcoholic beverages is strictly prohibited.

Exhibit G - Page 6


 

EXHIBIT H
LETTER OF CREDIT FORM
[BANK LETTERHEAD]
[Date]
Hines REIT Airport Corporate Center LLC
2800 Post Oak Boulevard, Suite 5000
Houston, Texas 77056
          Re: Irrevocable Clean Letter of Credit
Gentlemen:
By order of our client,                                          (“                    ”), we hereby open our clean irrevocable Letter of Credit No.                      in your favor for an amount not to exceed in the aggregate $                     U.S. Dollars effective immediately.
          Funds under this credit are available to you against your sight draft drawn on us mentioning thereon our Credit No.                     .
          This Letter of Credit shall expire twelve (12) months from the date hereof; provided, however, that it is a condition of this Letter of Credit that it shall be deemed automatically extended, from time to time, without amendment, except with respect to the maximum amount of this Letter of Credit as expressly provided herein, for one (1) year from the expiry date hereof and from each and every future expiry date, unless at least sixty (60) days prior to any expiry date we shall notify you (and a copy of any such notice shall also be sent to Hines Interests Limited Partnership, Five Ravinia Drive, Atlanta, Georgia 30346, Attention: Michael Harrison, Project Officer and Hines Interests Limited Partnership, 7300 Corporate Center Drive, Suite 100, Miami, Florida 33126, Attention: Gonzalo Cortabarria, Asset Manager) by registered mail, that we elect not to consider this Letter of Credit renewed for any such additional period, in which event, unless a substitute Letter of Credit in conformity with the provisions hereof is delivered to you within fifteen (15) days following your receipt of our notice of non-renewal, you may, at any time thereafter, upon presentation of a sight draft accompanied by a certificate purportedly signed by an officer of your company stating “a replacement letter of credit has not been delivered” draw on the entire amount of this Letter of Credit. The final expiry date hereof shall be no earlier than                     , 20___ [thirty (30) days following the last day of the Term]. The maximum amount of this Letter of Credit shall be as provided on Schedule A attached to and made a part of this Letter of Credit.
          This Letter of Credit is transferable and may be transferred one or more times. However, no transfer shall be effective unless advice of such transfer is received by us in the form attached, signed by you, with signature guaranteed by a commercial bank or member firm of a national stock exchange.
          We hereby agree with you that all drafts drawn or negotiated in compliance with the terms of this Letter of Credit will be duly and promptly honored upon presentment and delivery of your draft to our office at                                                              accompanied by a certificate purportedly signed by an officer of your company confirming that you are entitled to draw the amount represented by the sight draft pursuant to the Lease between you and                                         , if negotiated on or prior to the expiry date as the same may from time to time be extended.

Exhibit H - Page 1


 

          Except as otherwise specified herein, this Letter of Credit is subject to the Uniform Customs and Practice for Documentary Credits (1993) Revision, International Chamber of Commerce Publication No. 500.
Very truly yours,
[Name of Bank]
By:                                        

Exhibit H - Page 2


 

Schedule A to Exhibit H
Maximum Amount of Letter of Credit
         
(Date of Issuance – January 31, 2010)
    [**] [Confidential Treatment]  
 
       
(February 1, 2010 – January 31, 2011)
    [**] [Confidential Treatment]  
 
       
(February 1, 2011 – January 31, 2012)
    [**] [Confidential Treatment]  
 
       
(February 1, 2012 – January 31, 2013)
    [**] [Confidential Treatment]  
 
       
(February 1, 2013 – January 31, 2014)
    [**] [Confidential Treatment]  
 
       
(February 1, 2014 – February 28, 2019)
    [**] [Confidential Treatment]  
Schedule A to Exhibit H

 


 

EXHIBIT I
BASE RENTAL
                 
    Base Rent   Rentable
Year   (Per Annum Rate per RSF)   Square Feet
1
    [**] [Confidential Treatment]       208,737  
2
    [**] [Confidential Treatment]       208,737  
3
    [**] [Confidential Treatment]       208,737  
4
    [**] [Confidential Treatment]       208,737  
5
    [**] [Confidential Treatment]       208,737  
6
    [**] [Confidential Treatment]       208,737  
7
    [**] [Confidential Treatment]       208,737  
8
    [**] [Confidential Treatment]       208,737  
9
    [**] [Confidential Treatment]       208,737  
10
    [**] [Confidential Treatment]       208,737  
11
    [**] [Confidential Treatment]       208,737  
12
    [**] [Confidential Treatment]       208,737  
13*
    [**] [Confidential Treatment]       208,737  
         
Notes:
  (a)   Each “Year” is a calendar year of 365/6 days. The first year commences upon December 1, 2006 and ends on November 30, 2007.
 
       
 
  (b)   In addition to Base Rent, Tenant shall also be obligated to pay Additional Rent, including, without limitation, Tenant’s pro rata share of Operating Expenses.
 
       
 
  (c)   Tenant shall be entitled to an abatement of rent pursuant to Section 2.1 of this Lease.
 
       
 
  *   This lease year is only a two-month period.

 


 

EXHIBIT J
MARKET TERMS
Market Rent shall be defined as the then fair market rental value of the premises determined in accordance with the provisions set forth below. The fair market rental value of the premises shall mean the base rental rate that would be agreed to by a landlord and a comparable tenant for comparable space, each of whom is willing, but neither of whom is compelled, to enter into a lease transaction. The fair market rental value shall be projected to the commencement date of the applicable term, and shall not take into account any existing tenant improvements, but shall take into account the following factors:
  1.   Rental for comparable premises in comparable office buildings in the Airport West/Doral market (taking into consideration, but not limited to, annual escalations; definition of net rentable area; quality; age and location of the applicable buildings; and location and/or floor level within the applicable building);
 
  2.   The rentable area of the premises being leased;
 
  3.   The length of the pertinent rental term;
 
  4.   The extent to which the work letter, rent credit, moving allowance or similar inducement given to Tenant is less than that which would have been given to a comparable new tenant in a comparable building; and
 
  5.   The quality and creditworthiness of Tenant.
 
  6.   The rights and obligations of Tenant under the Lease.
 
      If Landlord and Tenant are unable to agree upon the fair market rental value, Landlord shall select a commercial real estate broker with at least ten (10) years experience as a landlord and tenant representative in major leasing transactions in the Miami-Dade County area, who shall prepare a written determination of the Market Rent using the assumptions described in this exhibit. Such broker’s determination of Market Rent shall be determinative unless Tenant disputes it as provided in the next sentence. If Tenant disputes such determination, Tenant shall deliver to Landlord written notice (a) that Tenant disputes such determination, and (b) of the identity of a commercial real estate broker selected by Tenant meeting the same qualifications as required for Landlord’s broker. The broker selected by Tenant shall submit his determination of the Market Rent using the assumptions described in this paragraph. If the two determinations are within five percent (5%) of each other (based on the higher number), the Market Rent shall be the average of the two. If not, then the two brokers shall appoint a third commercial real estate broker meeting the same qualifications as applicable to the other brokers as set forth in this exhibit. The third broker shall be limited in authority to selecting, in his opinion, which of the two earlier determinations best reflects the Market Rent under the assumptions set forth herein. The third broker must choose one of the two earlier determinations and, upon doing so, the third broker’s determination shall be the controlling determination of the Market Rent. Each party shall pay the costs and fees of the broker it selected; if a third broker is selected, each party shall pay fifty percent (50%) of said third broker’s costs and fees.

 


 

EXHIBIT K
FORM OF SNDA
     THIS SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT (this “Agreement”) is made as of the 27th day November, 2006, by and between LEHMAN BROTHERS BANK, FSB, having an address at 399 Park Avenue, New York, New York 10022 (“Lender”) and NCL (BAHAMAS) LTD., a Bermuda company having an address at 7665 Corporate Center Drive, Miami, Florida 33126 (“Tenant”).
RECITALS:
     A. Tenant is the holder of a leasehold estate in a portion of the property known as Airport Corporate Center, located in Miami, Florida, as more particularly described on Schedule A (the “Property”) under and pursuant to the provisions of a certain lease dated December 1, 2006 between HINES REIT AIRPORT CORPORATE CENTER LLC, a limited liability company organized under the laws of the State of Delaware, as landlord (“Landlord”) and Tenant or its predecessor in interest, as tenant (as amended through the date hereof, the “Lease”);
     B. The Property is or is to be encumbered by one or more mortgages, deeds of trust, deeds to secure debt or similar security agreements (collectively, the “Security Instrument”) from Landlord, or its successor in interest, in favor of Lender; and
     C. Tenant has agreed to subordinate the Lease to the Security Instrument and to the lien thereof and Lender has agreed to grant non-disturbance to Tenant under the Lease on the terms and conditions hereinafter set forth.
AGREEMENT:
     NOW, THEREFORE, the parties hereto mutually agree as follows:
     1. Subordination. The Lease shall be subject and subordinate in all respects to the lien and terms of the Security Instrument, to any and all advances to be made thereunder and to all renewals, modifications, consolidations, replacements and extensions thereof.
     2. Non-Disturbance. So long as Tenant pays all rents and other charges as specified in the Lease and is not otherwise in default (beyond applicable notice and cure periods) of any of its obligations and covenants pursuant to the Lease, Lender agrees for itself and its successors in interest and for any other person acquiring title to the Property through a foreclosure (an “Acquiring Party”), that Tenant’s possession of the premises as described in the Lease will not be disturbed during the term of the Lease, as said term may be extended pursuant to the terms of the Lease or as said premises may be expanded as specified in the Lease, by reason of a foreclosure. For purposes of this agreement, a “foreclosure” shall include (but not be limited to) a sheriff’s or trustee’s sale under the power of sale contained in the Security Instrument, the termination of any superior lease of the Property and any other transfer of the Landlord’s interest in the Property under peril of foreclosure, including, without limitation to the generality of the foregoing, an assignment or sale in lieu of foreclosure.
     3. Attornment. Tenant agrees to attorn to, accept and recognize any Acquiring Party as the landlord under the Lease pursuant to the provisions expressly set forth therein for the then remaining balance of the term of the Lease, and any extensions thereof as made pursuant to the Lease. The foregoing provision shall be self-operative and shall not require the execution of any further instrument or agreement by Tenant as a condition to its effectiveness. Tenant agrees, however, to execute and deliver, at any time and from time to time, upon the request of the Lender or any Acquiring Party any reasonable instrument which may be necessary or appropriate to evidence such attornment.
     4. No Liability. Notwithstanding anything to the contrary contained herein or in the Lease, it is specifically understood and agreed that neither the Lender, any receiver nor any Acquiring Party shall be:

Exhibit K - Page 1


 

          (a) liable for any act, omission, negligence or default of any prior landlord (other than to cure defaults of a continuing nature with respect to the maintenance or repair of the demised premises or the Property); provided, however, that any Acquiring Party shall be liable and responsible for the performance of all covenants and obligations of landlord under the Lease accruing from and after the date that it takes title to the Property; or
          (b) except as set forth in (a), above, liable for any failure of any prior landlord to construct any improvements;
          (c) subject to any offsets, credits, claims or defenses which Tenant might have against any prior landlord;
          (d) bound by any rent or additional rent which is payable on a monthly basis and which Tenant might have paid for more than one (1) month in advance to any prior landlord; or
          (e) be liable to Tenant hereunder or under the terms of the Lease beyond its interest in the Property.
     Notwithstanding the foregoing, Tenant reserves its rights to any and all claims or causes of action against such prior landlord for prior losses or damages and against the successor landlord for all losses or damages arising from and after the date that such successor landlord takes title to the Property.
     5. Rent. Tenant has notice that the Lease and the rents and all other sums due thereunder have been assigned to Lender as security for the loan secured by the Security Instrument. In the event Lender notifies Tenant of the occurrence of a default under the Security Instrument and demands that Tenant pay its rents and all other sums due or to become due under the Lease directly to Lender, Tenant shall honor such demand and pay its rent and all other sums due under the Lease directly to Lender or as otherwise authorized in writing by Lender. Landlord hereby irrevocably authorizes Tenant to make the foregoing payments to Lender upon such notice and demand.
     6. Lender to Receive Notices. Tenant shall notify Lender of any default by Landlord under the Lease which would entitle Tenant to cancel the Lease, and agrees that, notwithstanding any provisions of the Lease to the contrary, no notice of cancellation thereof shall be effective unless Lender shall have received notice of default giving rise to such cancellation and shall have failed within sixty (60) days after receipt of such notice to cure such default, or if such default cannot be cured within sixty (60) days, shall have failed within sixty (60) days after receipt of such notice to commence and thereafter diligently pursue any action necessary to cure such default.
     7. NOTICES. All notices or other written communications hereunder shall be deemed to have been properly given (i) upon delivery, if delivered in person with receipt acknowledged by the recipient thereof, (ii) one (1) Business Day (hereinafter defined) after having been deposited for overnight delivery with any reputable overnight courier service, or (iii) three (3) Business Days after having been deposited in any post office or mail depository regularly maintained by the U.S. Postal Service and sent by registered or certified mail, postage prepaid, return receipt requested, addressed to the receiving party at its address set forth above, and:
             
    If to Tenant, to the attention of:
 
           
 
           
 
           
 
  and        
 
           
    If to Lender, to the attention of:
 
           
 
           
or addressed as such party may from time to time designate by written notice to the other parties. For purposes of this Paragraph 7, the term “Business Day” shall mean any day other than Saturday, Sunday or any other day on which banks are required or authorized to close in New York, New York.

Exhibit K - Page 2


 

     Either party by notice to the other may designate additional or different addresses for subsequent notices or communications.
     8. Successors. The obligations and rights of the parties pursuant to this Agreement shall bind and inure to the benefit of the successors, assigns, heirs and legal representatives of the respective parties. In addition, Tenant acknowledges that all references herein to Landlord shall mean the owner of the landlord’s interest in the Lease, even if said owner shall be different than the Landlord named in the Recitals.
     9. Duplicate Originals; Counterparts. This Agreement may be executed in any number of duplicate originals and each duplicate original shall be deemed to be an original. This Agreement may be executed in several counterparts, each of which counterparts shall be deemed an original instrument and all of which together shall constitute a single Agreement. The failure of any party hereto to execute this Agreement, or any counterpart hereof, shall not relieve the other signatories from their obligations hereunder.
[Signature pages follow]

Exhibit K - Page 3


 

     IN WITNESS WHEREOF, Lender and Tenant have duly executed this Agreement as of the date first above written.
                     
            LENDER:    
 
                   
            LEHMAN BROTHERS BANK, FSB,    
            a federal stock savings bank    
 
                   
 
          By:        
                 
Print Name
          Name:        
 
                   
 
          Title:        
 
                   
 
                   
                 
Print Name
                   
 
                   
             
STATE OF
    )      
 
    ) SS:      
COUNTY OF
    )      
     The foregoing instrument was acknowledged before me this ___ day of                     , 2006, by                                         , the                      of Lehman Brothers Bank, FSB, a federal stock savings bank, on behalf of the bank, who is personally known to me or has produced a                      driver’s license as identification.
         
 
       
 
  Notary Public    
 
       
 
       
 
  Type, Print or Stamp Name    
 
       
 
  My Commission Expires:    

Exhibit K - Page 4


 

                     
            TENANT:    
 
                   
            NCL (BAHAMAS) LTD. D/B/A NORWEGIAN    
            CRUISE LINE,    
            A Bermuda Company    
 
                   
  /s/ James Travers
      By:     /s/ Colin Veitch    
                 
Print Name
    James Travers       Name:     Colin Veitch    
 
                   
 
          Title:     President & CEO    
 
                   
  /s/ George Chesney
               
                 
Print Name
    George Chesney                
 
                   
             
STATE OF
    )      
 
          ) SS:    
COUNTY OF
    )      
     The foregoing instrument was acknowledged before me this 27th day of November, 2005, by Colin Vetch, the President & CEO of NCL (Bahamas) Ltd, a Bermuda Company, on behalf of the Company, who is personally known to me.
             
 
    /s/ Sandra Dominguez    
 
       
 
  Notary Public    
 
       
 
  Sandra Dominguez    
 
       
 
  Type, Print or Stamp Name    
 
       
 
  My Commission Expires:   Feb. 16, 2010
Commission
#DD 519729
   

Exhibit K - Page 5


 

The undersigned accepts and agrees to the provisions of Paragraph 5 hereof.
                         
            LANDLORD:    
 
                       
            HINES REIT AIRPORT CORPORATE CENTER LLC,    
            a Delaware limited partnership, its sole member    
 
                       
            By:   Hines Real Estate Investment Trust,
                Inc., a Maryland corporation,
                its general partner
 
                       
/s/ David Steinback
          By:   /s/ Charles N. Hazen    
                     
Print Name
  David Steinback           Name:   Charles N. Hazen     
 
                       
 
              Title:   President    
 
                       
/s/ Todd R. Haines
                   
                     
Print Name
  Todd R. Haines                    
 
                       
             
STATE OF
    )      
 
    ) SS:      
COUNTY OF
    )      
     The foregoing instrument was acknowledged before me this 21 day of Nov., 2006, by Charles N. Hazen, the President of Hines Real Estate Investment Trust, Inc., a Maryland corporation, the general partner of Hines Reit Airport Corporate Center LLC, a Delaware limited partnership, the sole member, on behalf of the corporation and the limited partnership, who is personally known to me or has produced a                      driver’s license as identification.
         
 
  /s/ Melanie Greeley     
 
  Notary Public    
 
       
 
  Melanie Greeley     
 
  Type, Print or Stamp Name    
 
       
 
  My Commission Expires: 7/19/08    

Exhibit K - Page 6


 

SCHEDULE A
PROPERTY DESCRIPTION
     PARCEL 1:
     Lots 1, 2 and 3, in Block 1, and Lot 3, in Block 2, AIRPORT CORPORATE CENTER, according to the Plat thereof, recorded in Plat Book 130, at Page 51, of the Public Records of Miami-Dade County, Florida.
     PARCEL 2:
     Lot 1, Block 2, AIRPORT CORPORATE CENTER, according to the Plat thereof, recorded in Plat Book 130, at Page 51, of the Public Records of Miami-Dade County, Florida.
     PARCEL 2-A:
     Together with a non-exclusive easement for vehicular and pedestrian ingress and egress over and across the West 12 feet of Lot 2, Block 2, AIRPORT CORPORATE CENTER, Plat Book 130, Page 51, created pursuant to that certain Declaration of Restrictive Covenants in Lieu of Unity of Title, Easement and Operating Agreement dated December 31, 1986, filed January 2, 1987, in Official Records Book 13134, page 1105, of the Public Records of Miami-Dade County, Florida.
     PARCEL 3:
     Lot 2, Block 2, AIRPORT CORPORATE CENTER, according to the Plat thereof, recorded in Plat Book 130, at Page 51, of the Public Records of Miami-Dade County, Florida.
     PARCEL 3-A:
     The non-exclusive easement reserved in instrument filed January 2, 1987, in Official Records Book 13134, page 1105, for ingress and egress over the East 12 feet of Lot 1, Block 2, AIRPORT CORPORATE CENTER, according to the Plat thereof, recorded in Plat Book 130, at Page 51, of the Public Records of Miami-Dade County, Florida, for the benefit of Lot 2, Block 2, AIRPORT CORPORATE CENTER, according to the Plat thereof, recorded in Plat Book 130, at Page 51, of the Public Records of Miami-Dade County, Florida.
     PARCEL 4:
     Tract “B-2”, of ACC-WEST REPLAT, according to the Plat thereof, recorded in Plat Book 146, at Page 29, of the Public Records of Miami-Dade County, Florida.
     PARCEL 4-A:
     TOGETHER WITH that certain Driveway Easement created pursuant to Driveway Easement Agreement dated September 5, 1996, filed September 11, 1996, in Official Records Book 17348, at Page 3797.
     PARCEL 4-B:
     TOGETHER WITH Reciprocal Easement for Ingress and Egress created pursuant to Road Easement and Drainage Easement dated January 30, 1992, filed February 11, 1992, in Official Records Book 15382, page 2352.
     PARCEL 4-C:
     Together with a non-exclusive right, privilege and easement for access over and across the driveway only, legally described and depicted as set forth in Exhibit “C” of that certain Access Easement Agreement filed
Schedule A to Exhibit K — Page 1

 


 

February 11, 1992, in Official Records Book 15382, page 2371, as amended by Amendment to Access Easement Agreement filed June 19, 1996, in Official Records Book 17245, page 1450.
     PARCEL 5:
     Tract “A”, of ACC-WEST, according to the Plat thereof, recorded in Plat Book 144, at Page 29, Public Records of Miami-Dade County, Florida.
     PARCEL 5-A:
     Together with that certain Driveway Easement created pursuant to Driveway Easement Agreement dated September 5, 1996, filed September 11, 1996, in Official Records Book 17348, page 3797.
     PARCEL 5-B:
     TOGETHER WITH that certain Road Easement and Drainage Easement created pursuant to Road Easement and Drainage Easement Agreement dated January 30, 1992, filed February 11, 1992, in Official Records Book 15382, at Page 2352.
     PARCEL 6:
     Tract B-1, of ACC-WEST REPLAT, according to the Plat thereof, recorded in Plat Book 146, at Page 29, Public Records of Miami-Dade County, Florida.
     PARCEL 6-A:
     Together with a non-exclusive right, privilege and easement for access over and across the driveway only, legally described and depicted as set forth in Exhibit “C” of that certain Access Easement Agreement filed February 11, 1992, in Official Records Book 15382, page 2371, as amended by Amendment to Access Easement Agreement filed June 19, 1996, in Official Records Book 17245, page 1450.
Schedule A to Exhibit K — Page 2

 


 

EXHIBIT L
SATELLITE DISH AGREEMENT
     THIS SATELLITE DISH AGREEMENT made and entered into this                      day of                                         , 2006 (the “Effective Date”) by and between HINES REIT AIRPORT CORPORATE CENTER LLC (hereinafter referred to as the “Landlord”) and NCL (BAHAMAS) LTD. D/B/A NORWEGIAN CRUISE LINE (hereinafter referred to as “Tenant”)
WITNESSETH:
     WHEREAS, Landlord and Tenant are parties, in such respective capacities, under that certain Office Lease Agreement dated December 1, 2006 (the “Lease”) for office space on the                                          floor the (“Leased Premises”) of the office building located at                      Corporate Center Drive, Miami, Florida (hereinafter referred to as the “Building”).
     WHEREAS, Tenant has requested that Landlord allow the installation of certain satellite dishes on or about the Building and the Landlord is agreeable to entering into this instrument, whereby a license relative thereto would be granted but only on the terms and conditions hereinafter set forth.
     NOW THEREFORE, for and in consideration of the sum of TEN AND NO/100 ($10.00) DOLLARS and other good and valuable consideration, the adequacy, receipt and sufficiency of which are hereby acknowledged by Landlord and Tenant, Landlord and Tenant hereby agree as follows:
     1. License for Satellite Dishes.
          (a) Subject to the terms hereof, the Landlord hereby grants to the Tenant (and Tenant hereby accepts) a revocable license (the “License”) to install four Satellite Dishes (as defined below) and Facilities (also defined below) as such installation is described herein, and to maintain, operate and repair same and, at the conclusion of the License, to remove same from the Building, all to be at the Tenant’s sole cost and expense. Tenant agrees to pay, relative to the License, a monthly license fee of $ NONE plus sales tax due thereon, which shall be due and payable at the same time and in the same manner as the Base Rental is due and payable under the Lease, and which shall not be subject to any counterclaim, set off or deduction by Tenant. The monthly license fee shall constitute Additional Rental under the Lease and shall be subject to increase on an annual basis in Landlord’s reasonable discretion.
          (b) The term of the License shall be coterminous with the term of the Lease, so that unless earlier terminated as provided hereunder, the License will terminate automatically and without need of any further writing, upon the expiration or earlier termination of the Lease.
          (c) The “Satellite Dishes” consists of satellite receiving and transmitting dish antennae, as specified in Schedule 1 attached to and made a part hereof. The Landlord shall determine the location of the Satellite Dishes, and the location of the Facilities, all in its sole discretion. The plans and specifications for installation of the Satellite Dishes and the Facilities, including, among other things, the proposed mounting method, the location and point of entry to the Building, and the cable route, conduits and type information, shall in every instance be subject to the Landlord’s prior written approval, in its reasonable discretion. The Satellite Dishes shall include a non-penetrating building mount. The point of entry of the cable that is part of the Satellite Dishes shall be at such point as the Landlord shall determine in its reasonable judgment.
     The Tenant hereby acknowledges and agrees that the Satellite Dishes (including all components thereof) and the Facilities are the property of the Tenant. Provided however that at the expiration or earlier termination of the Lease or the License, of the Satellite Dishes or any portion thereof of any of the Facilities are not removed from the Property by or at the direction of the Tenant within ten (10) days following said expiration or termination, same shall be deemed abandoned by the Tenant and, at the Landlord’s option, may be claimed as the property of the
Exhibit L — Page 1

 


 

Landlord, free of all claims of the Tenant. Tenant acknowledges and agrees that the Satellite Dishes and all components thereof, and all of the Facilities are owned free and clear by the Tenant and that no liens or encumbrances shall be permitted relative to the Satellite Dishes or any portion thereof or the Facilities, at any time during the term of the Lease.
          (d) The Satellite Dishes and the Facilities shall be installed by the employees, agents or contractors of the Tenant, only in accordance with plans and specifications that shall have been previously approved by Landlord. Landlord agrees that it will reasonably cooperate with Tenant in connection with the installation of the Satellite Dishes and Facilities and the performance of any work required in connection therewith and the submission of any materials to governmental entities as may be required for any permits or other approvals necessary with respects thereto; provided, however, that Tenant shall promptly reimburse Landlord for all costs and expenses incurred by Landlord in connection with any of the said activities. The Tenant agrees to immediately remove or cause to be removed, and all mechanic’s lien(s) which are in any way related to the installation, maintenance, operation, and/or removal of the Satellite Dishes and/or the Facilities, all at Tenant’s sole cost and expense, within thirty (30) days after any such liens(s) encumber the Building or any portion thereof.
          (e) Upon reasonable prior notice to the Landlord, Landlord will permit Tenant reasonable access to the approved location of the Satellite Dishes and the Facilities, as needed, to install, maintain, operate and/or remove the Satellite Dishes and the Facilities.
          (f) Landlord may request that Tenant relocate the Satellite Dishes and/or the Facilities. Tenant will cooperate with Landlord to identify an alternate location on, or about, the Building which will comply with Landlord’s requirements and applicable governmental requirements and will provide to the extent reasonably possible, adequate reception for the Satellite Dishes, it being hereby understood that Landlord makes no warranties or representations as to the adequacy of such reception or otherwise, hereunder. If Landlord were to make a discretionary request to relocate the Satellite Dishes or the Facilities, then all expenses incurred in relocating the Satellite Dishes or the Facilities pursuant to this Paragraph shall be borne by Landlord. If a relocation request from the Landlord is made as a result of governmental requirements, then Tenant shall bear all costs of such relocation. Landlord will endeavor to provide Tenant with reasonable access to such alternate location.
          (g) Tenant agrees (and will insure) that the Satellite Dishes, and all related facilities, equipment, conduits and materials (all, collectively “Facilities”) will be installed in accordance with all applicable local and building rules of construction and codes. Tenant shall at all times maintain the Satellite Dishes and the Facilities in good order and repair and Tenant shall be responsible for any and all costs and expenses incurred in connection with such repairs to the Satellite Dishes and/or the Facilities, including without limitation, the installed conduits running from the Satellite Dishes to the Premises, Tenant’s installation, repair, maintenance and operation of the Satellite Dishes and The Facilities shall be subject to and performed in accordance with all terms and conditions of the Lease, as well as applicable governmental codes, laws, rules, regulations and/or ordinances in effect from time to time. Tenant shall be entitled, in connection with the installation and use of the Satellite Dishes, to run conduits (of a type approved in writing by the Landlord) from the Satellite Dishes to the Leased Premises, in order to connect Tenant’s related equipment in the Leased Premises to the Satellite Dishes. Tenant shall be required to pay the actual cost of any and all electricity, maintenance and operation costs (and any and all other costs and expenses) required or incurred in connection with the Satellite Dishes and/or any related Facilities.
          (h) If access to the Satellite Dishes or Facilities is impeded or in the event existing communications equipment within the Building interferes with the Satellite Dishes or Facilities, Landlord and Tenant agree to identify a new location for the Satellite Dishes and Facilities satisfactory to Landlord and the Satellite Dishes and Facilities will be relocated thereto. Such relocation will be at Tenant’s sole cost and expense.
          (i) Tenant hereby agrees that it will (and hereby does) indemnify, protect, defend and hold Landlord harmless from and against any claims, liabilities, judgments, costs or expenses (including, without limitation, all costs of litigation and attorney’s fees and expenses) arising out of, or related to property damage or personal injury caused by the Satellite Dishes, the Facilities and/or any and all activities of Tenant, its employees, agents and/or contractors in installing, maintaining, operating, servicing and/or removing the Satellite Dishes and/or Facilities. This subsection (i) shall survive any termination of the License and/or the Lease as amended hereby.
Exhibit L — Page 2

 


 

          (j) Tenant agrees not to interfere with the operation of other existing tenant’s business or with the communications equipment of other existing tenants within the Building. The Satellite Dishes and Facilities may not be used in any fashion which would cause any inference in the [Building’s Master Televising Distribution/Receiving System and Electronic Date Processing Operation] or any other antennae, radio systems or microwave dishes on, adjacent to, at the Building currently installed.
          (k) Should the Tenant ever remove or relocate the Satellite Dishes and/or Facilities, the Tenant will restore the Building to its condition prior to the placement of the Satellite Dishes and Facilities on the Building, reasonable wear and tear, however, Tenant shall not be obligated to remove the Initial Cabling (as such term is define in the Lease). Upon its vacation of the Leased Premises, or upon termination or expiration of the Lease, Tenant agrees that this paragraph (k) shall survive. Tenant shall, at its sole cost and expense, remove the Satellite Dishes and Facilities and restore the Building in accordance with the terms of this paragraph.
          (l) Tenant shall be responsible for obtaining all necessary permits and approvals from the FCC and from all other governmental agencies and/or political subdivisions having jurisdiction over installation, maintenance, operation, repair, and/or removal of the Satellite Dishes and Facilities. Copies of all permits and approvals shall be submitted to the Landlord once they are obtained.
          (m) This License shall inure to the benefit of, and be binding upon the parties hereto and their respective successors and approved assigns. Nothing in this Agreement shall prohibit or restrict Landlord from assigning its interests under the Lease.
          (n) The Landlord makes no representations whatsoever regarding the suitability or adequacy of the Building or any portion thereof relative to the installation, maintenance, operation repair and/or removal of the Satellite Dishes or Facilities, Landlord specifically disclaims any and all warranties, expressed or implied, relative thereto. The Tenant acknowledges and agrees that the portions of the Building that may be subject to the License, are accepted by the Tenant in an “AS IS WHERE IS “condition.
          (o) This Agreement sets forth the entire agreement between the parties with respect to the License. There have been no additional oral or written representations or agreements relative thereto.
     2. In case of any inconsistency between the provisions of the Lease and this Agreement, the terms of the Lease shall govern and control. Under no circumstances shall this Agreement be deemed to grant any rights to Tenant not specifically provided herein.
     3. The parties hereto represent and warrant that each has the authority to enter into this Agreement and that the signatories hereto are authorized representatives of the Landlord and Tenant respectively.
Exhibit L — Page 3

 


 

     IN WITNESS WHEREOF, the parties hereto have executed and sealed this Lease as of the date aforesaid.
                         
        LANDLORD:        
 
                       
        HINES REIT AIRPORT CORPORATE CENTER LLC,
a Delaware limited liability company or its affiliate
 
                       
        By:   HINES REIT PROPERTIES, L.P.,
a Delaware limited partnership Its Sole Member
 
                       
            By:   HINES REAL ESTATE INVESTMENT TRUST, INC.,
a Maryland corporation Its General Partner
Witnesses:                    
 
              By:        
                     
Print Name                   Frank Apollo
Its Chief Accounting Officer
 
 
 
                   
Print Name
                       
 
 
 
                   
        TENANT:

NCL (BAHAMAS) LTD. D/B/A NORWEGIAN CRUISE LINE,

a Bermuda company
Witnesses:                    
 
      By:                
               
Print Name
      Name:                
                   
 
      Title:                
                   
 
                       
                     
Print Name
                       
 
 
 
                   
Exhibit L — Page 4

 


 

SCHEDULE 1
SATELLITE RECEIVING AND TRANSMITTING DISH ANTENNAE
Schedule 1 to Exhibit L

 


 

EXHIBIT M
GUARANTY
     This Guaranty (“Guaranty”) is entered into as of the 27th day of November, 2006, by and between NCL CORPORATION LTD., a Bermuda corporation (the “Guarantor”), for the benefit of HINES REIT AIRPORT CORPORATE CENTER LLC, a Delaware limited liability company (“Landlord”). All capitalized terms used herein without being defined herein shall have the meaning ascribed to such terms in the Lease (as hereinafter defined).
W I T N E S S E T H:
RECITALS
     Landlord has entered into that certain Office Lease Agreement (together with all renewals and extensions thereof and any amendments and modifications thereto, the “Lease”), of even date herewith, with NCL (BAHAMAS) LTD., a Bermuda company, d/b/a NORWEGIAN CRUISE LINE (“Tenant”).
     NOW, THEREFORE, in consideration of the premises and of other valuable consideration and to induce the Landlord to execute the Lease, Guarantor hereby agrees with the Landlord as follows:
AGREEMENTS
     1. Guarantor unconditionally guarantees to Landlord: (a) the full and punctual payment when due (whether by acceleration or otherwise) of all Rental and court costs, reasonable attorneys’ fees and other costs incurred by Landlord in enforcing the Lease (to the extent permitted by the Lease) and (b) all other obligations and liabilities of Tenant under the Lease. The obligations discussed in (a) and (b) above are herein referred to as the “Lease Obligations.” The liability of the Guarantor hereunder shall be primary and direct. The failure to insist upon strict or timely performance by Landlord pursuant to the Lease shall not release the Guarantor from Guarantor’s obligations hereunder. Until all of the Lease Obligations have been fully satisfied and until all of the terms, covenants, and conditions of this Guaranty are fully performed, the Guarantor shall not be released by any act or thing which might, but for this provision of this Guaranty, be deemed a legal or equitable discharge of a surety or by reason of any waiver, extension, modification, forbearance or delay by any party, or the failure to proceed promptly or otherwise by reason of any further obligation or agreement between the Landlord and any other party. Following payment of all sums payable and performance of all obligations by Tenant under the Lease, Guarantor shall be released from liability hereunder. Although such release shall be automatic and self-operative, upon Guarantor’s request, Landlord shall execute a termination agreement in form and substance reasonably acceptable to Guarantor.
     2. Guarantor absolutely and unconditionally covenants and agrees that if Tenant does not or is unable to perform the Lease Obligations for any reason, including, without limitation, liquidation, dissolution, receivership, insolvency, bankruptcy, assignment for the benefit of creditors, reorganization, arrangement, composition or readjustment of or other similar proceedings affecting the status, composition, identity, existence, assets or obligations of the Tenant, Guarantor shall, following written demand therefor by Landlord, cause prompt performance of the Lease Obligations pursuant to the Lease and no such occurrence shall in any way affect Guarantor’s obligations hereunder.
     3. Tenant and Landlord may, without the consent of Guarantor and without affecting this Guaranty, at any time and from time to time: (a) amend any provision of the Lease, including any change in the provisions affecting the Lease Obligations, (whether increasing or decreasing Tenant’s responsibility or liability) including change orders or (b) make any agreement with the Tenant for the extension, payment, compromise, discharge or release of any obligation under the Lease, or for any modification of the terms of the Lease, without notice to or the consent of the Guarantor, and the guaranties herein made by the Guarantor shall not be impaired or affected by any of the foregoing.
Exhibit M — Page 1

 


 

     4. If Guarantor shall make any payments under this Guaranty, or perform any of the Lease Obligations pursuant to this Guaranty, Guarantor shall, to the extent of such payments, be subrogated to the rights and remedies of the Landlord against the Tenant under the Lease; provided, however, that any such rights of subrogation shall at all times be subordinate to Landlord’s rights against Tenant under the Lease and Guarantor shall not be entitled to enforce or receive payment thereof until all sums owing to the Landlord pursuant to the Lease have been paid.
     5. Guarantor expressly agrees that the validity of this Guaranty and its obligations hereunder shall in no way be terminated, affected, or impaired by reason of the assertion by Landlord against Tenant of any of the rights or remedies reserved to Landlord by the Lease or otherwise at law or in equity as a result of Tenant’s breach of any of its obligations under the Lease. Guarantor further covenants and agrees that this Guaranty and the full liability of Guarantor hereunder shall remain and continue in full force and effect notwithstanding the occurrence of any one (1) or more of the following events (whether or not Guarantor shall have received any notice or consented to such transaction): (i) any event described in Section 3 of this Guaranty; (ii) any assignment or transfer by Landlord permitted under the Lease; (iii) any assignment or transfer by Tenant permitted under the Lease; (iv) any dissolution or liquidation of Landlord or Landlord; or (v) any failure or delay by Landlord to exercise any remedy or right as to Landlord or Guarantor; (vi) any defect or deficiency in the Lease; or (vii) the fact that Tenant may be a party to any merger, consolidation or reorganization; if Tenant is a disappearing party in any such merger, consolidation or reorganization, then Guarantor shall nevertheless remain primarily liable for the performance of the Lease Obligations under the Lease.
     6. Guarantor further agrees that as to any right of action which shall accrue to Landlord under the Lease, Landlord may, at its option (without the need for any notice to Guarantor), proceed against Tenant alone (without having made any prior demand upon Guarantor or having commenced any action against Guarantor or having obtained or having attempted to satisfy any judgment against Guarantor) or proceed against Guarantor and Tenant jointly and severally or may proceed against Guarantor alone (without having made any prior demand upon Tenant or having commenced any action against Tenant or having obtained or having attempted to satisfy any judgment against Tenant). With the exception only of the defense of prior performance by Tenant of all of the Lease Obligations, all defenses of the law, guaranty, indemnification, suretyship, including without limitation, substantive defenses and procedural defenses are hereby waived and released by Guarantor.
     7. Without limiting any of the provisions of this Guaranty, Guarantor waives all defenses of a surety at law or in equity, including, without limitation, any rights of a surety to insist upon a creditor first exhausting all remedies against the primary obligor of a debt or other collateral securing the debt.
     8. Guarantor hereby represents and warrants the following to Landlord as of the date hereof:
          (a) Guarantor and Tenant are companies affiliated by common ownership and this Guaranty may reasonably be expected to benefit, directly or indirectly, Guarantor.
          (b) Guarantor is familiar with, and has independently reviewed the books and records regarding the financial condition of Tenant; provided, however, Guarantor is not relying on such financial condition or collateral as an inducement to enter into this Guaranty.
          (c) Guarantor has adequate means to obtain from Tenant on a continuing basis information concerning the financial condition of Tenant and Guarantor is not relying on Landlord to provide such information to Guarantor either now or in the future.
          (d) Guarantor has the power and authority to execute, deliver and perform this Guaranty and any other agreements executed by Guarantor contemporaneously herewith, and the execution, delivery and performance of this Guaranty and any other agreements executed by Guarantor contemporaneously herewith do not and will not violate (i) any agreement or instrument to which Guarantor is a party, or (ii) any law, rule, regulation or order of any governmental authority to which Guarantor is subject.
          (e) Neither Landlord nor any other party has made any representation, warranty or statement to Guarantor in order to induce Guarantor to execute this Guaranty.
Exhibit M — Page 2

 


 

          (f) The financial statements and other financial information regarding Guarantor heretofore and hereafter delivered to Landlord are and shall be true and correct in all material respects and fairly present the financial position of Guarantor as of the dates thereof, and no material adverse change has occurred in the financial condition of Guarantor reflected in the financial statements and other financial information regarding Guarantor heretofore delivered to Landlord since the date of the last statement thereof.
          (g) As of the date hereof, and after giving effect to this Guaranty and the obligations evidenced hereby, (i) Guarantor is and will be solvent, (ii) the fair saleable value of Guarantor’s assets exceeds and will continue to exceed its liabilities (both fixed and contingent), and (iii) Guarantor is and will continue to be able to pay its debts as they mature.
     9. If Landlord or Guarantor initiate any action to enforce its rights under this Guaranty or the terms hereof, the prevailing party shall be entitled to collect from the other party all reasonable or customary costs and expenses, including, without limitation, all reasonable attorneys’ fees at trial and all levels of appeal incurred by the prevailing party in connection with the administration, enforcement and/or collection of this Guaranty. This covenant shall survive the termination of the Lease.
     10. If any payment by Tenant to Landlord is held to constitute a preference under the bankruptcy laws and Landlord is required to refund such payment and actually refunds such payment, such payment by Tenant to Landlord shall not constitute a release of Guarantor from any liability hereunder, but Guarantor agrees to pay such amount to Landlord upon demand and this Guaranty shall continue to be effective or shall be reinstated, as the case may be, to the extent of any such payment or payments.
     11. If any or all of the Lease Obligations are now or hereafter secured in whole or in part, Landlord may, from time to time, at its discretion and with or without valuable consideration, allow substitution or withdrawal of collateral or release all or any part of such security, without notice or consent by Guarantor, and without in any way impairing, diminishing, or releasing the liability of Guarantor hereunder.
     12. The rights of Landlord are cumulative and shall not be exhausted by its exercise of any of its rights hereunder or otherwise against Guarantor or by any number of successive actions until and unless all Lease Obligations have been satisfied.
     13. Failure by Landlord to insist upon strict performance or observance of any of the terms, provisions, or covenants of the Lease or to exercise any right therein contained shall not be construed as a waiver or relinquishment of any such term, provision, covenant, or right, but the same shall continue and remain in full force and effect, unless expressly waived, in writing, by Landlord.
     14. The remedies of Landlord hereunder are limited to those remedies available to Landlord under the Lease, including those remedies available at law or in equity, together with the costs and expenses of enforcement hereof as described in Paragraph 9 above, if applicable.
BINDING EFFECT; NOTICE; MISCELLANEOUS
     1. This Guaranty is and shall be deemed to be entered into and pursuant to the internal, local laws of the State of Florida (excluding any conflicts of law provisions) and shall in all respects be governed, construed, applied and enforced in accordance with the laws of such state.
     2. All documents to be delivered and all notices which shall or may be given hereunder shall be in writing, sent by (a) personal delivery, (b) overnight courier or delivery service with proof of delivery, (c) United States mail, postage prepaid, return receipt requested, or (d) telecopy (provided that such telecopy is confirmed by mail in the manner previously described), addressed to the parties as follows:

Exhibit M - Page 3


 

If to Guarantor:
NCL Corporation
7665 Airport Corporate Center Drive
Miami, Florida 33126
Attn:   George Chesney
Tel:     (305) 436-4701
Fax:
With a copy to:
NCL Corporation
7665 Airport Corporate Center Drive
Miami, Florida 33126
Attn:   General Counsel
Tel:     (305) 436-4397
Fax:     (305) 436-4117
If to Landlord:
Hines REIT Airport Corporate Center LLC or its affiliate
2800 Post Oak Boulevard, Suite 5000
Houston, Texas 77056
Attn:   Mr. Charles Hazen
Tel:     (713) 966-2608
Fax:     (713)—966-2636
Hines Interests Limited Partnership
Five Ravinia Drive
Atlanta, Georgia 30346
Attn:   Mr. Michael T. Harrison
Tel:     (770) 206-5300
Fax:     (770) 206-5325
Hines Interests Limited Partnership
7300 Corporate Center Drive, Suite 100
Miami, Florida 33126
Attn:   Property Manager
Tel:     (305) 468-8200
Fax:     (305) 468-8201
Hines Interests Limited Partnership
70 West Madison, Suite 440
Chicago, Illinois 60602
Attn:   Mr. C. Kevin Shannahan
Tel:     (312) 419-4900
Fax:     (312) 346-4180
With a copy to:
Tew Cardenas LLP
Four Seasons Tower, 15th Floor
1441 Brickell Avenue
Miami, Florida 33131
Attn:   Brian P. Tague, Esq.
Tel:     (305) 536-8480

Exhibit M - Page 4


 

Fax:     (305) 536-1116
provided, however, that any party may change its address by written notice thereof to the other party sent in accordance with the provisions hereunder, which change of address shall be effective ten (10) business days following receipt of such written notice. All such notices shall be deemed to have been given upon receipt (or refusal of service). All payments shall be given or made upon such other party by wire transfer or hand delivery at the addresses set forth above or such other address as hereafter provided by either party to the other party in the manner described above.
     3. This Guaranty shall inure to the benefit of the Landlord and its respective successors and assigns under the Lease and shall be binding upon the successors and assigns of the Guarantor.
     4. If any provision of this Guaranty is held by a court of competent jurisdiction to be illegal, invalid or unenforceable under present or future laws, such provision shall be fully severable, shall not impair or invalidate the remainder of this Guaranty and the effect thereof shall be confined to the provision held to be illegal, invalid or unenforceable.
     5. No modification or amendment of any provision of this Guaranty, nor consent to any departure by Guarantor therefrom, shall be effective unless the same shall be in writing and signed by an officer of Landlord, and then shall be effective only in the specific instance and for the purpose for which given.
     6. The execution and delivery of this Guaranty by Guarantor to Landlord has served as a material inducement to Landlord to itself execute and deliver the Lease; but for the execution and delivery of this Guaranty by Guarantor, Landlord would not have executed and delivered the Lease.
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[signatures appear on next pages]

Exhibit M - Page 5


 

     EXECUTED as of the date first set forth above.
             
    GUARANTOR:    
 
           
    NCL CORPORATION LTD.,
a Bermuda corporation
   
 
           
 
  By:   /s/ Colin Veitch     
 
  Name:  
Colin Veitch 
   
 
  Title:  
President & CEO 
   
 
     
 
   

Exhibit M - Page 6


 

EXHIBIT N
JANITORIAL / CLEANING
SCOPE OF SERVICES
OFFICE AREAS & RETAIL SUITES
     Services performed nightly:
  -   Empty and clean (when necessary) all waste receptacles. Transport waste to the loading dock via the freight elevator. Replace all liners nightly. Adhere to recycling program as specified by the Property Manager
 
  -   Hand dust or wipe clean with damp or treated cloth all horizontal surfaces, desks, chairs, files etc. Do not rearrange materials on desks.
 
  -   Clean and sanitize drinking fountains, follow with stainless steel cleaner as needed taking care not to leave any oily residue.
 
  -   Spot clean all windows and partition glass.
 
  -   Vacuum all carpet areas. Broom sweep all area rugs. (Do not pull vacuum cords around corners.) Edges should be either swept or vacuumed with appropriate edge cleaning tool, as required.
 
  -   Remove all finger marks and smudges from all vertical surfaces taking care not to mar material finishes.
 
  -   Dust mop and spot clean all tiled areas.
 
  -   Damp wash and wipe dry all plastic or formica desk tops.
 
  -   Sweep internal stairways and vacuum, if carpeted. Dust handrails and vertical surfaces.
     Services performed as necessary or in the frequency as stated:
  -   Damp mop floors where spillage occurred or dirt tracked in.
 
  -   Spot clean carpet areas.
 
  -   Dust light fixtures — no less than annually.
 
  -   Vacuum/dust all perimeter slot diffusers on an annual basis.
 
  -   Clean all air vent grills.
 
  -   Wash windowsills.
 
  -   Dust fire extinguishers/fire extinguisher cabinets.
 
  -   Dust all doors.
 
  -   Spot clean door frames.

Exhibit N - Page 1


 

RESTROOMS
     Services performed nightly:
  -   Empty and clean (when necessary) all waste receptacles transport waste paper and rubbish to the loading dock. Replace all liners nightly.
 
  -   Wash and disinfect all basins, urinals and bowls using nonabrasive cleaners to remove stains and clean undersides of rim on urinals and bowls. Wash both sides of toilet seats.
 
  -   Clean all mirrors, bright work and enameled surfaces.
 
  -   Damp wipe all partitions, tile walls, doors and outside surfaces of all dispensers and receptacles. Damp wipe all lavatory tops and remove water spots from wall surfaces next to dispensers/receptacles. Spot clean around light fixtures.
 
  -   Clean flushometers, piping and other metal. Do not leave an oily finish.
 
  -   Fill toilet tissue, soap, towel and sanitary napkin dispensers. Do not place any extra supplies on top of dispenser or counter top. Do not install adjacent rolls of toilet paper in opposite direction.
 
  -   Sweep, wet mop and thoroughly rinse floor. Clean all corners and edges to prevent dirt buildup. Do not leave standing water on the floor. Dump at least one gallon of water down restroom floor drain and wipe clean drain grill.
 
  -   Spot clean door frames as necessary.
 
  -   Clean and sanitize mouths of all trashcans and sanitary dispensers.
     Services performed as necessary or in the frequency stated:
  -   Scrub all floors at least monthly...intent is to prevent buildup of dirt in grout.
 
  -   Thoroughly wash all partitions at least monthly.
 
  -   Dust all walls at least quarterly.
 
  -   Wash all walls at least annually.
 
  -   Clean light fixtures at least annually.
 
  -   Clean air vent grills and louvers at least quarterly.
 
  -   Clean soap dispensers.
It is the intention to keep the restrooms thoroughly clean and not to use a disinfectant or deodorant to kill odor. Disinfectants must be odorless. Use of abrasive cleaners or products that may damage any surface are not permitted.
ELEVATORS
     Services performed nightly:
  -   Spot clean walls taking care not to damage any special surfaces.
 
  -   Dust or damp wipe metal finishes and return panels.
 
  -   Clean and polish all thresholds.
 
  -   Clean edges and vacuum carpet floors.
 
  -   Tiles surfaces: sweep & damp mop. Do not use excessive water.
 
  -   Spot clean hall side of doors, frame and hall call stations.
 
  -   Service elevators — sweep and damp mop floors.
     Services performed, as necessary:
  -   Dust ceiling.
 
  -   Wash hall side of doors and frame.
 
  -   Dust woodwork.
 
  -   Clean/wash/shampoo mats.
LOBBY

Exhibit N - Page 2


 

     Services performed nightly:
  -   Damp mop tile surfaces. Do not use excessive water.
 
  -   Clean all edges and corners.
 
  -   Clean glass doors.
 
  -   Clean and polish all transoms, metal doors, door frames, etc.
 
  -   Dust fixtures, furnishings and other horizontal surfaces.
 
  -   Clean pay phones.
 
  -   Spot clean fingerprints off directory board. Dust interior panels.
 
  -   Clean surfaces of security console.
 
  -   Spot clean all walls.
     Services performed as necessary or in the frequency stated:
  -   Dust or wash wall surfaces as appropriate.
 
  -   Dust woodwork.
 
  -   Clean all air diffusers/grills.
COMMON AREAS (including back retail hallway, smoking lounge and mailroom)
     Services performed nightly:
  -   Sweep/vacuum/damp mop as indicated by type of flooring. — Spot clean carpet
 
  -   Spot clean walls
 
  -   Remove any clearly marked trash and debris
 
  -   Clean and sanitize drinking fountains, follow with stainless steel cleaner, as needed, taking care not to leave any oily residue.
 
  -   Spray wipe exterior finish of elevator call fixtures. — Mailroom
 
  -   Remove fingerprints and smudges from mailboxes, overnight delivery drop boxes, countertops, signs etc.
     Services performed as necessary or in the frequency stated:
  -   Dust all suite entrance doors, apply oil to wood doors no less than annually.
BUILDING STAIRWAYS AND LANDINGS
     Services performed as necessary or in the frequency as stated:
  -   Police for trash. — Sweep/spot mop no less than weekly.
 
  -   Spray clean handrails.
 
  -   Dust light fixtures — not less than quarterly.
 
  -   Remove fingerprints and smudges from doors and door frames.
 
  -   Clean/wash transoms high and low.

Exhibit N - Page 3


 

FREIGHT ELEVATOR VESTIBULES
     Services performed nightly:
  -   Sweep and damp mop nightly.
 
  -   Clean/wash transoms high and low.
 
  -   Clean prints and marks from doors.
 
  -   Spray wipe exterior finish of elevator call fixtures.
 
  -   Spot clean walls.
 
  -   Clean elevator entrance frames.
JANITORIAL STAGING AREAS
     Services performed as necessary or in the frequency stated:
  -   Maintain all janitorial areas in a clean, neat and orderly condition at all times.
 
  -   Maintain office and staging area in same fashion as tenant office areas
 
  -   Keep all paper supplies on pallets.
 
  -   Utilize shelving for chemicals.
 
  -   Re-stage brooms, mops and other equipment on a wall hanger at the end of a shift.
LOADING DOCK
     Services performed nightly:
  -   Place all trash and debris in compactor.
 
  -   Sweep dock area. Spot clean spills. Damp mop dock area weekly.
 
  -   Clean and polish ash urn — replace sand as necessary.
SIDEWALKS
     Service performed nightly:
  -   Police for trash — all areas including planting beds and along curb.
 
  -   Straighten furniture.
 
  -   Remove gum
ALLAREAS
Upon completion of nightly duties, the floor supervisors will insure that all areas have been cleaned and left in a neat and orderly condition, all lights have been turned off, and all areas properly secured. Supervisors will be responsible for completing a Nightly Supervisor Checklist which details any problems encountered during the course of cleaning either the tenant space of public areas.
Landlord shall contract for pest extermination services as provided to Comparable Buildings but if such services are required as a result of Tenant’s failure to comply with the Building Rules and Regulations, as these may be modified from time to time, or result from Tenant’s food service operations, Tenant shall be responsible for all costs incurred in connection therewith.

Exhibit N - Page 4


 

DAY STAFF RESPONSIBILITIES WILL INCLUDE BUT ARE NOT LIMITED TO:
  -   Re-stock men’s and women’s restrooms twice daily. Wipe down and clean all lavatory tops and fixtures. Patrol restrooms, removing paper/trash on floor. Report problems to Property Management Office.
 
  -   Remove all smudges and fingerprints from metal surfaces of interior cab.
 
  -   Constantly survey the lobby, common areas and sidewalk to insure cleanliness. Clean up spills. Spot mop as required. Remove fingerprints from door glass and metal surfaces at least three (3) times daily. Clean trash from tree grates and planters.
 
  -   Clean exterior entrance glass and entrance doors at least three (3) times daily.
 
  -   Patrol loading dock hallway, loading dock area, mailroom, and other backstage areas for trash at least two (2) times daily.
 
  -   Perform all special cleaning needs of individual tenants as authorized by the Property Manager.
 
  -   Perform all specific duties as detailed in the job description and any others as requested from time to time by the property management staff.
 
  -   Maintain paper supply inventory for submittal to Property Manager. - - Patrol smoking areas for trash. Empty ash urns. Vacuum as necessary throughout the day.
 
  -   Keep parking signage, monument signage and exterior lights through the office park wiped down as needed.
 
  -   Keep compactor(s) clean and free of standing trash. Call for trash and compactor pick-up as necessary.
Note:   Janitorial specifications are subject to change from time to time but any changes will not result in services below that of Comparable Buildings.

Exhibit N - Page 5


 

FIRST AMENDMENT
TO AIRPORT CORPORATE CENTER OFFICE LEASE
     THIS FIRST AMENDMENT TO AIRPORT CORPORATE CENTER LEASE AGREEMENT (“First Amendment”) in made on the 27th day of November, 2006, by and between HINES REIT AIRPORT CORPORATE CENTER LLC, a Delaware limited Liability company (“Landlord”), and NCL (BAHAMAS) LTD., a Bermuda company D/B/A NORWEGIAN CRUISE LINE (”Tenant”).
     A. Landlord and Tenant entered into that certain Airport Corporate Center Office Lease Agreement dated December 1, 2006 (the “Lease”), under which Tenant lease 208,737 Rentable Square Feet (the “Existing Premises” consisting of (A) 125, 806 Rentable Square Feet in the building known as 7665 Corporate Center Drive (N.W. 19th Street), Miami, Florida (“Building 11”), and (B) 82,931 Rentable Square Feet in the building known as 7650 Corporate Center Drive (N.W. 19th Street, Miami, Florida (“Building 10”).
     B. Landlord and Tenant desire to enter into this First Amendment for the purposes of modifying the terms of the Lease and for the other purposes set forth herein.
TERMS
     NOW THEREFORW, for Ten Dollars ($10.00) and for covenants and conditions of this First Amendment, the receipt and sufficiency of which are acknowledged, Landlord and Tenant agree as follows:
     1. Recitals. The foregoing recitals are correct and are incorporated herein by this reference.
     2. Terms. All capitalized terms herein but not defined shall have the meaning ascribed to them in the Lease.
     3. Building 10 Third Floor Premises. The Existing Premises include the space designated as Suite 301 containing 2,321 rentable square feet, and located on the third (3rd) floor of Building 10 (the “Building 10 Third Floor Premises”). The Building 10 Third Floor Premises are currently leased by another tenant (the “Existing Tenant”) under a lease that expires on March 31, 2007 (the “Existing Lease Expiration Date”). Tenant is currently subleasing and occupying the Building 10 Third Floor Premises. Landlord is engaged in negotiations with the Existing Tenant to terminate such lease with respect to Building 10 Third Floor Premises simultaneously with Tenant’s termination of the sublease. If, however, the Existing Tenant does not terminate the Building 10 Third Floor Premises on or before December 1, 2006, then the Commencement Date under the lease shall be delayed only with respect to Building 10 Third Floor Premises until such time as the termination or expiration of the Lease and sublease has occurred.

 


 

     IN WITNESS WHEREOF, the parties have executed this First Amendment as of the day and year first written above.
     
    TENANT:
    NCL (BAHAMAS) LTD., a Bermuda company
D/B/A NORWEGIAN CRUISE LINE
Witness: /s/ James Travers
 
Print Name: James Travers
  By: /s/ Mark E. Warren
 
Name: Mark E. Warren
/s/ George Chesney
 
Print Name: George Chesney
  Title: Executive Vice President & General Counsel
    LANDLORD:
    HINES REIT AIRPORT CORPORATE CENTER LLC,
a Delaware limited liability company or its affiliate
    By: HINES REIT PROPERTIES, L.P.,
    INVESTMENT TRUST, INC., a Maryland corporation Its Sole Member
    By: HINES REAL ESTATE
    INVESTMENT TRUST, INC.,
Its General Partner
Witness: /s/ David Steinback
 
Print Name: David Steinback
  By: /s/ Frank Apollo
 
Name: Frank Apollo
Its: Chief Accounting Officer
 
/s/ Todd Haines
 
Print Name: Todd Haines
   
 

 

EX-12.1 24 g05791exv12w1.htm EX-12.1 SECTION 302 CERTIFICATION OF CEO EX-12.1 Section 302 Certification of CEO
 

Exhibit 12.1
CERTIFICATION
     I, David Colin Sinclair Veitch, certify that:
1.   I have reviewed this annual report on Form 20-F of NCL Corporation Ltd.;
 
2.   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
 
3.   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report;
 
4.   The company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the company and have:
  a.   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
 
  b.   Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
 
  c.   Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and
5.   The company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions):
  a.   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and
 
  b.   Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting.
         
     
Date: March 5, 2007  By: /s/ David Colin Sinclair Veitch    
  Name:   David Colin Sinclair Veitch   
  Title:   President and Chief Executive Officer   
 

EX-12.2 25 g05791exv12w2.htm EX-12.2 SECTION 302 CERTIFICATION OF CFO EX-12.2 Section 302 Certification of CFO
 

Exhibit 12.2
CERTIFICATION
     I, Bonnie S. Biumi, certify that:
1.   I have reviewed this annual report on Form 20-F of NCL Corporation Ltd.;
 
2.   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
 
3.   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report;
 
4.   The company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the company and have:
  a.   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
 
  b.   Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
 
  c.   Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and
5.   The company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions):
  a.   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and
 
  b.   Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting.
         
     
Date: March 5, 2007  By:  /s/ Bonnie S. Biumi    
  Name:   Bonnie S. Biumi   
  Title:   Executive Vice President and Chief Financial Officer   
 

EX-13.1 26 g05791exv13w1.htm EX-13.1 SECTION 906 CERTIFICATION OF CEO & CFO EX-13.1 Section 906 Certification of CEO & CFO
 

Exhibit 13.1
CERTIFICATION
     Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code), each of the undersigned officers of NCL Corporation Ltd. (the “Company”), does hereby certify, to such officer’s knowledge, that:
     The Annual Report on Form 20-F for the year ended December 31, 2006 (the “Form 20-F”) of the Company fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in the Form 20-F fairly presents, in all material respects, the financial condition and results of operations of the Company.
         
     
  /s/ David Colin Sinclair Veitch    
Dated: March 5, 2007  Name:   David Colin Sinclair Veitch   
  Title:   President and Chief Executive Officer   
 
     
  /s/ Bonnie S. Biumi    
Dated: March 5, 2007  Name:   Bonnie S. Biumi   
  Title:   Executive Vice President and Chief Financial Officer   
 

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