NOTE

– LONG-TERM DEBT

Note Payable

May 4, 2016,

in connection with the Natural Habitat acquisition, Natural Habitat issued an unsecured promissory note to Mr. Bressler, the founder of Natural Habitat, with an outstanding principal amount of

$2.5

million due at maturity on

December 31, 2020.

The promissory note accrues interest at a rate of

1.44%

annually, with interest payable every

six

months.

Credit Facility

March 27, 2018,

the Company entered into the Third Amended and Restated Credit Agreement (the “Amended Credit Agreement”) providing for a refinancing and amendment of the terms of the Company’s prior secured credit facility, dated as of

March 7, 2016 (

the “Superseded Agreement”). The Amended Credit Agreement provided for a

$200.0

million senior secured term facility (the “Term Facility”), which represented an increase of

$25.0

million from the senior secured

first

lien term loan facility under the Superseded Agreement. The Term Facility matures

March 27, 2025.

The Amended Credit Agreement also provides for a

$45.0

million senior secured incremental revolving credit facility (the “Revolving Facility”), which includes a

$5.0

million letter of credit sub-facility. The Company’s obligations under the Amended Credit Agreement remain secured by substantially all of the assets of the Company.

In connection with the Amended Credit Agreement, the Company capitalized

$4.2

million related to lender and

third

-party fees. In addition, the entry into the Amended Credit Agreement was considered a debt modification with a partial extinguishment, as a result the Company expensed

$1.0

million of related costs during the year ended

December 31, 2018,

which is included in general and administrative expenses on the accompanying consolidated statements of operations.

Borrowings under the Term Facility bear interest at an adjusted Intercontinental Exchange (“ICE”) Benchmark administration LIBOR plus a spread of

3.25%,

which stepped down from

3.50%

during

2019

as the Company’s debt rating from Moody’s and S&P are both

(stable) or better and BB (negative) or better, respectively. The interest rate under the Term Facility at

December 31, 2019

5.01%.

Borrowings under the Revolving Facility will bear interest at an adjusted ICE Benchmark administration LIBOR plus a spread of

3.00%,

or, at the option of the Company, an alternative base rate plus a spread of

2.00%.

The Company is also required to pay a

0.5%

annual commitment fee on undrawn amounts under the Revolving Facility, which matures on

March 27, 2023.

The Amended Credit Agreement contains financial covenants that, among other things, (i) require the Company to maintain a total net leverage ratio (defined as on any date of determination, the ratio of total debt on such date, less up to

$50.0

million of the unrestricted cash and cash equivalents to Adjusted EBITDA (as defined in the Amended Credit Agreement) for the trailing

-month period) of

5.25

1.00

initially, with

0.25

equal reductions every

two

years thereafter until

June 30, 2022

when the total net leverage ratio shall be

4.75

1.00

thereafter; (ii) limit the amount of indebtedness the Company

may

incur generally and specifically for intercompany debt, debt incurred to finance acquisitions and improvements, for capital and synthetic lease obligations, for standby letters of credit, and in connection with refinancing; (iii) limit the amount the Company

may

spend in connection with certain types of investments; and (iv) require the delivery of certain periodic financial statements and an operating budget. As of

December 31, 2019,

the Company was in compliance with the covenants.

Borrowings under the Revolving Facility will be used for general corporate and working capital purposes and related fees and expenses. As of

December 31, 2019,

the Company had

borrowings under the Revolving Facility.

Senior Secured Credit Agreement

January 8, 2018,

the Company entered into a senior secured credit agreement (the “Export Credit Agreement”) with Citibank, N.A., London Branch (“Citi”) and Eksportkreditt Norge AS (together with Citi, the “Lenders”). Pursuant to the Export Credit Agreement, the Lenders have agreed to make available to the Company, at the Company’s option and subject to certain conditions, a loan in an aggregate principal amount

not

to exceed

$107.7

million for the purpose of providing financing for up to

80%

of the purchase price of the Company’s new expedition ice-class cruise vessel, the

National Geographic Endurance

, scheduled to be delivered in the

first

quarter of

2020.

Seventy percent of the loan will be guaranteed by Garantiinstituttet for Eksportkreditt, the official export credit agency of Norway. If drawn upon, the loan will be made at the time of delivery of the vessel.

At the Company’s election, the loan will bear interest either at a fixed interest rate effectively equal to

5.78%

or a floating interest rate equal to

three

-month LIBOR plus a margin of

3.00%

per annum. The loan will amortize quarterly based on a

twelve

-year profile, with

70%

maturing over

twelve

years from drawdown, and

30%

maturing over

five

years from drawdown. The loan will be secured by a

first

priority mortgage over the new vessel and the assignment of related insurances. The Export Credit Agreement also contains customary events of default and mandatory prepayment events for, among other things, non-payment, breach of covenants, default on certain other indebtedness, certain large judgments and a change of control of the Company. In addition to paying interest on any outstanding loans under the facility, the Company is required to pay customary coordination, arrangement, agency, collateral and commitment fees. Amounts drawn under the Export Credit Agreement

may

be voluntarily prepaid at any time subject to customary breakage costs.

April 8, 2019,

the Company entered into a senior secured credit agreement (the “Second Export Credit Agreement”) with the Lenders. Pursuant to the Second Export Credit Agreement, the Lenders have agreed to make available to the Company, at the Company's option and subject to certain conditions, a loan in an aggregate principal amount

not

to exceed

$122.8

million for the purpose of providing pre- and post- delivery financing for up to

80%

of the purchase price of the Company’s new expedition ice-class cruise vessel, the

National Geographic Resolution

, scheduled to be delivered in the

fourth

quarter of

2021.

30%

of the borrowing will mature over

five

years from drawdown, and

70%

of the borrowing will mature over

twelve

years from drawdown. Additionally,

70%

percent of the loan will be guaranteed by Garantiinstituttet for Eksportkreditt, the official export credit agency of Norway. The Company incurred approximately

$2.3

million in financing fees related to the Second Export Agreement, recorded as deferred financing costs as part of long-term debt. During

September 2019,

the Company drew approximately

$30.5

million against the Second Export Credit Agreement for the

second

contracted installment payment on the

National Geographic Resolution

. The Second Export Credit Agreement bears a variable interest rate equal to

three

-month LIBOR plus a margin of

3.00%

per annum, or

4.98%

as of

December 31, 2019.

After completion of the vessel, the Second Export Credit Agreement, at the Company’s option, will bear an interest rate of either a fixed rate of

6.36%

or a variable rate equal to

three

-month LIBOR plus a margin of

3.00%

per annum.

The Export Credit Agreement and the Second Export Credit Agreement contain financial covenants that, among other things, require us to maintain a total net leverage ratio of

5.25

1.00

for the trailing

-month period. The total net leverage ratio is defined under the covenants as on any date of determination, the ratio of total debt on such date, less up to

$50.0

million of the unrestricted cash and cash equivalents to Adjusted EBITDA (as defined in the Export Credit Agreement and the Second Export Credit Agreement) for the trailing

-month period. As of

December 31, 2019,

the Company was in compliance with the covenants.

Long-Term Debt Outstanding

As of

December 31, 2019

and

2018,

long-term debt and other borrowing arrangements consisted of:

	As of December 31,
	2019									2018
(In thousands)	Principal			Deferred Financing Costs, net			Balance			Principal			Deferred Financing Costs, net			Balance
Note payable	$	2,525		$	-		$	2,525		$	2,525		$	-		$	2,525
Credit Facility		197,000			(9,704	)		187,296			199,000			(11,436	)		187,564
Senior Secured Credit Agreement		30,476			(2,229	)		28,247			-			-			-
Total long-term debt		230,001			(11,933	)		218,068			201,525			(11,436	)		190,089
Less current portion		(4,525	)		-			(4,525	)		(2,000	)		-			(2,000	)
Total long-term debt, non-current	$	225,476		$	(11,933	)	$	213,543		$	199,525		$	(11,436	)	$	188,089

Future minimum principal payments of long-term debt are as follows:

Year	Amount
	(In thousands)
2020	$	4,525
2021		2,000
2022		4,540
2023		4,540
2024		4,540
Thereafter		209,856
	$	230,001

For the years ended

December 31, 2019,

2018

and

2017,

the Company recorded deferred financing costs of

$2.4

million,

$6.5

million and

$0.4

million, respectively, in long-term debt, amortizing the costs over the term of the financing using the straight-line method.

For the years ended

December 31, 2019,

2018

and

2017,

deferred financing costs charged to interest expense were

$1.9

million,

$1.9

million and

$2.2

million, respectively.

Letters of Credit

As of

December 31, 2019

and

2018,

the Company had

$1.2

million in letters of credit outstanding with financial institutions. The annual fee for letters of credit is

1.0%

of the outstanding balance. The letters of credit are secured by a certificate of deposit maintained at the financial institutions and that mature in

November 2020.