RESULT IN, A MATERIAL ADVERSE EFFECT.
Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of Borrower setting forth the
details of the event or development requiring such notice and any action taken
or proposed to be taken with respect thereto.
SECTION 6.05
EXISTENCE; CONDUCT OF BUSINESS.
Borrower will, and will cause each of its Subsidiaries to, do or cause to be
done all things necessary to preserve, renew and keep in full force and effect
its legal existence and the rights, licenses, permits, privileges and franchises
material to the conduct of its business; provided that, after the consummation
of the Phase Two Transactions, Borrower may dissolve Diving, Interisland, Tow
Boat and Marine Logistics, Inc. (as each such Subsidiary shall have been
converted to a limited liability company).
SECTION 6.06
INSURANCE.
(A)
WITH RESPECT TO THE COLLATERAL AND OTHER ASSETS, BORROWER SHALL
MAINTAIN, AND CAUSE EACH SUBSIDIARY GUARANTOR TO MAINTAIN, INSURANCE AT ALL
TIMES, WITH FINANCIALLY SOUND AND REPUTABLE INSURERS THAT ARE REASONABLY
ACCEPTABLE TO THE ADMINISTRATIVE AGENT.
WITH RESPECT TO INSURANCE ON ALL
COLLATERAL, ALL SUCH INSURANCE POLICIES SHALL BE IN SUCH FORM, SUBSTANCE,
AMOUNTS AND COVERAGE AS MAY BE SATISFACTORY TO THE ADMINISTRATIVE AGENT,
INCLUDING, WITHOUT LIMITATION, INSURANCE ON HULL AND MACHINERY, PROTECTION AND
INDEMNITY, LOSS OR DAMAGE TO VESSELS, DAMAGE TO PROPERTY OF THIRD PARTIES
(INCLUDING CUSTOMERS), LOSS OR CONTAMINATION OF CARGO, PERSONAL INJURIES TO
EMPLOYEES OR THIRD PARTIES, AND POLLUTION AND OTHER RELATED ENVIRONMENTAL
DAMAGE.
(B)
SUCH INSURANCE SHALL PROVIDE FOR THIRTY (30) DAYS' PRIOR WRITTEN
NOTICE TO THE ADMINISTRATIVE AGENT OF ANY REDUCTION OR CANCELLATION OF COVERAGE
ON ACCOUNT OF DEFAULT IN THE PAYMENT OF ANY PREMIUM AND SHALL PROVIDE LENDERS
WITH THE OPPORTUNITY TO CURE
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NONPAYMENT.
BORROWER HEREBY IRREVOCABLY APPOINTS THE ADMINISTRATIVE AGENT WITH
FULL RIGHT OF DELEGATION BY THE ADMINISTRATIVE AGENT AS ATTORNEY-IN-FACT FOR
BORROWER TO OBTAIN, AT BORROWER'S EXPENSE, ANY SUCH INSURANCE SHOULD BORROWER OR
ANY SUBSIDIARY GUARANTOR FAIL TO DO SO AND, AFTER AN EVENT OF DEFAULT, TO ADJUST
OR SETTLE ANY CLAIM OR OTHER MATTER UNDER OR ARISING PURSUANT TO SUCH INSURANCE
OR TO AMEND OR CANCEL SUCH INSURANCE.
BORROWER SHALL DELIVER TO THE
ADMINISTRATIVE AGENT EVIDENCE OF SUCH INSURANCE AND A LENDER'S LOSS PAYABLE
ENDORSEMENT SATISFACTORY TO THE ADMINISTRATIVE AGENT AS TO ALL EXISTING AND
FUTURE INSURANCE POLICIES WITH RESPECT TO THE COLLATERAL.
BORROWER SHALL
DELIVER TO THE ADMINISTRATIVE AGENT, IN KIND, ALL INSTRUMENTS REPRESENTING
PROCEEDS OF INSURANCE RECEIVED BY BORROWER OR ANY SUBSIDIARY GUARANTOR.
EXCEPT
AS OTHERWISE SPECIFICALLY PROVIDED HEREIN OR IN THE MORTGAGE AS TO ANY POOL
VESSEL, THE ADMINISTRATIVE AGENT MAY APPLY ANY INSURANCE PROCEEDS RECEIVED BY
THE ADMINISTRATIVE AGENT OR THE COLLATERAL TRUSTEE AT ANY TIME TO THE COST OF
REPAIRS TO OR REPLACEMENT OF ANY PORTION OF THE COLLATERAL AND/OR, AT THE
ADMINISTRATIVE AGENT'S OPTION, TO PAYMENT OF OR AS SECURITY FOR ANY OF THE
OBLIGATIONS, WHETHER OR NOT DUE, IN ANY ORDER OR MANNER AS THE ADMINISTRATIVE
AGENT MAY DETERMINE.