Document:

EX-4.2

 Exhibit 4.2 

 
  

FIFTEENTH SUPPLEMENTAL INDENTURE 

Dated as of April 5, 2019 
  

 
 between 

LOWE’S COMPANIES, INC. 
 and

 U.S. BANK NATIONAL ASSOCIATION 

as Trustee 
  

 
 Supplemental to
the Amended and Restated Indenture Dated as of December 1, 1995 
  

 
 Creating a
Series of Securities designated 3.650% Notes due April 5, 2029 
 and 

Creating a Series of Securities designated 4.550% Notes due April 5, 2049 

 FIFTEENTH SUPPLEMENTAL INDENTURE, dated as of April 5, 2019 (this “Fifteenth
Supplemental Indenture”), between LOWE’S COMPANIES, INC., a corporation duly organized and existing under the laws of the State of North Carolina (the “Company”), having its principal office at 1000 Lowe’s
Boulevard, Mooresville, North Carolina 28117, and U.S. BANK NATIONAL ASSOCIATION, a national banking association duly organized and existing under the laws of the United States, as Trustee (the “Trustee”), as successor trustee to
The Bank of New York Mellon Trust Company, N.A. 
 W I T N E S S E T H: 

WHEREAS, the Company has heretofore executed and delivered an Amended and Restated Indenture, dated as of December 1, 1995 (the
“Base Indenture”), as supplemented and amended by this Fifteenth Supplemental Indenture (the Base Indenture as Supplemented by the Fifteenth Supplemental Indenture, the “Indenture”), providing for the issuance from
time to time of its unsecured unsubordinated debentures, notes or other evidences of indebtedness (the “Securities”), to be issued in one or more series as provided in the Base Indenture; 

WHEREAS, it is provided in Section 901 of the Base Indenture that, without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Trustee may enter into indentures supplemental thereto (1) to add to, change or eliminate any of the provisions of the Indenture in respect of one or more series of Securities; provided that any such addition,
change or elimination (i) shall neither (A) apply to any Security of any series created prior to the execution of such supplemental indenture and entitled to the benefit of such provision nor (B) modify the rights of the Holder of any
such Security with respect to such provision or (ii) shall become effective only when there is no such Security Outstanding, (2) to add to the covenants of the Company for the benefit of the Holders of all or any series of Securities (and
if such covenants are to be for the benefit of less than all series of Securities, stating that such covenants are expressly being included solely for the benefit of such series) and (3) to establish the form or terms of Securities of any
series as permitted by Sections 201 and 301 of the Base Indenture; 
 WHEREAS, the Company, in the exercise of the power and authority
conferred upon and reserved to it under the provisions of the Indenture and pursuant to appropriate Board Resolutions and actions of its authorized officers, has duly determined to make, execute and deliver to the Trustee this Fifteenth Supplemental
Indenture in order to establish the form and terms of, and to provide for the creation and issuance of, two new series of Securities designated as its (i) 3.650% Notes due April 5, 2029 (the “2029 Notes”) in an aggregate
Principal Amount at Maturity of $1,500,000,000 and (ii) 4.550% Notes due April 5, 2049 (the “2049 Notes” and, together with the 2029 Notes, the “Notes”) in an aggregate Principal Amount at Maturity of
$1,500,000,000; and 
 WHEREAS, all acts and requirements necessary to make the Notes, when executed by the Company and authenticated and
delivered by the Trustee or any Authenticating Agent and issued upon the terms and subject to the conditions of the Indenture against payment therefor, the valid, binding and legal obligations of the Company and to make this Fifteenth Supplemental
Indenture a valid and legally binding supplement to the Indenture have been done. 
 NOW, THEREFORE, in order to establish the form and
terms of the series of the 2029 Notes and the series of the 2049 Notes and for and in consideration of the premises and of the covenants contained in the Indenture and for other good and valuable consideration the receipt and sufficiency of which
are hereby acknowledged, it is mutually covenanted and agreed, for the equal and proportionate benefit of all Holders, as follows: 

 ARTICLE I 

DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION 

Section 101. Definitions. For all purposes of the Base Indenture and this Fifteenth Supplemental Indenture relating to the
respective series of Notes created hereby, except as otherwise expressly provided or unless the context otherwise requires, the terms used in this Fifteenth Supplemental Indenture have the meanings assigned to them in this Article. Each capitalized
term that is used in this Fifteenth Supplemental Indenture but not defined herein shall have the meaning specified in the Base Indenture. “Business Day” means any day except a Saturday, a Sunday or a legal holiday in New York City
on which banking institutions are authorized or required by law or regulation to close. 
 “Change of Control” means the
occurrence of any of the following: (a) the consummation of any transaction (including, without limitation, any merger or consolidation) resulting in any “person” (as that term is used in Section 13(d)(3) of the Securities
Exchange Act of 1934, as amended) (other than the Company or one of its subsidiaries) becoming the beneficial owner (as defined in Rules 13d-3 and 13d-5 under the
Securities Exchange Act of 1934, as amended), directly or indirectly, of more than 50% of the Voting Stock of the Company or other Voting Stock into which Voting Stock of the Company is reclassified, consolidated, exchanged or changed, measured by
voting power rather than the number of shares; or (b) the direct or indirect sale, transfer, conveyance or other disposition (other than by way of merger or consolidation), in a transaction or a series of related transactions, of all or
substantially all of the assets of the Company and the assets of its subsidiaries, taken as a whole, to one or more “persons” (as that term is defined in the Indenture)(other than the Company or one of its subsidiaries). Notwithstanding
the foregoing, a transaction will not be considered to be a Change of Control if (a) the Company becomes a direct or indirect wholly-owned subsidiary of a holding company and (b)(y) immediately following that transaction, the direct or indirect
holders of the Voting Stock of the holding company are substantially the same as the holders of Voting Stock of the Company immediately prior to that transaction or (z) immediately following that transaction, no person is the beneficial owner,
directly or indirectly, of more than 50% of the Voting Stock of the holding company. 
 “Change of Control Triggering
Event” means the occurrence of both a Change of Control and a Rating Event. 
 “Comparable Treasury Issue” means
the U.S. Treasury security selected by the Quotation Agent as having a maturity comparable to the remaining term of the Notes of that series to be redeemed that would be utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of the Notes of that series (assuming for this purpose that such series of Notes matured on the applicable par call date). 

“Comparable Treasury Price” means, with respect to any redemption date, (i) the average of four Reference Treasury
Dealer Quotations for such redemption date, after excluding the highest and lowest such Reference Treasury Dealer Quotations, or (ii) if the Company obtains fewer than four such Reference Treasury Dealer Quotations, the average of all such
quotations, or (iii) if only one Reference Treasury Dealer Quotation is received, such quotation. 

 “Depositary” means, with respect to the Notes issuable in whole or in part
in global form, DTC and any nominee thereof, until a successor is appointed and becomes such pursuant to the applicable provisions of the Indenture, and thereafter “Depositary” shall mean or include such successor and any nominee thereof.

 “DTC” means The Depository Trust Company. 

“Global Note” means a Note issued in global form and deposited with or on behalf of the Depositary, substantially in the form
of one or more of the Global Notes attached hereto as Exhibit A-1 and Exhibit A-2. 

“Investment Grade Rating” means a rating equal to or higher than Baa3 (or the equivalent) by Moody’s and BBB- (or the equivalent) by S&P, and the equivalent investment grade credit rating from any replacement Rating Agency or Rating Agencies selected by the Company. 

“Moody’s” means Moody’s Investors Service, Inc. 

“Note Interest Payment Date” has the meaning set forth in Section 203(a) of this Fifteenth Supplemental Indenture. 

“Principal Amount at Maturity” of the Notes means the principal amount at maturity as set forth on the face of each
respective Note. 
 “Quotation Agent” means any Reference Treasury Dealer appointed by the Company. 

“Rating Agencies” means (a) each of Moody’s and S&P and (b) if either of Moody’s or S&P ceases to
rate the Notes or fails to make a rating of the Notes publicly available for reasons outside of the control of the Company, a “nationally recognized statistical rating organization” (as defined in Section 3(a)(62) of the Securities
Exchange Act of 1934, as amended) selected by the Company as a replacement Rating Agency for a former Rating Agency. 
 “Rating
Event” means the rating on the Notes is lowered by each of the Rating Agencies and the Notes are rated below an Investment Grade Rating by each of the Rating Agencies on any day within the 60-day
period (which 60-day period will be extended so long as the rating of the Notes is under publicly announced consideration for a possible downgrade by any of the Rating Agencies) after the earlier of
(a) the occurrence of a Change of Control and (b) public notice of the occurrence of a Change of Control or the Company’s intention to effect a Change of Control; provided that a Rating Event will not be deemed to have occurred in
respect of a particular Change of Control (and thus will not be deemed a Rating Event for purposes of the definition of Change of Control Triggering Event) if each Rating Agency making the reduction in rating does not publicly announce or confirm or
inform the Trustee in writing at the request of the Company that the reduction was the result, in whole or in part, of any event or circumstance comprised of or arising as a result of, or in respect of, the Change of Control (whether or not the
applicable Change of Control has occurred at the time of the Rating Event). 

 “Reference Treasury Dealer” means each of (i) a Primary Treasury
Dealer (as defined herein) selected by Barclays Capital Inc., (ii) a Primary Treasury Dealer selected by Goldman Sachs & Co. LLC, (iii) a Primary Treasury Dealer selected by Wells Fargo Securities, LLC, (iv) a Primary Treasury
Dealer selected by U.S. Bancorp Investments, Inc. and their respective successors; provided, however, that if any of the foregoing shall cease to be a primary U.S. Government securities dealer in New York City (a “Primary Treasury
Dealer”), the Company will substitute therefor another Primary Treasury Dealer, and (iv) any other Primary Treasury Dealer selected by the Company. 

“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any redemption date, the
average of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Company by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third
Business Day preceding such redemption date. 
 “Regular Record Date” has the meaning set forth in Section 203(b) of
this Fifteenth Supplemental Indenture. 
 “S&P” means Standard & Poor’s Ratings Services, a subsidiary of
S&P Global, Inc. 
 “Stated Maturity” has the meaning set forth in Section 202 of this Fifteenth Supplemental
Indenture. 
 “Treasury Rate” means, with respect to any redemption date, the rate per annum equal to the semi-annual
equivalent yield to maturity of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price of such redemption date. 

“Underwriting Agreement” means the Underwriting Agreement, dated April 3, 2019, among the Company and Barclays Capital
Inc., Goldman Sachs & Co. LLC, Wells Fargo Securities, LLC and U.S. Bancorp Investments, Inc. 
 “Voting Stock”
means, with respect to any specified person (as that term is used in Section 13(d)(3) of the Securities Exchange Act of 1934, as amended) as of any date, the capital stock of such person that is at the time entitled to vote generally in the
election of the board of directors of such person. 
 Section 102. Section References. Each reference to a particular section
set forth in this Fifteenth Supplemental Indenture shall, unless the context otherwise requires, refer to this Fifteenth Supplemental Indenture. Each reference to a particular section of the Base Indenture shall refer to that particular section of
the Base Indenture. 
 ARTICLE II 

THE NOTES 

Section 201. Title and Amount of the Notes. The Company hereby creates the 2029 Notes and the 2049 Notes, each as a separate
series of its Securities issued pursuant to the Indenture. The 2029 Notes shall be designated as the “3.650% Notes due April 5, 2029” and the 2049 Notes shall be designated as the “4.550% Notes due April 5, 2049.” The
aggregate Principal Amount at Maturity of the 2029 Notes that may be authenticated and delivered under this Fifteenth Supplemental Indenture is initially limited to $1,500,000,000 and the aggregate Principal Amount at Maturity of the 2049 Notes that
may be authenticated and delivered under this Fifteenth Supplemental Indenture is initially limited to $1,500,000,000. Each series of Notes may be reopened, without the consent of the holders of the Notes, for issuance of additional Notes of such
series. 

 Section 202. Stated Maturity. The Stated Maturity of the 2029 Notes shall be
April 5, 2029 and the Stated Maturity of the 2049 Notes shall be April 5, 2049. 
 Section 203. Interest and Payment.
The 2029 Notes shall bear interest at 3.650% per annum and the 2049 Notes shall bear interest at 4.550% per annum beginning on the date of issuance until the 2029 Notes and/or the 2049 Notes, as the case may be, are redeemed, paid or duly provided
for. Interest on the Notes shall be paid semiannually in arrears on each April 5 and October 5 (each, a “Note Interest Payment Date”), commencing October 5, 2019, to the persons in whose names the Notes are
registered at the close of business on the 15th calendar day immediately preceding the interest payment date (whether or not a Business Day) (each, a “Regular Record Date”). If
any interest payment date on the Notes falls on a day that is not a Business Day, the interest payment will be postponed to the next day that is a Business Day, and no interest on that payment will accrue for the period from and after the Note
Interest Payment Date. Payments of interest on the Notes shall include interest accrued to, but excluding, the respective Note Interest Payment Dates. Interest payments for the Notes shall be computed on the basis of a
360-day year composed of twelve 30- day months. Payments of principal and interest to owners of book-entry interests shall be made to holders of the Notes on the
respective Regular Record Dates in accordance with the procedures of DTC and its participants in effect from time to time. All payments of principal and interest shall be made by the Company in immediately available funds except as set forth in the
applicable Note. 
 Section 204. Optional Redemption. At any time prior to the date that is three months (with respect to the
2029 Notes) or six months (with respect to the 2049 Notes) prior to the applicable Stated Maturity for such series of Notes, the Notes of each series will be redeemable, in whole at any time or in part from time to time, at the Company’s
option, at a redemption price, to be calculated by the Company, equal to the greater of: 
 (i) 100% of the principal amount
of the Notes to be redeemed; or 
 (ii) the sum of the present values of the remaining scheduled payments of principal and
interest on such Notes that but for the redemption would be due after the related redemption date through the applicable par call date with respect to the series of Notes being redeemed, assuming such Notes matured on the applicable par call date
(not including any portion of such payments of interest accrued as of the date of redemption), discounted to the date of redemption on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate, plus 20 basis points with respect to the 2029 Notes and 25 basis points with respect to the 2049 Notes; 

plus, in each case, accrued and unpaid interest thereon to, but excluding, the date of redemption. 

(b) On or after the date that is three months (with respect to the 2029 Notes) or six months (with respect to the 2049 Notes) prior to the
applicable maturity date for each such series of Notes, the 2029 Notes and the 2049 Notes will be redeemable, in whole at any time or in part from time to time, at the Company’s option, at par plus accrued and unpaid interest thereon to, but
excluding, the date of redemption. 

 (c) Notwithstanding the foregoing, installments of interest on Notes that are due and
payable on Note Interest Payment Dates falling on or prior to a redemption date will be payable on the Note Interest Payment Date to the registered holders as of the close of business on the relevant record date. 

(d) Notice of any redemption will be given at least 10 days but not more than 60 days before the Redemption Date to each registered holder of
the 2029 Notes and/or the 2049 Notes, as the case may be, to be redeemed. Unless the Company defaults in payment of the redemption price, on and after the applicable Redemption Date, interest will cease to accrue on the Notes or portions thereof
called for redemption. If less than all of the Notes of a series are to be redeemed, the Notes of that series to be redeemed shall be selected in accordance with the procedures of DTC. 

Section 205. Change of Control Offer to Purchase. 

(a) If a Change of Control Triggering Event occurs, holders of Notes may require the Company to repurchase all or any part (equal to $2,000 or
an integral multiple of $1,000 in excess thereof) of their Notes at a purchase price of 101% of the principal amount, plus accrued and unpaid interest, if any, on such Notes to but excluding the date of purchase (unless a notice of redemption has
been mailed within 30 days after such Change of Control Triggering Event stating that all of the Notes will be redeemed as described in Section 204). The Company will be required to mail to holders of the Notes (with a copy to the Trustee) a
notice describing the transaction or transactions constituting the Change of Control Triggering Event and offering to repurchase the Notes. The notice must be mailed within 30 days after any Change of Control Triggering Event, and the repurchase
must occur no earlier than 30 days and no later than 60 days after the date the notice is mailed. 
 (b) On the date specified for repurchase
of the Notes, the Company will, to the extent lawful: 
 (i) accept for purchase all properly tendered Notes or portions of
Notes; 
 (ii) deposit with the paying agent the required payment for all properly tendered Notes or portions of Notes; and

 (iii) deliver to the Trustee the repurchased Notes, accompanied by an Officers’ Certificate stating, among other
things, the aggregate principal amount of repurchased Notes. 
 (c) The Company will comply with the requirements of Rule 14e-1 under the Securities Exchange Act of 1934, as amended, and any other securities laws and regulations applicable to the repurchase of the Notes. To the extent that these requirements conflict with the
provisions requiring repurchase of the Notes, the Company will comply with such requirements instead of the repurchase provisions and will not be considered to have breached its obligations with respect to repurchasing the Notes. Additionally, if an
Event of Default exists under the Indenture (which is unrelated to the repurchase provisions of the Notes), including Events of Default arising with respect to other issues of debt securities, the Company will not be required to repurchase the Notes
notwithstanding these repurchase provisions. 

 (d) The Company will not be required to comply with the obligations of this Section 205
if a third party instead satisfies them. 
 Section 206. Forms; Denominations. The Notes shall be Registered Securities and
shall be issued in minimum denominations of $2,000 and integral multiples of $1,000 thereafter. The certificates for the Notes shall be in substantially the forms attached hereto as Exhibit A-1 with respect to
the 2029 Notes and Exhibit A-2 with respect to the 2049 Notes. 
 Section 207. Global
Notes. 
 (i) Notes shall be issued initially in the form of one or more Global Notes in definitive fully
registered book-entry form without interest coupons, deposited on behalf of the purchasers of the Notes represented thereby with U.S. Bank National Association, at its Corporate Trust Office, as custodian for the Depositary and registered in the
name of DTC or a nominee thereof, duly executed by the Company and authenticated by the Trustee as provided in the Indenture. The aggregate Principal Amount at Maturity of the Global Notes may from time to time be increased or decreased by
adjustments made on the records of the Trustee and the Depositary as hereinafter provided. 
 (ii) Book-Entry Provisions. The
Company will execute and the Trustee will, in accordance with this Section 207(ii) and Section 303 of the Base Indenture, authenticate and deliver initially one or more Global Notes that (x) shall be registered in the name of the
Depositary, (y) shall be delivered by the Trustee to the Depositary or pursuant to the Depositary’s instructions and (z) shall bear legends substantially to the following effect: 

“UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
(“DTC”), TO LOWE’S COMPANIES, INC. OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR TO SUCH OTHER ENTITY OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL, INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.” 
 Section 208.
Applicability of Reports by the Company. For purposes of this Fifteenth Supplemental Indenture, Section 704 of the Base Indenture is Amended and Restated as follows: “The Company shall file with the Trustee and the Commission, and
transmit to Holders, such information, documents and other reports, and such summaries thereof, as may be required pursuant to the Trust Indenture Act at the times and in the manner provided pursuant to such Act; provided that any such information,
documents or reports filed with the Commission pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, shall be filed with the Trustee within 15 days after the same is filed with the Commission. To the extent information,
documents or reports are filed with the Commission and required to be delivered to the Trustee or the Holders, the 

 
availability of such information, documents or reports on the Commission’s Electronic Data Gathering Analysis and Retrieval system or any successor thereto or the Company’s website will
be deemed to have satisfied such delivery requirements to the Trustee or the Holders, as applicable. Delivery of such reports to the Trustee is for informational purposes only and the Trustee’s receipt of such reports shall not constitute
actual or constructive notice of any information contained therein or determinable from information contained therein, including the Company’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely
exclusively on Officers’ Certificates).” 
 Section 209. Applicability of Sinking Funds. The provisions of Article
Twelve of the Base Indenture shall not apply to the Notes. 
 Section 210. Applicability of Repayment of Securities at Option of
Holders. The provisions of Article Thirteen of the Base Indenture shall not apply to the Notes. 
 Section 211. Applicability of
Conversion of Securities. The provisions of Article Fourteen of the Base Indenture shall not apply to the Notes. 
 ARTICLE III

 MISCELLANEOUS PROVISIONS 

Section 301. Concerning the Indenture. Except as expressly amended hereby, the Base Indenture shall continue in full force and
effect in accordance with the provisions thereof and the Base Indenture is in all respects hereby ratified and confirmed. This Fifteenth Supplemental Indenture and all its provisions shall be deemed a part of the Base Indenture in the manner and to
the extent herein and therein provided. 
 Section 302. Severability. If any provision in this Fifteenth Supplemental Indenture shall
be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. 

Section 303. Trust Indenture Act. If any provision in this Fifteenth Supplemental Indenture limits, qualifies or conflicts with
any other provision hereof or of the Base Indenture, which provision is required to be included in the Base Indenture by any of the provisions of the Trust Indenture Act of 1939, as amended, such required provision shall control. 

Section 304. Trustee. The recitals and statements herein are deemed to be those of the Company and not of the Trustee. The Trustee
makes no representations as to the validity or sufficiency of this Fifteenth Supplemental Indenture. 
 Section 305. Governing
Law. This Fifteenth Supplemental Indenture shall be governed by, and construed in accordance with, the laws of the State of New York. 

Section 306. Multiple Originals. This Fifteenth Supplemental Indenture may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument. 

 Section 307. Agreement Concerning Methods of Submitting Instructions or Directions
Electronically or by Facsimile. The Trustee agrees to accept and act upon instructions or directions pursuant to this Fifteenth Supplemental Indenture sent by unsecured e-mail, pdf, facsimile transmission
or other similar unsecured electronic methods; provided, however, that the Trustee shall have received an incumbency certificate listing persons designated to give such instructions or directions and containing specimen signatures of
such designated persons, which such incumbency certificate shall be amended and replaced whenever a person is to be added or deleted from the listing. If the Company elects to give the Trustee e-mail or
facsimile instructions (or instructions by a similar electronic method) and the Trustee in its discretion elects to act upon such instructions, the Trustee’s understanding of such instructions shall be deemed controlling. The Trustee shall not
be liable for any losses, costs or expenses arising directly or indirectly from the Trustee’s reliance upon and compliance with such instructions notwithstanding that such instructions conflict or are inconsistent with a subsequent written
instruction. The Company agrees to assume all risks arising out of the use of such electronic methods to submit instructions and directions to the Trustee, including, without limitation, the risk of the Trustee acting on unauthorized instructions
and the risk of interception and misuse by third parties. 
 Section 308. Waiver of Jury Trial. EACH OF THE COMPANY AND THE
TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS FIFTEENTH SUPPLEMENTAL INDENTURE, THE NOTES OR THE TRANSACTION
CONTEMPLATED HEREBY. 
 Section 309. Force Majeure. In no event shall the Trustee be responsible or liable for any
failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or
military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services; it being understood that the Trustee shall use reasonable
efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances. 

Section 310. Consequential Damages. In no event shall the Trustee be responsible or liable for special, indirect or consequential
loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action. 

[SIGNATURES APPEAR ON FOLLOWING PAGE] 

 IN WITNESS WHEREOF, the parties have caused this Fifteenth Supplemental Indenture to be duly
executed. 
  

			
	LOWE’S COMPANIES, INC.
		
	By:	 	 /s/ Tiffany L. Mason

		 	Name: Tiffany L. Mason
		 	Title:   Senior Vice President, Corporate Finance             and Treasurer
	
	U.S. BANK NATIONAL ASSOCIATION, as Trustee
		
	By:	 	 /s/ Paul Vaden

		 	Name: Paul Vaden
		 	Title:   Vice President

 [Signature Page to Fifteenth Supplemental Indenture] 

 EXHIBIT A-1 

FORM OF GLOBAL NOTE 
 UNLESS THIS CERTIFICATE
IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO LOWE’S COMPANIES, INC. OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR TO SUCH OTHER ENTITY OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. 

LOWE’S COMPANIES, INC. 

3.650% Notes due April 5, 2029 

GLOBAL SECURITY 
  

			
	No.	  	CUSIP No. 548661 DR5
		  	 $

		  	 Original Principal Amount

 Lowe’s Companies, Inc., a corporation duly organized and existing under the laws of the State of North
Carolina (herein called the “Company,” which term includes any successor Person under the Indenture hereinafter referred to), for value received, hereby promises to pay to Cede & Co. or its registered assigns, the principal sum of
$ on April 5, 2029, at the office or agency of the Company referred to below, in such coin or currency of the United States of America as at the time of payment is legal tender for the payment of public and private debts, and to pay interest
thereon in like coin or currency from April 5, 2019, or from the most recent Note Interest Payment Date on which interest has been paid or duly provided for, semiannually in arrears on April 5 and October 5 in each year, commencing
October 5, 2019, at the rate of 3.650% per annum until the principal hereof is paid or made available for payment, and (to the extent lawful) to pay interest at the same rate per annum on any overdue principal and premium and on any overdue
installments of interest until paid. If any interest payment date falls on a day that is not a Business Day, the interest payment will be postponed to the next day that is a Business Day, and no interest on that payment will accrue for the period
from and after the interest payment date. 
 The interest so payable, and punctually paid or duly provided for, on any Note Interest Payment
Date, as provided in the Amended and Restated Indenture, dated as of December 1, 1995 (the “Base Indenture”) between the Company and U.S. Bank National Association, as successor trustee (the “Trustee”), as supplemented by
the Fifteenth Supplemental Indenture dated as of April 5, 2019, between the Company and the Trustee (the “Fifteenth Supplemental Indenture” and, the Base Indenture as supplemented by the Fifteenth Supplemental Indenture, the
“Indenture”) shall be 

  
 A-1-1 

 
paid to the Person in whose name this Note is registered at the close of business on the 15th calendar day immediately preceding the Note Interest Payment Date (whether or not a Business Day)
(the “Regular Record Date”). Any such interest not so punctually paid or duly provided for will forthwith cease to be payable to the Person in whose name this Note is registered on such Regular Record Date and may either be paid to the
Person in whose name this Note is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed in accordance with Section 307 of the Base Indenture by the Trustee, notice whereof shall be
given to the Person in whose name this Note is registered not less than ten days prior to such Special Record Date, or be paid at any time in any other lawful manner, all as more fully provided in the Indenture. 

This Note is a “book-entry” note and is being registered in the name of Cede & Co. as nominee of The Depository Trust
Company (“DTC”), a clearing agency. Subject to the terms of the Indenture, this Note will be held by a clearing agency or its nominee, and beneficial interests will be held by beneficial owners through the book-entry facilities of such
clearing agency or its nominee in minimum denominations of $2,000 and increments of $1,000 in excess thereof. 
 As long as this Note is
registered in the name of DTC or its nominee, the Trustee will make payments of principal of and interest on this Note by wire transfer of immediately available funds to DTC or its nominee. Notwithstanding the above, the final payment on this Note
will be made after due notice by the Trustee of the pendency of such payment and only upon presentation and surrender of this Note at its principal corporate trust office or such other office or agencies appointed by the Trustee for that purpose and
such other locations provided in the Indenture. 
 Payments of principal of (and premium, if any) and interest on this Note will be made at
the office or agency of the Company maintained for that purpose in the Borough of Manhattan, The City of New York, in such coin or currency of the United States of America as at the time of payment is legal tender for payments of public and private
debts; provided, however, that at the option of the Company, payment of interest may be made by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register. 

This Note is one of a duly authorized series of notes of the Company, designated 3.650% Notes due April 5, 2029 (the “Notes”),
initially limited in aggregate principal amount at any time outstanding to ONE BILLION FIVE HUNDRED MILLION DOLLARS ($1,500,000,000) which may be issued under the Indenture. This series of Notes may be reopened, without the consent of the holders of
the Notes, for issuance of additional Notes. Reference is hereby made to the Indenture and all indentures supplemental thereto which are applicable to the Notes for a statement of the respective rights, limitations of rights, duties, obligations and
immunities thereunder of the Company, the Trustee and the Holders of the Notes, and the terms upon which the Notes are, and are to be, authenticated and delivered. All terms used in this Note that are defined in the Indenture shall have the meanings
assigned to them in the Indenture. 
 The Notes do not have the benefit of any sinking fund obligations. 

Before the date that is three months prior to April 5, 2029, the Notes will be redeemable, in whole at any time or in part from time to
time, at the Company’s option, at a redemption price, to be calculated by the Company, equal to the greater of: 
 (i) 100% of the
principal amount of the Notes to be redeemed; or 

  
 A-1-2 

 (ii) the sum of the present values of the remaining scheduled payments of principal and
interest on such Notes (not including any portion of such payments of interest accrued as of the date of redemption), discounted to the date of redemption on a semi-annual basis (assuming a 360-day year
consisting of twelve 30-day months) at the Treasury Rate, plus 20 basis points; plus accrued and unpaid interest thereon to, but excluding, the date of redemption. 

On or after the date that is three months prior to April 5, 2029, the Notes will be redeemable, in whole at any time or in part from time
to time, at the Company’s option, at par plus accrued and unpaid interest thereon to, but excluding, the date of redemption. 

Notwithstanding the previous two paragraphs, installments of interest on Notes that are due and payable on Note Interest Payment Dates falling
on or prior to a redemption date will be payable on the Note Interest Payment Date to the registered holders as of the close of business on the relevant record date. 

Notice of any redemption will be given at least 10 days but not more than 60 days before the Redemption Date to each registered holder of the
Notes to be redeemed. Unless the Company defaults in payment of the redemption price, on and after the Redemption Date, interest will cease to accrue on the Notes or portions thereof called for redemption. If less than all of the Notes are to be
redeemed, the Notes to be redeemed shall be selected in accordance with the procedures of DTC. 
 Upon a Change of Control Triggering Event,
the Company shall be required to make an offer to repurchase the Notes on the terms set forth in the Indenture. 
 If an Event of Default
shall occur and be continuing, the principal of all the Notes may be declared due and payable in the manner and with the effect provided in the Indenture. 

The Indenture contains provisions for defeasance at any time of (a) the entire indebtedness of the Company under this Note and
(b) certain restrictive covenants and the related defaults and Events of Default applicable to the Company, in each case, upon compliance by the Company with certain conditions set forth in the Indenture, which provisions apply to this Note.

 The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Notes under the Indenture at any time by the Company and the Trustee with the consent of the Holders of a majority in aggregate principal amount of the Notes at the time Outstanding.
The Indenture also contains provisions permitting the Holders of specified percentages in aggregate principal amount of the Notes at the time Outstanding, on behalf of the Holders of all Notes, to waive compliance by the Company with certain
provisions of the Indenture and certain past Defaults under the Indenture and their consequences. Any such consent or waiver by the Holder of this Note shall be conclusive and binding upon such Holder and upon all future Holders of this Note and of
any Note issued upon the registration of transfer thereof or in exchange herefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Note. 

No reference herein to the Indenture and provisions of this Note or of the Indenture shall alter or impair the obligation of the Company,
which is absolute and unconditional, to pay the principal of (and premium, if any) and interest on this Note at the times, place and rate, and in the coin or currency, as herein prescribed. 

  
 A-1-3 

 As provided in the Indenture and subject to certain limitations on transfer of this Note by
DTC or its nominee, the transfer of this Note is registrable in the Security Register, upon surrender of this Note for registration of transfer at the office or agency of the Company in the Borough of Manhattan, The City of New York, duly endorsed
by, or accompanied by a written instrument of transfer in the form attached hereto duly executed by the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Notes, of authorized denominations and for the same
aggregate principal amount, shall be issued to the designated transferee or transferees. 
 The Notes are issuable only in registered form
in minimum denominations of $2,000 and integral multiples of $1,000 thereafter. As provided in the Indenture and subject to certain limitations therein set forth, the Notes are exchangeable for a like aggregate principal amount of Notes of different
authorized denomination, as requested by the Holder surrendering the same. 
 No service charge shall be made for any such registration of
transfer or exchange of Notes, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith. 

Prior to due presentment of this Note for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may
treat the Person in whose name this Note is registered as the owner hereof for all purposes, whether or not this Note be overdue, and none of the Company, the Trustee or any such agent shall be affected by notice to the contrary. 

Interest on this Note shall be computed on the basis of a 360-day year composed of twelve 30-day months. 
 The Company shall furnish to any Holder of record of Notes, upon written request and
without charge, a copy of the Indenture. 
 The Indenture and this Note each shall be governed by and construed in accordance with the laws
of the State of New York. 
 Unless the certificate of authentication hereon has been executed by the Trustee by manual signature, this Note
shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose. 

  
 A-1-4 

 IN WITNESS WHEREOF,
LOWE’S COMPANIES, INC. has caused this Note to be signed by a duly elected or appointed, qualified and serving officer and attested by a duly elected or appointed, qualified and
serving officer. 
  

			
	LOWE’S COMPANIES, INC.
		
	By:	 	  

		 	Name: Tiffany L. Mason
		 	Title:   Senior Vice President, Corporate Finance             and Treasurer

 Dated: April 5, 2019 
  

			
	Attest:	 	  

		 	Name: Beth R. MacDonald
		 	Title:   Assistant Secretary

 TRUSTEE’S CERTIFICATE OF AUTHENTICATION 

THIS IS ONE OF THE SECURITIES OF
THE SERIES DESIGNATED THEREIN REFERRED TO IN THE WITHIN-MENTIONED INDENTURE. 

 

			
	U.S. BANK NATIONAL ASSOCIATION as Trustee
		
	By:	 	  

		 	Authorized Officer

  
 A-1-5 

 ABBREVIATIONS 

The following abbreviations, when used in the inscription on the face of this Note, shall be construed as though they were written out in full
according to applicable laws or regulations: 
 TEN COM—tenants in common 

TEN ENT—tenants by the entireties 

JT TEN—joint tenants with right of survivorship and not as tenants in common 

CUST—Custodian 
 U/G/M/A or
UNIF GIFT MIN ACT—Uniform Gifts to Minors Act 
 Additional abbreviations may also be used though not in the above list. 

  
 A-1-6 

 FORM OF TRANSFER 

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto 

 
  
  

 
 (Please print or typewrite name and
address of assignee) 
  
  

(Please insert Social Security or other identifying Number of Assignee) 

the within Note of Lowe’s Companies, Inc. and does hereby irrevocably constitute and appoint
                                         
                                         
                                         
                                         
                                 , Attorney, to transfer the said Note on the books of
the within named Lowe’s Companies, Inc., with full power of substitution in the premises. 
 Dated:
                                        
         
  

	
	  

	 NOTICE: The signature to this assignment
 must
correspond with the name as written
 upon the face of this Note in every particular

without alteration or enlargement or
 any change
whatever.

  

	
	  

	SIGNATURE GUARANTEED:
	 The signature must be guaranteed by
 a member of
the Securities Transfer

	Agents Medallion Program.
	 Notarized or witnessed signatures are
 not
acceptable.

  
 A-1-7 

 PAYMENT INSTRUCTIONS 

The assignee should include the following for purposes of payment: 

Payment shall be made, by wire transfer or otherwise, in immediately available funds,
to                     , for the account
of                     , account
number                     , or, if mailed by check,
to                         . Applicable reports and statements required to be physically delivered under the terms of the
Indenture should be mailed to                     . This information is provided
by                     , the assignee named above,
or                     , as its agent. 

  
 A-1-8 

 EXHIBIT A-2 

FORM OF GLOBAL NOTE 
 UNLESS THIS CERTIFICATE
IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO LOWE’S COMPANIES, INC. OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR TO SUCH OTHER ENTITY OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. 

LOWE’S COMPANIES, INC. 

4.550% Notes due April 5, 2049 

GLOBAL SECURITY 
  

			
	No.	  	CUSIP No. 548661 DS3
		  	 $

		  	Original Principal Amount

 Lowe’s Companies, Inc., a corporation duly organized and existing under the laws of the State of North
Carolina (herein called the “Company,” which term includes any successor Person under the Indenture hereinafter referred to), for value received, hereby promises to pay to Cede & Co. or its registered assigns, the principal sum of
$    on April 5, 2049, at the office or agency of the Company referred to below, in such coin or currency of the United States of America as at the time of payment is legal tender for the payment of public and private debts,
and to pay interest thereon in like coin or currency from April 5, 2019, or from the most recent Note Interest Payment Date on which interest has been paid or duly provided for, semiannually in arrears on April 5 and October 5 in each
year, commencing October 5, 2019, at the rate of 4.550% per annum until the principal hereof is paid or made available for payment, and (to the extent lawful) to pay interest at the same rate per annum on any overdue principal and premium and
on any overdue installments of interest until paid. If any interest payment date falls on a day that is not a Business Day, the interest payment will be postponed to the next day that is a Business Day, and no interest on that payment will accrue
for the period from and after the interest payment date. 
 The interest so payable, and punctually paid or duly provided for, on any Note
Interest Payment Date, as provided in the Amended and Restated Indenture, dated as of December 1, 1995 (the “Base Indenture”) between the Company and U.S. Bank National Association, as successor trustee (the “Trustee”), as
supplemented by the Fifteenth Supplemental Indenture dated as of April 

  
 A-2-1 

 
5, 2019, between the Company and the Trustee (the “Fifteenth Supplemental Indenture” and, the Base Indenture as supplemented by the Fifteenth Supplemental Indenture, the
“Indenture”) shall be paid to the Person in whose name this Note is registered at the close of business on the 15th calendar day immediately preceding the Note Interest Payment Date (whether or not a Business Day) (the “Regular Record
Date”). Any such interest not so punctually paid or duly provided for will forthwith cease to be payable to the Person in whose name this Note is registered on such Regular Record Date and may either be paid to the Person in whose name this
Note is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed in accordance with Section 307 of the Base Indenture by the Trustee, notice whereof shall be given to the Person in
whose name this Note is registered not less than ten days prior to such Special Record Date, or be paid at any time in any other lawful manner, all as more fully provided in the Indenture. 

This Note is a “book-entry” note and is being registered in the name of Cede & Co. as nominee of The Depository Trust
Company (“DTC”), a clearing agency. Subject to the terms of the Indenture, this Note will be held by a clearing agency or its nominee, and beneficial interests will be held by beneficial owners through the book-entry facilities of such
clearing agency or its nominee in minimum denominations of $2,000 and increments of $1,000 in excess thereof. 
 As long as this Note is
registered in the name of DTC or its nominee, the Trustee will make payments of principal of and interest on this Note by wire transfer of immediately available funds to DTC or its nominee. Notwithstanding the above, the final payment on this Note
will be made after due notice by the Trustee of the pendency of such payment and only upon presentation and surrender of this Note at its principal corporate trust office or such other office or agencies appointed by the Trustee for that purpose and
such other locations provided in the Indenture. 
 Payments of principal of (and premium, if any) and interest on this Note will be made at
the office or agency of the Company maintained for that purpose in the Borough of Manhattan, The City of New York, in such coin or currency of the United States of America as at the time of payment is legal tender for payments of public and private
debts; provided, however, that at the option of the Company, payment of interest may be made by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register. 

This Note is one of a duly authorized series of notes of the Company, designated 4.550% Notes due April 5, 2049 (the “Notes”),
initially limited in aggregate principal amount at any time outstanding to ONE BILLION FIVE HUNDRED MILLION DOLLARS ($1,500,000,000) which may be issued under the Indenture. This series of Notes may be reopened, without the consent of the holders of
the Notes, for issuance of additional Notes. Reference is hereby made to the Indenture and all indentures supplemental thereto which are applicable to the Notes for a statement of the respective rights, limitations of rights, duties, obligations and
immunities thereunder of the Company, the Trustee and the Holders of the Notes, and the terms upon which the Notes are, and are to be, authenticated and delivered. All terms used in this Note that are defined in the Indenture shall have the meanings
assigned to them in the Indenture. 
 The Notes do not have the benefit of any sinking fund obligations. 

Before the date that is six months prior to April 5, 2049, the Notes will be redeemable, in whole at any time or in part from time to
time, at the Company’s option, at a redemption price, to be calculated by the Company, equal to the greater of: 

  
 A-2-2 

 (i) 100% of the principal amount of the Notes to be redeemed; or 

(ii) the sum of the present values of the remaining scheduled payments of principal and interest on such Notes (not including
any portion of such payments of interest accrued as of the date of redemption), discounted to the date of redemption on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate, plus 25 basis points; 
 plus accrued and unpaid interest thereon to, but excluding,
the date of redemption. 
 On or after the date that is six months prior to April 5, 2049, the Notes will be redeemable, in whole at
any time or in part from time to time, at the Company’s option, at par plus accrued and unpaid interest thereon to, but excluding, the date of redemption. 

Notwithstanding the previous two paragraphs, installments of interest on Notes that are due and payable on Note Interest Payment Dates falling
on or prior to a redemption date will be payable on the Note Interest Payment Date to the registered holders as of the close of business on the relevant record date. 

Notice of any redemption will be given at least 10 days but not more than 60 days before the Redemption Date to each registered holder of the
Notes to be redeemed. Unless the Company defaults in payment of the redemption price, on and after the Redemption Date, interest will cease to accrue on the Notes or portions thereof called for redemption. If less than all of the Notes are to be
redeemed, the Notes to be redeemed shall be selected in accordance with the procedures of DTC. 
 Upon a Change of Control Triggering Event,
the Company shall be required to make an offer to repurchase the Notes on the terms set forth in the Indenture. 
 If an Event of Default
shall occur and be continuing, the principal of all the Notes may be declared due and payable in the manner and with the effect provided in the Indenture. 

The Indenture contains provisions for defeasance at any time of (a) the entire indebtedness of the Company under this Note and
(b) certain restrictive covenants and the related defaults and Events of Default applicable to the Company, in each case, upon compliance by the Company with certain conditions set forth in the Indenture, which provisions apply to this Note.

 The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Notes under the Indenture at any time by the Company and the Trustee with the consent of the Holders of a majority in aggregate principal amount of the Notes at the time Outstanding.
The Indenture also contains provisions permitting the Holders of specified percentages in aggregate principal amount of the Notes at the time Outstanding, on behalf of the Holders of all Notes, to waive compliance by the Company with certain
provisions of the Indenture and certain past Defaults under the Indenture and their consequences. Any such 
 consent or waiver by the
Holder of this Note shall be conclusive and binding upon such Holder and upon all future Holders of this Note and of any Note issued upon the registration of transfer thereof or in exchange herefor or in lieu hereof, whether or not notation of such
consent or waiver is made upon this Note. 

  
 A-2-3 

 No reference herein to the Indenture and provisions of this Note or of the Indenture shall
alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of (and premium, if any) and interest on this Note at the times, place and rate, and in the coin or currency, as herein prescribed. 

As provided in the Indenture and subject to certain limitations on transfer of this Note by DTC or its nominee, the transfer of this Note is
registrable in the Security Register, upon surrender of this Note for registration of transfer at the office or agency of the Company in the Borough of Manhattan, The City of New York, duly endorsed by, or accompanied by a written instrument of
transfer in the form attached hereto duly executed by the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Notes, of authorized denominations and for the same aggregate principal amount, shall be issued to the
designated transferee or transferees. 
 The Notes are issuable only in registered form in minimum denominations of $2,000 and integral
multiples of $1,000 thereafter. As provided in the Indenture and subject to certain limitations therein set forth, the Notes are exchangeable for a like aggregate principal amount of Notes of different authorized denomination, as requested by the
Holder surrendering the same. 
 No service charge shall be made for any such registration of transfer or exchange of Notes, but the Company
may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith. 
 Prior to due
presentment of this Note for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name this Note is registered as the owner hereof for all purposes, whether or not this Note be
overdue, and none of the Company, the Trustee or any such agent shall be affected by notice to the contrary. 
 Interest on this Note shall
be computed on the basis of a 360-day year composed of twelve 30-day months. 

The Company shall furnish to any Holder of record of Notes, upon written request and without charge, a copy of the Indenture. 

The Indenture and this Note each shall be governed by and construed in accordance with the laws of the State of New York. 

Unless the certificate of authentication hereon has been executed by the Trustee by manual signature, this Note shall not be entitled to any
benefit under the Indenture or be valid or obligatory for any purpose. 

  
 A-2-4 

 IN WITNESS WHEREOF, LOWE’S
COMPANIES, INC. has caused this Note to be signed by a duly elected or appointed, qualified and serving officer and attested by a duly elected or appointed, qualified and serving officer. 

 

			
	LOWE’S COMPANIES, INC.
		
	By:	 	  

		 	Name: Tiffany L. Mason
		 	Title:   Senior Vice President, Corporate Finance             and Treasurer

  

			
	Dated: April 5, 2019
		
	Attest:	 	  

		 	Name: Beth R. MacDonald
		 	Title:   Assistant Secretary

 TRUSTEE’S CERTIFICATE OF AUTHENTICATION 

THIS IS ONE OF THE SECURITIES OF
THE SERIES DESIGNATED THEREIN REFERRED TO IN THE WITHIN-MENTIONED INDENTURE. 

 

			
	U.S. BANK NATIONAL ASSOCIATION as Trustee
		
	By:	 	  

		 	Authorized Officer

  
 A-2-5 

 ABBREVIATIONS 

The following abbreviations, when used in the inscription on the face of this Note, shall be construed as though they were written out in full
according to applicable laws or regulations: 
 TEN COM—tenants in common 

TEN ENT—tenants by the entireties 

JT TEN—joint tenants with right of survivorship and not as tenants in common 

CUST—Custodian 
 U/G/M/A or
UNIF GIFT MIN ACT—Uniform Gifts to Minors Act 
 Additional abbreviations may also be used though not in the above list. 

  
 A-2-6 

 FORM OF TRANSFER 

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto 

 
  
  

 
 (Please print or typewrite name and
address of assignee) 
  
  

(Please insert Social Security or other identifying Number of Assignee) 

the within Note of Lowe’s Companies, Inc. and does hereby irrevocably constitute and appoint
                                         
                                         
                                         
                                         
                                     , Attorney, to transfer the
said Note on the books of the within named Lowe’s Companies, Inc., with full power of substitution in the premises. 
 Dated:
                                         
        
  

	
	  

	 NOTICE: The signature to this assignment
 must
correspond with the name as written
 upon the face of this Note in every particular

without alteration or enlargement or any
 change
whatever.

  

	
	  

	SIGNATURE GUARANTEED:
	 The signature must be guaranteed by a
 member of
the Securities Transfer
 Agents Medallion Program.

	 Notarized or witnessed signatures are
 not
acceptable.

  
 A-2-7 

 PAYMENT INSTRUCTIONS 

The assignee should include the following for purposes of payment: 

Payment shall be made, by wire transfer or otherwise, in immediately available funds,
to                     , for the account
of                     , account
number                     , or, if mailed by check,
to                     . Applicable reports and statements required to be physically delivered under the terms of the Indenture should be mailed
to                     . This information is provided
by                     , the assignee named above,
or                     , as its agent.loanagreement08122017sea

  Execution Version      US$1,632,000,000 Secured Loan Agreement      Dated    2 D     .2.. ~bv         2017      (1)      DSME Hull No. 2434 L.L.C.             DSME Hull No. 2433 L.L.C.             DSME Hull No. 2431 L.L.C.             DSME Hull No.   2430 L.L.C.             DSME Hull No.   2425 L.L.C.             DSME Hull No. 2423 L.L.C.             (as Borrowers)     (2)     The Financial Institutions            listed in Schedule 1             (as Original Lenders)     (3)     China Development Bank             (as Mandated Lead Arranger)     (4)     China Development Bank             (as Agent)     (5)     China Development Bank            (as Swap Provider)     (6)     China Development Bank            (as Security Agent)     Stephenson Harwood LLP   1 Finsbury C1rcus. London EC2M 7 SH                                  STEPHENSON  T +44 20 7329 4422 F +44 20 7329 7100  DX 64 Chancery Lane •Nww shlegal com                                        HARWOOD  

 

Contents                                                                                            Page    Section 1     Interpretation .........................................................................................2     1             Definitions and Interpretation ...................................................................2     Section 2     The Loan ............................................................................................. 35    2             The Loan ............................................................................................. 35    3             Purpose ............................................................................................... 35   4              Conditions of Utilisation ......................................................................... 35    Section 3     Utilisation ............................................................................................ 40    5             Advance .............................................................................................. 40    Section 4     Repayment,  Prepayment and  Cancellation ................................................ 41    6             Repayment ••.•..•..••..•.••.••..•.•..•••.••.••.••...•..•..••..•..•.••..•..•...•..•.•..••.•..•.•.•.•. 41    7             Illegality, Prepayment and Cancellation .................................................... 41    Section 5     Costs of Utilisation ................................................................................ 48   8              Interest ............................................................................................... 48    9             Interest Periods .................................................................................... 48    10            Changes to the Calculation of Interest......................................................  49    11            Fees .................................................................................................... 50   Section 6      Additional Payment Obligations ............................................................... 51    12            Tax Gross Up and Indemnities ................................................................ 51    13            Increased Costs .................................................................................... 58    14            Other Indemnities ................................................................................. 60    15            Mitigation by the Lenders ....................................................................... 62    16            Costs and Expenses .............................................................................. 62   Section 7      Security, Accounts and Application of Moneys ........................................... 65   17             Security Documents, Accounts and  Application of Moneys ........................... 65   Section 8      Representations, Undertakings and Events of Default ................................. 73    18            Representations .................................................................................... 73    19            Information Undertakings ...................................................................... 81    LONLIVE\30137956.24  

 

 20            Financial Covenants ••..•..•....•...•.••.•...•..•.••..•.........•...•.•..•..•..•.....•...•..••.••. 86    21            General Undertakings .••..•..•.•...•.••.•...•..•.•...•.•..•....••..•.•..•.•••.••••••••••••••••••• 93    22            Events of Default ••..••.••..•..•.•..••.••.•..•...•..•................•.••.••..•....•....•.•..•... 101    Section 9     Changes to Parties ..•..•...•..•.•...•.••.••.••..•..•....•..•..•..•..•.••.•.•.•..•.•...•..•..•... 112    23            Changes to the Lenders ..•....•..••.••.•..••..•.......•..•..•..•..•..•...•.•..•••••••••••••••. 112    24            Changes to the Security Parties ............................................................ 117    Section 10    The Finance Parties ............................................................................. 118    25            Role of the Agent, the Security Agent and the Arranger ............................ 118    26            Conduct of Business by the Finance Parties .•.••••••••.••.••••.....••.•..•......•..••..• 129    27            Sharing among the Finance  Parties .••..••.•.••.•••••.•••.•..••.•..•...•.•..•......•..••..• 129   Section 11     Administration ••••.•••.•..•...•........•.••.•...•.....•...••..•..•..•.••.•••..•....•.•....•..•.•.• 132    28            Payment Mechanics ..•......•..•.....•..•.••..•......•••.••.•..•..•.••..•...•....•.........•...• 132    29            Set-Off •.........•.••.•...••.....•..•.•••••..•..•..••..•..•...•.....•..••.••.•...•..•.•.•••.•••.•...• 136    30            Notices •..•..••..•..•..••.••..•.....•..•...•.•..••••••.•..•....•..•.•...•..•.••.••..•....•••..•..••.• 136   31             Calculations and Certificates ................................................................. 138   32             Partial Invalidity .••.••..•...•....•..•..••••••••..•..•..•..........•..•.••..••.••••.••••••.••.•... 139   33             Remedies  and Waivers •...•.•••••..•••..•...•..•.•.....•..•..•...•.•..•...•.••••.....•...•..••. 139    34            Amendments and   Waivers ..•.•...•..•.••.••..•..•...•......•...•.••.•...•..•.•......•..•...•• 139    35            Confidentiality ..•......••••••...•..•..••.•.••..••..•..•...••..•..•..••.•..•.•••••.•..•...•..•..••. 142    36            Disclosure of Lender Details by Agent •.••.•...•....•..•.•.•.•.••.•...•....•.........••... 146    37            Counterparts ..•..•..••.••••.•••..•..•..••.••.•...••.•..••...•..•.•.•.••••.••..•..•.•...•..•..•...• 147   38             Joint and Several Liability ..•••..••..•.••..•..•.•....•...•..•.••..•..•.••...•.•.•...•...••••..• 147   Section 12     Governing Law  and Enforcement .•..•..••.•..•.•.•......•..••••..•••.•..•.•.........•...•.• 149   39             Governing Law •.•••..•..•...•....•.•••.•..••.••..•..•..•..........•..•.••.•...•.•..•.•.•..••••.•. 149   40             Enforcement •..••.•...•..••.•........••.••....••.••..........•..•..•..•.••.•••.•....•...•..•..•... 149   Schedule  1    The Original Lenders •.•••..•....•..••.•..•..••.•......•......•..••.•..•...•.•....•...•..••.•••. 150   Schedule 2     Conditions Precedent and Subsequent ..•.•...•...•...•...•.•.••••.•.•..•.•.....•..••..••. 151  Part I Initial Conditions Precedent ..•..•...•..•..•..•..••.•..•.•...•...••.••..••••.••••..•..••........••..•..•. 151  Part II Conditions Subsequent to initial Drawing ...•.••.••............•..•.•••.•..•..••••.••.•......•.•..• 156  Part III Conditions Precedent to Instalment Drawings ................................................... 157  Part IV Conditions Precedent to Drawing for Pre-delivery Expenses •...•.•••••.••.••.•...•..•...••.. 158    LONUVE\30137956.24  

 

Part V Conditions Precedent to pre-position the Delivery Instalment ............................... 159  Part VI Delivery Conditions Precedent •..••..•..•.••..•.•.••.•............••.•..•.••.••.•..•••••.•••••••.••..•. 161  Part VII Delivery Conditions Subsequent •..•..•.••..•.•.••.•......•.....•..•..•.••.••.•..••..•.....•••••••.•• 163   Schedule 3     Drawdown Request ..•.•...•..•..•..•..•..••••••.•••.•.••••••.••••..•.••.•••.•..•.....•..••...•. 164   Schedule 4     Repayment Schedule •.•...•..•.....•..•..••..•..•..•....•.....•..•.•..•••••.•••••••••...••....• 165   Schedule 5     Form of Transfer Certificate •..•..•..•...•..•..•...•...•..•..•..•.•..•..••.••.•.•••••••.••..•• 171   Schedule 6     Form of Assignment Agreement ............................................................ 174   Schedule 7     List of Assigned Documents •..•..•..••.•••.••.••.••.••••••••••••••..•...•..•....•...•..•...•• 178    lONUVE\30137956.Z4  

 

Loan Agreement  Dated     8      D.ILOUY\bSU"        2017  Between:   (1)      DSME   Hull  No.  2434   L.L.C. ("Borrower   A"),   DSME   Hull  No.  2433   L.L.C.           ("Borrower   B"), DSME   Hull No.  2431   L.L.C. ("Borrower  C"), DSME    Hull No.           2430 L.L.C.  ("Borrower D"),  DSME   Hull No.  2425  L.L.C. ("Borrower E"),  DSME           Hull No. 2423   L.L.C. ("Borrower  F") and, each a company incorporated  under the           law of The Republic of the Marshall Islands, and each with registered office at Trust           Company    Complex,   Ajeltake Road,   Ajeltake Island,  Majuro,  Marshall  Islands           (together the "Borrowers" and  each a "Borrower"), jointly and severally; and   (2)      The  Financial Institutions listed in Schedule 1 (The Original Lenders), each acting           through its Facility Office (together the "Original Lenders" and each an "Original           Lender");  and   (3)      China  Development    Bank,  acting as mandated  lead arranger through its office at           No. 1093  Shennan  Zhong  Road,  Futian District, Shenzhen, China (in that capacity,           the 11 Arranger"); and   (4)      China  Development    Bank,  acting as facility agent through its office at No. 1093           Shennan   Zhong   Road,  Futian District, Shenzhen,  China  (in that capacity, the           "Agent");   (5)      China  D.evelopment   Bank,  acting as swap  provider through its office at No.1093           Shennan  Zhong  Road, Futian District, Shenzhen, China (in that capacity, the "Swap           Provider"); and   (6)      China  Development Bank,     acting as security agent through its office at No. 1093           Shennan   Zhong  Road,   Futian District, Shenzhen,  China  (in that capacity, the           "Security Agent").   Preliminary   (A)      Each Borrower has  agreed  to purchase the relevant Vessel from the Builder on the           terms  of the relevant  Building Contract and  intends to  register that Vessel on           delivery under the relevant flag specified below in the definition of "Vessels".   (B)      Each of the Original Lenders has agreed to advance to the Borrowers on  a joint and           several basis its Commitment  (aggregating, with all the other Commitments,  up to           US$1,632,000,000)   to assist the  Borrowers  to finance or  refinance part of the           aggregate of the Total Project Costs of the Vessels.   It is agreed as follows:    LONLlVE\30137956.24                                                                    Page 1  

 

Section 1        Interpretation   1        Definitions and Interpretation   1.1      Definitions  In this Agreement:            "Acceptable   Bank"  means   in the case of a  non-PRC  bank,  a bank  or financial           institution which bears a long-term credit rating of at least BBB+  by Standard  &           Poor's or at least Baal by Moody's (or an equivalent rating by another international           reputable credit rating agency) or in the  case of PRC  bank,  a bank  or financial           institution which bears a long-term credit rating of at least BB by Standard & Poor's           or at  least Ba2  by  Moody's  (or an  equivalent rating by  another  international           reputable credit rating agency).            "Account   Holder"  means  Bank  of China (Hong  Kong)  Limited acting through  its           branch at 14/F,  Bank of China  Tower, 1  Garden  Road, Central Hong  Kong  or any           other bank or financial institution which at any time, with the Security Agent's prior           written consent, holds the Accounts.            "Account  Security  Deeds"  means,  collectively, the account security deeds referred           to in Clause 17.1.7 and "Account Security Deed"  means any one   of them.·            "Accounts"  means,  in relation to each Borrower, the Proceeds Account (dollar), the           Proceeds Account  (euro), the Retention Account, the Debt Service Reserve Account,           the Operating  Reserve  Account,  the Dividend  Lock-Up  Account,  the Distribution           Account and the Dry-docking Reserve  Account.            "Administration" has the meaning given to it in paragraph 1.1.3 of the ISM Code.            "Affiliate" means, in relation to any person, a Subsidiary of that person or a Holding           Company of that person  or any other Subsidiary of that Holding Company.            "Alternative Yamal Sponsor Guarantee" means any deed       of guarantee granted or           to be granted  by (a) an Alternative Yamal Sponsor  Guarantor  in favour of (b) the           relevant Borrower (as owner).            "Alternative  Yamal   Sponsor    Guarantor"   means   any  entity (other than  JSC           Novatek, CNPC  or EA) which may become    an additional or replacement guarantor of           a Yamal Sponsor Guarantor for the purposes of and in accordance with clause 67.3 of           the  Charter (but  always  subject to  Clause 21.26   (Proposed Alternative  Yama/           Sponsor Guarantor)).            "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).            "Approved    Flag" means   the flag of the Commonwealth   of the Bahamas   or such           other flag approved by the Lenders, the relevant Borrower  and the Charterer, such           approval not to be unreasonably withheld.            "Approved   Manager" in  relation to each Vessel, means (i) Teekay Shipping Limited,           (ii) a member   of  the Teekay  Group,  or  (iii) any other management    company           acceptable to the Agent and appointed by the Borrowers.     LONUVE\30137956. 24                                                                    Page 2  

 

        "Approved   Shipbroker" means each    of Clarksons Platou, Poten & Partners, MJLF &          Associates, Braemar   ACM  Shipbroking,  Fearnleys, Arrow  Sale  & Purchase   (UK),          Simpson,  Spence  & Young  and any other reputable, independent and  first class firm          of ship brokers.           "Assignable Charter" means:           (a)    the Charter; or           (b)    a Yamal  Bareboat Charter; or           (c)    any  other charterparty or  contract of employment   in respect of a Vessel                   entered into between a Borrower (as owner) and any charterer.           "Assigned   Documents" means together, the documents referred    in Schedule 7 (List          of Assigned  Documents)   hereto  and  each as  amended,   supplemented,  novated,          restated, modified or replaced from time to time, and "Assigned Document" means          any one  (1) of them.           "Assignment Agreement" means an       agreement substantially in the form set out in          Schedule  6 (Form of Assignment Agreement) or any   other form agreed  between the          relevant assignor and assignee .           .. Authorisation~~ means:           (a)      an authorisation, permit, consent, approval, resolution, licence, exemption,                   filing, notarisation, lodgement or registration; or           (b)      in relation to anything which will be fully or partly prohibited or restricted by                   law if a Governmental   Agency   intervenes or acts in any  way  within  a                   specified period after lodgement,  filing, registration or notification, the                   expiry of that period without intervention or action.           "Availability Period"  means,  in relation to each Vessel Loan, the period from and          including the date of this Agreement to and including, the earliest of:           (a)      the Delivery Date of the Vessel relevant to such Vessel Loan;           (b)      the Long Stop Date applicable to the Vessel relevant to such Vessel Loan;           (c)      three years from the date of this Agreement; and           (d)      the date on which the Commitments for such  Vessel Loan are fully drawn or                   the Available Commitment is cancelled,           or in each case such later date as the Lenders may agree.           "Available Commitment" means a Lender's Commitment minus:           (a)      the amount of its participation in any outstanding Vessel Loans; and           (b)      in relation to any proposed Drawing, the amount  of its participation in any                   Vessel Loans that are due to be made on  or before the proposed Drawdown                   Date.    lONUVE\30137956.24                                                                     Page 3  

 

        "Balloon"  means,  in relation to a Vessel Loan, an amount equal to thirty per cent          (30%) of such Vessel Loan.           "Borrowers    Group"   means,   collectively, the Borrowers,  the  Parent, Teekay          Operating, the Vessel Sponsor  Guarantors and  each of their respective Subsidiaries          from time to time.           "Borrower   Pledge  Agreements"    means,  the pledge  or pledges of the shares or          membership   interests (as the case may be) of the Borrowers  referred to in Clause          17.1.3 (Security Documents).           "Break Costs"  means the amount (if any)  by which:           (a)      the interest which a Lender should have  received for the period from the                   date of receipt of all or any part of its participation in the Loan or an Unpaid                   Sum to the last day of the current Interest Period in respect of the Loan or                   Unpaid Sum,  had the principal amount or Unpaid Sum received been paid on                  the last day of that Interest Period;           exceeds:           (b)      the amount which that Lender would  be able to obtain by placing an amount                   equal to the principal amount or Unpaid Sum  received by it on deposit with                   a leading bank in the Relevant Interbank Market for a period starting on the                   Business Day following receipt or recovery and ending on the last day of the                   current Interest Period.           "Builder" means collectively, DSME and  DY Tankers:           "Builder's  Bank"  means  a first-class bank in the Republic of Korea with a credit          rating of not less than A- from Standard & Poor's and/or the equivalent rating from          Moody's,  or other equivalent financial institution and otherwise acceptable to the          Agent.           "Builder's  PDA"  means   the protocol of delivery and acceptance  in respect of a          Vessel to be executed  by the Builder, the relevant Borrower and  countersigned by          the Agent  (evidencing  the unconditional physical delivery of such Vessel  by the          Builder to such Borrower pursuant to the relevant Building Contract).           "Building Contracts"  means,  collectively:           (a)      the building contract dated 8 July 2014 entered into between Borrower A (as                   buyer) and  the  Builder (as builder), on  the terms  and  subject to the                   conditions of which the Builder has agreed to construct Vessel A  for, and                   deliver Vessel A to Borrower A;           (b)      the building contract dated 8 July 2014 entered into between Borrower B (as                   buyer)  and the  Builder (as builder), on  the terms  and  subject to the                   conditions of which the Builder has agreed to construct Vessel B  for, and                   deliver Vessel B to Borrower B;           (c)      the building contract dated 8 July 2014 entered into between Borrower C (as                   buyer)  and the  Builder (as builder), on  the terms  and  subject to the    LONUVE\30137956.24                                                                     Page 4  

 

                 conditions of which the Builder has agreed to construct Vessel C  for, and                   deliver Vessel C to Borrower C;           (d)      the building contract dated 8 July 2014 entered  into between Borrower  D                   (as buyer) and  the Builder (as builder), on the terms and  subject to the                   conditions of which the Builder has agreed to construct Vessel D  for, and                   deliver Vessel D to Borrower D;           (e)      the building contract dated 8 July 2014 as amended by an amendment no.   1                   dated 25 April 2016  entered into between  Borrower  E (as buyer) and the                   Builder (as builder), on the terms and subject to the conditions of which the                   Builder has  agreed to  construct Vessel  E for, and  deliver Vessel E  to                   Borrower E; and           (f)      the building contract dated 8 July 2014 entered into between Borrower F (as                   buyer) and  the  Builder (as builder), on  the terms  and  subject to the                   conditions of which the Builder has agreed  to construct Vessel F for, and                   deliver Vessel F to Borrower F,           each  as amended,   supplemented   and/or varied from  time  to time to the  extent          permitted under the Finance Documents, and   "Building Contract" means any one of          them.           "Business  Day"  means a day (other than  a Saturday or Sunday) on which banks  are          open  for general business in Beijing, London, Hong Kong, New York and Moscow, and          in respect of the date for any payment to be made to the Builder, Korea and also, in          respect of a Delivery Date, the Bahamas.           "Business   Ethics Laws"  means   any laws, regulations and/or other legally binding          requirements  or  determinations in relation to bribery, corruption, fraud, money­         laundering, terrorism, collusion bid-rigging or anti-trust, human  rights violations          (including forced labour and human  trafficking) which are applicable to either party          or to any jurisdiction where activities are performed and which shall include: (i) the          United Kingdom  Bribery Act 2010 and  (ii) the United States Foreign Corrupt Practices          Act 1977.           "Charged   Property" means all  of the assets of the Security Parties which from time          to time are, or are expressed to be, the subject of the Security Documents.           "Charter   Assignments"    means  the  forms  of assignment  referred to in Clause          17.1.6 (Security Documents).           "Charterer" means Yamal Trade Pte.   Ltd., a company incorporated under the laws of          the Republic of Singapore whose  registered office is at 12 Marina Boulevard, #35-05          Marina Bay Financial Centre, Singapore, 018982.           "Charters"  means,  collectively:           (a)      the time charter dated  8 July 2014 entered  into between  Borrower A  (as                   owner)  and the Charterer  (as charterer) on the terms and  subject to the                   conditions of which Borrower A will time charter Vessel A to the Charterer;    lONUVE\30137956.24                                                                     Page 5  

 

         (b)     the time  charter dated 8 July 2014  entered into between  Borrower  B (as                   owner)  and  the Charterer (as charterer) on the terms  and subject to the                   conditions of which Borrower B will time charter Vessel B to the Charterer;            (c)     the time  charter dated 8 July 2014  entered into between  Borrower  C (as                   owner)  and  the Charterer (as charterer) on the terms  and subject to the                   conditions of which Borrower C will time charter Vessel C to the Charterer;            (d)     the time  charter dated 8 July 2014  entered into between  Borrower  D (as                   owner)  and  the Charterer (as charterer) on the terms  and subject to the                   conditions of which Borrower D will time charter Vessel D to the Charterer;            (e)     the time  charter dated 8 July 2014  entered into between  Borrower  E (as                   owner)  and  the Charterer (as charterer) on the terms  and subject to the                   conditions of which Borrower E will time charter Vessel E to the Charterer;                   and            (f)     the time  charter dated 8 July 2014  entered into between  Borrower  F (as                   owner)  and  the Charterer (as charterer) on the terms  and subject to the                   conditions of which Borrower F will time charter Vessel F to the Charterer,            each with the  initial charter period up to 31 December 2045  (and  subject to two           extension periods  of up to  five years each  at the option of  the Charterer), as           amended   on  22  September   2016  and  as  may   be further  amended,   restated,           supplemented  and/or  varied from time  to time to the extent permitted  under the           Finance Documents, and  "Charter"  means any one of them.            "CLNG"   means  China  LNG  Shipping  (Holdings) Limited, a company   incorporated           under the laws of Hong Kong whose  registered office is at Unit 1904, 19th Floor, West           Tower, Shun Tak Centre,  Nos. 168-200 Connaught Road   Central, Hong Kong.            "CLNG Group" means CLNG      and each of its Subsidiaries from time to time.            "Code"  means the US  Internal Revenue Code of 1986.            11 Commitmentn means:            (a)     in relation to an Original Lender, the amount set opposite its name  under                   the  heading "Commitment"   in Schedule  1 (The  Original Lenders) 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 cancelled, reduced or transferred by it under this Agreement.            "Commitment Fee"     means  the commitment fee  to be paid by the Borrowers to the           Agent under Clause 11.1 (Commitment Fee).            "Compliance    Certificate" means   a certificate delivered pursuant to Clause 19.2           (Compliance  Certificate) and signed by an authorised signatory of the Borrower or           relevant Vessel Sponsor Guarantor (as applicable) substantially in the form set out in           Schedule 8 (Form  of Compliance Certificate).   LONUVE\30137956.24                                                                     Page 6  

 

        "Confidential  Information"   means  all information relating to any Security Party,          any other member of the Teekay Group, the Finance Documents or the Loan    of which          a Finance Party becomes  aware  in its capacity as, or for the purpose of becoming, a          Finance Party which is received by a Finance Party in relation to, or for the purpose          of becoming a Finance Party under, the Finance Documents or the Loan  from either:           (a)      any Security Party, any other member   of the Teekay  Group  or any of its                   advisers; or           (b)      another Finance Party, if the information was obtained by that Finance Party                   directly or indirectly from any Security Party, any other member   of the                  Teekay Group or any of its advisers,           in whatever form, and includes information given orally and any document, electronic          file or any other way of representing or recording information which contains or is          derived or copied from such information but excludes information that:           (i)      is or becomes public information other than as a direct or indirect result of                   any breach by that Finance Party of Clause 35 (Confidentiality); or           (ii)     is identified in writing at the time of delivery as non-confidential by any                   Security Party, any  other member    of the Teekay   Group  or any  of its                   advisers; or           (iii)    is known by that Finance Party before the date the information is disclosed                   to it in accordance with (a) or (b) or is lawfully obtained by that Finance                   Party after that date, from a source which is, as far as that .finance Party is                   aware, unconnected  with any  Security Party or any  other member   of the                   Teekay  Group  and which,  in either case, as far as that Finance Party is                   aware, has not been obtained  in breach of, and is not otherwise subject to,                   any obligation of confidentiality.           "Confidentiality  Undertaking" means    a confidentiality undertaking substantially in          a recommended form of the Loan   Market Association at the relevant time.           "Confirmation"   means   a Confirmation  exchanged   or deemed   to  be exchanged          between   the Swap   Provider and  the Borrowers  as  contemplated  by  the Master          Agreement.           "Contract Price"  means,  in relation to a Vessel, the total price of the Vessel payable          by the relevant Borrower to the Builder under the relevant Building Contract.           "Credit Support Document"     means any document described    as such in the Master          Agreement and   any other document referred to in any such document which  has the          effect of creating security in favour of any of the Finance Parties.           "Credit Support Provider" means any person     (other than a Borrower) described as          such in the Master Agreement.           "CTA"  means the Corporation Tax Act 2009.           "Debt Service Reserve" means,    in respect of a Vessel Loan as at any relevant date,          an amount equal to the aggregate of the amount of:    LONUVE\30137956.24                                                                    Page 7  

 

        (a)      the Repayment  Instalment in respect of such Vessel Loan  due on the next                   Repayment  Date  (which shall be deemed   to be such relevant date if that                   day is a Repayment Date); and           (b)      interest in respect of such Vessel Loan due on the next Interest Payment                   Date (which  shall be deemed  to be  such relevant date  if that day is an                   Interest Payment Date).           "Debt Service  Reserve   Account"  means,  in respect of a Borrower, a bank account          to be opened  in the name of such Borrower with the Account  Holder and designated          "[Name of Borrower]  - Debt Service Reserve Account".           "Deeds  of Covenants"   means  the deeds  of covenants referred to in Clause 17.1.4          (Security Documents).           "Default"  means  an  Event of Default or any  event or circumstance  which  would          (with the  expiry of  a grace  period, the  giving of  notice, the making   of any          determination  under  the Finance  Documents   or any  combination  of any  of the          foregoing) be an Event of Default.           "Delegate"  means   any  delegate, agent, attorney or co-trustee appointed  by the          Security Agent.           "Delivery  Date" means  the date of actual delivery and acceptance of a Vessel to a          Borrower by the Builder under a Building Contract.           "Delivery  Instalment"   means  the fifth and final instalment of the Contract Price          which the relevant Borrower is obliged to pay to the Builder pursuant to clause 2.3(e)          (Final Instalment) of the relevant Building Contract.           "Direct  Agreement    Parties" means   the Charterer, the Builder and  each  Yamal          Sponsor Guarantor.           "Direct  Agreements"    means  the Quiet Enjoyment   Agreements,  the Replacement          Step-in Agreements and  the Replacement Novation Side  Letters.           "Disruption Event"  means either or both of:           (a)      a material disruption to those payment  or communications   systems  or to                   those financial markets which are, in each case, required to operate in order                   for payments to be made  in connection with the Loan (or otherwise in order                   for the transactions contemplated by the Finance Documents   to be carried                   out) which disruption is not caused by, and is beyond the control of, any of                   the Parties; or           (b)      the occurrence  of any  other event  which  results in a disruption (of a                   technical or systems-related nature) to the treasury or payments operations                   of a Party preventing that, or any other Party:                    (i)     from   performing  its payment    obligations under  the  Finance                           Documents;  or                    (ii)    from  communicating   with other  Parties in accordance  with the                           terms of the Finance Documents,   lONUVE\30137956.24                                                                    Page B  

 

        and which  (in either such case) is not caused by, and is beyond the control of, the          Party whose operations are disrupted.           "Distribution  Account"   means,  in respect of a Borrower,  a bank  account to be          opened  in the  name  of such  Borrower  with the  Account  Holder and  designated          "[Name of Borrower] -  Distribution Account".           "Dividend  Lock-Up   Account"  means,  in respect of a Borrower, a bank account to          be opened  in the name   of such Borrower  with the Account Holder  and designated          "[Name of Borrower]  - Dividend Lock-Up Account".           "Dividend  Restriction  Event" means,  (i) the occurrence of an Event of Default that          is continuing, (ii) non-compliance with the provisions of Clause 17.19  (Additional          Security) or  (iii) non-compliance with the  provisions of Clause  20.2.1(a) (Debt          Service Cover Ratios).           "DOC"   means,  in relation to the ISM Company,   a valid Document   of Compliance          issued for the ISM Company by the Administration  under paragraph  13.2 of the ISM          Code.           "Drawdown     Date"  means  the  date on  which the  relevant Drawing  is advanced          under Clause 5 (Advance).           "Drawdown     Request"  means  a notice substantially in the form set out in Schedule          3 (Drawdown Request).           "Drawing" means any part of a Ve?sel   Loan advanced  or to be advanced pursuant to          a Drawdown   Request and "Drawings" means more than one of them.           "Dry-docking   Reserve   Account"  means,  in respect of a Borrower, a bank account          to be opened  in the name of such Borrower with  the Account Holder and designated          "[Name of Borrower]  - Dry-docking Reserve Account".           "DSME"   means  Daewoo  Shipbuilding and Marine  Engineering Co. Ltd., a corporation          organised and  existing under the Jaws of the Republic of Korea, whose principle office          is at 125, Namdaemun-ro, Jung-gu, Seoul,  100-180, The  Republic of Korea.           "DY  Tankers"   means   DY  Tankers Limited, a  corporation organised and  existing          under the laws  of The Commonwealth   of the Bahamas,  whose  registered office is at          Bayside  Executive Park, Building No. 3, West Bay Street & Blake Road, P.O. Box N-         4875, Nassau,  The Commonwealth of the Bahamas.           "EA"  means Elf Aquitaine, a company incorporated under the laws of France.           "Earnings"  means  all hires, freights, pool income and other sums payable to or for          the account  of a Borrower  in respect of a Vessel including (without limitation) all          remuneration  for salvage and  towage  services, demurrage  and detention  moneys,          contributions in general average, compensation in respect of any requisition for hire,          and  damages and  other payments  (whether awarded  by any court or arbitral tribunal          or by agreement or otherwise) for breach, termination or variation of any contract for          the construction, operation, employment or use of a Vessel.    LONUVE\30137956.24                                                                     Page 9  

 

         "Encumbrance"    means   a mortgage,   charge, assignment,  pledge,  lien or other          security interest securing any obligation of any person or any other agreement   or          arrangement having   a similar effect.           "Environmental    Approval"  means  any  present or future permit, licence, approval,           ruling, variance, exemption or  other Authorisation required under  Environmental           Laws.           "Environmental     Claim"  means   any  and  all enforcement,   clean-up, removal,          administrative, governmental,  regulatory  or judicial actions, orders, demands  or          investigations instituted or completed   pursuant  to any  Environmental   Laws  or          Environmental Approvals together with  any claims made by any third person  relating          to damage, contribution, loss or injury resulting from any Environmental Incident.            "Environmental Incident" means:           (a)      any release, emission, spill or discharge into a Vessel or into or upon the air,                   sea, land or soils (including the seabed) or surface water of Environmentally                   Sensitive Material within or from a Vessel; or            (b)     any  incident in  which  Environmentally  Sensitive  Material is released,                   emitted, spilled or discharged  into or upon  the  air, sea, land or  soils                   (including the seabed) or surface water from a  vessel other than a Vessel                   and which  involves a collision between a Vessel and such  other vessel or                   some  other incident of navigation or operation, in either case, in connection                   with which a Vessel is actually or potentially liable to be arrested, attached,                   detained or injuncted and/or a Vessel and/or any Security Party and/or any                   operator or manager of a Vessel is at fault or allegedly at fault or otherwise                   liable to any legal or administrative action; or            (c)     any other incident in which Environmentally Sensitive Material is released,                   emitted, spilled or discharged  into or upon  the  air, sea, land or  soils                   (including the seabed) or surface water otherwise than from a Vessel and in                   connection with which a Vessel is actually or potentially liable to be arrested                   and/or  where  any  Security Party and/or any  operator  or manager   of a                   Vessel is at fault or allegedly at fault or otherwise liable to any legal or                   administrative action, other  than in  accordance  with an  Environmental                   Approval.            "Environmental   Law"  means   any applicable law and  regulation in any applicable          jurisdiction in which any  Security Party  conducts business  which  relates to the           pollution or protection of the environment or harm  to or the protection of human           health or the health of animals or plants.            "Environmentally   Sensitive  Material" means  (i) oil and oil products and (ii) any           other waste, pollutant, contaminant or other substance (including any liquid, solid,           gas, ion, living organism or noise) that may be harmful to human health or other life           or the environment or a nuisance  to any person or that may make   the enjoyment,           ownership or other territorial control of any affected land, property or waters more           costly for such person to a material degree.    LONUVE\30137956.24                                                                    Page 10  

 

         "Event of Default"  means  any event or circumstance specified as such in Clause 22           (Events of Default).            "Excluded Transferee"    means  a pooled investment vehicle or similar entity that is           commonly   but not exclusively referred to in the financial marketplace as a "hedge           fund" and having the following characteristics: (i) it generally seeks consistent levels           of returns regardless of market conditions, (ii) it generally uses complex strategies           (which may include but not be limited to short-selling, use of leverage and arbitrage           and derivatives transactions) in order to minimise market correlations with the goal           of generating high returns (either in an absolute sense or over a specified market           benchmark)   and   (iii) it generally is  open  only  to  financially sophisticated           investors. Such vehicle or entity will be construed so as to include "vulture funds"           and any pass-through or structured finance vehicles in whatever legal form which are           used by a such a vehicle or entity as part of structuring an investment.            "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 Business Days' written notice) as the office or offices through which it will           perform its obligations under this Agreement.            "Facility Period" means   the period beginning on the  date of this Agreement  and           ending on the date when  the whole of the Indebtedness has been  paid in full and the           Security Parties have ceased to be under any further actual or contingent liability to           the Finance Parties under or in connection with the Finance Documents.            11 FATCA 11 means:            (a)     sections 1471 to 1474 of the Code or any associated regulations;            (b)     any  treaty, law or regulation of any  other jurisdiction, or relating to an                   intergovernmental  agreement   between  the US  and any  other jurisdiction,                   which  (in either case) facilitates the implementation of any law or regulation                   referred to in (a); or            (c)     any  agreement   pursuant  to the  implementation  of  any  treaty, law or                   regulation referred to in (a) or (b) with the US Internal Revenue  Service,                   the US  government or any  governmental  or taxation authority in any other                   jurisdiction.            "FATCA Application Date" means:            (a)     in relation to a "withholdable payment" described in section 1473(1)(A)(i) of                   the Code  (which relates to payments of interest and certain other payments                   from sources within the US), 1 July 2014;            (b)     in relation to a "withholdable payment" described in section 1473(1)(A)(ii)                   of the  Code  (which  relates to "gross proceeds"  from the  disposition of                   property of a type that can produce interest from sources within the US), 1                   January 2019; or            (c)     in relation to a "passthru payment" described in section 1471(d)(7) of the                   Code  not falling within (a) or (b), 1 January 2019,    LONUVE\30137956.24                                                                    Page 11  

 

        or, in each case, such other date from which such payment may become   subject to a          deduction or withholding required by FATCA as a result of any change in FATCA after          the date of this Agreement.           "FATCA   Deduction"   means  a  deduction or withholding from  a payment   under a          Finance Document required  by FATCA.           "FATCA   Exempt   Party"  means  a Party  that is entitled to receive payments free          from any FATCA  Deduction.           "FATCA   FFI" means a foreign financial institution as defined in section 147l(d)(4) of          the Code which, if any Finance Party is not a FATCA Exempt Party, could be required          to make a FATCA  Deduction.           "Fee  Letter"  means   any  letter or letters dated on or  about  the date  of this          Agreement between the Arranger and   the Borrowers (or the Agent and the Borrowers          or the Security Agent and  the Borrowers) setting out any of the fees referred to in          Clause 11 (Fees).           "Finance  Documents"    means  this Agreement, the Security Documents,  the Master          Agreement,   the  Fee  Letter, the Direct  Agreements   and  any  other  document          designated  as such  by the  Agent and  the Borrowers   and "Finance   Document"          means any one  of them.           "Finance  Parties"  means  the Arranger, the Agent,  the Security Agent, the Swap          Provider and the Lenders and "Finance Party" means any one of them.           "Financial Indebtedness" means any indebtedness for or in   respect of:           (a)      moneys borrowed;           (b)      any amount   raised by acceptance  under any  acceptance  credit facility or                   dematerialised equivalent;           (c)      any amount   raised pursuant to any note  purchase facility or the issue of                   bonds, notes, debentures, loan stock or any similar instrument;           (d)      the amount of any liability in respect of any lease or hire purchase contract                   which  would, in accordance  with  GAAP,  be treated  as a  balance sheet                   liability;           (e)      receivables sold or discounted (other than  any receivables to the extent                   they are sold on a non-recourse basis);           (f)      any amount raised  under any  other transaction (including any forward sale                   or hire purchase   agreement)  of  a type  not  referred to in any   other                   paragraph of this definition having the commercial effect of a borrowing;           (g)      any derivative transaction entered into in connection with protection against                   or benefit from fluctuation in any rate or price (and, when calculating the                   value of any derivative transaction, only the marked to market value (or, if                   any actual amount is due as a result of the termination or close-out of that                   derivative transaction, that amount) shall be taken into account);    LONUVE\30137956.24                                                                    Page 12  

 

         (h)     any  counter-indemnity  obligation in respect of  a guarantee,  indemnity,                   bond,  standby  or documentary   letter of credit or any other  instrument                   issued by a bank or financial institution; and            (i)     the amount of any liability in respect of any guarantee or indemnity for any                   of the items referred to in paragraphs (a) to (h) above.            "GAAP11 means:            (a)     in  relation to the  Borrowers  and  TGP,  generally  accepted  accounting                   principles in the United States of America; and            (b)     in relation to CLNG, generally accepted accounting principles in Hong Kong.            "General  Assignments"    means  all the forms of assignment referred to in Clause           17.1.5 (Security Documents).            "Governmental    Agency"   means   any government   or any  governmental   agency,           semi-governmental  or judicial entity or authority (including, without limitation, any           stock exchange or any self-regulatory organisation established under statute).            "Guarantee"  means the guarantee   and indemnity of the Vessel Sponsor Guarantors           referred to in Clause 17.1.2 (Security Documents).            "Holding  Company"   means,  in relation to a person, any other person in respect of           which it is a Subsidiary.            "IAPPC"  means  a valid international air pollution prevention certificate for a Vessel           issued under Annex VI.            "IFRS"  means   international accounting standards within the meaning   of the lAS           Legislation 1606/2002 to the extent applicable to the relevant financial statements.            "Impaired Agent"   means the Agent at any time when:            (a)     it has failed to make   (or has notified a Party that it will not make)  a                   payment required to be  made by  it under the Finance Documents by the due                   date for payment;            (b)     the Agent otherwise rescinds or repudiates a Finance Document;            (c)     an  Insolvency Event  has occurred  and  is continuing with respect to the                   Agent;            unless, in the case of (a):            (i)     its failure to pay is caused by:                    (A)      administrative or technical error; or                    (B)      a Disruption Event; and                    payment is made within three Business  Days of its due date; or    LONLIVE\30137956.24                                                                   Page 13  

 

        (ii)     the Agent is disputing in good faith whether it is contractually obliged to                   make the payment in  question.           "Indebtedness"   means the aggregate from time to time of:  the amount of the Loan          outstanding; all accrued and unpaid interest on the Loan; and all other sums of any          nature (together with all accrued and unpaid interest on any of those sums) payable          to any of the Finance Parties under all or any of the Finance Documents.           "Indirect Tax" means any goods   and services taxes, consumption tax, valued added          tax or any tax of a similar nature, including without limitation any PRC VAT.           "Insolvency Event" in  relation to an entity means that the entity:           (a)      is dissolved (other than  pursuant  to a  consolidation, amalgamation   or                   merger);           (b)      becomes  insolvent or is unable to pay its debts or fails or admits in writing                   its inability generally to pay its debts as they become due;           (c)      makes  a general assignment,  arrangement  or composition  with or for the                   benefit of its creditors;           (d)      institutes or has instituted against it, by a regulator, supervisor or any                   similar official with  primary  insolvency,  rehabilitative or  regulatory                   jurisdiction over it in the jurisdiction of its incorporation or organisation or                   the jurisdiction of its head or home office, a proceeding seeking a judgment                   of insolvency or bankruptcy  or any other  relief under any bankruptcy  or                   insolvency law or other similar law ·affecting creditors' rights, or a petition is                   presented for its winding-up or liquidation by it or such regulator, supervisor                   or similar official;           (e)      has instituted against it a proceeding  seeking a judgment of insolvency or                   bankruptcy  or any other relief under any bankruptcy  or insolvency law or                   other similar law affecting creditors' rights, or a petition is presented for its                   winding-up  or liquidation, and, in the case  of any  such  proceeding  or                   petition instituted or presented against it, such proceeding or petition is                   instituted or presented by a person or entity not described in (d) and:           (i)    results in a judgment of insolvency or bankruptcy or the entry of an order for                 relief or the making of an order for its winding-up or liquidation; or           (ii)   is not dismissed, discharged, stayed or restrained in each case within thirty                  (30) days of the institution or presentation thereof;           (f)      has  exercised in respect of it one  or more   of the stabilisation powers                   pursuant to Part 1 of the Banking Act 2009 and/or has instituted against it a                   bank insolvency proceeding pursuant to Part 2 of the Banking Act 2009 or a                   bank administration proceeding pursuant to Part 3 of the Banking Act 2009;            (g)     has  a  resolution passed   for its winding-up,  official management    or                   liquidation (other than  pursuant  to  a  consolidation, amalgamation   or                   merger);    lONLlVE\30137956.24                                                                   Page 14  

 

         (h)     seeks   or becomes    subject to  the  appointment   of  an  administrator,                    provisional liquidator, conservator, receiver, trustee, custodian or other                   similar official for it or for all or substantially all its assets (other than, for so                    long as it is required by law or regulation not to be publicly disclosed, any                   such  appointment which  is to be made,  or is made, by a  person or entity                   described in (d));            (i)      has a secured party take possession of all or substantially all its assets or                    has a distress, execution, attachment, sequestration or other legal process                    levied, enforced or sued on or against all or substantially all its assets and                    such secured  party  maintains  possession, or  any  such  process is not                    dismissed, discharged, stayed or restrained, in each case within thirty (30)                    days thereafter;            (j)      causes or  is subject to any  event with  respect to it which,  under the                    applicable laws of any jurisdiction, has an analogous effect to any of the                    events specified in (a) to (i); or            (k)      takes any action in furtherance of, or indicating its consent to, approval of,                    or acquiescence in, any of the foregoing acts.            "Instalment   Drawings"   means  the drawings  in relation to the second, third and           fourth instalment payments under each  Building Contract.            "Insurances"   means  all policies and contracts of insurance (including all entries in           protection and  indemnity or war  risks associations) which are from  time to time           taken out or entered into in respect of or in connection with a Vessel or her increased           value or  her Earnings  and  (where  the context permits)  all benefits under such           contracts and policies, including all claims of any nature and returns of premium.            "Interest  Payment    Date"   means   each  date  for the  payment   of interest in           accordance with Clause 8.2 (Payment of interest).            "Interest  Period"  means   each  period determined  in accordance  with  Clause 9           (Interest Periods) and, in relation to an Unpaid  Sum,  each  period determined  in           accordance with Clause 8.3 (Default interest).            "Interpolated  Screen   Rate" means,  in relation to LIBOR for any Vessel Loan, the           rate which results from interpolating on a linear basis between:            (a)      the applicable Screen Rate  for the longest period (for which that Screen                    Rate is available) which is less than the Interest Period of that Vessel Loan;                    and            (b)      the applicable Screen Rate for the shortest period (for which that Screen                    Rate is available) which exceeds the Interest Period of that Vessel Loan,            each as of 11.00 a.m. on the Quotation Day for dollars.            "ISM  Code"  means   the International Management  Code  for the Safe Operation  of           Ships and for Pollution Prevention.    LONLlVE\30137956.24                                                                    Page 15  

 

        "ISM  Company"    means,  at any given time, the company  responsible for a Vessel's          compliance with the ISM Code  under paragraph  1.1.2 of the ISM Code.           "ISPS Code"   means the International Ship and Port Facility Security Code.           "ISSC"  means a valid international ship security certificate for a Vessel issued under          the ISPS Code.           "ITA" means the Income Tax Act 2007.           "Joint   Venture"   means    any   joint venture   entity,  whether   a  company,          unincorporated  firm, undertaking, association, joint venture or partnership or any          other entity.           "JV Partner" means any entity which  is:           (a)      a member of the TGP  Group  (in each case "TGP JV Partner"); or           (b)      CLNG  or a Subsidiary of CLNG (in each case, a "CLNG JV Partner").           "Legal  Opinion"  means  any  legal opinion delivered to the Agent under Clause 4.1          (Initial conditions precedent) or Clause 4.4 (Conditions subsequent).           11 Lender 11 means:           (a)      any Original Lender; and           (b)      any bank, financial institution, trust, fund or other entity which has become                   a·Party as a Lender in accordance with Clause 23 (Changes to the Lenders),           which  in each case has not ceased  to be a Lender in accordance with the terms  of          this Agreement.           "LIBOR"   means, in relation to any Vessel Loan:            (a)     the applicable Screen Rate; or            (b)     (if no Screen   Rate  is available for the  relevant Interest Period)  the                   Interpolated Screen Rate for that Vessel Loan; or           (c)      (if (i) no Screen Rate is available for the currency of that Vessel Loan or (ii)                   no Screen  Rate is available for the relevant Interest Period and it is not                   possible to calculate the Interpolated Screen Rate for that Vessel Loan)) the                   Reference Bank Rate,           as of 11.00 a.m. on the Quotation Day  for dollars and for a period equal in length to          the relevant Interest Period and, if that rate is less than zero, LIBOR shall be deemed          to be zero.            "Limitation Acts" means the Limitation Act 1980 and  the Foreign Limitation Periods           Act 1984.            "Loan"  means   the aggregate  amount   of the  Vessel Loans  advanced   or to  be          advanced   by the Lenders to the Borrowers under Clause 2 (The Loan)  or, where the    LONLIVE\30137956.24                                                                   Page 16  

 

-------------------··----                            context permits, the principal amount of the Vessel Loans advanced and for the time                           being outstanding.                            "Long  Stop Date"  means,  in relation to a Vessel, the date falling on 240 days from                           the Scheduled Delivery Date applicable to such Vessel.                            "Majority  Lenders"   means  a Lender  or Lenders  whose  Commitments    aggregate                           more  than 662/,%  of the Total Commitments    (or, if the Total Commitments  have                           been  reduced  to zero, aggregated  more  than  662/,%  of the Total Commitments                           immediately prior to the reduction).                            "Management Agreements" means,       collectively:                            (a)     the  ship management   agreement   dated 7 July 2014 entered  into between                                    Borrower A (as owner)  and the Approved  Manager (as  manager)  in respect                                    of Vessel A;                            (b)     the  ship management   agreement   dated 7 July 2014 entered  into between                                    Borrower B (as owner)  and the Approved  Manager  (as manager)  in respect                                    of Vessel B;                            (c)     the  ship management   agreement   dated 7 July 2014 entered  into between                                    Borrower C (as owner)  and the Approved  Manager  (as manager) in respect                                    of Vessel C;                            (d)      the ship management   agreement   dated 7 July 2014 entered  into between                                    Borrower D  (as owner) and the Approved  Manager {as  manager)  in respect                                    of Vessel D;                            (e)     the  ship management   agreement  dated  7 July 2014 entered  into between                                    Borrower E (as owner)  and the Approved  Manager  (as manager)  in respect                                    of Vessel E; and                            (f)      the ship management   agreement  dated  7 July 2014 entered  into between                                    Borrower F (as owner)  and the Approved  Manager  (as manager)  in respect                                    of Vessel F,                            each  as amended,   supplemented   and/or varied from  time to  time to the extent                           permitted  under the Finance  Documents,  and  "Management    Agreement"    means                           any one of them.                            "Managers'   Undertaking" means,   in relation to a Vessel, the written undertaking of                           the Approved   Manager  whereby,  throughout  the  Facility Period unless otherwise                           agreed by the Finance Parties:                            (a)      they will remain the manager of such Vessel;                            (b)      they will not, without the prior written consent of the Agent, subcontract or                                    delegate the management of such  Vessel to any third party; and                            (c)      the interests of the Approved Manager  in the Insurances  relating to such                                    Vessel (if the  Approval  Manager   is  named   assureds  or  co-assureds                                    thereunder) will be assigned to the Security Agent with first priority; and                     LONUVE\30137956.24                                                                    Page 17  

 

        (d)      (following the occurrence of an Event  of Default which  is continuing) all                   claims of the Approved Manager  against the Borrower  owning  such Vessel                  shall be subordinated to the claims of the Finance Parties under the Finance                  Documents.           "Mandatory   Prepayment    Event"  means,  in relation to a Vessel, the event where          the Charterer exercises its step-in rights in accordance with the Replacement Step-In          Agreement relating to such Vessel.           "Margin"  means three point one per cent (3.1%) per annum.           "Market Value"   means the value of a Vessel conclusively determined by the average          of valuations of that Vessel addressed to the Agent certifying a value for that Vessel          provided  by an  Approved  Shipbroker  appointed  on  behalf of the Agent  and  an          Approved  Shipbroker appointed  by the relevant Borrower on the  basis of a sale for          prompt delivery for cash at arm's length on normal commercial terms as  between  a          willing seller and a willing buyer, subject to the Agent's consent (which shall not be          withheld if the Approved Shipbrokers appointed both certify there is not a sufficiently          developed  market for the Vessel to provide a charter-free valuation), including the          cash flows associated with the relevant Charter.           "Master  Agreement"    means   any ISDA  Master  Agreement  (or any  other form  of          master  agreement  relating to interest or currency exchange transactions) entered          into between the Swap  Provider and the Borrowers  (or any one of them) during the          Facility Period, including each  Schedule  to  any  Master  Agreement    and  each          Confirmation exchanged  under any Master Agreement.           "Master  Agreement    Proceeds"   means  any  and all sums due  and payable to the          Borrowers   or any   of them   under  the  Master  Agreement   following  an  Early          Termination Date  (subject always to all rights of netting and set-off contained in the          Master Agreement) and  all rights to require and enforce the payment of those sums.           "Master  Agreement    Proceeds   Charge"  means  the  deed of charge referred to in          Clause 17.1.8 (Security Documents).           "Material Adverse Effect"   means in the reasonable opinion of the Majority Lenders          a material adverse effect on:           (a)      the business, operations, property,  condition (financial or otherwise) or                   prospects of any Security Party; or           (b)      the ability of any Security Party to perform its obligations under any Finance                   Document;  or           (c)      the validity, legality or enforceability of, or the effectiveness or ranking of                   any Encumbrance   granted or purporting to be granted pursuant to  any of,                   the Finance Documents or the rights or remedies of any Finance Party under                   any of the Finance Documents.           "Maximum     Loan  Amount"   means  US$275,000,000   for Vessel A, US$274,000,000          for  Vessel  B, US$275,000,000    for  Vessel C,  US$274,000,000    for  Vessel D,          US$269,000,000 for Vessel  E and US$265,000,000 for Vessel  F.    LONUVE\30137956.24                                                                    Page 18  

 

         "Month"  means a  period starting on one day in a calendar month and ending on the           numerically corresponding day in the next calendar month, except that:            (a)     subject to paragraph (c) below, if the numerically corresponding day is not a                   Business  Day,  that period shall end  on  the next  Business Day  in that                   calendar month  in which that period is to end if there is one, or if there is                   not, on the immediately preceding Business Day;            (b)     if there is no numerically corresponding day in the calendar month in which                   that period is to end, that period shall end on the last Business Day in that                   calendar month; and            (c)     if an Interest Period begins on the last Business Day of a calendar month,                   that Interest Period shall end  on the  last Business Day  in the calendar                   month in  which that Interest Period is to end.            The above rules will apply only to the last Month of any period.            "Mortgages"   means   the first priority statutory mortgages referred to in Clause           17.1.4 (Security Documents) together with the Deeds  of Covenants and "Mortgage"           means any one  of them.            "New Lender"   has the meaning  given to that term in Clause 23.1 (Assignments and           transfers by the Lenders).            "Non-Consenting    Lender"  has  the meaning  given to that term  in Clause 34.3.4           (Replacement of Lender).  _            "Operating   Expenses"   means   expenses  properly and  reasonably incurred  by a           Borrower  in connection with the operation, employment,   maintenance,  repair and           insurance of the relevant Vessel, such  expenses  to include, without limitation, all           amounts payable  by the relevant Borrower to the Approved Manager pursuant to the           relevant Management    Agreement   and  any corporate  or administrative expenses           incurred by such Borrower in its ordinary course of business.            "Operating  Expenses Reserve"    means,  in relation to a Borrower as at any relevant           date, an  amount  equal to  three Months'  of such Borrower's  Operating Expenses           (excluding scheduled dry-docking expenses  payable by the Charterer) in accordance           with its Vessel Operating Budget.            "Operating  Reserve Account"    means,  in respect of a Borrower, a bank account to           be opened  in the name  of such  Borrower with the Account  Holder and  designated           "[Name of Borrower]  - Operating Reserve Account".            "Original  Financial  Statements"   means   (a) the  audited consolidated financial           statements  of the Parent for the financial year ended 31 December 2016,   (b) the           unaudited financial statements for the financial year ended  31 December 2016    of           each Borrower and  (c) the audited financial statements for the financial year ended           31 December 2016   of each  Security Party (other than the  Parent, the Borrowers,           Teekay Operating  and the Approved  Manager)  which was  in existence for all or part           of that financial year.    LONUVE\30137956.24                                                                    Page 19  

 

         "Original Jurisdiction" means,  in relation to a Security Party, the jurisdiction under           whose  laws  that Security Party is formed or  incorporated as at the  date of this           Agreement.            "Parent"  means  TC  LNG  Shipping L.L.C., a limited liability company formed under           the laws of The Republic of the Marshall Islands whose registered address is at Trust           Company   Complex,   Ajeltake Road, Ajeltake Island, Majuro,  The  Republic of the           Marshall Islands MH96960.            "Parent  Pledge   Agreement"    means   the pledge  of the shares  or  membership           interests (as the case may be) of the Parent referred to in Clause 17.1.9 (Security           Documents).            "Party" means  a party to this Agreement.            "Payment    Notice" means,   in relation to the Delivery Instalment of a Vessel, a           notice of the amount  payable by the relevant Borrower  under the relevant Building           Contract to be issued by  the Builder to such Borrower  at least ten Business Days           prior to the anticipated payment date .            .. Permitted Encumbrance" means:            (a)     any  Encumbrance   created or to be created in accordance with the Security                   Documents;            (b)     any  liens securing obligations incurred in the ordinary course of trading                   and/or operating  a Vessel and not more  than thirty (30) days overdue and                   not exceeding an aggregate amount of $10,000,000 per Vessel;            (c)     any Encumbrance which   has the prior written approval of the Agent;            (d)     any  Encumbrance   arising by operation of law or otherwise in the ordinary                   course  of the operation, repair or maintenance  of any  Vessel where  the                   relevant Borrower  is contesting the claim giving rise to such lien in good                   faith by appropriate steps and for the payment of which adequate  reserves                   have  been made in  case such Borrower finally has to pay such claim so long                   as  any  such proceedings  shall not, and  may  reasonably  be  considered                   unlikely to lead to the arrest, sale, forfeiture or loss of any Vessel, or any                   interest in such Vessel; or            (e)     any  Encumbrances  arising by operation of law in respect of Taxes which are                   not overdue for payment or Taxes  which are overdue for payment but which                   are  being contested in good  faith by appropriate steps and  in respect of                   which   appropriate  reserves  have  been   made   so  long  as  any  such                   proceedings  or the continued existence of such Encumbrance  shall not and                   may reasonably   be considered unlikely to lead to the arrest, sale, forfeiture                   or loss of any Vessel, or any interest in such Vessel.             11           Permitted Transaction II means:            (a)     any   disposal  required,  Financial  Indebtedness   incurred,  guarantee,                   indemnity  or Encumbrance   or  Quasi-Security given, or other  transaction                   arising, under the Finance Documents; or    LONUVE\30137956.24                                                                    Page 20  

 

        (b)     transactions  (other than  (i) any sale, lease, license, transfer or other                   disposal, (ii) the granting of any guarantee or (iii) the granting or creation of                   any Encumbrance  (other than a Permitted Encumbrance)   or the incurring or                   permitting to subsist of Financial Indebtedness) conducted in the ordinary                   course of trading on arm's length terms.           "PRC"  means   the People's Republic of China  for the purpose  of this Agreement          excluding Hong  Kong  Special Administrative Region, Macau   Special Administrative          Region and Taiwan.           "PRC  Surcharges" means:           (a)      any national and  local surcharges (including without limitation any urban                   construction tax,  education  surcharge   or  local education  surcharge)                   chargeable in respect of any Indirect Tax pursuant  to the applicable PRC                   laws and regulations in effect as at the date of this Agreement; and           (b)      any other surcharges  of similar nature, imposed  in the  PRC  whether  in                   substitution for, or in addition to, the surcharges referred to in paragraph                   (a) above,           in each  case,  applicable to  the transactions  contemplated  under  the  Finance          Documents.           "PRC VAT"   means:           (a)      any tax imposed in compliance with the Circular (Cai Shui [2016] No. 36) on                   the Full Implementation  of the Business Tax  to Value Added  Tax  Reform                   Pilot issued by the Ministry Finance and the State Tax Bureau of the PRC ( «                   Mi&llB • §!l*fl!~.~;i.FoJ~'f~ffiilJE7fE.'!ll!fl!i&UE!l'!!M]JI. ttP.:ft;JJHij;!l} ( Mfl![2016]36                   ~)  ; and           (b)      any other tax of similar nature, imposed in the PRC whether in substitution                   for, or in addition to, the tax referred to in paragraph (a) above,           in each   case, applicable to  the transactions  contemplated  under  the  Finance          Documents.           "Pre-Approved    Classification Society"  means  each of Russian Maritime  Register          of Shipping and Bureau  Veritas or such other classification society acceptable to the          Majority Lenders such consent  not to be unreasonably  withheld if that classification          society is a member of the International Association of Classification Societies.           "Pre-Delivery   Assignments"    means   the deeds  of  assignment  of the  Building          Contracts, the Refund  Guarantees  and  the Supervision Agreements   referred to in          Clause 17.1.1 (Security Documents).           "Pre-Delivery   Expenses"   means,  in relation to a Vessel, the  aggregate of the          following costs (the amounts of which are to be confirmed by the Borrower with each          Drawdown   Request):           (a)      the supervision costs incurred by the relevant Borrower in supervising such                   Vessel's construction under the relevant Building Contract;    LONUVE\30137956.24                                                                    Page 21  

 

        (b)      the cost of purchasing depot  spares in an aggregate  amount  of no  more                   than $5,500,000;           (c)      the amounts   of commitment    fees, agency  fees  and  arrangement  fees                   payable by  the Borrower  up  to and including the Delivery Date  of such                   Vessel together  with the  amount   of interest incurred by  the  relevant                   Borrower under this Agreement during the Availability Period; and           (d)      any other costs approved by the Agent;           for which:           (i)      in the case of (a) above, the items listed as Schedule 2, Part IV, paragraph                   1 have been provided to and accepted by the Agent;           (ii)     in the case of (b) above (other than in respect of amounts payable to the                   Lender}, the items listed as Schedule 2, Part IV, paragraph  2 have  been                   provided to and accepted by the Agent;           (iii)    in the case of (d) above, the items listed as Schedule 2, Part IV, paragraph                   3 have been provided to and accepted by the Agent,           and, in respect of (b) above, any difference between the budgeted cost drawn under          the relevant Vessel Loan and the actual cost paid shall be refunded by the Borrowers          making  a  prepayment  of the relevant Vessel Loan  in the relevant amount  at the          same time as  the actual cost is paid.           "Pre-position  Date"  means,  in relation to the Delivery Instalment ·payable under          the relevant Building Contract and the relevant Payment Notice, the date specified in          such Payment Notice as  the date on which the Lenders shall pre-position the relevant          amount into the Builder's Bank.           "Proceeds Account"    means, in respect of a Borrower, the Proceeds Account (dollar)          or the Proceeds Account (euro).           "Proceeds   Account   (dollar)"  means,  in respect of  a Borrower,  a dollar bank          account  to be opened  in the name  of such Borrower  with the Account  Holder and          designated "[Name of Borrower]  - Proceeds Account (dollar)".           "Proceeds Account    (euro)"  means,  in respect of a Borrower, a euro bank account          to be opened  in the name of such Borrower with the Account  Holder and designated          "[Name of Borrower]-   Proceeds Account (euro)".           "Purchase   Option  Side Letter" has the meaning  given to such term  in Schedule 7          (List of Assigned Documents).           "Quasi-Security"   has the  meaning  given to  that term in Clause  21.9 (Negative          pledge).           "Quiet Enjoyment Agreement" means each        agreement of that name to be entered          into between the Security Agent, the Charterer and each Borrower in respect of each          Vessel.    LONLIVE\30137956.24                                                                   Page 22  

 

         "Quotation  Day"  means,  in relation to any period for which an interest rate is to be           determined, two Business Days  (in London) before the first day of that period, unless           market practice differs in the Relevant Interbank Market, in which case the Quotation           Day  will be determined  by the Agent  in accordance  with market  practice in the           Relevant Interbank  Market (and  if quotations would normally be  given by leading           banks in the Relevant Interbank Market on  more  than  one day, the Quotation Day           will be the last of those days).            "Rating Agency"   means any of Moody's Investors Service Limited, Standard & Poors           Rating Services, DBRS, Inc. and Fitch Ratings Ltd.            "Receiver"  means  a receiver or receiver and manager or administrative receiver of           the whole or any part of the Charged Property.            "Reference  Bank   Rate"  means,  in relation to LIBOR, the arithmetic mean of the           rates (rounded  upwards  to four decimal  places) as supplied to  the Agent  at its           request by the Reference Banks:            (a)     if:                    (i)      the Reference Bank  is a contributor to the applicable Screen Rate;                            and                    (ii)     it consists of a single figure,                    the rate (applied to the relevant Reference Bank and the relevant currency                   and  period) which contributors to the applicable Screen Rate are asked to                   submit to the relevant administrator; or            (b)     in any other case, the rate at which the relevant Reference Bank could fund                   itself in the relevant currency for the relevant period with reference to the                   unsecured  wholesale funding market.            "Reference   Banks"  means,  in relation to LJBOR, the  principal London offices of           HSBC  Bank  pic and Citibank or such other banks as may be appointed  by the Agent           in consultation with the Borrowers.            "Refund Guarantees" means, collectively:            (a)     the  refund guarantee  numbered   M0931407LG00178     dated  11 July 2014                   issued by  the Refund  Guarantor in favour of Borrower  A  pursuant to the                   Building Contract relating to Vessel A;            (b)     the  refund guarantee  numbered   M0931407LG00160     dated  11 July 2014                   issued by  the Refund  Guarantor in favour of Borrower  B  pursuant to the                   Building Contract relating to Vessel B;            (c)     the  refund guarantee  numbered   M0931407LG00153     dated  11 July 2014                   issued by  the Refund  Guarantor in favour of Borrower  C pursuant  to the                   Building Contract relating to Vessel C;            (d)     the  refund guarantee  numbered   M0931407LG00121     dated  11 July 2014                   issued by  the Refund  Guarantor in favour of Borrower  D  pursuant to the                   Building Contract relating to Vessel D;    LONUVE\30137956.24                                                                    Page 23  

 

         (e)     the refund  guarantee  numbered   M0931407LG00114     dated 11  July 2014                   issued by the Refund  Guarantor  in favour of Borrower  E pursuant  to the                   Building Contract relating to Vessel E; and           (f)      the refund  guarantee  numbered   M0931407LG00107     dated 11  July 2014                   issued by the  Refund Guarantor  in favour of Borrower  F pursuant  to the                   Building Contract relating to Vessel F,           and  "Refund Guarantee" means any one     of them.           "Refund   Guarantor" means The   Export-Import Bank of Korea,  a financial institution          incorporated under the laws of the Republic of Korea, acting through its office at 38,          Eunhaeng-Ro    (16-1,  Yeouido-Dong),   Yeongdeungpo-Gu,     Seoul  150-996,   The          Republic  of Korea, or any  other first class bank or financial institution having a          foreign currency credit rating for its long-term unsecured and non credit-enhanced          debt  originations of A- or higher by Standard &  Poor's Ranking Services or A3  or          higher  by  Moody's  Investors Services  Limited or a  comparable   rating from  an          internationally recognised credit rating agency, as shall be approved by the Lenders          that has issued or will issue the Refund Guarantee.            "Related  Fund"  in relation to a fund (the "first fund"), means  a fund  which is           managed  or advised by the same  investment manager or investment adviser as   the          first fund or, if it is managed by  a different investment manager   or investment          adviser, a fund whose  investment  manager  or investment  adviser is an Affiliate of          the investment manager or investment adviser of the first fund.            "Relevant  Documents"   means  the· Finance Documents,  the Building Contracts, the           Refund  Guarantees, the  Charters, the Supervision  Agreements,  the  Management           Agreements and  any other Assigned Documents.            "Relevant Interbank Market" means the London     interbank market.            "Relevant Jurisdiction" means,  in relation to a Security Party:            (a)     its Original Jurisdiction;            (b)     any jurisdiction where any asset subject to or intended to be subject to a                   Security Document to be  executed by it is situated;            (c)     any jurisdiction where it conducts its business; and            (d)     the jurisdiction whose laws  govern the  perfection of any of the Security                   Documents entered   into by it.            "Repayment    Date"  means  the date for payment  of any Repayment   Instalment in           accordance with Clause  6 (Repayment)  as  more  particularly set out in Schedule 4           (Repayment Schedu!e).            "Repayment    Instalment"  means  any  instalment of a Vessel Loan to be repaid by           the Borrowers under Clause 6 (Repayment).            "Repeating  Representations" means each     of the representations set out in Clause           18 (Representations)  other than  those representations and  warranties  in Clause           18.1.5 (Validity and admissibility in evidence), Clause 18.1.8 (No filing or stamp   lONUVE\30137956.24                                                                    Page 24  

 

        taxes), Clause 18.1.9  (Deduction of tax), Clause 18.1.10(a)  (No material default)          and Clause 18.1.25 (US Tax Obligor).           "Replacement    Novation   Side  Letters"  means  in respect of each  Vessel, each          letter of that name  to  be entered  into between  the  Security Agent, the  Yamal          Sponsor Guarantors, the Builder and each Borrower.           "Replacement Step-In     Agreement"   means  the replacement step-in  agreement in          respect of each  Vessel  made  between  the  Builder (as builder), (b) the relevant          Borrower (as buyer) (c) the Charterer (as charterer) and (d) the Security Agent.           "Representative"   means   any delegate, agent,  manager,  administrator, nominee,          attorney, trustee or custodian.           "Requisition  Compensation"    means  all compensation  or other money  which may          from  time to time be payable  to a Borrower  and/or the Charterer as a result of a          Vessel being requisitioned for title or in any other way compulsorily acquired (other          than by way of requisition for hire).           "Restricted  Party" means   a person or entity that is (a) listed on, or 50% or more          owned  or controlled by a person listed on, or acting on behalf of a person listed on,          any Sanctions  List; (b) a national of, located in, incorporated under the laws of, or          50% or more   owned  or (directly or indirectly) controlled by, or acting on behalf of, a          person  located  in or organised  under  the  laws of Sanctioned   Country; or  (c)          otherwise a target of Sanctions ("target of Sanctions" signifying a person with whom          a US person  or other national of Sanctions Authority would be prohibited or restricted          by applicable Sanctions from engaging in trade, business or other activities).           "Retention Account" means,    in respect of a Borrower, a bank account to be opened          in the name  of such  Borrower with the  Account Holder  and designated  "[Name  of          Borrower]  - Retention Account".           "Sanctioned   Country"  means  a  country or territory that is, or whose government          is, the subject of country-wide or territory-wide Sanctions.           "Sanctions"   means   the   economic  sanction  laws,  regulations, embargoes    or          restrictive measures administered, enacted or enforced by: (a) the People's Republic          of  China; (b)  the United  States government;   (c) the  United  Nations; (d)  the          European  Union or  its Member States; (e) the United Kingdom; or (f) the respective          governmental   institutions and agencies of any of the foregoing, including, without          limitation, the Office of Foreign Assets Control of the US Department  of Treasury          ("OFAC"),   the United  States Department   of  State and  Her  Majesty's Treasury          ("HMT")  (together, the "Sanctions Authorities").           "Sanctions   List" means  the "Specially Designated Nationals and Blocked Persons"          list maintained by the  OFAC,  the Consolidated List of Financial Sanctions Targets          maintained  by HMT,  or any  similar list maintained by, or public announcement  of          Sanctions designation made by,  any of the Sanctions Authorities.           "Scheduled   Delivery Date"   means, in relation to a Vessel, the date on which such          Vessel is scheduled for delivery pursuant to the relevant Building Contract, being:           (a)      in respect of Vessel A, 28 February 2020;    lONUVE\30137956.24                                                                    Page 25  

 

        (b)      in respect of Vessel B, 29 January 2020;           (c)      in respect of Vessel C, 29 November 2019;           (d)      in respect of Vessel D, 29 October 2019;           (e)      in respect of Vessel E, 29 November 2018; and           (f)      in respect of Vessel F, 29 January 2018.           "Screen   Rate"  means   the London   interbank offered rate administered  by  ICE          Benchmark   Administration  Limited (or any  other  person  which  takes  over the          administration of that rate) for the relevant currency and period displayed on pages          LIBOR01  or LIBOR02  of the Thomson   Reuters screen (or any replacement  Thomson          Reuters  page which  displays that rate or on the  appropriate page  of such other          information service which publishes that rate from time to time in place of Thomson          Reuters.  If such page or the service ceases to be available, the Agent may specify          another  page  or service displaying the relevant rate after consultation with the          Borrowers.           "Secured   Parties"  means  each  Finance  Party from  time to  time party  to this          Agreement and  any Receiver or Delegate.           "Security  Documents"    means  the Pre-Delivery Assignments, each  Guarantee, the          Borrower Pledge  Agreements,  the Mortgages, the Charter Assignments,  the General          Assignments,  the Account Security Deeds,  the Managers'  Undertakings, the Master          Agreement   Proceeds  Charge, the  Parent Pledge Agreement   and  any  other Credit          Su.pport Documents  or (where  the context permits) any one  or more  of them, and          any other agreement or document which   may at any time be  executed by any person          as security for the payment  of all or any part of the Indebtedness and  "Security          Document" means     any one of them.           "Security  Parties"  means   each  Borrower, the  Parent, Teekay   Operating, each          Vessel Sponsor Guarantor, the Approved  Managers  and any other person who  may at          any  time during the Facility Period be liable for, or provide security for, all or any          part of the Indebtedness (other than (a) the Charterer, (b) the Builder, (c) the Yamal          Sponsor Guarantors and  (d) YLNG), and "Security Party" means any one of them.           "Security   Perfection   Requirements"     means,    in respect   of the   Security          Documents:           (a)      registration of the Mortgage at the Bahamas Maritime Authority;           (b)      execution of all notices and consents as required under the relevant Security                   Document;  and           (c)      any other Authorisations of the Security Documents  as may  be required in                   any legal opinion accepted under Clause 4 (Conditions of Utilisation).           "Ship Registry"  means the ship registry of the Approved Flag.           "SMC"   means  a valid safety management   certificate issued for a Vessel by or on          behalf of the Administration under paragraph 13.7 of the ISM Code.    LONLlVE\30137956.24                                                                   Page 26  

 

        "Subsidiary"  means a subsidiary undertaking within the meaning  of section 1162 of          the Companies Act 2006.           "Supervision Agreements" means, collectively:           (a)     the supervision agreement in respect of Vessel A dated 7 July 2014 entered                  into between  Borrower  A (as buyer), the  Builder (as builder) and Teekay                  Shipping Limited (as supervisor);           (b)     the supervision agreement in respect of Vessel B dated 7 July 2014 entered                  into between  Borrower  B (as buyer), the  Builder (as builder) and Teekay                  Shipping Limited (as supervisor);           (c)     the supervision agreement in  respect of Vessel C dated 7 July 2014 entered                  into between  Borrower  C (as buyer), the  Builder (as builder) and Teekay                  Shipping Limited (as supervisor);           (d)     the supervision agreement in respect of Vessel D dated 7 July 2014 entered                  into between  Borrower  D  (as buyer), the Builder (as builder) and Teekay                  Shipping Limited (as supervisor);           (e)     the supervision agreement in  respect of Vessel E dated 7 July 2014 entered                   into between Borrower  E (as buyer), the  Builder (as builder) and Teekay                  Shipping Limited (as supervisor); and           (f)     the supervision agreement in  respect of Vessel F dated 7 July 2014 entered                   into between Borrower  F (as buyer), the  [luilder (as builder) and Teekay                  Shipping Limited (as supervisor),                    each as amended,   supplemented  and/or  varied from  time to time to the                   extent  permitted  under  the   Finance  Documents,   and   "Supervision                  Agreement" means any one of them.           "Tax" means   any tax, levy, impost, duty or other charge or withholding of a similar          nature (including any penalty or interest payable in connection with any failure to          pay or any delay in paying any of the same).           "Teekay   Group"    means   Teekay   Parent, TGP   and  each   of their  respective          Subsidiaries from time to time.           "Teekay   Operating"    means  Teekay   LNG   Operating  L.L.C., a limited  liability          company   incorporated according to the law of The Republic of the Marshall Islands          whose  registered address  is at Trust Company   Complex,  Ajeltake Road,  Ajeltake          Island, Majuro, The Republic of the Marshall Islands MH96960.           "Teekay   Parent" means   Teekay Corporation, a corporation incorporated according          to the law of The  Republic of the Marshall Islands whose  registered address is at          Trust Company Complex,   Ajeltake Road, Ajeltake Island, Majuro, The Republic of the          Marshall Islands MH96960.           "Termination   Date" means,  in respect of a Vessel Loan, subject to any prepayment          or cancellation of such Vessel Loan as may be  permitted under Clause  7 (Illegality,          Prepayment and Cancellation), the date falling on the earlier of:    LONUVE\30137956.24                                                                    Page 27  

 

         (a)      144 Months from the Delivery Date of the Vessel to which such Vessel Loan                   relates; and            (b)     180 Months from the date of this Agreement,            or such later date as the Lenders may agree.            "TGP"  means Teekay LNG   Partners L.P., a limited partnership formed under the laws           of The Republic of the Marshall Islands whose registered address is at Trust Company           Complex,  Ajeltake Road,  Ajeltake Island, Majuro,  The  Republic  of the Marshall           Islands MH96960.            "TGP  Group"  means TGP  and each of its Subsidiaries from time to time.            "Total Commitments" means the aggregate of the Commitments.            "Total Loss" means:            (a)     an  actual, constructive, arranged, agreed or compromised   total loss of a                   Vessel; or            (b)     the  requisition for title or compulsory  acquisition of a Vessel  by  any                   government or other competent   authority (other than by way of requisition                   for hire); or            (c)     the  capture, seizure, arrest, detention, hijacking, theft, condemnation as                   prize, confiscation or forfeiture of a Vessel (not falling within (b)), unless                   that Vessel  is released and  returned  to the possession  of the relevant                   Borrower or the Charterer within thirty (30) days after the capture, seizure,                   arrest, detention, hijacking, theft, condemnation as prize, confiscation or                   forfeiture in question.            "Total  Project Cost"  means,   in relation to a Vessel, the aggregate  of (a) the           Contract Price, and (b) the Pre-Delivery Expenses, each in respect of such Vessel.            "Transaction   Party" means   each of the  Security Parties and the parties to the           Relevant Documents (other than  any Finance Party and the Account Holder).            "Transfer  Certificate" means   a  certificate substantially in the form set out in           Schedule  5 (Form  of Transfer Certificate) or any other form agreed  between  the           Agent and the Borrowers.            "Transfer Date"  means,  in relation to an assignment or a transfer, the later of:            (a)     the proposed  Transfer Date specified in the relevant Assignment Agreement                   or Transfer Certificate; and            (b)     the date on  which the Agent  executes the relevant Assignment  Agreement                   or Transfer Certificate.            "Trust Propertyn means:            (a)     all benefits derived by the Security Agent  from  Clause 17  (Security and                   Application of Moneys); and    LONUVE\30137956.24                                                                    Page 28  

 

         (b)     all benefits arising under (including, without limitation, all proceeds of the                   ~nforcement of) each of the Security Documents,            with the exception of any benefits arising solely for the benefit of the Security Agent.            "Unpaid  Sum"   means  any sum  due  and payable  but unpaid by any  Security Party           under the Finance Documents.            "US" means the United States of America.            "US Tax Obligor"  means:            (a)     a Security Party which is resident for tax purposes in the US; or            (b)     a  Security  Party some   or all of whose   payments   under  the  Finance                   Documents   are  from  sources within the  US  for US  federal income  tax                   purposes.            "Vessel  A" means  the Arc  7 172,410  m3 ice breaking LNG  carrier and everything           now  or  in the future  belonging to  her on  board  and  ashore,  currently under           construction by the Builder with the Builder's hull number 2434 on the terms of the           relevant Building Contract and, on delivery to Borrower A, intended to be registered           under the flag of the Commonwealth of the Bahamas.            "Vessel  B" means  the Arc  7 172,410  m3 ice breaking LNG  carrier and everything           now  or  in the future  belonging to  her on  board  and  ashore,  currently under           construction by the Builder with the Builder's hull number 2433 on the terms of the           relevant Building Contract and, on delivery to Borrower B, intended to be registered           under the flag of the Commonwealth of the Bahamas.            "Vessel  C" means  the Arc  7 172,410  m3 ice breaking LNG  carrier and everything           now  or  in the future  belonging to  her on  board  and  ashore,  currently under           construction by the Builder with the Builder's hull number 2431 on the terms of the           relevant Building Contract and, on delivery to Borrower C, intended to be registered           under the flag of the Commonwealth of the Bahamas.            "Vessel  D" means  the  Arc 7 172,410  m3 ice breaking LNG  carrier and everything           now  or  in the future  belonging to  her on  board  and  ashore,  currently under           construction by the Builder with the Builder's hull number 2430 on the terms of the           relevant Building Contract and, on delivery to Borrower D, intended to be registered           under the flag of the Commonwealth of the Bahamas.            "Vessel  E" means  the Arc 7  172,410  m3 ice breaking LNG  carrier and everything           now  or  in the future  belonging to  her on  board  and  ashore,  currently under           construction by the Builder with the Builder's hull number 2425 on the terms of the           relevant Building Contract and, on delivery to Borrower E, intended to be registered           under the flag of the Commonwealth of the Bahamas.            "Vessel F" means the Arc 7  172,410 m3  ice breaking LNG carrier and everything now           or in the future belonging to her on board and ashore, currently under construction           by the  Builder with the Builder's hull number 2423  on the  terms of the  relevant           Building Contract and, on delivery to Borrower F, intended to be registered under the           flag of the Commonwealth of the Bahamas.    LONLIVE\30137956.24                                                                   Page 29  

 

         "Vessel Loan"  means:            (a)     in respect of Vessel A, an amount  up to the lesser of US$275,000,000  and                   80% of the Total Project Cost of Vessel A advanced or to be advanced to the                   Borrowers by the Lenders  in respect of Vessel A;            (b)     in respect of Vessel B, an amount  up to the lesser of US$274,000,000  and                   80% of the Total Project Cost of Vessel B advanced or to be advanced to the                   Borrowers by the Lenders in respect of Vessel B;            (c)     in respect of Vessel C, an amount  up to the lesser of US$275,000,000  and                   80% of the Total Project Cost of Vessel C advanced or to be advanced to the                   Borrowers by the Lenders  in respect of Vessel c;            (d)     in respect of Vessel D, an amount up  to the lesser of US$274,000,000  and                    80% of the Total Project Cost of Vessel D advanced or to be advanced to the                   Borrowers by the Lenders  in respect of Vessel D;            (e)     in respect of Vessel E, an amount up  to the lesser of US$269,000,000  and                   80% of the Total Project Cost of Vessel E advanced or to be advanced to the                   Borrowers by the Lenders  in respect of Vessel E; and            (f)     in respect of Vessel F, an amount up  to the lesser of US$265,000,000  and                   80% of the Total Project Cost of Vessel F advanced or to be advanced to the                    Borrowers by the Lenders in respect of Vessel F,            or, in each case,  where the  context permits, the aggregate  principal amount  so           advanced  and for the time being outstanding and "Vessel Loans"  means  more than           one of them.            "Vessel  Operating  Budget"  means,  in relation to a Borrower, an annual budget of           anticipated Operating Expenses of such Borrower for the ensuing year.            "Vessel  Sponsor  Guarantee"   means the  several guarantee and  indemnity of each           Vessel Sponsor Guarantor referred to in Clause 17.1.2 (Security Documents).            "Vessel  Sponsor    Guarantors"   means,  together,  (a) TGP,  and  (b) CLNG   and           "Vessel Sponsor Guarantor"    means either of them.            "Vessels"  means, collectively, Vessel A, Vessel B, Vessel C, Vessel D, Vessel E and           Vessel F and "Vessel" means any one  of them.            "Yamal   Bareboat  Charter"  has the meaning  given to that term in Clause 21.10.2           (Charter Arrangements).            "Yamal Sponsor Guarantee" means,      in relation to a Vessel, any one (1) of:                     the deed of guarantee dated 8 July 2014 and granted by (i) JSC Novatek, a                   joint stock company  incorporated under the laws of the Russian Federation                    with registered number 33556474 whose   registered office is at 22a, Pobedy                    Street, Tarko-Sale, Purovsky  Area,  Yamalo-Nenets   Autonomous   Region,                    629850, Russian Federation ("JSC Novatek"), in  favour of (ii) the Borrower                    owning such Vessel;    LONUVE\30137956.24                                                                     Page 30  

 

                 the  deed  of  guarantee  dated  8 July  2014  and  granted  by  (i) CNPC                   International Limited, a limited liability company incorporated and registered                   in the  Cayman   Islands  with it registration number  80856,  and  whose                   registered  office is at Offices of  Mourant  Ozannes   Corporate  Service                   (Cayman)   Limited at 94 Solaris Avenue, Camana Bay, P.O. Box 1348, Grand                   Cayman   KY1-1108,  Cayman  Islands ("CNPC"), in favour of (ii) the Borrower                   owning  such Vessel;            (c)     the deed  of guarantee dated 8 July 2014 and  granted by (i) originally Total                   E&P  Holdings SA, a company incorporated  in France with registered number                   652  004  565  RCS  NANTERRE   whose  registered office is at 2, Place Jean                   Millier, La Defense 6, 92400  Courbevoie, France, which  later merged  into                   EA, in favour of (ii) the Borrower owning such Vessel; and            (d)     any Alternative Yamal Sponsor Guarantee,            pursuant to which the aggregate maximum amount of liability of the guarantors shall           be  one hundred  and  sixty million dollars ($160,000,000)  and  "Yamal   Sponsor           Guarantees" means any two (2) or more of them.            ""Yamal Sponsor Guarantor""   means each  of:            (a)     JSC  Novatek;            (b)     CNPC;            (c)     EA; and            (d)     any Alternative Yamal Sponsor Guarantor,            and "Yamal Sponsor Guarantors" means any two (2) or more of them.            "YLNG"  means JSC Yamal   LNG, a joint stock company incorporated under the laws of           the Russian  Federation whose  registered address  is at 25A, Khudi-Seroko  Street,           village Yar-Sale, Yamal Region, Yamalo-Nenets Autonomous District, Russia, 629700.            "YLNG   Guarantees"   has the  meaning  given to such  term in Schedule  7 (List of           Assigned Documents).   1.2      Construction      Unless  a  contrary  indication appears,  any  reference  in this           Agreement to:            1.2.1   any  "Lender",  any  "Borrower",  any  "Vessel  Sponsor   Guarantor", the                                                                                        11                  "Arranger", the "Agent", the  "Swap   Provider", any nsecured  Party  , the                   "Security Agent",   any "Finance  Party" or any "Party"  shall be construed                   so  as to include its successors in title, permitted assignees and permitted                   transferees;            1.2.2   "assets"  includes present  and future  properties, revenues and  rights of                   every description;            1.2.3   a   "Finance   Document",     a   .. Security Document",     a  "Relevant                    Document"    or  any  other  document   is a  reference  to  that Finance     LONUVE\30137956.24                                                                   Page 31  

 

                 Document,   Security Document,  Relevant Document   or other document   as                   amended,  novated, supplemented, extended or restated from time to time;            1.2.4   a "group of Lenders"   includes all the Lenders;            1.2.5   "indebtedness"   includes any obligation (whether incurred as principal or as                   surety) for the payment or repayment of money, whether present or future,                   actual or contingent;            1.2.6   a   "person"   includes   any  individual,  firm,  company,    corporation,                   government,   state or agency  of a  state or any  association, trust, joint                   venture, consortium  or partnership or other entity (whether or not having                   separate legal personality);            1.2.7   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  of any                   regulatory, self-regulatory or other authority or organisation;            1.2.8   a provision of law is a reference to that provision as amended or re-enacted                   from time to time; and            1.2.9   a time of day (unless otherwise specified) is a reference to Beijing time.   1.3      Headings    Section, Clause and Schedule headings are for ease of reference only.   1.4      Defined  terms     Unless a contrary indication appears, a term used  in any other           Finance Document   or in any notice given under or in connection with any  Finance           Document   has the same   meaning  in that Finance  Document  or  notice as in this           Agreement.   1.5      Default   A Default (other than an Event of Default) is "continuing" if it has not been           remedied  or waived and an Event of Default is "continuing" if it has not been waived.   1.6      Charters  The  provisions of clause 11.7 of each Quiet Enjoyment Agreement shall be           incorporated herein with respect to any references in this Agreement to a clause of a           Charter.   1.7      Currency   symbols   and  definitions    11 US$", nuson and  "dollarsn denote  the           lawful currency of the United States of America.   1.8      Third party  rights   A person who  is not a Party has no right under the Contracts           (Rights of Third Parties) Act 1999 (the "Third Parties Act") to enforce or to enjoy           the benefit of any term of this Agreement.   1.9      Offer letter  This Agreement supersedes the terms and   conditions contained in any           correspondence  relating to the subject matter of this Agreement exchanged between           any Finance Party and the Borrowers or their representatives before the date of this           Agreement.    1.10    Contractual recognition of bail-in    LONUVE\30137956.24                                                                     Page 32  

 

         1.10.1  In this Clause 1.10:                    "Bail-In  Action"  means  the exercise of any  Write-down  and  Conversion                   Powers.                    "Bail-In Legislation" means:                    (a)      in relation to an EEA Member  Country which  has implemented,  or                            which at any time  implements, Article 55 of Directive 2014/59/EU                            establishing a framework for the recovery and  resolution of credit                            institutions and investment firms, the relevant implementing law or                            regulation as described in the EU Bail-In Legislation Schedule from                            time to time; and                    (b)      in relation to any other state, any analogous law or regulation from                            time to time which  requires contractual recognition of any Write­                           down and  Conversion Powers  contained in that law or regulation.                    "EEA  Member Country"     means any member state    of the European Union,                   Iceland, Liechtenstein and Norway.                    "EU  Member State" means any member state of the European      Union.                    "EU  Bail-In Legislation Schedule" means the document described as    such                   and  published by  the Loan  Market Association (or any  successor person)                   from time to time.                    "Resolution   Authority"  means  any  body which  has authority to exercise                   any Write-down and   Conversion Powers .                    .. Write-down and Conversion Powers"     means:                     (a)     in relation to any Bail-In Legislation described in the EU Bail-In                            Legislation Schedule from  time to time, the powers  described as                            such  in relation to  that Bail-In Legislation in the  EU  Bail-In                            Legislation Schedule; and                     (b)     in relation to any other applicable Bail-In Legislation:                             (i)     any   powers  under  that  Bail-In Legislation to  cancel,                                    transfer or dilute shares issued by a person that is a bank                                    or investment firm  or other financial institution or affiliate                                    of a bank, investment firm or other financial institution, to                                    cancel, reduce, modify or change  the form of a liability of                                    such  a person or any  contract or instrument under which                                    that liability arises, to convert all or part of that liability                                     into shares, securities or obligations of that person or any                                    other  person,  to  provide  that any   such  contract or                                     instrument  is to have  effect as  if a  right had  been                                     exercised under it or to suspend any obligation in respect                                     of that liability or any of the powers under that Bail-In                                     Legislation that are related to or ancillary to any of those                                     powers; and    LONLlVE\30137956.24                                                                   Page 33  

 

                          (ii)    any  similar  or analogous   powers   under  that  Bail-In                                    Legislation.            1.10.2  Notwithstanding  any  other term  of any  Finance Document   or any  other                   agreement,  arrangement  or understanding  between  the Parties, each Party                   acknowledges  and  accepts that any liability of any Party to any other Party                   under or in connection with the Finance Documents  may be  subject to Bail­                  In  Action by  the  relevant Resolution Authority  and  acknowledges   and                   accepts to be bound by the effect of:                    (a)      any Bail-In Action in relation to any such liability, including (without                            limitation):                             (i)     a reduction, in full or in part, in the principal amount, or                                    outstanding amount due   (including any accrued but unpaid                                    interest) in respect of any such liability;                             (ii)    a conversion of all, or part of, any such liability into shares                                    or other instruments of ownership  that may be  issued to,                                    or conferred on, it; and                             (iii)   a cancellation of any such liability; and                    (b)      a variation of any term  of any Finance  Document   to the extent                            necessary to give effect to any Bail-In Action in relation to any such                            liability.    LONUVE\30137956.24                                                                     Page 34  

 

Section 2       The Loan   2       The Loan   2.1     Amount      Subject to the  terms of this Agreement,   the Lenders  agree to make          available to the Borrowers on a joint and several basis a term loan comprising all the          Vessel Loans and not exceeding in aggregate the Maximum   Loan Amount.   2.2     Finance Parties' rights and obligations           2.2.1    The obligations of each Finance  Party under  the Finance  Documents  are                   several. Failure by a  Finance Party to perform  its obligations under the                   Finance Documents  does  not affect the obligations of any other Party under                   the Finance Documents.   No Finance Party is responsible for the obligations                   of any other Finance Party under the Finance Documents.           2.2.2    The rights of each Finance Party under  or in connection with the Finance                   Documents  are separate and independent rights and  any debt arising under                   the Finance  Documents   to a  Finance Party  from  a Security Party is a                   separate and independent debt in respect of which a Finance Party shall be                   entitled to enforce its rights in accordance with Clause 2.2.3. The rights of                   each Finance Party include any debt owing to that Finance Party under the                   Finance Documents and, for the avoidance of doubt, any part of the Loan or                   any other  amount  owed  by  a Security Party which  relates to a Finance                   Party's participation in the Loan or its role under  a Finance  Document                   (including any such amount  payable  to the Agent on  its behalf) is a debt                   owing to that Finance Party by that Security Party.           2.2.3    A  Finance  Party may,   except as  specifically provided in the  Finance                   Documents,  separately enforce its rights under or in connection with the                   Finance Documents.   3       Purpose   3.1     Purpose     The  Borrowers  shall apply the  Loan for the  purposes  referred to in          Preliminary (B) and  each  Drawing  under  a Vessel Loan  shall be applied  only in          respect of the relevant Vessel.   3.2     Monitoring    No  Finance Party is bound to monitor or verify the application of any          amount borrowed   under this Agreement.   4       Conditions of Utilisation   4.1     Initial conditions precedent           4.1.1   The   Lenders will only be  obliged to  comply  with Clause  5.3  (Lenders'                  participation) in relation to the advance of the first Drawing in respect of                   each Vessel Loan  if, on or before the relevant Drawdown  Date, the Agent                   has received all of the documents  and  other evidence  listed in Part I of                   Schedule 2 (Initial Conditions Precedent) in form and substance satisfactory                   to the Agent, save that references in Section 2 of that Part I to "the Vessel"                   or to any person or document relating to a Vessel shall be deemed to relate    LONUVE\30137956.24                                                                    Page 35  

 

                 solely to the Vessel specified in the relevant Drawdown Request  or to any                   person  or document relating to that Vessel respectively.            4.1.2   Other  than  to the extent that  the Majority Lenders  notify the Agent  in                   writing to the contrary before the Agent gives the notification described in                   Clause  4.1.1, the Lenders authorise (but do not require) the Agent to give                   that notification. The Agent shall not be liable for any damages,  costs or                   losses whatsoever as a result of giving any such notification.   4.2      Further conditions precedent            The Lenders will only be obliged to advance or pre-position or release a Drawing if on           the date of the relevant Drawdown   Request, the proposed  Drawdown   Date  and (if           applicable) the relevant Delivery Date:            4.2.1    no Default is continuing or would result from the advance of that Drawing;            4.2.2    the Repeating Representations are true and correct;            4.2.3    none of the circumstances described in Clause 7.2 (Change  of control) has                    occurred; and            4.2.4    no event  described in Clauses  7.1  (Illegality), 7.7 (Charterer's Material                   Adverse  Effect), 7.8 (Sanctions Event under  a Charter) and  7.9 (Off-hire                    under a  Charter)  has occurred  in respect  of the Vessel  to which  the                    Drawdown  Request relates; and            4.2.5    no Mandatory  Prepayment   Event has occurred  in respect of the Vessel to                    which the Drawdown  Request relates.    4.3     Drawing Limit    The Lenders will only be obliged to advance a Drawing if:            4.3.1    that Drawing will not increase the Loan to a sum in excess of the Maximum                    Loan Amount;            4.3.2    that Drawing will not cause the amount  of the relevant Vessel Loan to be                    exceeded;            4.3.3    the proposed Drawdown   Date  of that part of an Instalment Drawing or the                    Drawing  in respect of the Delivery Instalment coincides with the due date                    for payment or for pre-positioning in the case of the Delivery Instalment by                    the relevant Borrower of the relevant instalment of the Contract Price of the                    relevant Vessel under the relevant Building Contract and that Drawing will                    be applied in or prepositioned for payment of that instalment, but:                     (a)     the  proposed Drawdown    Date for the first Drawing may   be any                            Business Day during the Availability Period; and                     (b)     the proposed  Drawdown   Date for any part of a Drawing relating to                            Pre-Delivery Expenses  shall be any Business  Day which  coincides                            with the Drawdown   Date of an Instalment Drawing  or the Drawing                            in respect of the Delivery Instalment provided that two  Drawings                            relating to Pre-Delivery Expenses shall be permitted in a minimum                            amount   of US$5,000,000  each  between  launch and  delivery of a     LONUVE\30137956.24                                                                    Page 36  

 

                         Vessel  on  a Business  Day   which  does  not coincide  with the                           Drawdown    Date  of an  Instalment  Drawing  or  the Drawing   in                           respect of the Delivery Instalment on condition that such additional                           Drawings are also in compliance with Clause 4.3.4(c); and           4.3.4    that Drawing will be applied in or towards payment:                    (a)     in respect of the first Drawing relating to Vessel E and to Vessel F,                           to the  relevant Borrower  for the  purpose  of reimbursing  such                           Borrower  of any amounts  paid by that Borrower as  at the date of                           the Drawdown   Request relating to such Drawing which in aggregate                           exceed  20%   of the Total Project Costs for that Vessel and each                           such  payment   may  be  applied as  a dividend  payment  without                           restriction and in addition to any dividend paid pursuant to Clause                           17.12.4(a);                    (b)     in respect of all Instalment Drawings and the Delivery Instalment                           relating to each Vessel, to the Builder in an amount such that the                           Drawings  under that Vessel Loan do not in aggregate exceed  80%                           of the Total Project Costs for that Vessel; and                    (c)     of the Pre-Delivery Expenses relating to each Vessel in an amount                           such that the Drawings under that Vessel Loan  do not in aggregate                           exceed  80%   of the Total Project Costs for that Vessel, with the                           proceeds  of the relevant Drawing to be  applied (i) in payment of                           Pre-delivery Expenses   or (ii) in reimbursement  of  Pre-Delivery                           Expenses   paid or incurred  and  free to be  paid as  a dividend                           payment   without restriction and in addition to any dividend paid                           pursuant to Clause 17.12.4(a).   4.4     Initial Conditions subsequent     The  Borrowers undertake to deliver or to cause to          be delivered to the Agent within five Business Days after the first Drawdown Date in          respect of each Vessel Loan  the additional documents  and other evidence  listed in          Part II of Schedule 2 (Conditions Subsequent to initial Drawing), save that references          in that Part II to "the Vessel" or to any person or document relating to a Vessel shall          be deemed  to relate solely to the Vessel specified in the relevant Drawdown Request          or to any person or document relating to that Vessel respectively.   4.5     Conditions  precedent to Instalment Drawings        The  Borrowers  are not entitled          to have   any Instalment  Drawing   advanced  unless  the Agent  has  received the          additional documents and  other evidence listed in Part Ill of Schedule 2 (Conditions          precedent  to Instalment  Drawing), save  that references  in that Part Ill to "the          Vessel" or to any person or document relating to a Vessel shall be deemed to relate          solely to the Vessel specified in the relevant Drawdown Request or to any person or          document relating to that Vessel respectively.   4.6     Conditions  precedent   to Drawing   for  Pre-delivery  Expenses    The  Borrowers          are not entitled to have any Drawing  in respect of Pre-delivery Expenses advanced          unless the Agent has received the additional documents and  other evidence listed in          Part IV of Schedule 2 (Conditions precedent to Drawing  for Pre-delivery Expenses),          save that references in that Part IV to "the Vessel" or to any person or document          relating to a Vessel shall be deemed  to relate solely to the Vessel specified in the    LONLIVE\30137956.24                                                                   Page 37  

 

        relevant Drawdown   Request  or to any person  or document  relating to that Vessel          respectively.   4. 7    Conditions precedent to pre-position the Delivery Instalment        The  Borrowers          are not entitled to request the Lenders to pre-position the Delivery Instalment unless          the Agent has  received the additional documents and other evidence listed in Part V          of Schedule  2  (Conditions Precedent to pre-position the Delivery Instalment),  or          evidence satisfactory to the Agent that it shall, on the Pre-position Date, receive such          documents or evidence,  save that references in that Part V to "the Vessel" or to any          person  or document   relating to a Vessel shall be deemed  to relate solely to the          Vessel specified in the relevant Drawdown   Request or to any  person or document          relating to that Vessel respectively.   4.8     Delivery  conditions   precedent     The  Borrowers  are not  entitled to have any          Drawing  released to the Builder on a Delivery Date unless the Agent has received the          additional documents  and  other evidence listed in Part VI of Schedule 2 (Delivery          conditions precedent), save that references in that Part VI to "the Vessel" or to any          person  or document   relating to a Vessel shall be deemed  to relate solely to the          Vessel being delivered on that Delivery Date. Whether or not a  Drawing is released          to the Builder on a Delivery Date, the Borrowers undertake to deliver or to cause to          be delivered to the Agent on each Delivery Date the additional documents and  other          evidence  listed in Part VI of Schedule 2 (Delivery conditions precedent), save that          references in that Part VI to "the Vessel" or to any person or document relating to a          Vessel shall be deemed to relate solely to the Vessel being delivered on that Delivery          Date.   4.9     Delivery  conditions  subsequent      Whether  or not a Drawing  is released to the          Builder on a  Delivery Date, the Borrowers  undertake to deliver or to cause to be          delivered to the Agent  on, or as soon as practicable after, each Delivery Date the          additional documents  and other  evidence listed in Part VII of Schedule 2 (Delivery          conditions subsequent)  other than  in the case of paragraph  1, items (b) and  (c)          (Evidence of Borrower's title) of Part VII of Schedule 2 which shall be delivered to the          Agent  within  two  Business  Days  after the  relevant  Delivery Date,  save  that          references in that Part VII to "the Vessel" or to any person or document relating to a          Vessel shall be deemed to relate solely to the Vessel delivered on that Delivery Date.   4.10    No waiver    If the Lenders in their sole discretion agree to advance a Drawing to the          Borrowers  before all of the documents and  evidence required by Clause 4.1 (Initial          conditions precedent), Clause  4.5 (Conditions precedent  to Instalment Drawings),          Clause  4.7 (Condition precedents  to pre-position the Delivery Instalment) and/or          Clause 4.8 (Delivery conditions precedent) have been delivered to or to the order of          the  Agent,  the Borrowers  undertake  to  deliver all outstanding documents   and          evidence  to or to the  order of the Agent  no  later than ten (10) days  after the          relevant Drawdown   Date  or such other  date specified by the Agent (acting on the          instructions of the Majority Lenders).           The  advance  of a Drawing under this Clause 4.10 shall not be taken as a waiver of          the Lenders' right to require production of all the documents and evidence required          by  Clause 4.1  (Initial conditions precedent), Clause 4.5 (Conditions precedent to          Instalment Drawings),  Clause 4. 7 (Condition precedents to pre-position the Delivery          Instalment) and Clause 4.8 (Delivery conditions precedent).    LONUVE\30137956.24                                                                    Page 38  

 

4.11     Form  and  content    All documents and  evidence delivered to the Agent under this           Clause shall:            4.11.1   be in form and substance reasonably acceptable to the Agent; and            4.11.2   if required by the Agent, be certified, notarised, legalised or attested in a                    manner reasonably acceptable to the Agent.    LONUVE\30137956.24                                                                    Page 39  

 

Section 3        Utilisation   5        Advance   5.1      Delivery of a  Drawdown    Request    The  Borrowers may  request a Drawing  to be           advanced  by delivery to the Agent of a duly completed Drawdown Request  not fewer           than ten Business Days before the proposed Drawdown   Date.   5.2      Completion   of a Drawdown    Request    A Drawdown   Request  may be amended   or           withdrawn after delivery to the Agent but is irrevocable and cannot be amended five           Business Days  before the  proposed  Drawdown   Date and  will not be regarded  as           having been duly completed unless:            5.2.1   it is signed by an authorised signatory of each Borrower;            5.2.2   the  proposed  Drawdown   Date  is a Business  Day  within the  Availability                   Period; and            5.2.3   the proposed Interest Period complies with Clause 9 (Interest Periods).   5.3      Lenders' participation            5.3.1   Subject  to  Clauses 2  (The  Loan),  3  (Purpose)  and  4  (Conditions of                   Utilisation), each Lender  shall make   its participation in any  Drawing                   available by the relevant Drawdown Date through its Facility Office.            5.3.2   The  amount of each  Lender's participation in any Drawing will be equal to                   the proportion borne by its Commitment to the Total Commitments.   5.4      Cancellation  of Commitment      The  Total Commitments   shall be cancelled at the           end of the Availability Period to the extent that they are unutilised at that time.    LONLlVE\30137956.24                                                                    Page 40  

 

Section 4         Repayment, Prepayment and Cancellation    6       Repayment    6.1     Repayment of each  Vessel Loan            6.1.1   The  Borrowers agree to repay each Vessel Loan to the Agent for the account                   of the Lenders  by consecutive half-yearly Repayment  Instalments together                    with a balloon instalment (a "Balloon Instalment").  One such  Repayment                   Instalment shall be made  on each  of the Repayment Dates  and the Balloon                   Instalment shall be  made  on the Termination  Date relating to that Vessel                    Loan, each in the amounts  specified in Schedule 4 (Repayment Schedule),                   the  first instalment falling due on the earlier to occur of 20 June or 20                    December following the final Drawdown  Date in respect of that Vessel Loan.                    For the avoidance of doubt, each Vessel Loan shall be repaid in full by the                   Termination  Date in relation to that Vessel Loan.            6.1.2   The  Borrowers  shall procure  that the instalments  payable to the  Agent                    pursuant to this Clause 6.1 are received by the Agent no later than one (1)                    Business Days prior to the date on which such instalment falls due.            6.1.3   If an Repayment Instalment falls due on  a day which is not a Business Day,                   that Repayment Instalment will instead fall due on the next Business Day in                   that Month  (if there is one) or the preceding Business Day (if there is not).    6.2     Reduction   of Balloon  Instalments     If the aggregate  amount  advanced  to the           Borrowers  in respect of a Vessel Loan is less than the Maximum  Loan Amount,  the           amount of the Balloon Instalment and  the Repayment Instalments in  respect of that           Vessel Loan shall be reduced pro rata to the amount actually advanced.   6.3      Reborrowing     The Borrowers may not reborrow any part of a Vessel  Loan  which is           repaid or prepaid.   7        Illegality, Prepayment and Cancellation   7.1      Illegality   If in any applicable jurisdiction it becomes unlawful for a Lender to           perform  any of its obligations as contemplated  by this Agreement   or to fund or           maintain its participation in the Loan or it becomes unlawful for any Affiliate of a           Lender for that Lender to do so:            7.1.1   that Lender  shall promptly notify the Agent upon  becoming  aware  of that                   event;            7.1.2   upon  the Agent notifying the Borrowers, the Commitment of that Lender will                   be immediately cancelled; and            7.1.3   the Borrowers shall repay that Lender's participation in each Vessel Loan on                   the last day of its current Interest Period or, if earlier, the date specified by                   that Lender in the notice delivered to the Agent and notified by the Agent to                   the Borrowers  (being no  earlier than the last day of any applicable grace                   period permitted by law).    LONLlVE\30137956.24                                                                   Page 41  

 

7. 2     Change of control            7.2.1   The Borrowers shall procure that throughout the Facility Period:                    (a)      in relation to TGP:                             (i)     (where  all management    powers  over the  business  and                                    affairs of TGP   are  vested  exclusively in  its general                                    partner),                                     (A)      Teekay  GP  LLC remains  the  general partner of                                             TGP; and                                     (B)      Teekay  Parent  remains  the  owner,  directly or                                             indirectly, of a minimum of fifty per cent (50%) of                                             the voting rights in Teekay GP LLC; or                             (ii)    (where  all management    powers  over  the business  and                                    affairs of TGP become   vested  exclusively in a board of                                    directors of TGP),  Teekay   Parent  remains  the  holder,                                    directly or indirectly, of (A) a minimum of fifty per cent                                    (50%)   of the voting rights to elect the members  of that                                    board  of directors or (B) of the voting rights to elect a                                    minimum    of  fifty per cent  (50%)   of that  board  of                                    directors;                    (b)      in relation to each Borrower and the Parent, there is no change in                            the legal or beneficial ownership of any such company   from that                            advised to the Agent  at the date  of this Agreement  without the                            Agent's prior written consent;                    (c)      in relation to Tee kay Operating, its shareholders at the date of this                            Agreement   retain full legal and  beneficial ownership  of  such                            company or corporation directly or indirectly; and                     (d)     in relation to CLNG, its shareholders at the date of this Agreement                            retain full legal and beneficial ownership  of such  company   or                            corporation.            7.2.2    If there is any change of control in breach of Clause 7.2.1:                     (a)     the  Borrowers  shall promptly  notify the Agent  upon  becoming                            aware of that event;                     (b)     a Lender shall not be obliged to fund a Loan; and                     (c)     if a Lender so requires and notifies the Agent within five days of the                            Borrower notifying the Agent of the event, the Agent shall, by not                            less  than  five  days'  notice  to the   Borrowers,  cancel  the                            Commitment   of that Lender and  declare the participations of that                            Lender in all outstanding Loans, together with accrued interest, and                            all  other  amounts   accrued   under   the  Finance   Documents                            immediately due  and payable, whereupon   the Commitment of that     LONLIVE\30137956.24                                                                   Page 42  

 

                          Lender  will be cancelled and  all such outstanding  amounts  will                            become  immediately due and  payable.   7.3      Voluntary prepayment of a     Vessel  Loan    The Borrowers  may prepay the whole           or any  part of a Vessel Loan  (but, if in part, being an amount that reduces  that           Vessel Loan by a minimum   amount of five million dollars and in an integral multiple           of one million dollars) at any time following the end of the Availability Period for that           Vessel Loan subject as follows:            7.3.1   they give the Agent not less than 30 Business Days' (or such shorter period                    as the Majority Lenders may agree) prior notice;            7 .3.2   if the prepayment is made prior to the third anniversary of this Agreement,                   they  pay to the Agent  for the account of the  Lenders, in addition to the                   amount   prepaid, a fee of an  amount  equal to one  per cent (1%)  of the                    amount prepaid, which fee shall be paid on the date of the prepayment; and            7.3.3    any prepayment under this Clause 7.3 shall be applied in prepayment of the                    relevant Balloon  Instalment  and  remaining  Repayment    Instalments  in                    respect of that Vessel Loan in inverse order of maturity.   7.4      Right of cancellation and prepayment in relation to a    single Lender            7.4.1   If:                     (a)     any sum  payable to any Lender by  the Borrowers is required to be                            increased under Clause 12.2.2 (Tax gross-up);                     (b)     any Lender claims indemnification from the Borrowers under Clause                            12.3 (Tax indemnity) or Clause 13.1 (Increased costs); or                     (c)     at any time on  or after the date which is three Months before the                            earliest FATCA Application Date for any payment   by a Party to a                            Lender (other than a PRC  Lender) (or to the Agent for the account                            of that Lender (other than a PRC  Lender)), that Lender is not, or                            has ceased to be, a FATCA  Exempt Party  and, as a consequence, a                            Party will be required to make a FATCA Deduction  from a payment                            to that Lender (or to the Agent for the account of that Lender) on                            or after that FATCA Application Date,                    the Borrowers  may,  whilst the circumstance giving rise to the requirement                   for that increase or indemnification or FATCA Deduction continues, give the                   Agent 15 Business  Days' notice of cancellation onhe Commitment(s) of that                   Lender  and  their intention to  procure the  repayment   of that Lender's                   participation in the Loan.            7.4.2   On  receipt of a notice referred to in Clause 7.4.1 in relation to a Lender, the                   Commitment(s) of that Lender shall immediately be  reduced to zero.            7.4.3   On  the last day of the Interest Period in respect of each Vessel Loan which                   ends  after the Borrowers have given notice under Clause 7.4.1 in relation to                   a Lender  (or, if earlier, the date specified by the Borrowers in that notice),                   the  Borrowers shall repay that  Lender's participation in that Vessel Loan    LONUVE\30137956.24                                                                    Page 43  

 

                 together  with all interest and other amounts  accrued  under  the Finance                   Documents.   7.5      Mandatory   prepayment    on  Total  Loss   If a Vessel becomes  a Total Loss, the           Borrowers shall:            7.5.1   make   a prepayment  to the  relevant Debt Service Reserve  Account  of an                   amount equal to the  Debt Service Reserve for that Vessel Loan (which shall                   be  maintained on the relevant Debt Service Reserve  Account in addition to                   the  existing Debt Service Reserve)  so that, for the avoidance  of doubt,                   following such  prepayment,  the amount   maintained  in the relevant Debt                   Service Account is equal to (i) the net amount of interest payable in respect                   of  the Vessel Loan  relating to that Borrower's  Vessel on  the next  two                   Interest Payment   Dates  in respect of the  Vessel Loan  relating to that                   Borrower's  Vessel plus (ii) the Repayment Instalments  of the Vessel Loan                    relating to that Borrower's Vessel due to be repaid under this Agreement on                   the next two Repayment Dates   in respect of the Vessel Loan relating to that                   Borrower's Vessel; and            7.5.2   on  the earlier of the date falling 180 days after the date on which  such                   event becomes   or is declared or deemed to be a Total Loss and the date on                   which  the proceeds of any such Total Loss are realised, prepay the whole of                   the Vessel Loan in respect of that Vessel then outstanding, at which time all                   amounts   held  on the  relevant Debt  Service  Reserve  Account  shall be                    released to the relevant Borrower.    7.6     Mandatory prepayment on sale of a     Vessel   If:            7.6.1   the Charterer exercises the purchase option in respect of a Vessel pursuant                   to  any provision of the Charter in relation to such Vessel (other than  in                    accordance with clause 47.1(a) of such Charter); or            7 .6.2   any Yamal   Sponsor  Guarantor  (or  a nominee   of such  Yamal   Sponsor                    Guarantor) exercises its right to acquire a Vessel in accordance with the                    Purchase Option Side Letter in respect of that Vessel,            the Borrowers shall, in each case, simultaneously with the sale of such Vessel to the           Charterer or a Yamal Sponsor Guarantor  (as the case may  be), prepay the whole  of           the Vessel Loan  in respect of that Vessel then outstanding. In the event that the           proceeds from such  sale exceed the amount of the Vessel Loan then outstanding, the           Borrowers  shall, if (i) there is an Event of Default continuing or a continuing breach           of Clause  17.19 (Additional Security) or (ii) the Agent has not (in its discretion)           approved  the retention by the Borrowers of such  excess proceeds, pay the  surplus           proceeds  to  the  Agent  for application pro  rata  against the  relevant  Balloon           Instalments and the remaining Repayment Instalments for each Vessel  Loan.     lONUVE\30137956.24                                                                    Page 44  

 

7. 7     Charterer's  Material  Adverse  Effect   If an event or circumstance  occurs which           has or is reasonably likely to have a material adverse effect on the financial condition           or business of the Charterer and  YLNG  and  the Charterer's ability to perform and           comply with its obligations under a Charter then:            7.7.1   the Borrowers shall promptly notify the Agent upon becoming  aware  of that                   event;            7.7.2   the Borrower's insurers shall confirm to the Agent that the Security Agent is                    named  as loss payee under the loss of hire insurances and that claims are                    payable and will be paid to the Debt Service Reserve Account; and            7.7.3    each Borrower  shall make  payment  to the relevant Debt  Service Reserve                   Account of an amount equal to the Debt Service  Reserve and  which shall be                    maintained in the Debt Service Reserve Account  in addition to the existing                    Debt Service Reserve  for so long as the Agent, in its reasonable opinion,                    believes the event or circumstance notified to it is continuing.   7.8       Sanctions  Event under a   Charter   If a Sanctions Event (as such term is' defined           in clause 70 of each Charter) occurs, then:            7 .8.1  the Borrowers shall promptly notify the Agent upon becoming  aware  of that                    event;            7.8.2   the Security Agent  shall participate in the charter restructuring process set                    out in clause 70 of each Charter, unless to do so would mean it is in breach                    of any applicable law;            7.8.3    if the relevant Charter is then suspended pursuant  to clause 70.9 of the                    Charter, the relevant Borrower shall procure that the payment due from the                    Charterer in the amount of US$160,000,000  (the "Suspension   Payment")                    is paid to the relevant Debt Service Reserve Account for application either                    (at the discretion of the Agent): (i) on receipt thereof, in one application                   against  all amounts  (in chronological order  of maturity and  up  to the                   amount of the  Suspension  Payment)  which  shall become  due in respect of                   the relevant Vessel Loan during the following five years of the Facility Period                    (which application shall proportionately discharge the Borrowers' principal                    repayment  and interest payment  obligations in respect of that Vessel Loan                   for  that period), with any  balance  being  retained in the Debt  Service                    Reserve Account; or (ii) semi-annually over the following five years of the                    Facility Period, as such amounts  become  due  in respect of the  relevant                   Vessel Loan;            7.8.4    if the relevant Charter has been suspended for a continuous period of five                   years:                     (a)     a Lender shall not be obliged to fund a Loan; and                     (b)     if a Lender so requires and notifies the Agent within five days of the                            Borrowers  notifying the Agent of the event  or circumstance, the                            Agent  shall, by not less than five days' notice to the Borrowers,                            cancel  the    Commitment     of that  Lender   and  declare  the    LONUVE\30137956.24                                                                    Page 45  

 

                          participations of that Lender in in all outstanding Loans, together                            with accrued interest, and all other amounts  accrued  under  the                            Finance Documents   immediately due  and payable, whereupon   the                           Commitment     of that  Lender  will be  cancelled  and   all such                            outstanding amounts will become immediately due and  payable.   7.9      Off-hire under a Charter            7.9.1   If a Vessel is off-hire under its Charter the relevant Borrower shall promptly                   notify the Agent of that event and, if it continues, shall, 10 Business Days                   before the date upon  which the Charterer's right to terminate the Charter                   for off-hire shall arise, make payment to the relevant Debt Service Reserve                   Account  of an amount  equal to the  Debt Service Reserve  (which shall be                   maintained on  the Debt Service Reserve Account  in addition to the existing                   Debt  Service Reserve) so that, for the avoidance of doubt, following such                   payment,  the amount   maintained in the relevant Debt  Service Account is                   equal to (i) the net amount of interest payable in respect of the Vessel Loan                   relating to that Borrower's Vessel on the next two Interest Payment Dates in                   respect of the Vessel Loan  relating to that Borrower's Vessel plus (ii) the                   Repayment Instalments of the Vessel  Loan relating to that Borrower's Vessel                   due to be repaid under this Agreement on the next two Repayment Dates in                   respect of the Vessel Loan relating to that Borrower's Vessel.            7.9.2   If, on or after the date upon which the  Charterer's right to terminate the                   Charter arises, the Charterer:                    (a)      terminates the Charter in accordance with its rights: the provisions                            of  Clause   22.1.14  (Repudiation,   rescission  or  breach   of                           agreements) shall apply; or                    (b)      does not terminate the Charter but continues to have  the right to                            terminate the  Charter for off-hire: the additional Debt  Service                            Reserve shall be maintained on the relevant Debt Service Reserve                            Account, and after a period of 270  days following the date upon                            which the  Charterer's right to terminate the  Charter arose  the                            Borrowers shall prepay the whole of the Vessel Loan  in respect of                            that Vessel then outstanding, at which time all amounts held on the                            relevant Debt Service  Reserve Account  shall be  released to the                            relevant Borrower.   7.10     Mandatory Prepayment Event       The Borrowers shall, on the date of the occurrence           of a Mandatory Prepayment Event,  prepay the whole of the Vessel Loan in respect of           the Vessel to which such Mandatory Prepayment Event relates then outstanding.   7.11     Restrictions            7.11.1  Any  notice of prepayment or cancellation given under this Clause 7 shall be                   irrevocable and, unless a  contrary indication appears in this Agreement,                   shall specify the date or  dates upon  which  the relevant prepayment   or                   cancellation is to  be  made   and  the  amount   of that  prepayment   or                   cancellation.    LONUVE\30137956.24                                                                    Page 46  

 

         7.11.2  Any  prepayment under this Agreement shall  be made together with  accrued                   interest on the amount prepaid and, subject to any Break Costs and subject                   to Clause 7.3.2 (Voluntary prepayment of a  Vessel Loan), without premium                   or penalty.            7.11.3  The  Borrowers shall not repay, prepay or cancel all or any part of a Vessel                   Loan  except at the times and  in the manner expressly provided  for in this                   Agreement.            7.11.4  No  amount of the Total Commitments   cancelled under this Agreement  may                   be subsequently reinstated.            7.11.5  If the Agent receives a notice under this Clause 7 it shall promptly forward a                   copy of that notice to the Borrowers or the affected Lender, as appropriate.    LONUVE\30137956.24                                                                    Page 47  

 

Section 5        Costs of Utilisation   8        Interest   8.1      Calculation of interest   The rate of interest on each Vessel Loan for each Interest           Period is the percentage rate per annum which is the aggregate of the applicable:            8.1.1   Margin; and            8.1.2   LIBOR.   8.2      Payment of interest            8.2.1   The  Borrowers  shall pay accrued interest on each Vessel Loan on  the last                   day  of each Interest Period (and, if the Interest Period is longer than six                   Months,  on the dates falling at six monthly intervals after the first day of the                   Interest Period).            8.2.2   The  Borrowers shall procure that interest payments payable pursuant to this                   Clause 8.2 are transferred to the Agent no later than two (2) Business Days                   prior to the date on which such payment falls due.   8.3      Default interest   If the Borrowers fail to pay any amount payable by them under a           Finance Document on  its due date, interest shall accrue on the overdue amount from           the due date up to the date of actual payment (both before and after judgment) at a           rate which is two per cent per annum  higher than the rate which  would have  been           payable if the overdue amount had, during the period of non-payment, constituted a           Vessel Loan in the currency of the overdue amount for successive  Interest Periods,           each of a duration selected by the Agent (acting reasonably). Any interest accruing           under this Clause 8.3 shall be immediately payable by the Borrowers on demand   by           the Agent.            Default interest (if unpaid) arising on an overdue amount will be compounded  with           the overdue  amount  at the end of each  Interest Period applicable to that overdue           amount but will remain immediately due and  payable.   8.4      Notification of rates of interest  The Agent shall promptly notify the Borrowers of           the determination of a rate of interest under this Agreement.   9        Interest Periods   9.1      Duration of Interest Periods            9.1.1   Subject  to Clauses 9.2  (Second and  subsequent  Drawings),  9.3 (Interest                   Periods  to meet  Repayment   Dates)  and  9.4 (Non-Business  Days),  each                   Interest Period for a Vessel Loan shall have a duration of six Months or any                    other period agreed in writing between the Borrowers and the Agent (acting                    on the instructions of all the Lenders).            9.1.2    No Interest Period shall extend beyond the Termination Date.            9.1.3    Each Interest Period shall start on the Drawdown Date in respect of the first                    Drawing  in respect of the Vessel Loan or  (if the first Drawing is already                    made)  on the last day of the preceding Interest Period and end on the date    LONUVE\30137956.24                                                                     Page 48  

 

                 which  numerically corresponds to the Drawdown   Date in respect of the first                    Drawing or the  last day of the preceding  Interest Period in the relevant                    Month  except that, if there is no numerically corresponding date  in that                   Month, the Interest Period shall end on the last Business Day in that Month.   9.2      Second  and subsequent Drawings       If the second or any subsequent Drawing of a           Vessel Loan  is made otherwise  than on the  first day of an Interest Period for the           balance of that Vessel Loan, there shall be a separate initial Interest Period for that           Drawing  commencing   on its Drawdown   Date and  expiring on the final date of the           then current Interest Period for the balance of that Vessel Loan.   9.3      Interest  Periods  to meet   Repayment    Dates    If an Interest Period will expire           after the next Repayment Date  in respect of the relevant Vessel Loan, there shall be           a separate Interest Period for a part of that Vessel Loan equal to the  Repayment           Instalment due on that next Repayment Date   and that separate Interest Period shall           expire on that next Repayment Date.   9.4      Non-Business    Days   If an Interest Period would otherwise end on a day  which is           not a Business Day, that Interest Period will instead end on the next Business Day in           that Month (if there is one) or the preceding Business Day (if there is not).   10       Changes to the Calculation of Interest    10.1    Absence   of quotations    Subject to Clause 10.2 (Market disruption), if LIBOR is to           be determined  by reference to the Reference Banks  but a Reference Bank  does not           supply a quotation by 11.00 am  (London time) on  the Quotation Day, the applicable           LIBUR shall be determined on the basis of the quotations of the remaining Reference           Banks.   10.2     Market  disruption    If a Market  Disruption Event occurs for any Interest Period,           then the rate of interest on each Lender's share of the relevant Vessel Loan for that           Interest Period shall be the percentage rate per annum which is the sum of:            10.2.1  the Margin; and            10.2.2  the rate notified to the Agent by that Lender as soon as practicable, and in                   any event by close of business on the date falling three Business Days after                   the Quotation Day  (or, if earlier, on the date falling five Business Days prior                   to the date on  which interest is due to be paid in respect of that Interest                   Period), to be that which expresses as a percentage rate per annum the cost                   to that Lender of funding its participation in the relevant Vessel Loan from                   whatever source it may reasonably select.                    In this Agreement "Market Disruption Event" means:                    (a)      at or about noon  on the  Quotation Day  for the relevant Interest                            Period LIBOR  is to be determined  by reference  to the Reference                            Banks and  none or only one of the Reference Banks supplies a rate                            to the  Agent to  determine  LIBOR  for dollars and  the relevant                            Interest Period; or                    (b)      before close of business in London  on the Quotation  Day for the                            relevant Interest Period, the Agent  receives notifications from a    LONLIVE\30137956.24                                                                   Page 49  

 

                         Lender or Lenders (whose participations in the relevant Vessel Loan                           exceed  60 per  cent of that Vessel  Loan) that the  cost to it of                           funding its participation in that Vessel Loan  from the  Relevant                           Interbank  Market  or, if cheaper, from  whatever  source  it may                           reasonably select would be in excess of L!BOR.   10.3    Alternative basis of interest or funding           10.3.1  If a Market  Disruption Event  occurs and  the Agent  or the Borrowers  so                  require, the Agent  and the  Borrowers shall enter into negotiations (for a                  period of not more  than thirty days) with a view to agreeing  a substitute                  basis for determining the rate of interest.           10.3.2  Any  alternative basis agreed pursuant to Clause 10.3.1 shall, with the prior                  consent of all the Lenders and the Borrowers, be binding on all Parties.           10.3.3   If an alternative basis  is not agreed  pursuant  to  Clause  10.3.1, the                   Borrowers will immediately prepay the relevant Commitment together with                   Break Costs and  the remaining  Repayment   Instalments in respect of the                   relevant Vessel Loan shall be reduced pro rata.   10.4    Break Costs           10.4.1  The  Borrowers shall, promptly following written demand from  the Agent on                   behalf of a Finance Party, pay to the Agent (for the account of that Finance                   Party) its Break Costs attributable to all or any part of a Vessel Loan or                   Unpaid Sum being  paid by the Borrowers on a day other than the last day of                   an Interest Period for that Vessel Loan or Unpaid Sum.           10.4.2   Each Lender shall, as soon as reasonably practicable after a demand by the                   Agent, provide a certificate confirming the amount of its Break Costs for any                   Interest Period in which they accrue.   11      Fees   11.1    Commitment Fee           11.1.1  The  Borrowers  shall pay to the Agent  (for the account of the Lenders  in                   proportion to their Commitments) a fee computed   at the rate of zero point                   five per cent (0.5%) per annum on the undrawn  and  uncancelled amount of                   the Loan for the Availability Period.           11.1.2   The accrued commitment fee   is payable on the last day of each successive                   period of three Months which ends during the Availability Period, on the last                   day of the Availability Period, on the Drawdown Date in respect of the final                   Drawing   and  (on   the  cancelled  amount   of  the  relevant  Lender's                   Commitment) at the time the cancellation is effective.   11.2    Arrangement fee      The Borrowers shall pay to the Arranger an arrangement fee  in          the amount and  at the times agreed in the Fee Letter.   11.3    Agency fee    The  Borrowers shall pay to the Agent (for its own account) an agency          fee in the amount and at the times agreed in the Fee Letter.    LONLIVE\30137956.24                                                                   Page SO  

 

Section 6        Additional Payment Obligations   12       Tax Gross Up and Indemnities   12.1     Definitions  In this Agreement:            "FATCA  Payment" means either:            (a)     the increase in a payment made by a Borrower to a Finance  Party that is not                   originally a party to this Agreement  under Clause  12.8 (FATCA  deduction                   and gross-up  by Borrower)  or Clause 12.9.2 (FATCA  Deduction  by Finance                   Party); or            (b)     a payment under Clause   12.9.4 (FATCA Deduction by Finance Party).            "PRC  Lender"  means the Original Lenders, and any Lender that:            (a)     is resident in or organised under the laws of the PRC; or            (b)     is acting through its Facility Office located in the PRC.            "Protected  Party" means   a Finance Party which is or will be subject to any liability           or required to make  any  payment  for or on  account of Tax  in relation to a sum           received or receivable (or any sum deemed  for the purposes of Tax to be received or           receivable) under a Finance Document.            "Tax  Credit" means  a credit against, relief or remission for, or repayment of any           Tax.            "Tax  Deduction"  means a  deduction or withholding for or on account of Tax from a           payment under a Finance Document,   other than a FATCA  Deduction.            "Tax Payment" means either the increase in  a payment made by a Security Party to           a Finance Party under Clause  12.2 (Tax gross-up) or a payment  under Clause  12.3           (Tax indemnity) or a FATCA Payment.            Unless a contrary indication appears, in this Clause 12 a reference to "determines" or           "determined" means   a determination made  in the absolute discretion of the person           making the determination.   12.2     Tax  gross-up     Each Borrower  shall (and shall procure that each other Security           Party shall) make all payments to be made by it without any Tax Deduction, unless a           Tax Deduction is required by law, subject as follows:            12.2.1  a  Borrower  shall promptly  upon  becoming   aware  that it or any  other                   Security Party must make   a Tax Deduction  (or that there is any change in                   the  rate or the basis of a  Tax Deduction)  notify the Agent  accordingly.                   Similarly, a Lender shall notify the Agent on becoming so aware  in respect                   of a payment payable to that Lender.  If the Agent receives such notification                   from  a Lender  it shall notify the Borrowers and any  such other Security                   Party;            12.2.2  if a Tax Deduction is required by law to be made by a Borrower or any other                   Security Party, the amount of the payment due   from that Borrower or that    LONLlVE\30137956.24                                                                   Page 51  

 

                 other Security Party shall be increased to an amount  which  (after making                   any Tax  Deduction)  leaves an amount  equal to the  payment  which would                   have been  due if no Tax Deduction had been required;            12.2.3  if a Borrower  or  any  other Security Party  is required to make   a Tax                   Deduction, that Borrower shall (and shall procure that such other Security                   Party  shall) make   that Tax  Deduction  and   any  payment   required in                   connection  with that Tax  Deduction  within the time  allowed and  in the                   minimum amount required   by law;            12.2.4  within thirty (30) days, or by the statutory deadline specified in the relevant                   tax legislation (if later), of making either a Tax Deduction or any payment                   required in connection with that Tax Deduction, the  Borrower making  that                   Tax  Deduction shall (and shall procure that such other Security Party shall)                   deliver to the  Agent  for the  Finance Party  entitled to the payment   a                   statement  under  section 975  of  the ITA  or other  evidence  reasonably                   satisfactory to that Finance Party that the Tax Deduction has been made or                   (as  applicable) any  appropriate  payment   paid to  the  relevant taxing                   authority;            12.2.5  The  Finance Parties and the Security Parties shall cooperate in completing                   any  procedural  formalities necessary  for a  Security Party  to make   a                   payment to a Lender without a Tax Deduction.   12.3     Tax indemnity            12.3.1  Each  Borrower shall (within three Business Days of demand  by  the Agent)                   pay  to a Protected Party an amount equal to the loss, liability or cost which                   that Protected Party determines will be or has been  (directly or indirectly)                   suffered for or on account  of Tax by that Protected Party in respect of a                   Finance Document.            12.3.2  Clause 12.3.1 shall not apply:                    (a)      with respect to any Tax assessed on a Finance Party:                             (i)     under  the  law of the jurisdiction in which that Finance                                    Party is incorporated or, if different, the jurisdiction (or                                    jurisdictions) in which that Finance  Party is treated as                                    resident for tax purposes; or                             (ii)    under  the  law of the jurisdiction in which that Finance                                    Party's Facility Office is located in respect of amounts                                    received or receivable in that jurisdiction,                             if that Tax is imposed  on or calculated by  reference to the net                            income  received or receivable (but  not any  sum  deemed   to be                            received or receivable) by that Finance Party; or                     (b)     to the extent a loss, liability or cost:                             (i)     is compensated  for by an increased payment under Clause                                     12.2 (Tax gross-up); or    LONLIVE\30137956.24                                                                    Page 52  

 

                          (ii)    relates to a FATCA  Deduction  required to be  made  by a                                    Party.            12.3.3  A Protected Party making, or intending to make a claim under Clause 12.3.1                   shall promptly notify the Agent of the event which  will give, or has given,                   rise to the claim, following which the Agent shall notify the Borrowers.            12.3.4  A Protected Party shall, on receiving a payment from a Borrower under this                   Clause 12.3, notify the Agent.   12.4     Tax Credit   If a Borrower or any other Security Party makes a Tax Payment and the           relevant Finance Party determines that:            12.4.1  a  Tax Credit is attributable to an increased payment   of which  that Tax                   Payment   forms  part, to  that Tax  Payment   or to  a Tax  Deduction   in                   consequence  of which that Tax Payment was  required; and            12.4.2  that Finance Party has obtained and utilised that Tax Credit,            that Finance Party shall pay an amount to  that Borrower  or to that other Security           Party which that Finance Party determines  will leave it (after that payment) in the           same  after-Tax position as it would have been  in had the Tax  Payment  not  been           made by that Borrower or that other Security Party.   12.5     Stamp taxes    The  Borrowers shall pay and, within three Business Days of demand,           indemnify each  Finance Party against any  cost, loss or liability that Finance Party           incurs in relation to all stamp duty, registration and other similar Taxes payable in.           respect of any Finance Document, except for:            12.5.1  any  stamp  duty, registration or other similar Taxes which are payable  in                   respect  of an assignment,  transfer or other alienation of any kind  by a                   Finance Party of any rights or obligations under a Finance Document; and            12.5.2  any  stamp duty, registration or other similar Taxes which are payable by a                   Finance  Party in PRC  in respect of the negotiation, preparation, printing,                   execution,  syndication and  perfection of this Agreement  and  any  other                   Finance Documents.   12.6     Indirect Tax            12.6.1  Subject only to clause 12.6.3 below,                    (a)      all amounts  set out or expressed  in a Finance  Document   to be                            payable by  any Party to  a Finance Party shall be deemed   to be                            exclusive of any Indirect Tax and any PRC Surcharges;                    (b)      if any Indirect Tax  is chargeable on  any  supply  made  by  any                            Finance Party to any Party in connection with a Finance Document,                            that Party shall pay to the Finance Party (in addition to and at the                            same  time as  paying the consideration) an amount   equal to the                            amount of the Indirect Tax; and                    (c)      if any PRC Surcharges are chargeable in respect of any Indirect Tax                            referred to in paragraph (b) above, the relevant Party shall pay to    LONLIVE\30137956.24                                                                   Page 53  

 

                         the  Finance Party (in addition to and at the same time as  paying                            such Indirect Tax) an amount   equal to the amount   of such PRC                           Surcharges.            For the purposes  of this Clause 12.6.1, consideration for a  supply may  include,           without limitation, an obligation to pay fees or interest in consideration for such          supply.            12.6.2  Where  a Finance Document requires  any Party to reimburse a Finance Party                   for any costs or expenses, that Party shall also at the same time pay and                   indemnify the Finance Party against all Indirect Tax incurred by that Finance                   Party in respect of the costs or expenses and any PRC Surcharges in respect                   of such Indirect Tax, in each  case to the  extent that the Finance  Party                   reasonably  determines  that it is not entitled to credit or repayment  in                   respect of the Indirect Tax or PRC Surcharges.            12.6.3  If any provision of the Finance Documents   is specifically expressed to be                   subject to this Clause 12.6.3 and:                    (a)      requires or deems  a payment   under  a Finance  Document  to  be                            made  to  a  Finance  Party  exclusive of  Indirect Tax  or  PRC                            Surcharges;                    (b)      requires a person to indemnify  or reimburse a  Finance Party for                            Indirect Tax chargeable on any supply made  by any  Finance Party                            in connection with a Finance Document; or                    (c)      requires a person to indemnify  or reimburse a  Finance Party for                            PRC  Surcharges   chargeable  in  respect  of  any  Indirect Tax                            chargeable on any supply made  by any Finance Party in connection                            with a Finance Document,            such provision shall not apply to any PRC VAT  which is or would be chargeable  by           such Finance Party in respect of:            (i)     any  interest payable  under  Clause  8.2  (Payment   of interest) of this                   Agreement;  or            (ii)    any fees payable under Clause 11 (Fees) of this Agreement,            or any  PRC  Surcharges  in respect of such  PRC  VAT, to the  extent that (i) the           aggregate blended  rate of PRC VAT and  PRC Surcharges  chargeable by reference to           any amount  referred to in paragraphs  (i) and (ii) above at such time (taking into           account any PRC VAT  chargeable on the applicable supply and any PRC Surcharges in           respect of such PRC VAT)  is the same  as or lower than (ii) the aggregate blended           rate of PRC  VAT  and  PRC  Surcharges  chargeable  by reference  to such  amount           pursuant to the laws and regulations referred to in the definitions of PRC Surcharges           and PRC VAT in their forms in effect as at the date of this Agreement.   12.7     FATCA  information            12.7.1  Subject to Clause  12.7.3, each Party shall, within ten Business Days of a                   reasonable request by another Party:    LONUVE\30137956.24                                                                    Page 54  

 

                 (a)      confirm to that other Party whether it is:                             (i)     a FATCA  Exempt Party;  or                             (ii)    not a FATCA  Exempt Party;                    (b)      supply to that other Party such  forms, documentation  and  other                            information relating to its status under FATCA as that other Party                            reasonably  requests  for  the  purposes  of  that  other  Party's                            compliance with FATCA;  and                    (c)      supply to that other Party such  forms, documentation  and  other                            information relating to its status as that other Party reasonably                            requests for the purposes of that other Party's compliance with any                            other law, regulation, or exchange of information regime.            12.7.2  If a Party confirms to another Party pursuant to Clause 12.7.1(a)(i) that it                   is a FATCA Exempt Party and  it subsequently becomes aware that it is not or                   has ceased  to be a FATCA  Exempt  Party, that Party shall notify that other                   Party reasonably promptly.            12.7.3  Clause  12.7.1 shall not oblige any Party to do  anything, which would  or                   might in its reasonable opinion constitute a breach of:                    (a)      any Jaw or regulation;                    (b)      any fiduciary duty; or                    (c)      any duty of confidentiality.            12.7.4  If a Party fails to confirm whether or not it is a FATCA Exempt Party or to                   supply forms, documentation  or other information requested  in accordance                   with Clause 12.7.1(a)  or 12.7.1(b) (including, for the avoidance of doubt,                   where  Clause  12.7.3 applies), then  such Party  shall be treated for the                   purposes  of the Finance Documents  (and  payments  under them)  as if it is                   not a FATCA  Exempt Party  until such time as the Party in question  provides                   the requested confirmation, forms, documentation or other information.            12.7.5  If a Borrower is a US Tax Obligor or the Agent reasonably believes that its                   obligations under FATCA or any other applicable law or regulation require it,                   each Lender shall, within ten Business Days of:                    (a)      where a Borrower is a US Tax Obligor and the relevant Lender is an                            Original Lender, the date of this Agreement;                    (b)      where a Borrower is a US Tax Obligor on a date on which any other.                            Lender becomes a Party as a Lender, that date; or                    (c)      where a  Borrower is not a US Tax  Obligor, the date of a request                           from the Agent,                    supply to the Agent:    LONUVE\30137956.24                                                                    Page 55  

 

                          (i)     a withholding certificate on Form W-8 or Form W-9  or any                                    other relevant form; or                             (ii)    any    withholding   statement    or   other   document,                                     authorisation or waiver as the Agent may require to certify                                     or establish the status of such Lender under FATCA or that                                     other law or regulation.            12.7.6  The  Agent shall provide any withholding certificate, withholding statement,                    document,  authorisation or waiver it receives from a Lender  pursuant to                   Clause 12.7 .5 to the Borrowers.            12.7.7  If   any   withholding   certificate, withholding  statement,   document,                    authorisation or waiver provided  to the Agent  by  a Lender  pursuant to                    Clause 12.7.5  is or becomes   materially inaccurate  or incomplete, that                    Lender shall promptly  update  it and  provide such  updated  withholding                    certificate, withholding statement, document, authorisation or waiver to the                    Agent unless it is unlawful for the Lender to do so (in which case the Lender                    shall promptly notify the Agent). The Agent shall provide any such updated                    withholding certificate, withholding statement, document, authorisation or                    waiver to the Borrowers.            12.7.8  The  Agent  may  rely on any withholding certificate, withholding statement,                    document,  authorisation or waiver it receives from a Lender  pursuant to                    Clause 12.7.5 or 12.7.7 without further verification. The Agent shall not be                    liable for any action taken by it under or in connection with Clause 12.7.5,                    12.7.6 or 12.7.7.            12.7.9   If a Lender fails to supply any withholding certificate, withholding statement,                    document,  authorisation, waiver or information in accordance with Clause                    12.7 .5 above,  or  any  withholding  certificate, withholding statement,                    document,  authorisation, waiver or information provided by a Lender to the                    Agent is or becomes materially inaccurate or incomplete, then such Lender                    shall indemnify the Agent, within three Business Days of demand,   against                    any cost, loss, Tax or liability (including, without limitation, for negligence or                    any other category of liability whatsoever) incurred by the Agent (including                    any related interest and penalties) in acting as Agent under  the Finance                    Documents as  a result of such failure.    12.8    FATCA   Deduction and gross-up by the Borrower            12.8.1   If a Borrower is required to make a FATCA  Deduction, such Borrower shall                    make  that FATCA  Deduction and  any payment   required in connection with                    that FATCA Deduction  within the time allowed and in the minimum  amount                    required by FATCA.            12.8.2   If a FATCA Deduction  is required to be made by  a Borrower (other than a                    FATCA  Deduction  in respect of a payment  to a Lender  that is not a PRC                    Lender), the amount   of the  payment  due  from  that Borrower  shall be                    increased to an amount  which (after making  any FATCA  Deduction) leaves                    an amount equal  to the payment  which  would have  been due  if no FATCA    LONUVE\30137956.24                                                                     Page 56  

 

                 Deduction  had  been required. No  additional payment  shall be required in                   respect of a FATCA Deduction  relating to a Lender that is not a PRC Lender.            12.8.3  Each  Borrower shall promptly upon  becoming  aware  that a Borrower  must                   make   a FATCA  Deduction  (or that there is any change in the rate or the                   basis of a  FATCA  Deduction)  notify the Agent  accordingly.  Similarly, a                   Finance  Party shall notify the Agent on becoming so aware  in respect of a                   payment   payable   to that  Finance  Party. If the  Agent  receives  such                   notification from a Finance Party it shall notify the Borrower.            12.8.4  Within  30  days  of making  either a  FATCA   Deduction  or any  payment                   required  in connection with  that FATCA  Deduction,  each  Borrower  shall                   deliver to the Agent for the Finance Party entitled to the payment evidence                   reasonably  satisfactory to that Finance Party that the FATCA Deduction has                   been  made or (as applicable) any appropriate payment has been  paid to the                   relevant governmental or taxation authority.   12.9     FATCA Deduction by a    Finance Party            12.9.1  Each  Finance Party may make any FATCA    Deduction it is required by FATCA                   to  make,  and   any  payment   required  in connection  with that  FATCA                   Deduction, and  no Finance Party shall be required to increase any payment                   in  respect of  which  it makes   such  a FATCA   Deduction  or  otherwise                   compensate   the  recipient of the payment   for that FATCA  Deduction.  A                   Finance  Party which becomes  aware  that it must make  a FATCA  Deduction                   in respect of a paym_ent to another Party (or that there is any change in the                   rate or the basis of such FATCA  Deduction) shall notify that Party and the                   Agent.            12.9.2  If the Agent is required to make a FATCA Deduction in respect of a payment                   to a Finance  Party (other than a Lender  that is not a PRC Lender)  under                   Clause 28.2  (Distributions by the Agent) which relates to a payment  by a                   Borrower,  the amount   of the payment   due from  that Borrower  shall be                   increased  to an  amount  which  (after the Agent  has  made  such  FATCA                   Deduction), leaves the Agent  with an amount  equal  to the payment  which                   would  have  been  made   by the Agent  if no FATCA   Deduction  had  been                   required.            12.9.3  The  Agent shall promptly upon becoming  aware  that it must make a FATCA                   Deduction  in respect of a payment   to a Finance Party under  Clause 28.2                   (Distributions by the Agent) which relates to a payment by a  Borrower (or                   that there is any change in the rate or the basis of such a FATCA Deduction)                   notify that Borrower and the relevant Finance Party.            12.9.4  Each  Borrower shall (within three Business Days of demand   by the Agent)                   pay  to a Finance Party (other than a Lender that is not a PRC  Lender) an                   amount   equal  to the  loss, liability or cost which  that Finance  Party                   determines  will be or  has been  (directly or indirectly) suffered by that                   Finance  Party  as a  result of another  Finance  Party  making  a  FATCA                   Deduction  in respect of a payment due to it under a Finance Document. This                   paragraph   shall not  apply  to the  extent  a  loss, liability or cost is                   compensated for by an  increased payment under Clause  12.9.2 above.    LONUVE\30137956.24                                                                    Page 57  

 

         12.9.5  A Finance Party making, or intending to make, a claim under Clause  12.9.4                   above  shall promptly notify the Agent of the FATCA  Deduction  which  will                   give, or has given, rise to the claim, following which the Agent shall notify                   the Borrower.            12.9.6  A Finance  Party must, on  rece1vmg a payment   from the  Borrowers under                   this Clause, notify the Agent.   13       Increased Costs   13.1     Increased  costs   Subject to Clause  13.3 (Exceptions) the Borrowers shall, within           three Business Days of a demand  by the Agent, pay to the Agent for the account of a           Finance Party the amount of any  Increased Costs incurred by that Finance Party or           any of its Affiliates as a result of (i) the introduction of or any change in (or in the           interpretation, administration or application of)  any  law  or regulation  or (ii)           compliance with any law or regulation made  after the date of this Agreement or (iii)           the implementation or application of or compliance with Basel III, CRR or CRD IV or           any other law or  regulation which implements  Basel III, CRR or CRD  IV (whether           such implementation, application or compliance is by a government,  regulator, that           Finance Party or any of that Finance Party's Affiliates).            In this Agreement:            (a)     "Basel III" means:                    (i)      the agreements   on  capital requirements, a  leverage  ratio and                            liquidity standards contained in "Basel  III: A global regulatory                            framework  for more resilient banks and banking  systems", "Basel                            III: International framework   for  liquidity risk measurement,                            standards and  monitoring" and  "Guidance for national authorities                            operating the countercyclical capital buffer" published by the Basel                            Committee  on  Banking  Supervision in December   2010,  each  as                            amended,  supplemented  or restated;                    (ii)     the rules for global systemically  important banks   contained in                            "Global systemically important  banks:  assessment   methodology                            and  the additional loss absorbency   requirement  -  Rules text"                            published by  the  Basel Committee   on  Banking  Supervision  in                            November 2011, as  amended, supplemented or restated;   and                    (iii)    any  further  guidance  or  standards   published  by  the  Basel                            Committee on  Banking Supervision relating to "Basel III".            (b)     "CRD   IV" means  Directive 2013/36/EU  of the European  Parliament and of                   the Council of 26 June  2013 on  access to the activity of credit institutions                   and  the prudential supervision of credit institutions and investment firms,                   amending   Directive 2002/87/EC  and repealing Directives 2006/48/EC   and                   2006/49/EC, as  amended,  supplemented  or restated.            (c)     "CRR"  means   Regulation EU No  575/2013  of the European Parliament  and                   of the  Council of  26 June  2013   on prudential requirements   for credit    LONLIVE\30137956.24                                                                   Page SB  

 

                 institutions and  investment  firms  and   amending   Regulation  EU   No                   648/2012, as amended, supplemented or restated.           (d)      "Increased Costs"  means:                    (i)     a reduction in the rate of return from  the Loan  or on a Finance                           Party's (or its Affiliate's) overall capital;                    (ii)    an additional or increased cost; or                    (iii)   a reduction of  any amount   due and  payable  under  any Finance                           Document,                    which is incurred or suffered by a Finance Party or any of its Affiliates to the                   extent that it is attributable to that Finance Party having entered into any                   Finance Document    or funding  or performing  its obligations under  any                   Finance Document.   13.2    Increased cost claims           13.2.1  A  Finance  Party  intending to  make  a  claim  pursuant  to Clause  13.1                   (Increased costs) shall notify the Agent of the event giving rise to the claim,                  following which the Agent shall promptly notify the Borrowers.           13.2.2   Each Finance  Party shall, as soon as practicable after a demand   by the                  Agent, provide a certificate confirming the amount of its Increased Costs.   13.3    Exceptions     Clause  13.1  (Increased costs) does  not  apply to the  extent any          Increased Cost is:           13.3.1   attributable to a Tax Deduction required by law to be made by a Borrower;           13.3.2   attributable to a FATCA Deduction required to be made by a Party;           13.3.3   compensated  for  by Clause  12.3 (Tax  indemnity)  (or would  have  been                  compensated   for under  Clause  12.3 but was  not  so compensated   solely                   because any of the exclusions in Clause 12.3 applied);           13.3.4   attributable to the wilful breach by the relevant Finance Party or its Affiliates                   of any law or regulation; or           13.3.5   attributable to the implementation or application of or compliance with the                   "International Convergence of Capital Measurement  and Capital Standards,                   a Revised  Framework"   published  by  the Basel  Committee   on  Banking                  Supervision in June 2004 in the form existing on the date of this Agreement                   (but excluding any amendment arising  out of Basel III) ("Basel II") or any                  other  law   or  regulation which   implements   Basel  II (whether   such                   implementation, application or compliance is by a  government,  regulator,                   Finance Party or any of its Affiliates).           In this Clause 13.3, a reference to a "Tax Deduction" has the same  meaning  given          to the term in Clause 12.1 (Definitions).    LONUVE\30137956.24                                                                   Page 59  

 

14       Other Indemnities   14.1     Currency   indemnity      If any  sum  due  from  a  Borrower  under  the  Finance           Documents (a  "Sum"), or any order, judgment or award  given or made  in relation to           a Sum,  has to be converted from the currency (the "First Currency") in which that           Sum is payable into another currency (the "Second Currency") for the purpose of:            14.1.1  making or filing a claim or proof against that Borrower, or            14.1.2  obtaining or  enforcing an  order, judgment  or  award  in relation to any                   litigation or arbitration proceedings,            that Borrower  shall as an independent  obligation, within three Business Days  of           demand,  indemnify each  Finance Party to whom  that Sum  is due against any  cost,           loss or liability arising out of or as  a result of the  conversion  including any           discrepancy between  (a) the rate of exchange  used to convert that Sum   from the           First Currency into the Second  Currency  and  (b) the  rate or rates of exchange           available to that Finance Party at the time of its receipt of that Sum.            Each Borrower  waives any  right it may have in any jurisdiction to pay any amount           under the Finance Documents in  a currency or currency unit other than that in which           it is expressed to be payable.   14.2     Other indemnities            14.2.1  The  Borrowers  shall, promptly following written demand  from  the Agent,                   indemnify  each Finance Party against any cost, loss or liability incurred by                   that Finance Party as a result of:                     (a)     the occurrence of any Event of Default;                     (b)     any other information produced by  or on behalf of a Security Party                            in connection with  the Loan  being knowingly  misleading  and/or                            deceptive in any material respect or omitting information relevant                            to the  Loan  where  that  omission is attributable to the  gross                            negligence of those producing other information referred to above;                     (c)     any enquiry, investigation, subpoena (or similar order) or litigation                            with respect to a Security Party or with respect to the transactions                            contemplated or financed under the Finance Documents;                     (d)     a failure by a Borrower to pay  any amount   due under  a Finance                            Document   on its due date, including without limitation, any cost,                            loss or liability arising as a result of Clause 27 (Sharing among the                            Finance Parties);                     (e)     funding, or  making  arrangements   to fund, a  Drawing  following                            delivery by the Borrowers of a Drawdown  Request but that Drawing                            not being advanced  by reason of the operation of any one or more                            of the provisions of this Agreement (other than by reason of default                            or negligence by a Finance Party alone); or    LONUVE\30137956.24                                                                     Page 60  

 

                 (f)      a Vessel  Loan  (or part of a Vessel  Loan) not  being prepaid  in                            accordance with a notice of prepayment given by the Borrowers.            14.2.2  The  Borrowers  shall promptly on demand   from the  Agent indemnify  each                   Finance Party, each Affiliate of a Finance Party and each officer of a Finance                   Party or its Affiliate (each such person for the purposes of this Clause 14.2                   an  "Indemnified   Person")  against any  cost, loss or liability incurred by                   that Indemnified  Person pursuant  to or in connection with  any litigation,                   arbitration or  .administrative proceedings   or  regulatory  enquiry,  in                   connection  with  or arising out of  the entry  into and  the transactions                   contemplated   by  the  Finance  Documents,   having  the  benefit of  any                   Encumbrance   constituted by the Finance Documents or which  relates to the                   condition or operation of, or any incident occurring in relation to, a Vessel,                   unless such cost, loss or liability is caused by the gross negligence or wilful                   misconduct of that Indemnified Person.            14.2.3  Subject to any  limitations set out in Clause 14.2.2, the indemnity in that                   Clause  shall cover any cost, loss or liability incurred by each Indemnified                   Person in any jurisdiction:                    (a)      arising or asserted under or in connection with any law relating to                            safety at sea,  the ISM   Code,  any  Environmental  Law  or  any                            Sanctions; or                    (b)      in connection with any Environmental Claim.   14.3     Indemnity to   the Agent    The  Borrowers shall promptly on written demand   from           the Agent indemnify the Agent against:            14.3.1  any  cost, loss or liability incurred by the Agent (acting reasonably) as a                   result of:                    (a)      investigating any event which it reasonably believes is a Default; or                    (b)      acting or relying on any  notice, request or instruction from any                            Security Party which it reasonably believes to be genuine, correct                            and appropriately authorised; or                    (c)      instructing lawyers, accountants, tax advisers, surveyors or other                            professional advisers   or  experts   as  permitted   under  this                            Agreement;  and            14.3.2  any cost, loss or liability (including, without limitation, for negligence or any                   other category of liability whatsoever) incurred by the Agent (otherwise than                   by  reason of the Agent's gross  negligence or wilful misconduct) and  not                   including any claim based  on  the fraud of the Agent) in acting as Agent                   under the Finance Documents.   14.4     Indemnity to   the Security  Agent    The  Borrowers  shall promptly indemnify the          Security Agent  and  every Receiver and  Delegate against any  cost, loss or liability           incurred by any of them as a resu It of:    LONUVE\30137956.24                                                                    Page 61  

 

        14.4.1  any  failure by the Borrowers to comply with their obligations under Clause                  16 (Costs and Expenses);           14.4.2  acting or relying on any notice, request or instruction which it reasonably                  believes to be genuine, correct and appropriately authorised;           14.4.3  the taking, holding, protection or enforcement of the Security Documents;           14.4.4  any  acts  or omissions  of the  Account  Holder in  the operation  of the                  Accounts;           14.4.5  the  exercise of any  of the  rights, powers,  discretions, authorities and                  remedies  vested in the Security Agent and each  Receiver and  Delegate by                  the Finance Documents or by law;           14.4.6  any  default  by any  Security  Party in the  performance   of any  of the                  obligations expressed to be assumed by it in the Finance Documents; or           14.4. 7  acting as  Security  Agent,  Receiver  or  Delegate   under  the  Finance                   Documents   or which  otherwise relates to any  of the  Charged  Property                   (otherwise, in each case, than by reason of the relevant Security Agent's,                   Receiver's or Delegate's gross negligence or wilful misconduct).   14.5    Indemnity   survival    The  indemnities contained in this Agreement  shall survive          repayment of the Loan.   15      Mitigation by the Lenders   15.1    Mitigation    Each Finance Party shall, in consultation with the Borrowers, take all          reasonable steps to mitigate any circumstances which arise and which would result in          all or any part of a Vessel Loan ceasing  to be available or any amount  becoming          payable under or pursuant to any of Clause 7.1 (Illegality), Clause 12 (Tax Gross Up          and  Indemnities) or  Clause 13  (Increased  Costs) including (but not  limited to)          transferring its rights and obligations under  the Finance  Documents   to another          Affiliate or Facility Office. The above does not in any way limit the obligations of any          Security Party under the Finance Documents.   15.2    Limitation  of liability The Borrowers shall promptly indemnify each  Finance Party          for all costs and expenses reasonably incurred by that Finance Party as a result of          steps taken by  it under Clause 15.1 (Mitigation). A Finance Party is not obliged to          take any steps under Clause 15.1 if, in its opinion (acting reasonably), to do so might          be prejudicial to it.   16      Costs  and Expenses   16.1    Transaction   expenses    The  Borrowers shall promptly on demand   pay the Agent,          the Security Agent and the Arranger the amount of all costs and expenses (including          legal fees) reasonably incurred by  any of them  (and, in the case  of the Security          Agent, by any Receiver or Delegate) in connection with:           16.1.1   the negotiation, preparation, printing, execution, syndication and perfection                   of this Agreement and any other documents referred to in this Agreement;    LONLIVE\30137956.24                                                                   Page 62  

 

         16.1.2  the negotiation, preparation, printing, execution and perfection of any other                   Finance Documents executed   after the date of this Agreement;            16.1.3  any  other document which  may at any time  be required by a Finance Party                   to give effect to any Finance Document or which  a Finance Party is entitled                   to  call for or obtain under   any Finance  Document    (including, without                   limitation, any valuation of a Vessel); and            16.1.4  any discharge, release or reassignment of any of the Security Documents.   16.2     Amendment     costs    If (a) a Security Party requests an  amendment,   waiver or           consent or (b) an amendment is  required under Clause  28.11 (Change  of currency),           the Borrowers  shall, within three Business Days of demand, reimburse  each of the           Agent and  the Security Agent for the amount   of all costs and expenses (including           legal fees) reasonably incurred by the Agent and the Security Agent (and, in the case           of the Security Agent, by any  Receiver or Delegate)  in responding to, evaluating,           negotiating or complying with that request or requirement.   16.3     Enforcement and preservation     costs   The Borrowers shall, within three Business           Days of demand  from  the Agent, pay to each Finance Party and each  other Secured           Party) the amount of all costs and expenses  (including legal fees) incurred by that           Finance Party in connection  with the enforcement   of, or the preservation of any           rights under, any Finance Document and  any proceedings instituted by or against the           Security Agent as  a consequence  of taking or holding the Security  Documents  or           enforcing those rights including (without limitation) any losses, costs and expenses           which that Finance Party or other Secured Party may from time to time sustain, incur           or become  liable for by reason of that Finance Party or other Secured Party being           mortgagee  of a Vessel and/or a lender to a Borrower, or by reason of that Finance           Party or other Secured  Party  being deemed   by any  court or authority to be  an           operator or controller, or in any way concerned  in the operation  or control, of a           Vessel.   16.4     Security  Agent  expenses     The  Borrowers shall, promptly upon  written demand           from the  Security Agent, pay  to the Security Agent  the amount  of all costs and           expenses  (including legal fees)  reasonably  incurred by  the  Security Agent   in           connection with the administration or release of any Encumbrance  created pursuant           to any Security Document.   16.5     Advisers'  costs  and  expenses      The  Borrowers  shall, promptly upon   written           demand  from  the Agent, pay  to the Agent the amount  of all costs incurred by the           Lenders in engaging legal advisers as required pursuant to the Finance Documents.   16.6     Other costs    The  Borrowers shall, within three Business Days of demand,  pay to           the each Finance Party and each other Secured  Party) the amount of all sums which           that Finance  Party  or  other Secured   Party may   pay  or  become   actually or           contingently liable for on account of a Borrower in connection with a Vessel (whether           alone or jointly or jointly and severally with any other person) including (without           limitation) all sums which that Finance Party or other Secured  Party may   pay or           guarantees which it may give in respect of the Insurances, any expenses incurred by           that Finance Party or other Secured  Party in connection with  the maintenance  or           repair of a Vessel or in discharging any lien, bond or other claim relating in any way           to a Vessel, and any sums which that Finance Party or other Secured Party may pay   LONUVE\30137956.24                                                                    Page 63  

 

---------------------------                                                 --------------------------------                          or guarantees  which it may give to procure the release of a Vessel from  arrest or                         detention.                   LONUVE\30137956.24                                                                    Page 64  

 

Section 7        Security, Accounts and Application of Moneys   17      Security Documents, Accounts and Application of Moneys   17.1    Security  Documents       As  security for the payment   of the Indebtedness,  the          Borrowers  shal_l execute and deliver to the Security Agent or cause to be executed          and  delivered to the Security Agent  the following documents   in such forms  and          containing such terms and conditions as the Security Agent shall require:           17.1.1   first priority deeds of assignment of the Building Contracts, the  Refund                   Guarantees and the Supervision Agreements;           17.1.2   a several guarantee  and  indemnity from  each Vessel  Sponsor  Guarantor                   limited to its share of the ownership interest of the relevant Borrowers;           17.1.3   first priority pledges of all the shares or membership interest (as applicable)                   of the Borrowers;           17 .1.4  first priority statutory mortgages over the Vessels together with collateral                   deeds of covenants;           17.1.5   first priority deeds  of assignment   of  the  Insurances,  Earnings  and                   Requisition Compensation  of the Vessels from the Borrowers; and  the first                   priority assignments of Insurances from the Approved  Managers  contained                   in the Managers' Undertakings;           17.1.6   first priority deeds of assignment  of the  Charters and  other  Assigned                   Documents in respect of the Vessels from the-Borrowers;           17.1.7   first priority account security deeds in respect of all amounts from time to                   time standing to the credit of the Accounts of the Borrowers;           17.1.8   a first priority deed of charge aver the Master Agreement Proceeds;           17.1.9   first priority pledge of all the shares or membership interest (as applicable)                   of the Parent; and           17.1.10  Managers'  Undertakings  from  the Approved   Manager  in relation to the                   Vessels.   17.2    Accounts     Each Borrower  shall maintain its Accounts with the Account Holder for          the duration of the Facility Period free of Encumbrances and rights of set off other          than those created by or under the Finance Documents or a  Permitted Encumbrance.          If at any time the Account Holder gives notice of the termination of its agreement to          act as Account  Holder, the Borrowers  shall appoint a replacement  Account Holder          before such termination becomes effective.   17.3    Earnings      Each Borrower   shall procure that all Earnings and  any  Requisition          Compensation   received by it are credited to that Borrower's Proceeds Account and, if          any  such amounts   are in euro, the Borrower  shall instruct the Account Holder to          convert (at the Account Holder's spot rate of exchange) such amounts to  dollars for          transfer from the relevant Proceeds Account (euro) to the relevant Proceeds Account          (dollar).    LONUVE\30137956.24                                                                    Page 65  

 

17.4    Application   of Proceeds   Account    Each  Borrower shall, on the date falling ten           (10) Business Days  after the Delivery Date of the Vessel owned by  such Borrower          and  thereafter on the day in each Month during the Facility Period which numerically          corresponds to  the 7'" Business Day following the relevant Delivery Date (or, if there           is no such day, on the last Business Day of that Month), apply, and for this purpose,           each Borrower  undertakes,  subject to Clause 17.12  (Restriction on transfers and           withdrawals), to instruct the Account Holder to apply the amounts  standing to the          credit of its Proceeds Account (dollar) in the following order:            17.4.1  first, in and towards payment of an amount equal to:                    (a)      the Operating Expenses of the relevant Vessel; and                    (b)      any Taxes,                    in each  case, due  and  payable  by  such  Borrower  as at  such date  of                   application;            17.4.2  secondly, in transfer to the relevant Retention Account of such sum so as to                   enable such  Borrower  to comply with Clause  17.5 (Transfers to Retention                   Account);            17.4.3  thirdly, in transfer to the relevant Debt Service Reserve Account  of such                   sum  so  as to enable  such  Borrower  to comply  with Clause  17.9  (Debt                   Service Reserve Account);            17.4.4  fourthly, in transfer to the relevant Operating Reserve Account of such sum                   so as  to enable such  Borrower  to comply  with Clause  17.10  (Operating                   Reserve Account);            17 .4.5 fifthly, in transfer to the relevant Dry-docking Reserve Account of such sum                   so as to comply with Clause 17.11 (Dry-docking Reserve Account); and            17.4.6  sixthly, any moneys remaining in such  Proceeds Account (dollar) shall:                    (a)      in the absence of a Dividend Restriction Event that is continuing, be                            transferred to the relevant Distribution Account without the Agent's                            prior consent; and                    (b)      upon  the occurrence  of  a Dividend  Restriction Event  which  is                            continuing, be  transferred  to the  relevant  Dividend  Lock-Up                            Account until such time as the relevant Dividend Restriction Event                            has either been remedied  to the satisfaction of, or waived by, the                            Lenders, following from which such moneys shall, subject to Clause                            17.17 (Application of moneys by Security Agent), be transferred to                            the relevant Distribution Account for applicable by  the relevant                            Borrower in accordance with paragraph (a) above.   17.5     Transfers to Retention Account            17.5.1  Each  Borrower shall, on the date falling ten (10) Business Days  after the                   Delivery Date of the Vessel owned  by such Borrower and  thereafter on the                   day in each Month  during the Facility Period which numerically corresponds    LONUVE\30137956.24                                                                    Page 66  

 

                 to  the 7'" Business Day following the relevant Delivery Date (or, if there is                   no  such day, on the last Business Day of that Month), such Borrower shall,                   subject to Clause 17.12  (Restriction on transfers and withdrawals), procure                   that there is transferred from such Borrower's Proceeds Account  (dollar) to                   its Retention Account:                    (a)      one-sixth of the amount of the Repayment Instalment in  respect of                            the relevant Vessel Loan due on  the next Repayment   Date (which                            shall be deemed  to  be the day  for that transfer if that day is a                            Repayment Date); and                    (b)      the amount  of interest in respect of the relevant Vessel Loan due                            on the next Interest Payment  Date  (which shall be deemed  to be                            the day for that transfer if that day is an Interest Payment Date)                            divided by  the  number   of months   between   the  last Interest                            Payment  Date  (or, if none, the first Drawdown Date in respect of                            that Vessel Loan) and that next Interest Payment Date.   17.6     Additional  payments    to Retention   Account      If for any reason  the amount           standing to the credit of the Proceeds Account  (dollar) is insufficient to make any           transfer to the Retention Account required by  Clause 17.5 (Transfers to Retention           Account), the Borrowers shall, without demand, procure that there is credited to the           Retention Account,  on the  date on which  the  relevant amount  would  have  been           transferred from the Proceeds Account  (dollar), an amount equal to the amount of           the shortfall.   17.7     Application  of Retention   Account     The  Borrowers  shall procure that there is           transferred from the Retention Account to the Agent for the account of the Lenders:            17.7.1  on each  Repayment Date  in respect of the relevant Vessel Loan, the amount                   of the Repayment Instalment then due;  and            17.7.2  on  each Interest Payment  Date in respect of the relevant Vessel Loan, the                   amount of interest then due,            and  the Borrowers   undertakes  to instruct the  Account  Holder  to make   those           transfers.   17.8     Borrowers'   obligations not affected    If for any reason the amount standing  to           the credit of the Retention Account is insufficient to pay any Repayment Instalment           or to make any  payment of interest when due, the Borrowers' obligation to pay that           Repayment Instalment or to make that payment of interest shall not be affected.   17.9     Debt Service Reserve Account            17.9.1  Each  Borrower  shall at all times  maintain in  its Debt Service  Reserve                   Account such  amount which  is at least:                    (a)      before the Delivery Date in respect of that Borrower's Vessel, the                            net amount   of interest payable  in respect of  the Vessel  Loan                            relating to that Borrower's Vessel on the  next Interest Payment                            Date  in respect of the  Vessel Loan  relating to that Borrower's                            Vessel; or    LONUVE\30137956.24                                                                    Page 67  

 

--------------------------------------------------------------------------------------------------------                                   (b)     from  and including the Delivery Date in respect of that Borrower's                                          Vessel, (i) the net amount  of interest payable in respect of the                                          Vessel Loan relating to that Borrower's Vessel on the next Interest                                          Payment   Date  in respect  of the  Vessel Loan   relating to that                                          Borrower's Vessel plus (ii) the Repayment Instalment of the Vessel                                          Loan  relating to that Borrower's Vessel due to be repaid under this                                          Agreement   on the next Repayment   Date  in respect of the Vessel                                          Loan  relating to that Borrower's Vessel.                          17.9.2   Each Borrower  shall, on the date falling ten (10) Business Days after the                                  Delivery Date of the Vessel owned by such  Borrower and  thereafter on the                                  day in each Month  during the Facility Period which numerically corresponds                                  to the 7th Business Day following the relevant Delivery Date (or, if there is                                  no such  day, on the last Business Day  of that Month), subject to Clause                                  17.12 (Restriction on transfers and withdrawals), transfer from the Proceeds                                  Account  (dollar) into its Debt Service  Reserve  Account  any  remaining                                  amounts  standing to the  credit of its Proceeds Account (dollar) following                                  application in accordance with Clauses 17.4.1 and 17.4.2 until the amount                                  standing to the credit of its Debt Service Reserve Account is in compliance                                  with Clause 17.9.1.                  17.10   Operating   Reserve   Account     Each Borrower shall, on the date  falling ten (10)                         Business  Days after the Delivery Date of the Vessel owned   by such Borrower  and                         thereafter on the  day in each  Month  during the Facility Period which numerically                         corresponds to  the 7th Business Day following the relevant Delivery Date (or, if there                         is no such  day, on the last Business Day  of that Month), subject to Clause 17.12                         (Restriction on transfers and withdrawals), pay into its Operating Reserve Account                         following application in accordance with Clauses 17.4.1 to 17.4.3 until the amount                         standing  to the credit of such Operating Reserve Account  is equal to the relevant                         Operating  Expenses   Reserve.  Each  Borrower  shall thereafter  unless otherwise                         permitted by the Security Agent ensure that there is always standing to the credit of                         its Operating  Reserve  Account  an amount   not less than  the relevant Operating                         Expenses Reserve.                  17.11   Dry-docking    Reserve  Account    Each  Borrower  shall procure that the Charterer                         pays to its Proceeds Account (euro) each amount it is obliged to pay under the terms                         of the  Charter; in relation to such payments,   each Borrower   undertakes: (i) to                         provide to the Agent, at the same  time as any dry docking  expenses payments are                         made   by  the  Charterer, a  copy  of the  budget  (the "Dry-docking    Expenses                         Budget")   in relation to which the payments  have  been  made  as evidence  of the                         amount   of such expenses;  and  (ii) to instruct the Account Holder to transfer the                         relevant  amount  from  its Proceeds Account  (dollar) to its Dry docking  Reserve                         Account.                  17.12   Restriction on withdrawal                           17.12.1 The  Borrowers may  transfer sums  (i) between the Accounts  or (ii) to the                                  Agent without the prior written consent of the Agent.                           17.12.2 Unless an Event  of Default has occurred and is continuing, each Borrower                                  may  make  any  withdrawal or transfer of any sum  to any person  from its                   LONUVE\30137956.24                                                                    Page 68  

 

                 Proceeds Account which  will not result in an aggregate amount of more than                    US$2,000,000 being  withdrawn  or transferred from such Account in any one                   calendar  Month   without the  prior written  consent  of the  Agent;  any                   withdrawal or transfer of any sum to any person from the relevant Proceeds                   Account   which   will result in  an  aggregate   amount   of  more   than                   US$2,000,000 being   withdrawn  or transferred from such Account in any one                   calendar  Month  will be subject to the prior written consent of the Agent                   which  consent shall not be unreasonably withheld or delayed.            17.12.3  Unless an Event of Default has occurred  and is continuing, each Borrower                   may   make  any  withdrawal  or transfer of any sum  from  its Dry-docking                   Reserve Account with the prior written consent of the Agent.                    The  consent of the Agent  required in accordance with this Clause 17.12.3                   shall be granted  by the Agent  provided   that the relevant Borrower  has                   delivered to the Agent:                     (a)     a  copy  of the  relevant Dry-docking  Expenses   Budget  for the                            relevant dry-docking payments as approved  by the Charterer; and                    (b)      a copy of the invoice issued to the Charterer for such dry-docking                            expenses together with evidence that the relevant funds have been                            received from the Charterer into the relevant Proceeds Account            17.12.4 Unless  an Event of Default has occurred  and is continuing, each Borrower                   may   make  any  withdrawal  or transfer of any  sum  from  its Distribution                   Account   for dividend  distribution payments   or  payments   for  Capital                   Expenditure (as defined in Clause 20.1) with the prior written consent of the                   Agent.                    The  consent of the Agent  required in accordance with this Clause 17.12.4                   shall be granted by the Agent provided that:                    (a)      in the case of any dividend distribution requests, no Borrower shall                            declare, make or pay any dividend, charge, fee or other distribution                            (or  interest on  any  unpaid   dividend, charge,   fee or  other                            distribution) (whether in cash or in kind) on or in respect of its                            share  capital (or any  class of its share  capital), or repay or                            distribute any dividend or share premium  reserve more  than once                            every 12 Months; and                    (b)      in the case of any payment for the Capital Expenditure (as defined                            in Clause 20.1) the Agent's consent for such payment shall not be                            unreasonably withheld if the relevant Borrower has delivered to the                            Agent  a copy  of the  invoice relating to the proposed  payment                            together with such  other evidence as  the Agent  may  reasonably                            require.                    For  the avoidance  of doubt, no  payment  for the  Operating Expenses  or                   Taxes of the relevant Vessel shall be made from the Distribution Account.    LONUVE\30137956.24                                                                    Page 69  

 

        17.12.5 Unless  otherwise permitted  under Clauses  17.12.1, 17.12.2, 17.12.3  and                   17.12.4 above, no  Borrower shall make  any withdrawal  or transfer of any                   sum from any one  or more of the Accounts without the prior written consent                   of the Agent.           17.12.6  No Account shall be overdrawn.   17.13   Relocation  of Accounts     On and  at any time after the occurrence of an Event of          Default which  is continuing, the Security Agent  may  without the  consent of the          Borrowers  instruct the Account Holder to relocate any of the Accounts to any other          branch of the Account  Holder, without prejudice to the continued application of this          Clause 17 and the rights of the Finance Parties under the Finance Documents.   17.14   Access   to information     The Borrowers  agree  that the Security Agent  (and its          nominees)  may from  time  to time during the Facility Period on prior written notice          review the records held by the Account Holder (whether in written or electronic form)          in relation to the Accounts, and irrevocably waive any right of confidentiality which          may exist in relation to those records.   17.15   Statements     Without  prejudice to the rights of the Security Agent under Clause          17.14  (Access to information), the Borrowers shall procure that the Account Holder          provides to the Security Agent, no less frequently than each calendar month during          the Facility Period, written statements of account showing all entries made to the          credit and debit of each of the Accounts during the immediately preceding calendar          month.   17.16   Application   after acceleration     From   and  after the g1vmg  of notice to the          Borrowers  by  the Agent  under  Clause 22.2.1  (Acceleration), the Borrowers shall          procure that all sums from time to time standing to the credit of any of the Accounts          are immediately  transferred to the Security Agent or any Receiver  or Delegate for          application in accordance  with Clause  17.17  (Application of moneys  by  Security          Agent)  and the Borrowers  undertake to instruct the Account Holder to make  those          transfers.   17.17   Application   of moneys    by  Security  Agent     The Borrowers  and  the Finance          Parties irrevocably authorise the Security Agent or any Receiver or Delegate to apply          all moneys which it receives and is entitled to receive:           17.17.1  pursuant to a  sale or other disposition of a Vessel or any  right, title or                   interest in a Vessel; or            17.17.2 by way  of payment  of any  sum  in respect of the Insurances, Earnings or                   Requisition Compensation; or            17.17.3 by way of transfer of any sum from any of the Accounts; or            17.17.4 pursuant to clause 7.4(f) of a Quiet Enjoyment Agreement; or            17.17.5 otherwise under or in connection with any Security Document,                    in or towards satisfaction of the Indebtedness in the following order:    LONLlVE\30137956.24                                                                   Page 70  

 

                 (a)     first, any unpaid fees, costs, expenses and default interest due to                           the Agent and  the Security Agent (and, in the case of the Security                           Agent, to any Receiver or Delegate) under all or any of the Finance                           Documents,  such  application to be apportioned between the Agent                           and the Security Agent  pro rata to the aggregate amount of such                           items due to each of them;                    (b)     second, any unpaid  fees, costs, expenses (including any sums paid                           by  the Lenders  under  Clause 25.11  (Lenders' indemnity  to the                           Agent)  due   under   this Agreement,   such   application to  be                           apportioned between  the Lenders pro rata to the aggregate amount                           of such items due to each of them;                    (c)     third, any accrued but unpaid  default interest due to the Lenders                           under this Agreement,  such application to be apportioned between                           the Lenders  pro  rata to the aggregate  amount   of such  default                           interest due to each of them;                    (d)     fourth, any other accrued  but unpaid interest due to the Lenders                           under this Agreement,  such application to be apportioned between                           the Lenders pro rata to the aggregate amount of such  interest due                           to each of them;                    (e)     fifth, any principal of the Loan due and payable but unpaid under                           this Agreement,  such  application to be apportioned between  the                           Lenders pro rata to the aggregate amount of such  principal due to                           each of them; and                    (f)     sixth, any other sum  due  and  payable to any  Finance Party but                           unpaid under any of the Finance Documents, such  application to be                           apportioned between  the Finance Parties pro rata to the aggregate                           amount of any such  sum due to each of them,           Provided  that  any  part of the Indebtedness arising out of the Master Agreement          shall be satisfied on a pari passu basis with any repayment  of the principal of the          Loan; and           Provided   that the balance  (if any) of the moneys  received shall be paid to the          Security Parties from whom   or  from whose   assets those sums  were  received  or          recovered or to any other person entitled to them.   17.18   Retention on account     Moneys to be  applied by the Security Agent or any Receiver          or Delegate under Clause  17.17 (Application of moneys by Security Agent)  shall be          applied as soon  as  practicable after the relevant moneys  are  received by it, or          otherwise become available to it, save that (without prejudice to any other provisions          contained in any of the Security Documents)  the Security Agent or any  Receiver or          Delegate may retain  any such  moneys  by crediting them to a suspense  account for          so long and in such manner as  the Security Agent or such Receiver or Delegate may          from time to time determine following the occurrence of an Insolvency Event with a          view to preserving the rights of the Finance Parties or any of them to prove for the          whole  of the Indebtedness  (or any relevant part) against the Borrowers or any  of          them or any other person liable.    LONLlVE\30137956.24                                                                  Page 71  

 

17.19    Additional security            17.19.1 If the aggregate  amount  of (i) the relevant Vessel Loan then outstanding                   and  (ii) the amount of interest on the relevant Vessel Loan payable on the                   last day of the next two Interest Periods is more than: (a) during the first                   two years after the relevant Delivery Date, 95%, or (b) during the following                   four years, 90%,  or (c) during the period thereafter, 80%,  of the Market                   Value of a Vessel and the value of any additional security for the time being                   provided to the Security Agent under this Clause 17.19, the Borrowers shall,                   within 30 days of the Agent's request, either:                    (a)      pay to the Security Agent or to its nominee a cash deposit in the                            amount  of the  shortfall to be secured in favour of the Security                            Agent as additional security for the payment of the Indebtedness;                            or                    (b)      give to the Security Agent other additional security in amount and                            form acceptable to the Security Agent in its absolute discretion; or                    (c)      prepay the relevant Vessel Loan in the amount of the shortfall.            17.19.2 The  Market Value  of a Vessel shall be determined semi-annually or at any                   other time  required by the Security Agent  following the occurrence of an                   Event of Default which is continuing.            17.19.3 Clauses  6.3 (Reborrowing),  7.3 (Voluntary prepayment  of a  Vessel Loan)                   and  7.11 (RestrictioQs) shall apply, mutatis mutandis, to any prepayment                   made  under this Clause 17 .19.            17.19.4 Any  additional security provided pursuant to clause 17.19.1(a) or (b) shall                   be  released following compliance with Clause 17.19.1, provided at that time                   there is no Event of Default continuing.    LONLlVE\30137955.24                                                                    Page 72  

 

Section 8        Representations, Undertakings and Events of Default   18       Representations   18.1     Representations     Each Borrower makes the representations and  warranties set out           in this Clause  18  to each  Finance  Party, except that  the representations  and           warranties set out in Clauses 18.1.1(c) and 18.1.25 are not made to any Lender that           is not a PRC Lender.            18.1.1  Status   Each of the Security Parties:                     (a)     is a corporation, limited partnership or limited liability company,                            duly incorporated or formed and validly existing under the law of its                            jurisdiction of incorporation or formation (as the case may be);                    (b)      has the power to  own its assets and carry on its business as it is                            being conducted; and                    (c)      is not a FATCA FFI.            18.1.2  Binding obligations                    (a)      The obligations expressed to be assumed   by each  of the Security                            Parties in each of the Relevant Documents to which it is a party are                            legal, valid, binding and enforceable obligations.                    (b)      Without limiting the generality of Clause 18.1.2(a), each Security                            Document to which  it is a party creates the security interests which                            that Security Document    purports to  create and  those  security                            interests are valid and effective.            18.1.3  Non-conflict   with  other   obligations  and  no   obligation  to create                   security  The  entry into and performance by each of the Security Parties of,                   and  the transactions contemplated by, the Relevant Documents do not:                    (a)      conflict with any law  or regulation applicable to  such Security                            Party; or                     (b)     conflict with the constitutional documents of such Security Party; or                    (c)      conflict with any  agreement   or instrument  binding  upon  such                            Security Party or any of such Security Party's assets or constitute a                            default or termination event (however  described) under any  such                            agreement or instrument and  having a Material Adverse Effect; or                    (d)      (except  as provided  in the  Security Documents)   result in the                            existence  of, or  oblige  such  Security  Party to  create,  any                            Encumbrance over its assets.            18.1.4  Power and authority                    (a)      Each of the Security Parties has the power to enter into, perform                            and  deliver, and has taken  all necessary action to authorise its                            entry into, performance and delivery of, the Relevant Documents to    LONUVE\30137956.24                                                                    Page 73  

 

                         which it is or will be a party and the transactions contemplated by                           those Relevant Documents.                    (b)     No limit on the powers of any Security Party will be exceeded as a                           result of the borrowing, grant of security or giving of guarantees or                           indemnities contemplated  by the Relevant Documents to which  it is                           a party.           18.1.5   Validity and  admissibility  in evidence    All Authorisations required or                   desirable:                    (a)     to  enable each  of  the Security Parties lawfully to  enter into,                           exercise its rights and comply with its obligations in the Relevant                           Documents to which  it is a party or to enable each Finance Party to                           enforce and exercise all its rights under the Relevant Documents;                    (b)     to ensure that the obligations expressed to be assumed by each  of                           the Security Parties in the Relevant  Documents   to which it is a                           party are legal, valid and binding; and                    (c)     to make  the Relevant Documents   to which any Security Party is a                           party admissible in evidence in its Relevant Jurisdictions,                    have been  obtained  or effected and are in full force and effect, with the                   exception only of the  registrations referred to in Schedule 2 (Conditions                   Precedent and Subsequent).           18.1.6   Governing law and enforcement                    (a)     The  choice of  governing  law of any  Finance  Document   will be                           recognised  and  enforced  in the  Relevant  Jurisdictions of each                           relevant Security Party.                    (b)     Any judgment obtained   in relation to any Finance Document in the                           jurisdiction of the governing law of that Finance Document will be                           recognised  and  enforced  in the  Relevant  Jurisdictions of each                           relevant Security Party.            18.1.7  Insolvency    No  corporate action, legal proceeding or other procedure or                   step  described in Clause  22.1.8  (Insolvency proceedings)  or  creditors'                   process described in Clause 22.1.9 (Creditors' process) has been taken or,                   to the best knowledge and  belief of any Borrower, threatened in relation to                   a Security Party or the Borrowers Group taken as a whole; and  none of the                   circumstances described in Clause 22.1.7 (Insolvency) applies to a Security                   Party which  might  have  a  material adverse  effect on  the business  or                   financial condition of the Borrowers Group taken as a whole.            18.1.8  No filing or stamp taxes     Under the laws of the Relevant Jurisdictions of                   each  relevant Security Party, it is not necessary (subject to the Security                   Perfection Requirements) that the Finance Documents   be filed, recorded or                   enrolled with any court or other authority in any of those jurisdictions or                   that any stamp, registration, notarial or similar tax or fees be paid on or in    lONUVE\30137956.24                                                                    Page 74  

 

                 relation to the Finance Documents  or the transactions contemplated by the                   Finance Documents.            18.1.9  Deduction   of Tax   None  of the Security Parties is required under the law                   of its jurisdiction of incorporation to make any Tax Deduction.            18.1.10 No material default                    (a)      No Event of Default, Mandatory Prepayment Event or any event set                            out in Clause 7 (Illegality, Prepayment and Cancellation) and, on                            the date of this Agreement  and each  Drawdown   Date, no Default                            has occurred is continuing or is reasonably likely to result from the                            advance of any  Drawing or the entry into, the performance  of, or                            any transaction contemplated by, any of the Relevant Documents.                    (b)      No event or circumstance is outstanding under any of the Relevant                            Documents  which  constitutes a material default thereunder which                            has not been waived (excluding a default by any Finance Party).                    (c)      Without  prejudice to paragraph   (a) above,  no  other event  or                            circumstance is outstanding which constitutes (or, with the expiry                            of a  grace  period, the  giving of  notice, the making   of any                            determination or any  combination of any  of the foregoing, would                            constitute) a default or termination event (howsoever  described)                            under any other agreement or instrument which   is binding on any                            of the Security Parties or to which its assets are subject which has                            or is reasonably likely to have a Material Adverse Effect.            18.1.11 No misleading information      Save as disclosed in writing to the Agent and                   the Arranger  prior to the  date of this Agreement,  to  the best of each                   Borrower's knowledge:                    (a)      any factual information  provided by  any  Security Party to any                            Finance Party was true and accurate  in all material respects as at                           the  date  of  the relevant  report or  document   containing  the                            information or (as the case may be) as at the date the information                            is expressed to be given;                    (b)      any financial projection or forecast provided by any Security Party                            to any Finance  Party has been  prepared  on  the basis of recent                            historical information and on the basis of reasonable assumptions                            and was  fair (as at the date of the relevant report or document                            containing the projection or forecast) and arrived at after careful                            consideration;                    (c)      all material information provided to a Finance Party by or on behalf                            of any  of the  Security Parties on  or before  the date  of this                           Agreement and   not superseded  before that date was accurate and                            not misleading in any material respect and all projections provided                           to any Finance  Party on or before the date of this Agreement have                            been prepared  in good  faith on the basis of assumptions  which    LONUVE\30137956.24                                                                    Page 75  

 

                         were  reasonable  at the time  at which  they were  prepared  and                           supplied; and                    (d)     all other written information provided by any of the Security Parties                           (including its advisers) to a Finance Party was true, complete and                           accurate in all material respects as at the date it was provided and                           is not misleading in any respect.           18.1.12  Financial statements     The Original Financial Statements and all financial                   statements  relating to the Borrowers and  the Vessel Sponsor  Guarantors                   required to be delivered under Clause 19.1 (Financial statements):                    (a)     were  each prepared in accordance with the applicable GAAP or !FRS                           (as applicable) consistently applied; and                    (b)     give (in conjunction with the notes thereto) a true and fair view of                           (in the case  of the Original Financial Statements and  any  other                           annual  financial statements) or  fairly represent (in the case of                           semi-annual   and  quarterly  financial statements)  the  financial                            condition of each Borrower  or Vessel Sponsor  Guarantor  (as the                            case may be) and its Subsidiaries at the date as of which they were                            prepared and  the results of their operations during the financial                            period then ended.            18.1.13 No material proceedings                    (a)      No litigation, arbitration or administrative proceedings of or before                            any court, arbitral body or agency which, if adversely determined,                            are reasonably likely to have a Material Adverse Effect have (to the                            best of its knowledge  and  belief (having made  due  and careful                            enquiry)) been started or threatened against any  of the Security                            Parties.                    (b)      No judgment or order of a court, arbitral tribunal or other tribunal                            or any order or sanction of any governmental  or other regulatory                            body which  is reasonably likely to have a Material Adverse Effect                            has (to the best of its knowledge and belief (having made due and                            careful enquiry)) been made against any of the Security Parties.            18.1.14 No breach of laws                    (a)      None  of the Security Parties has breached any  law or regulation                            which breach has or is reasonably likely to have a Material Adverse                            Effect.                    (b)      No labour disputes are current or (to the best of each Borrower's                            knowledge  and  belief) threatened  against any  member    of the                            Borrowers Group  which  have  or are reasonably  likely to have a                            Material Adverse Effect.    LONUVE\30137956.24                                                                    Page 76  

 

         18.1.15 Environmental laws                    (a)      Each member of the  Borrowers  Group  is in compliance with Clause                            21.3 (Environmental compliance)  and to the best of its knowledge                            and belief no circumstances  have  occurred which  would  prevent                            such compliance  in a  manner  or  to an  extent which  has or  is                            reasonably likely to have a Material Adverse Effect.                    (b)      No Environmental  Claim has been commenced   or (to the best of its                            knowledge  and  belief) is threatened against any of the Security                            Parties where that claim has or is reasonably likely, if determined                            against that Security Party, to have a Material Adverse Effect.                    (c)      All records,  reports,  returns,  registrations and   information                            necessary for compliance with any Environmental Law  applicable to                            the Charters or any Environmental  Approvals  have been  made  or                            given to the relevant competent  authority in accordance with the                            requirements thereof.            18.1.16 Taxation                    (a)      None of the Security Parties is materially overdue in the filing of                            any Tax  returns or is overdue in the payment  of any  amount  in                            respect of Tax  of US$5,000,000   (or its equivalent in any other                            currency) or more.                    (b).     No claims or investigations are being, or are reasonably likely to                            be, made  or conducted  against any  of the Security Parties with                            respect to Taxes  such that a  liability of, or claim against, such                            Security Party of US$5,000,000   (or its equivalent in any  other                            currency) or more is reasonably likely to arise.                    (c)      No Security Party is resident for Tax purposes in any jurisdiction                            outside of its Original Jurisdiction.            18.1.17 Anti-corruption  law   Each of the Security Parties and each Affiliate of any                   of them  has conducted  its businesses in compliance  with applicable anti­                  corruption laws and  has instituted and maintained policies and procedures                   designed to promote and  achieve compliance with such laws.            18.1.18 Good title to assets and Encumbrance                    (a)      Each Security Party and each of its Subsidiaries has a good, valid                            and marketable   title to, or valid leases or licences of, and all                            appropriate Authorisations to use, the assets necessary to carry on                            its business as presently conducted.                    (b)      Each of the Security Parties is the legal and beneficial owner of all                            assets and other property which  it purports to charge, mortgage,                            pledge, assign  or otherwise  secure  pursuant  to each  Security                            Document   and those  Security Documents   to which it is a party                            create and  give rise to valid and  effective security having the                            ranking expressed in those Security Documents.    LONLlVE\30137956.24                                                                   Page 77  

 

        18.1.19  Pari passu ranking                    (a)     The  payment obligations of each of the Security Parties under the                           Finance Documents   to which it is a party rank at least pari passu                           with  the claims  of all its other unsecured  and  unsubordinated                           creditors, except for obligations preferred solely by any bankruptcy,                           insolvency or other similar laws of general applicable.                    (b)     The   obligations of  each   Security  Party  under  the  Finance                           Documents    to  which  it is a  party  are  direct, general  and                           unconditional obligations of that Security Party.           18.1.20  No adverse consequences                    (a)     It is not necessary under the laws of the Relevant Jurisdictions of                           any of the Security Parties:                            (i)      in order to enable any Finance Party to enforce its rights                                    under any Finance Document;  or                            (ii)     by reason  of the execution of any  Finance Document   or                                    the performance  by it of its obligations under any Finance                                    Document,                            that any  Finance Party should be  licensed, qualified or otherwise                           entitled to carry on business in any of the Relevant Jurisdictions of                           any of the Security Parties.                    (b)     No  Finance Party is or will be deemed to be resident, domiciled or                           carrying on business in any of the Relevant Jurisdictions of any of                           the Security Parties by reason only of the execution, performance                           and/or enforcement of any Finance  Document.            18.1.21 Disclosure  of material  facts  No Borrower is aware of any  material facts                   or circumstances  which have  not been  disclosed to the Agent  and which                   might,  if disclosed, have adversely  affected the  decision of  a person                   considering  whether   or  not  to  make   loan  facilities of the  nature                   contemplated  by this Agreement available to the Borrowers.            18.1.22 Relevant Documents                    (a)     The  copies of the Relevant Documents  provided  or to be provided                            by the  Borrowers  to  the Agent   in accordance  with  Clause  4                            (Conditions of Utilisation) are, or will be, true and accurate copies                            of the originals and represent, or will represent, the full agreement                            between the parties to those Relevant Documents in relation to the                            subject matter of those  Relevant  Documents   and  there are no                           commissions,   rebates, premiums   or other  payments   due  or to                            become   due  in connection  with  the subject  matter  of those                            Relevant Documents  other than in the ordinary course of business                            or as disclosed to, and approved in writing by, the Agent.    LONUVE\30137956.24                                                                    Page 78  

 

                 (b)      Other than  the Relevant  Documents   to which  it is a party, no                            Borrower   has   entered  into  any   charterparty,  contract  of                            affreightment, management   agreement   or other contract relating                            to the  purchase,  operation  or  use  of  its Vessel  except  as                            contemplated by or permitted under the Finance Documents.                    (c)      No Borrower has  previously charged, encumbered   or assigned any                            of its rights, titles, interests or benefit in and to any Relevant                            Document  (or support, guarantee,  assurance  or the like given to                            that Borrower in connection with any Relevant Document).            18.1.23 No  Immunity      No Security Party or any of its assets is immune to  any                   legal action or proceeding in their respective jurisdictions of incorporation or                   formation (as applicable).            18.1.24 Money   laundering    Any  borrowing by a Borrower under this  Agreement,                   and the performance  of its obligations under this Agreement and under the                   other Finance 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 (2005/EC/60) of the                   European  Parliament and of the Council of the European Communities.            18.1.25 US Tax Obligor    No Security Party is a US Tax Obligor.            18.1.26 Sanctions   As regards Sanctions:                    (a)      no Security Parties, nor any Affiliate of any Security Party, nor any                           of their respective directors, officers or employees is a Restricted                            Party;                    (b)      no Security Parties, nor any of their respective directors, officers or                           employees   or any person 50%  or more  owned  or controlled by, or                           acting directly or indirectly on their behalf received notice or are                           aware of any claim, action, suit, proceeding or investigation against                           any of them with respect to Sanctions by a Sanctions Authority;                    (c)     no  proceeds  of  the Loan  shall be  made   available, directly or                            indirectly, to or for the benefit of a Restricted Party (other than the                           Charterer, JSC  Novatek and  YLNG)  if to do so would be prohibited                            by Sanctions applicable to any Security Party, the Borrowers or any                            Finance Party or otherwise shall be, directly or indirectly, applied in                           a  manner  or for a purpose  prohibited by Sanctions applicable to                           any Security Party; and                    (d)     each  Security Party is in compliance with all Sanctions.           18.1.27  Assets    Save for the relevant Vessel and any other assets and properties                   arising out of each Borrower's purchase,  ownership  and chartering "of the                   relevant Vessel and entering into the Relevant Documents   to which it is a                   party, no Borrower has other vessels or significant assets or property.            18.1.28 Private and  commercial    acts   Each  Borrower irrevocably acknowledges                   and accepts that the Finance Documents and  all agreements entered into by    LONLIVE\30137956.24                                                                   Page 79  

 

                each  Security Party  in connection the  Finance Documents   (including all                  appendices,  schedules and  exhibits thereto) and the performance  or non­                  performance of its obligations under the Finance Documents are commercial                   rather than sovereign or governmental acts.           18.1.29  Encumbrances and Financial Indebtedness                    (a)     No  Encumbrance   or Quasi-Security exists over all or any of the                           present or future assets of any Borrower  other than as permitted                           by this Agreement.                    (b)     No  Borrower  has  any  Financial Indebtedness  outstanding other                           than as permitted by this Agreement.   18.2    Repetition     Each Repeating  Representation  is deemed  to be  repeated by  each          Borrower  by reference to the facts and circumstances then  existing on the date of          each Drawdown   Request,  on each Drawdown   Date, on the first day of each Interest          Period.   18.3    Repetition of Clause 18.1.26 (Sanctions)           18.3.1   Notwithstanding  Clause   18.2  (Repetition),  the  repetition of  Clause                   18.1.26(a) of this Agreement  or clause 7.1.23 of the Guarantee  shall not                   give rise to an Event of Default under Clause 22.1.5 (Misrepresentation) if:                    (a)     in relation to any applicable director, officer or employee, within                           thirty (30) days from the date  on which  such representation was                           deemed repeated,  it ceases to be a Restricted Party or ceases to be                           a director, officer or employee of a Security Party or an Affiliate of                           any Security Party; or                    (b)     the relevant Security Party, Affiliate of any Security Party or any of                           their respective directors, officers or employees:                            (i)      becomes  a Restricted Party solely as a result of Sanctions                                    administered, enacted or enforced by an EU Member State                                    other than:                                     (A)     the United Kingdom,  France, Germany;  or                                     (B)     an  EU Member State   where any  Finance Party or                                            any Yamal  Sponsor Guarantor is incorporated,                                     and it would not otherwise be a Restricted Party; and                            (ii)     the circumstances set out above in this Clause 18.3.1(b)(i)                                    do not have a Material Adverse Effect or, in relation to any                                    applicable director, officer or employee, within thirty (30)                                    days  from the  date on  which  such  representation was                                    deemed   repeated, it ceases to be  a Restricted Party or                                    ceases to be a director, officer or employee of a Security                                    Party or an Affiliate of any Security Party.    LONLIVE\30137956.24                                                                   Page so  

 

         18.3.2  Notwithstanding   Clause  18.2   (Repetition), the  repetition  of  Clause                   18.1.26(b) of this Agreement  or clause 7.1.23 of the Guarantee  shall only                   give rise to an Event of Default under Clause 22.1.5 (Misrepresentation) in                   relation to any applicable director, officer or employee if thirty days (30)                   days after the date of notice of awareness of any applicable claim, action,                   suit, proceeding or investigation with respect to Sanctions by a Sanctions                   Authority it is still under such claim, action, suit, proceeding or investigation                   and it is still a director, officer or employee.            18.3.3  Notwithstanding   Clause  18.2   (Repetition), the  repetition  of  Clause                   18.1.26(c) shall be made   with reference to Sanctions  in force as at the                   Drawdown   Date  on which  the applicable proceeds  of the Loan are  made                   available.            18.3.4  This Clause  18.3  (Repetition of Clause  18.1.26  (Sanctions)) is without                   prejudice to any of the other provisions of this Agreement (except  Clause                   18.2)  including, without  limitation, Clause 7.1  (Illegality), Clause 7.8                   (Sanctions Event under a Charter), Clause 21.2.2 (Compliance with Jaws) or                   Clause 22.1.28 (Sanctions).   19      Information Undertakings           The  undertakings  in this Clause 19 remain in force for the duration of the Facility           Period.   19.1     Financial statements    Each  Borrower shall supply to the Agent in sufficient copies          for all of the Lenders as soon as the same become available, but in any event within:           19.1.1   120  days after the end of each  of its financial years, its audited financial                   statements for that financial year;           19.1.2   90  days  after the end  of each  of its financial half-year, its unaudited                   financial statements for that financial half-year;           19.1.3   90 days after the end of each of its financial quarters, its unaudited financial                   statements for that financial quarter;           19.1.4   120  days after the end of each of the Vessel Sponsor  Guarantors and  the                   Parent's financial years, the audited consolidated financial statements of                   such Vessel Sponsor Guarantor or the Parent for that financial year;           19.1.5   90 days  after the end of each of the Vessel Sponsor  Guarantors' and  the                   Parent's financial half-year, the unaudited consolidated financial statements                   of such Vessel Sponsor Guarantor or the Parent for that financial half-year;                   and           19.1.6   90 days  after the end of each of the Vessel Sponsor  Guarantors' and  the                   Parent's financial quarters, the unaudited consolidated financial statements                   of such Vessel Sponsor Guarantor or the Parent for that financial quarter.           Notwithstanding  the latest times specified in Clauses  19.1.2, 19.1.3, 19.1.5 and          19.1.6, the Borrowers shall use their reasonable endeavours to supply the unaudited    LONUVE\30137956.24                                                                    Page 81  

 

        financial statements referred to in those clauses within forty five ( 45) days of the end           of each half year or quarter as the case may be of the relevant financial years.   19.2     Compliance Certificate     The Borrowers shall supply to the Agent, with each set of           financial statements delivered pursuant  to Clause 19.1  (Financial statements), a           Compliance  Certificate setting out  (in reasonable  detail) computations   as  to           compliance with Clause  20 (Financial covenants) as at the date as at which  those           financial statements were drawn up.   19.3     Requirements as to financial statements            Each set of financial statements delivered by a Borrower under Clause 19.1 (Financial           statements):            19.3.1  shall be certified by an authorised officer of the relevant entity as fairly                   presenting its financial condition as at the date as at which those financial                   statements were drawn  up; and            19.3.2  shall be prepared using GAAP  or !FRS (as applicable), accounting practices                   and  financial reference  periods  consistent with  those  applied in  the                   preparation of the Original Financial Statements unless, in relation to any                   set of financial statements, it notifies the Agent that there has  been  a                   change   in GAAP   or !FRS  (as  applicable), the accounting  practices or                   reference periods and its auditors deliver to the Agent:                    (a)      a  description of  any   change   necessary  for  those  financial                            stattJments to reflect the GAAP or !FRS (as applicable), accounting                            practices and reference periods upon  which the Original Financial                            Statements were prepared;  and                    (b)      sufficient information, in form and substance as may be reasonably                            required by the Agent, to enable  the Agent to make   an accurate                            comparison  between   the  financial position indicated in  those                            financial statements and the Original Financial Statements.            Any reference in this Agreement to those financial statements shall be construed as a           reference to those financial statements as adjusted to reflect the basis upon which           the Original Financial Statements were prepared.   19.4     Information:  miscellaneous     Each Borrower shall, and shall procure that each of           the other Security Parties shall, supply to the Agent (in sufficient copies for all the           Lenders, if the Agent so requests):            19.4.1  promptly  upon   becoming  aware   of them,  the  details of any  material                   litigation, arbitration or administrative proceedings  which  are current,                   threatened  or pending against any  Security Party and which,  if adversely                   determined, are reasonably likely to have a Material Adverse Effect;            19.4.2  promptly upon  becoming  aware  of them, details of (i) any casualty or other                   accident or damage to  any of the Vessels the cost of repair of which is likely                   to exceed ten million dollars (US$10,000,000) and (ii) a Total Loss of any of                   the Vessels;    LONUVE\30137956.24                                                                    Page 82  

 

         19.4.3  promptly, details of any material Environmental Claim or any other material                   incident, event or circumstance which  may  give rise to any such material                   Environmental  Claim which  is reasonably likely to have a Material Adverse                   Effect;            19.4.4  promptly, details of any capture, seizure, arrest, confiscation or detention of                   any  Vessel which remains  in existence five Business Days after the initial                   capture, seizure, arrest, confiscation or detention (as the case may be);            19.4.5  promptly on  written request, such further information regarding the financial                   condition, business and  operations of any  Security Party as any  Finance                   Party  through  the  Agent   may   reasonably  request  including, without                   limitation, cash flow analyses and  details of the operating costs  of any                   Vessel;            19.4.6  promptly  upon  becoming  aware  of them,  the details of any judgment  or                   order of a court, arbitral tribunal or other tribunal of any order or sanction of                   any  governmental  or  other regulatory body  which  is made  against  any                   Security Party and  which is reasonably  likely to have a Material Adverse                   Effect;            19.4.7  promptly  upon  becoming  aware  of  them, details of the exercise or  any                   purported  exercise of any lien on the Insurances or the Earnings which  is                   not discharged  within ten Business Days and  which is reasonably likely to                   have a Material Adverse Effect;            19.4.8  as soon as they become  available, but in any event prior to the end of each                   of the financial years of each Borrower and each Vessel Sponsor Guarantor,                   the budget  and  cash flow projections for such Borrower  and each  Vessel                   Sponsor Guarantor;            19.4.9  promptly, upon  becoming  aware  of the same, notification in writing should                   (i) the Charterer of a Vessel declare an intention to terminate the relevant                   Charter  (otherwise than  by  effiuxion of time), (ii) two (2) consecutive                   payments  of charter hire not be paid as scheduled  under a Charter (other                   than as previously advised to the Agent  in writing prior to the date of this                   Agreement),  (iii) any charter hire under a Charter be paid in a materially                   reduced  amount on  three consecutive occasions or (iv) a Vessel subject to a                   Charter be  off-hire for forty five (45), consecutive or cumulative, days in                   any six-Month period;            19.4.10 promptly,  such  information  regarding  the  material milestones  on  the                   progress  of construction of each Vessel  and other  information regarding                   incidents occurring which affect the material progress of the construction of                   each  Vessel or which  are otherwise  material to the construction of that                   Vessel  or such  other related information as  the Agent  may   reasonably                   request;            19.4.11 promptly, upon  becoming  aware  of that, the occurrence of a force majeure                   event (howsoever defined)  under a Charter or a Building Contract;    lONUVE\30137956.24                                                                    Page 83  

 

         19.4.12 promptly,  any   notice being   received  from  any  competent   authority                   amending, terminating or ·suspending or threatening to amend, terminate or                   suspend  any  Authorisation where such  action (or implementing  the result                   thereof) would be reasonably likely to have a Material Adverse Effect;            19.4.13 promptly,  upon becoming  aware  of them, the details of any circumstances                   which  may lead to:                    (a)      any Authorisation not being obtained or effected or not remaining                            in full force and effect (other than in accordance with its terms); or                    (b)      any Authorisation not  being obtained, renewed  or effected when                            required;                    where  failure to obtain and/or maintain the  same  would  have a  Material                   Adverse  Effect; and            19.4.14 any other information connected  with the Charters or the Building Contracts                   reasonably requested  by the Agent.    19.5    Notification of Event of Default etc.   Each Borrower shall:            19.5.1   promptly, upon becoming  aware  of the same, notify the Agent in writing of                   the occurrence of any Event of Default, Mandatory Prepayment Event or any                   event set out in Clause 7.5 (Mandatory prepayment on   Total Loss) and 7.6                    (Mandatory  prepayment   on sale of a  Vessel) and  steps, if any, and  if                   applicable, being taken to remedy it; and            19.5.2   promptly upon  a request by the Agent, each Borrower shall confirm to the                   Agent  that, save as previously notified to the Agent or as notified in such                   confirmation, no  Event  of Default, Mandatory  Prepayment   Event  or any                   event  set out in Clause 7.5 (Mandatory prepayment on  Total Loss) and 7.6                    (Mandatory prepayment on  sale of a Vessel) is continuing, or if an Event of                    Default, Mandatory  Prepayment   Event  or event  set  out in Clause  7.5                    (Mandatory prepayment on   Total Loss) and 7.6 (Mandatory prepayment on                   sale of a Vessel) is continuing, specifying the steps, if any, and if applicable,                   taken to remedy it.    19.6    "Know your customer" checks            19.6.1  If:                     (a)     the introduction of or  any  change  in (or in the  interpretation,                            administration or application of) any law or regulation made after                            the date of this Agreement;                     (b)     any  change  in the status of  a Security Party (or  of a Holding                            Company    of  a  Security  Party)  or  the  composition  of  the                            shareholders of a  Security Party (or of a Holding Company   of a                            Security Party) after the date of this Agreement; or    LONUVE\30137956.24                                                                     Page 84  

 

                 (c)      a proposed assignment or transfer by a  Lender of any of its rights                            and  obligations under this Agreement   to a party  that is not a                            Lender prior to such assignment or transfer,                    obliges the Agent or any  Lender (or, in the case of Clause 19.6.1(c), 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, each Borrower 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 19.6.1(c), on behalf of any prospective new                   Lender)  in order for the Agent, such Lender  or, in the case of the event                   described in Clause 19.6.1(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.            19.6.2  Each Lender shall promptly upon the request of the Agent supply, or procure                   the supply  of, such documentation   and other  evidence as  is reasonably                   requested by the Agent (for itself) in order for the Agent to carry out and be                   satisfied it has complied with all necessary "know your customer" or other                   similar checks under  all applicable laws and regulations pursuant  to the                   transactions contemplated in the Finance Documents.   19.7     Winding-up           The  Borrowers shall promptly notify the Agent of any petition or notice of meeting to           consider any  resolution to wind-up  any Security  Party (or any  event analogous           thereto under the laws of the place of its incorporation), unless that Security Party in           its reasonable opinion has deemed such petition or notice to be vexatious or frivolous           in nature.   19.8     Project Budget           The  Borrowers  shall notify the Agent of any change  to the allocation of the funds           within the items of the Total Project Costs where the re-allocation is in the amount of           US$2,000,000  per Vessel or above.   19.9     Updating information            If a Borrower becomes  aware  of the occurrence of any event or circumstance  as a           result of which the information which has been  provided by  it or another Security           Party to the Agent under the Finance Documents  (including an event or circumstance           which would  have  resulted in a breach  of a representation  under Clause  18.1.9           (Deduction of Tax) or Clause 18.1.25 (US Tax Obligor) had that representation been           a Repeating  Representation) includes an  untrue  statement  of a material fact or           omitted to state any material fact, it will (without prejudice to any rights which may           have arisen in relation to the relevant untrue statements or omission)  inform the           Agent and,  if appropriate, will promptly furnish to the Agent updated  or revised           information.    LONUVE\30137956.24                                                                    Page 85  

 

20       Financial Covenants   20.1     Financial definitions            "Available  Credit  Lines"  means  any  undrawn  committed   revolving credit lines,           other than undrawn  committed revolving credit lines with less than six (6) months to           maturity, available to be drawn by any member of the TGP  Group or CLNG  Group (as           applicable), as reflected in TGP's or CLNG's  (as applicable) most recent financial           statements forming  part of TGP's Accounts or CLNG's Accounts (as applicable).            "Borrowings"   means,  in respect of any Borrower, any Financial Indebtedness owed           by it falling within paragraph (g) of the definition of Financial Indebtedness alone.            "Business   Acquisition"  means  the  acquisition of a company   or any  shares  or           securities or a business or undertaking (or, in each case, any interest in any of them)           or the incorporation of a company.            "Capital  Expenditure"    means   any   expenditure  or  obligation in  respect  of           expenditure which,  in accordance with GAAP  or !FRS  (as applicable), is treated as           capital expenditure (and (except for the purposes of paragraph (g) of the definition           of "Cashflow" where  it shall not be included) including the capital element of any           expenditure or obligation incurred in connection with a Finance Lease).            "Cash"  means, at any time, cash in hand or at bank and (in the latter case) credited           to an account  in the name  of a Borrower with an Acceptable  Bank  and to which a           Borrower is alone beneficially entitled and for so long as:            (a)      that cash is repayable 10 days after the relevant date of calculation;            (b)      repayment of that cash is not contingent on the prior discharge of any other                    indebtedness or of any  other person whatsoever  or on  the satisfaction of                    any other condition;            (c)      there is no Security over  that cash  except for Encumbrances   permitted                    under  the Finance  Documents   and  constituted by  a  netting or set-off                    arrangement  entered into by the  Borrower in the ordinary course of their                    banking arrangements; and            (d)      the cash  is freely and  (except as  mentioned  in paragraph   (a) above)                    immediately  available to be applied in repayment  or  prepayment  of the                    Facility.            "Cashflow"   means,  in respect of any  Relevant Period, EBITDA  for that Relevant           Period after:            (a)      adding the  amount  of any  decrease  (and deducting  the amount   of any                    increase) in Working Capital for that Relevant Period;            (b)      adding the amount of any cash  receipts (and deducting the amount of any                    cash payments)  during that Relevant  Period in respect of any Exceptional                    Items not already taken account  of in calculating EBITDA for any Relevant                    Period (other than, in the case of cash receipts, Relevant Proceeds);     LONUVE\30137956.24                                                                    Page 86  

 

         (c)     adding  the amount   of any  cash receipts during  that Relevant Period  in                   respect of any  Tax rebates  or credits and deducting the  amount  actually                   paid or due and  payable in respect of Taxes during that Relevant Period by                   the Borrower;            (d)     adding the amount of any increase  in provisions, other non-cash debits and                   other non-cash  charges (which are not Current Assets or Current Liabilities)                   and  deducting the amount of any non-cash   credits (which are not Current                   Assets or Current Liabilities) in each case to the extent taken into account in                   establishing EBITDA;            (e)     deducting  the amount   of any Capital Expenditure  actually made  in cash                   during  that  Relevant  Period  by  the  Borrower   unless funded   by  (i)                   withdrawals  from the Dry-docking  Reserve Account  or Distribution Account                   or (ii) equity injections provided by the Vessel Sponsor Guarantors to the                   Borrower;            (f)     deducting  the amount   of any  cash  costs of Pension  Items  during that                   Relevant Period to the extent not taken into account in establishing EBITDA,            and so that no amount shall be added (or deducted) more than once.            "CLNG's  Accounts"   means   the consolidated financial statements of CLNG   to be           provided to the Lenders.            "Current  Assets"  means  the aggregate  (on a consolidated basis) of all inventory,           work  in  progress,  trade  and  other  receivables  of  each  Borrower   including           prepayments in  relation to operating items and sundry debtors (but excluding Cash)           expected  to be realised within twelve Months  from  the date  of computation  but           excluding amounts in respect of:            (a)     receivables in relation to Tax;            (b)     Exceptional Items and other non-operating items;            (c)     insurance claims; and            (d)     any interest owing to any Borrower.            "Current  Liabilities" means the aggregate (on a consolidated basis) of all liabilities           (including trade creditors, accruals and provisions) of each Borrower expected to be           settled within twelve Months from the date of computation but excluding amounts in           respect of:            (a)     liabilities for Borrowings and Finance Charges;            (b)     liabilities for Tax;            (c)     Exceptional Items and other non-operating items;            (d)     insurance claims; and            (e)     liabilities in relation to dividends declared .but not paid by a Borrower.    LONLIVE\30137956.24                                                                   Page 87  

 

         "Debt Service"  means, in respect of any Relevant Period, the aggregate of:            (a)     Finance Charges for that Relevant Period;            (b)     all scheduled and mandatory   repayments  of Borrowings falling due during                   that Relevant Period but excluding:                    (i)      any amounts  falling due under any  overdraft or revolving facility                            and which were  available for simultaneous redrawing according to                            the terms of that facility; and                    (ii)     any such obligations owed to any member of the Borrower's Group;            (c)     the  amount  of the  capital element of any  payments   in respect of that                   Relevant  Period payable  under  any  Finance  Lease entered  into by  the                   Borrower,            and so that no amount shall be included more than once.            "Debt Service Cover Ratio"   means the  ratio of Cashflow to Debt Service in respect           of any Relevant Period.            "EBITDA"   means,  in respect of any  Relevant  Period, the consolidated operating           profit of the Borrower  before taxation  (excluding the results from  discontinued           operations):            (a)     before  deducting any  interest, comm1ss1on,  fees, discounts, prepayment                   fees, premiums   or  charges  and  other finance payments   whether  paid,                   payable or capitalised by the Borrower in respect of that Relevant Period;            (b)     not including any accrued interest owing to any member of the   Borrower's                   Group;            (c)     after adding back any amount attributable to the amortisation, depreciation                   or impairment of assets of members   of the Borrower Group  (and taking no                   account  of the reversal of any previous impairment   charge made   in that                   Relevant Period);            (d)     before taking into account any Exceptional Items;            (e)     (after deducting the amount of any profit (or adding back the amount of any                   loss) of any  member    of the Borrower's  Group  which  is attributable to                    minority interests);            (f)     after deducting the  amount  of any profit of any Non-Group   Entity to the                   extent that the amount of the  profit included in the financial statements of                   the  Borrower's Group  exceeds  the  amount  actually received in cash  by                   members   of the Borrower's Group  through  distributions by the Non-Group                    Entity;            (g)      before taking into account any unrealised gains or losses on any financial                    instrument;    LONUVE\30137956.24                                                                    Page 88  

 

         (h)     before  taking into account  any gain  or loss ansmg   from an  upward  or                   downward   revaluation of any  other asset at any time  after 31 December                   2016;            (i)     before taking into account any Pension Items;            (j)     excluding  the  charge to  profit represented by  the  expensing  of stock                   options;            (k)     before taking  into account any gain arising from any  transaction where a                   member of the Borrower's Group:                    (i)      purchases by way of assignment or transfer;                    (ii)     enters into any sub-participation in respect of; or                    (iii)    enters  into any  other  agreement   or  arrangement   having  an                            economic   effect substantially similar to a  sub-participation in                            respect of,                    any Commitment or amount outstanding under this Agreement,            in each case, to the extent added, deducted or taken into account, as the case may           be, for the purposes of determining operating profits of the Borrower before taxation.            "Equity" means the aggregate   of the amount paid up on  the issued share capital of           TGP or CLNG  (as applicable) and the amount standing to the credit of its capital and           revenue  reserves  (including any share  premium   account  or  capital redemption           reserve but excluding any revaluation reserve), plus or minus the amount standing           to the credit or debit (as the case may be) of its profit and loss account.            "Exceptional  Items"   means  any  material items  of an unusual  or non-recurring           nature which represent gains or losses including those arising on:            (a)     the restructuring of the activities of an entity and reversals of any provisions                   for the cost of restructuring;            (b)     disposals, revaluations, write downs or impairment of non-current assets or                   any reversal of any write down or impairment; and            (c)     disposals of assets associated with discontinued operations.            "Finance  Charges"   means, for any  Relevant Period, the aggregate amount  of the           accrued  interest, commission,  fees, discounts,  prepayment   fees, premiums   or           charges and other finance payments  in respect of Borrowings paid or payable by the           Borrower in cash or capitalised in respect of that Relevant Period:            (a)     including any costs  which are included as part of the effective interest rate                   adjustments;            (b)     including the interest (but not the capital) element of payments in respect                   of Finance Leases;    LONLIVE\30137956.24                                                                   Page 89  

 

        (c)      including  any comm1ss1on,   fees, discounts and  other finance payments                   payable by  (and deducting  any  such amounts   payable to) the  Borrower                   under any interest rate hedging arrangement; and           (d)      if a Joint Venture is accounted for on a proportionate consolidation basis,                   after adding the TGP Group's, or CLNG' (as applicable), share of the finance                   costs or interest receivable of the Joint Venture; and           (e)      taking no  account  of any  unrealised gains  or losses  on  any financial                   instruments other than any derivative instruments which are accounted  for                   on a hedge accounting basis; and           (f)      excluding interest (capitalised or otherwise) in respect of any debt which is                   fully subordinated to the Loan,           and so that no amount shall be added (or deducted) more than once.           "Finance   Lease"  means   any  lease or  hire purchase  contract which  would,  in          accordance  with GAAP  or  !FRS (as applicable), be treated as a finance or capital          lease.           "Free   Liquidity" means   cash,  cash  equivalents and   marketable  securities of          maturities less than one (1) year to which the members of the TGP   Group  or CLNG          Group  (as applicable) shall have free, immediate and direct access each as reflected          in TGP's or CLNG's  (as applicable) most recent financial statements forming part of          the TGP Accounts or CLNG  Accounts  (as applicable).           "Net Debt"  means TGP's   or CLNG's (as applicable) Total Debt less its Free Liquidity.           "Net Debt to Net Debt plus    Equity Ratio" means the ratio of Net Debt to Net Debt          plus Equity.           "Non-Group    Entity" means  any investment or entity (which is not itself a member          of the  Borrower's Group  (including associates and Joint Ventures))  in which any          member of the  Borrower's Group or has an ownership interest.           "Quarter Date"   means each  of 31 March, 30 June, 30 September and  31 December.           "Pension   Items"  means  any  income or charge  attributable to a post-employment          benefit scheme  other than the current service costs and any past service costs and          curtailments and settlements attributable to the scheme.           "Relevant   Period"  means  the 12  month  period which  immediately  precedes  the          each  date  on  which  the financial covenants  set out  in Clause  20.2 ,(Financial          condition) are tested pursuant to Clause 20.3 (Financial testing).           "Relevant   Proceeds"   means   the proceeds  of an  insurance  claim subject to  a           mandatory prepayment under Clause   7.5 (Mandatory prepayment on   Total Loss) or a          sale of a Vessel subject to a mandatory  prepayment   under Clause  7.6 (Mandatory          Prepayment on  sale of a Vessel).            "Tangible Net Worth"   means the issued  and paid up share capital (including share           premium  or items of a similar nature (but excluding shares which are expressed to    lONLIVE\30137956.24                                                                   Page 90  

 

         be redeemable)), loans from shareholders, and amounts standing to the credit of the           consolidated capital reserves of the TGP Group or the CLNG Group (as applicable),            (a)     plus any credit balance carried forward on TGP's or CLNG's  (as applicable)                   consolidated profit and loss account,            (b)     less:                    (i)      any  debit  balance  carried forward  on   TGP's  or  CLNG's  (as                            applicable) consolidated profit and loss account;                    (ii)     any amount shown   for goodwill, including on consolidation, or any                            other intangible property (other than intangible property relating to                            contracts as shown   in the balance  sheet  of TGP  or CLNG   (as                            applicable)); and                    (iii)    any amount attributable to minority interests in Subsidiaries.            "TGP's  Accounts"   means   the  consolidated financial statements  of TGP  to  be           provided to the Lenders.          "Total Debt" means the aggregate of:            (a)     the amount calculated  in accordance with US  GAAP  or !FRS (as applicable)                   shown  as each  of "long term debt", "short term debt" and "current portion                   of long term debt" on the latest consolidated balance sheet of TGP or CLNG                   (as applicable); and            (b)     the amount of any  liability in respect of any lease or hire purchase contract                   entered into by TGP or CLNG  (as applicable) or any of its Subsidiaries which                   would, in accordance with US  GAAP  or !FRS (as applicable), be treated as a                   finance or capital lease (excluding any amounts applicable to leases to the                   extent that the lease obligations are secured by a security deposit which is                   held on the balance sheet under "Restricted Cash").            "Working Capital" means, on   any date, Current Assets less Current Liabilities.   20.2     Financial condition            The Borrower shall ensure that:            20.2.1  Debt Service Cover Ratios:                    (a)      Debt  Service Cover  Ratio of  each  Borrower  in respect of  any                            Relevant Period shall not be less than 1.05:1, unless one or more                            Vessels is off-hire at any time during the Relevant Period in which                            case Debt Service Cover  Ratio of the Borrowers on a consolidated                            basis in respect of any  Relevant  Period shall not be  less than                            1.05:1.                    (b)      For the purpose only of determining a  Dividend Restriction Event,                            Debt  Service Cover  Ratio of  each  Borrower  in respect of  any                            Relevant Period shall not be less than 1.2: 1, unless one or more    LONLIVE\30137956.24                                                                   Page 91  

 

                         Vessels is off-hire at any time during the Relevant Period in which                           case Debt Service Cover  Ratio of the Borrowers on a consolidated                           basis in respect of any Relevant Period shall not be less than 1.2: 1.           20.2.2  CLNG's  Free Liquidity and Available Credit Lines:                   CLNG   maintains Free Liquidity and Available Credit Lines of (in aggregate)                   not less than thirty two million dollars (US$32,000,000); and           20.2.3   CLNG  's Net Debt to Net Debt plus Equity Ratio:                    CLNG  maintains a Net Debt to Net Debt plus Equity Ratio of not more than                  seventy five per cent. (75%).           20.2.4   CLNG's Total Net Worth:                    CLNG  maintains  a Tangible Net  Worth  of at least three hundred  million                   dollars (US$300,000,000).           20.2.5   TGP's Free Liquidity and Available Credit Lines                   TGP  maintains Free Liquidity and Available Credit Lines of (in aggregate) not                   less than thirty five million dollars ($35,000,000);           20.2.6   TGP's Net Debt to Net Debt plus Equity Ratio                   TGP  maintains  a Net Debt to Net Debt  plus Equity Ratio of not more than                   eighty per cent (80%); and           20.2. 7  TGP's Total Net Worth                   TGP  maintains a Tangible Net Worth  of at least four hundred million dollars                   ($400,000,000).   20.3    Financial testing           20.3.1   The financial covenants set out in Clause 20.2.1 (Financial condition) shall                   be calculated in accordance with GAAP  and tested by reference to each  of                   the Borrowers' financial statements delivered pursuant  to Clauses 19.1.1                   and 19.1.2.           20.3.2   The  financial covenants set  out in Clauses  20.2.2,  20.2.3 and  20.2.4                   (Financial condition) shall be calculated in accordance with IFRS and tested                   by reference to each of CLNG's  financial statements delivered pursuant to                   Clauses 19.1.4 and 19.1.5.           20.3.3   The  financial covenants set  out in Clauses  20.2.5,  20.2.6 and  20.2.7                   (Financial condition) shall be calculated in accordance with GAAP and tested                   by reference to each  of TGP's financial statements delivered pursuant  to                   Clauses 19.1.4 and 19.1.5.   20.4    No less favourable financial covenants           20.4.1   The financial covenants in 20.2.2, 20.2.3 and 20.2.4 (Financial covenants)                   are as  favourable as, or  more  favourable  than, those  given by  CLNG   lONUVE\30137956.24                                                                    Page 92  

 

                 currently to other lenders or finance lessors. If during the Facility Period                   CLNG  provides to another lender or finance lessor financial covenants which                   are more  favourable  than  those in  Clauses 20.2.2,  20.2.3 and  20.2.4                   (Financial covenants) the  Borrowers will promptly  notify the Agent  and                   hereby agrees  to amend  Clauses   20.2.2, 20.2.3 and  20.2.4 so as to be                   consistent with those more favourable financial covenants.           20.4.2  The  financial covenants in 20.2.5, 20.2.6 and 20.2.7 (Financial covenants)                   are as favourable as, or more favourable than, those given by TGP currently                   to other lenders or finance lessors. If during the Facility Period TGP provides                   to another  lender or finance lessor financial covenants which  are  more                   favourable than  those  in Clauses  20.2.5, 20.2.6  and  20.2.7 (Financial                   covenants) the Borrowers  will promptly notify the Agent and hereby agree                   to amend  Clauses  20.2.5, 20.2.6 and  20.2.7 so as to be  consistent with                   those more favourable financial covenants.   21      General Undertakings           The  undertakings in this Clause 21 remain  in force for the duration of the Facility          Period.   21.1    Authorisations     Each  Borrower  shall, and shall procure that each of the  other          Security Parties shall:           21.1.1   obtain, comply with and do all that is necessary to maintain in full force and.                   effect all Authorisations and promptly supply certified copies to the Agent of                   any  Authorisation required under  any  law  or regulation of  a Relevant                   Jurisdiction, in each case to:                    (a)     enable  any  Security Party to perform  its obligations under the                           Finance Documents to which  it is a party;                    (b)     ensure  the  legality, validity, enforceability or admissibility in                           evidence of any Finance Document;  and                    (c)     enable any Security Party to carry on its business where failure to                           do so has or is reasonably likely to have a Material Adverse Effect;                           and           21.1.2   ensure that no failure to obtain, comply with or maintain any Authorisation                   may cause  a Material Adverse Effect.   21.2    Compliance with laws           21.2.1   Each  Borrower  shall, and shall procure that each  of the  other Security                   Parties shall, comply in all respects with all laws to which it may be subject,                   if (except as regards Sanctions, to which Clause 21.2.2 applies, and anti­                  corruption laws, to which Clause 21.5 applies) failure so to comply has or is                   reasonably likely to have a Material Adverse Effect.           21.2.2   No Borrower  shall, and shall not permit or authorise any other person to,                   directly utilise or employ the Vessel, or to use, lend, make payments  of,                   contribute or otherwise make  available, all or any part of the proceeds of    LONLIVE\30137956.24                                                                   Page 93  

 

                any  transaction(s) contemplated  by the  Finance Documents   to fund  any                  trade, business or other activities:                    (a)     involving or for the direct or indirect benefit of any Restricted Party                           (other than  the Charterer,  JSC  Novatek  and  YLNG)  or  in any                           country or territory that at the time of such funding is a Sanctioned                           Country  (other than Russia)  if to do so would  be prohibited by                           Sanctions applicable to any Security Party or any Finance Party;                    (b)     in any manner that would  reasonably  be expected to result in any                           Security Party, any Approved Manager or any Finance  Party or any                           Affiliate of such party or any other person (including any person                           participating in the Loan  hereunder, whether   as lender, facility                           agent  or security agent  or otherwise)  being party to  or which                           benefits from  any  Finance  Document    being in  breach  of any                           Sanctions by  which it is bound or (other than the Charterer, JSC                           Novatek and  YLNG)  becoming a Restricted Party provided that:                            (i)      it shall not be a breach of this Clause  21.2.2(b) if the                                    relevant Security Party, Approved Manager, Finance Party,                                    Affiliate of such parties or other person is in breach of any                                    Sanctions by which  it is bound or becomes   a Restricted                                    Party solely as a result of Sanctions administered, enacted                                    or enforced by a EU Member State other than:                                     (A)     the United Kingdom,  France, Germany; or                                     (B)     an EU  Member State  where  any  Finance Party or                                            any Yamal  Sponsor Guarantor is incorporated,                                     and it would not otherwise be in breach of any Sanctions                                    which  it is bound  or  be  a  Restricted Party and  the                                    circumstances set out  in this Clause 21.2.2(b)(i) do not                                    have a Material Adverse Effect;                    (c)     which  is prohibited under  applicable Sanctions  or  which ·could                           expose  any Security Party, its assets, any asset subject to Security                           Documents, the Vessels,  any Finance Party, any other person being                           party to or which benefits from any Finance Document (other than                           the Charterer, JSC Novatek and YLNG)  or any Approved  Manager to                           enforcement  proceedings  or any  other consequences   whatsoever                           arising from Sanctions by which it is bound.   21.3    Environmental compliance           Each Borrower shall, and shall procure that each of the Security Parties will:           21.3.1   comply with all Environmental Laws;           21.3.2   obtain, maintain and  ensure  compliance with  all requisite Environmental                   Approvals; and    LONUVE\30137956.24                                                                    Page 94  

 

         21.3.3  implement   procedures to monitor  compliance with  and to prevent  liability                    under any Environmental Law,            where failure to do so has or is reasonably likely to have a Material Adverse Effect.    21.4    Environmental Claims            Each Borrower shall promptly upon becoming  aware  of the same, inform the Agent in           writing of:            21.4.1  any  Environmental   Claim  against any  Security Party  which  is current,                    pending or threatened; and            21.4.2   any facts or circumstances  which  are reasonably  likely to result in any                    Environmental Claim  being commenced   or threatened against any Security                   Party,            where the claim, if determined against that Security Party, has or is reasonably likely           to have a Material Adverse Effect.   21.5     Anti-corruption law            Each  Borrower  warrants, represents and  agrees  that it and its Affiliates and its           respective officers, directors, employees, consultants, agents and/or intermediaries           have  complied with, and  shall comply with, all applicable Business Ethics Laws in           connection with this Agreement.   21.6     Taxation    Each  Borrower shall pay and discharge all Taxes imposed  upon it or its           assets within the time period allowed without incurring penalties unless and only to           the extent that:            21.6.1  such  payment is being contested in good faith;            21.6.2  adequate   reserves are being  maintained  for those Taxes  and  the costs                    required to contest them which  have  been disclosed in its latest financial                   statements   delivered   to  the  Agent   under   Clause   19.1  (Financial                   statements); and            21.6.3   such payment can  be lawfully withheld and failure to pay those Taxes does                    not have or is not reasonably likely to have a Material Adverse Effect.   21.7     Evidence  of good   standing    Each  Borrower will from time to time if requested,           upon  reasonable notice by the Agent  provide the Agent with evidence  in form and           substance  satisfactory to the Agent  that the  Security Parties and  all corporate           shareholders of any of the Security Parties remains in good standing.   21.8     Pari passu  ranking     Each Borrower shall ensure that at all times any unsecured           and  unsubordinated   claims of  a  Finance  Party  against it under  the  Finance           Documents   rank at least pari passu with the claims of all its other unsecured and           unsubordinated  creditors except those creditors whose claims are preferred by any           bankruptcy,  insolvency, liquidation, winding-up or other  similar laws of general           application.    21.9    Negative pledge    No  Borrower shall:    LONLlVE\30137956.24                                                                   Page 95  

 

        21.9.1   create, or permit to subsist, any Encumbrance  (other than pursuant to the                   Security Documents)  over all or any part of the Vessel owned by it, its other                   assets or undertakings (other than Permitted Encumbrances); or           21.9.2   sell, lease, assign, transfer or otherwise dispose of a Vessel or any of those                   assets or all or any part of those undertakings other than, in the case of a                   sale of the Vessel, where such sale complies with the requirements  of this                   Agreement or any  other Finance Documents.   21.10   Charter Arrangements      In the event that:           21.10.1  a Charter is novated, amended   or otherwise  supplemented  in accordance                   with the terms of such Charter (the "Restructured Time Charter");  or           21.10.2  a Borrower  and  the Charterer (or the  Charterer's nominee)  enter into a                   bareboat charter in accordance with clause 46 (Bareboat Charter Option) of                   the relevant Charter (the "Yamal Bareboat Charter"),           the relevant Borrower shall, to the extent that it is a party to the Restructured Time           Charter (in respect of the Restructured Time Charter):            (a)     assign its rights and interest under such Restructured Time Charter or the                   Yamal  Bareboat Charter  (as the case may  be) by a legal assignment  duly                   notified to the Charterer in favour of the Security Agent;            (b)     subject to Clause 21.10.2(c) below, if the Yamal Bareboat Charter is entered                   into, each Borrower  shall procure  that the Charterer  complies with  the                   requirements  of clause 6.6  of the relevant Quiet  Enjoyment  Agreement                   which, inter alia, provides that the relevant Borrower (as owner) (and not                   the Charterer  (as bareboat  charterer)) shall provide  the Insurances  in                   accordance  with the  terms  set out at clause  13 of the  relevant Yamal                   Bareboat Charter; and            (c)     if, pursuant to the Charterer's request for the prior written consent of its                   financiers to an  assignment  by  Charterer to  the relevant  Borrower  of                   Charterer's rights and interests (or the Charterer's nominee's  rights and                   interests) to the relevant Vessel's Insurances (the "Charterer's Insurance                   Assignment"), such   consent is received, Clause 21.10.2(b) above shall not                   apply.  In such  circumstances, the  relevant Borrower  shall procure that                   Charterer  enters  into a  Charterer's  Insurance  Assignment   and  such                   Borrower shall on-assign such rights and interests in the Vessel's Insurances                   in favour of the Security Agent.           The  Borrowers  shall give the Agent  no less than twenty  (20) days' prior written           notice of any such novation, amendment    or restructure referred to in this Clause           21.10.   21.11   Arm's   length  basis   No Borrower shall (and the  Borrowers shall procure that no           other Security Party (other than TGP and Teekay Operating) will), sell or transfer any           of its material assets other than (and provided not otherwise prohibited by any other           term of this Agreement):    LONUVE\30137956.24                                                                    Page 96  

 

         21.11.1  on arm's length terms to third parties where the net proceeds  of sale are                    used as a prepayment hereunder;            21.11.2  on arm's length terms to its Affiliates, which are and remain members of the                    Borrowers Group; or            21.11.3  on arm's length terms and for full market value.    21.12   Merger    No  Borrower  shall, and the Borrowers shall procure that the Parent shall           not, enter into any  amalgamation,  demerger,   merger, consolidation or corporate           reconstruction without the prior written consent of the Agent.    21.13   Change   of business    No Borrower shall, and the Borrowers shall procure that the           Parent shall not, make any substantial change to the general nature of its business           from that carried on at the date of this Agreement without the prior written consent           of all Lenders.   21.14   .No  other  business     No Borrower  shall engage  in any business  other than the           ownership, operation, chartering and management of the relevant Vessel.   21.15    No acquisitions    No Borrower shall make any acquisition or investment without the           prior written consent of the Agent  save for the acquisition of the relevant Vessel           under the relevant Building Contract (such consent not to be unreasonably withheld           or delayed).   21.16    No  borrowings     No  Borrower shall (a) incur or allow to remain outstanding any           bank loan, bond issuance or any other Financial Indebtedness or (b) incur any other           liability or obligation except, in either case:            21.16.1 liabilities and obligations under the Finance Documents to which  they are                   parties;            21.16.2 liabilities or obligations (other than a bank loan) reasonably incurred in the                   ordinary  course of  operating, chartering, repairing and  maintaining the                   Vessel;            21.16.3 with the prior written consent of the Agent, Financial Indebtedness (other                   than a bank loan) owing to their Affiliates provided that:                    (a)      such Financial Indebtedness is unsecured and  subordinated to the                            Loan on terms acceptable to the Majority Lenders; and                    (b)      no Borrower shall be permitted to repay any Financial Indebtedness                            owing to its Affiliates at any time during the Facility Period;            21.16.4 any  other Financial Indebtedness  (other than a  bank  loan) the principal                   amount of which   (when aggregated  with the principal amount of any other                   Financial Indebtedness  incurred by  any  Borrower  (except any  permitted                   under  Clauses  21.16.1  or 21.16.2  or 21.16.3  above)  does  not exceed                   US$5,000,000   (or its equivalent in another currency or currencies), plus an                   amount equal  to amounts  credited to the Drydocking  Reserve Account  and                   the Operating Reserve Account.    LONLIVE\30137956.24                                                                   Page 97  

 

21.17   No  loans  or credit  or other  financial commitments      No  Borrower shall be a          creditor in respect of any Financial Indebtedness or enter into any guarantee  and          indemnity or otherwise voluntarily assume any actual or contingent liability in respect          of any obligation of any other person unless pursuant to the Finance Documents and          loans made   in the ordinary course of business in connection  with the chartering,          operation or repair of the relevant Vessel.   21.18   No guarantee or indemnities           21.18.1  No Borrower  shall incur or allow to remain outstanding any  guarantee  in                   respect of any obligation of any person.           21.18.2  No Borrower  shall incur or allow to remain outstanding  any indemnity  in                   respect of any obligation of any person other than indemnities incurred in                   the ordinary course of trading and/or operating a Vessel.   21.19   Disposals           21.19.1  No Borrower shall enter into a single transaction or a series of transactions                   (whether related or not) and whether voluntary or involuntary to sell, lease,                   transfer or otherwise dispose of any asset.           21.19.2  Clause 21.19.1 does  not apply to any sale, lease, transfer or other disposal                   which is a Permitted Transaction.   21.20   Inspection   of records    Each  Borrower will permit the inspection of its financial          records and  accounts from time to time on reasonable  notice during business hours           by the Agent or its nominee.   21.21    Relevant  Documents       In relation to the Relevant  Documents,  each  Borrower           undertakes that:            21.21.1 there shall be no:                    (a)     termination by such Borrower of any Relevant Document;   or                    (b)     alteration to or  waiver  of any  material term  of  any Relevant                            Document where doing  so would have a Material Adverse Effect,                    in each case, unless the prior written consent of the Agent is obtained (it                   being understood, and for the avoidance of doubt, that any (x) replacement                   of a Yamal  Sponsor  Guarantee,  or (y) execution of an Alternative Yamal                   Sponsor  Guarantee  (in each case) pursuant to clause 67.3  of the Charter                   shall, subject to each Borrower's  compliance  of Clause 21.26  (Proposed                   Alternative Yama/ Sponsor Guarantor), not have a Material Adverse Effect);            21.21.2 without:                    (a)      limiting the generality of Clause 21.21.1 above; and                    (b)      prejudice to the  provisions of the  Relevant  Documents   which                            expressly contemplate or permit a sale of a Vessel to the Charterer,                            any Yamal  Sponsor Guarantor  or any nominee  of the Charterer or                            of any Yamal Sponsor Guarantor,    LONUVE\30137956.24                                                                    Page 98  

 

                 no  Borrower will, without the prior written consent of the Agent, effect any                   sale of the Vessel to the Charterer, any Yamal  Sponsor  Guarantor  or any                   nominee  of the Charterer or of any Yamal Sponsor Guarantor; and            21.21.3 without prejudice to the foregoing, each Borrower shall, where  applicable,                   use  reasonable endeavours  and  forthwith execute and  deliver any and all                   such other agreements,  instruments and documents   (including any novation                   agreement)  as may be  required by law or deemed  necessary to ensure that                   the Relevant Documents   which  are in effect on the date of this Agreement                   shall remain  in effect, so  that all obligations previously owed  by  the                   applicable  Transaction  Party to  such   Borrower  under   such  Relevant                   Documents   shall continue to  be owed  to  such Borrower  throughout  the                   Facility Period (provided that this shall not be applicable to expiration of                   such Relevant Document through effluxion of time).   21.22    Constitutional Documents            No  Borrower  shall agree   to any  material  amendment    to  or variation of  its           constitutional documents, except as required by the Finance Documents  or pursuant           to a reduction of capital (while the Borrower is solvent) by (A) a share or common           unit buy-back, or (B) redemption of redeemable shares or units, without the approval           of the Agent or as required by applicable law, including share capital reductions to           set off accumulated losses.   21.23    Further assurance            21.23.1 Each  Borrower  shall, and shall procure  each other  Security Party shall,                   promptly  do  all such  acts  or  execute  all such  documents   (including                   assignments, transfers, mortgages, charges, notices and instructions) as the                   Security Agent  may  reasonably specify (and in such form  as the Security                   Agent  may   reasonably  require in favour  of the  Security Agent  or  its                   nominee(s)):                    (a)      to perfect any  Encumbrance   created or  intended to be  created                            under or evidenced by the Security Documents  (which may include                            the  execution  of a  mortgage,   charge,  assignment   or  other                            Encumbrance   aver  all or any  of the assets  which  are, or are                            intended to be, the subject of the Security Documents)  or for the                            exercise of any rights, powers and remedies of the Security Agent                            or the Finance  Parties provided  by or pursuant  to the  Finance                            Documents or by law;                    (b)      to confer on the Security Agent or confer on the Finance Parties an                            Encumbrance   aver any  property and  assets of that Borrower (or                            that other Security  Party as the  case may   be) located  in any                            jurisdiction equivalent or similar to the Encumbrance intended to be                            conferred by or pursuant to the Security Documents; and/or                    (c)      to facilitate the realisation of the assets which are, or are intended                            to be, the subject of the Security Documents.    LONLIVE\30137956.24                                                                   Page 99  

 

        21.23.2  Each Borrower shall, and shall procure each other Security Party shall, take                   all such  action as is available to  it (including making  all filings and                   registrations) as may   be  necessary  for the  purpose  of  the creation,                   perfection, protection or maintenance  of any  Encumbrance   conferred  or                   intended to be conferred on the Security Agent or the Finance Parties by or                   pursuant to the Finance Documents.   21.24   Access           21.24.1  If a Default is continuing, each Borrower shall and shall ensure that each                   member of the Borrowers Group will, permit the Agent or the Security Agent                   and/or accountants  or other professional advisers of the Agent or Security                   Agent  reasonable  access  upon  prior written notice at the  cost of  the                   Borrowers to (a) the premises, assets, books, accounts and records of each                   member of the Borrowers   Group and  (b) meet and discuss matters with the                   senior management of each  member of the Borrowers Group.            21.24.2 On  the request of the Agent or the Security Agent or accountants or other                   professional advisers of the Agent or Security Agent (a "relevant person"),                   each  Borrower  shall take (and  shall procure that each  member    of the                   Borrowers  Group takes) all steps necessary to enable such relevant person                   at the  cost of  the Borrowers   to perform  the  activities or obtain the                   information, to the extent it is available, referred to in the column entitled                   "Relevant Access" at a frequency of not less than the period specified in the                   column  entitled "Frequency" in the following table:                         Relevant Access                                  Frequency                  (i)    Conducting on-site monitoring of members of the  Once  a year                        Borrowers Group, and  have access at reasonable                        times  and  on  reasonable  notice  to (a)  the                        premises, assets, books, accounts and records of                        each member   of the  Borrowers Group  and  (b)                        meeting and  discussing matters with the senior                        management   of each member   of the Borrowers                        Group.                 (ii)   Conducting  off-site monitoring of members   of  Once  a half-year                        the Borrowers Group  and have  access to books,                        accounts and  records  of each  member   of the                        Borrowers Group.                 (iii)  Obtaining general information about members of   Once  a half-year                        the   Borrowers   Group,    including  (without                        limitation) corporate financial statements  and                        project management reports.                 (iv)   Collecting other information relevant to members Once  a half-year                        of the Borrower's Group  in connection with the                        Relevant  Documents   and   any  credit  ratings                        which shall including any governmental ratings.    LONUVE\30137956.24                                                                   Page 100  

 

21.25    No  dealings   with  Master  Agreement       No  Borrower  shall assign, novate  or           encumber   or in any other way  transfer any of its rights or obligations under the           Master Agreement   (other than Permitted Encumbrances),  nor enter into any interest           rate exchange or hedging agreement with anyone   other than the Swap Provider.    21.26   Proposed Alternative Yamal Sponsor Guarantor            21.26.1  Each Borrower undertakes that, unless its consent has been deemed to have                    been given in accordance with clause 67.3 of the Charter, it may only agree                    to any:                     (a)     replacement of a Yamal Sponsor Guarantee;   or                     (b)     execution of an Alternative Yamal Sponsor Guarantee                     (in each case) pursuant to clause 67.3 of the Charter if the Agent has, after                    conducting relevant  due  diligence, given its written confirmation of its                    acceptance  of the relevant  Alternative Yamal  Sponsor  Guarantor  (such                    confirmation not to be unreasonably withheld or delayed).            21.26.2  For the purpose  of this Clause 21.26, the Agent's  due diligence shall be                    deemed to include (but not be limited to) the Agent's procurement of a legal                    opinion issued (at the cost of the Borrowers) by a firm of lawyers qualified                    to practise in the jurisdiction of incorporation of the relevant Alternative                   Yamal  Sponsor  Guarantor  and  a legal opinion issued (at the cost of the                    Borrowers) by a firm of lawyers qualified to practise in the jurisdiction of the                    governing law of the relevant Alternative Yamal Sponsor Guarantee.    21.27   Application  of FATCA   The  Borrowers shall procure that, unless agreed by all the           Finance Parties, no Security Party shall become a US Tax Obligor.    21.28   Insurances     Each,Borrower covenants  to ensure at their own expense  throughout           the Facility Period each Vessel remains insured in accordance with:            21.28.1  clause 5 (Insurance) of the relevant Deed of Covenants; and            21.28.2  the terms of the respective Charter.    21.29   Registration of Vessels and Mortgages     The  Borrowers shall:            21.29.1  maintain the registration of each Vessel under its current flag or another                    Approved Flag;            21.29.2  effect and maintain  the  registration of each Mortgage   at the  relevant                    Vessel's Ship Registry; and            21.29.3  not cause nor permit to be done any act or omission as a result of which any                    of those registrations might be defeated or imperilled.    22      Events of Default    22.1    Events  of Default   Each of the events or circumstances set out in this Clause 22.1           is an Event of Default.     LONLlVE\30137956.24                                                                  Page 101  

 

        22.1.1   Non-payment     A Security Party does not pay on the due date any amount                   payable pursuant to a Finance Document at the place at and in the currency                   in which it is expressed to be payable unless:                    (a)     its failure to pay is caused by:                            (i)      administrative or technical error; or                            (ii)     a Disruption Event; and                    (b)     payment is  made within three Business Days of its due date.           22.1.2   Financial  covenants   and   financial  information  Any   requirement  of                   Clause 19.1 (Financial statements), Clause 19.2 (Compliance Certificate) or                   Clause 20  (Financial covenants)  (other than   Clause  20.2.1(b)) is  not                   satisfied.           22.1.3   Other  specific obligations    A  Security Party does not comply  with its                   obligations in Clause 21.29 (Insurances).           22.1.4   Other obligations                    (a)     A  Security Party does not comply with any  provision of a Finance                           Document    or any  obligation expressed  to  be  assumed   by  or                           procured  by the Borrowers under this Agreement (other than those                           referred to  in Clause 22.1.1  (Non-payment)   and  Clause  22.1.3                           (Other specific obligations)).                    (b)     No  Event of Default under this Clause 22.1.4 will occur if the failure                           to comply  is capable of remedy and  is remedied within thirty (30)                           days of the Agent giving notice to the Borrowers provided that such                           remedy   period shall not apply in addition to any  other  remedy                           period provided for under any other provision in this Agreement.           22.1.5   Misrepresentation     Any representation or statement made or deemed    to                   be repeated  by a  Security Party in any Finance  Document   or any  other                   document   delivered by  or on  behalf  of a  Security Party under  or  in                   connection with any Finance Document is  or proves to have  been incorrect                   or misleading in any material respect when  made   or deemed  to be made                   where  the circumstances causing the same  give rise to a Material Adverse                   Effect.           22.1.6   Cross default   Any Financial Indebtedness of any Security Party:                    (a)     is not  paid when  due  nor within any  originally applicable grace                           period; or                    (b)     is declared to be, or otherwise becomes, due  and payable prior to                           its specified maturity as a result of an event of default (however                           described); or                    (c)     is capable of being declared by  a creditor to be due and payable                           prior to its specified maturity as a  result of such  an event  of                           default.   LONUVE\30137956.24                                                                   Page 102  

 

                 No  Event  of Default will occur under this Clause 22.1.6 if the aggregate                   amount of Financial Indebtedness or commitment for Financial Indebtedness                   falling within (a) to (c) is, (i) in respect of a Vessel Sponsor Guarantor,                   equal to or less than thirty million dollars (US$30,000,000) or its equivalent                   in any other currency or currencies, or (ii) in respect of each of a Borrower                   and  the Parent, equal to or less than three million dollars (US$3,000,000) or                   its equivalent in any other currency or currencies.            22.1.7  Insolvency     A Security Party is unable to pay its debts as they fall due,                   commences   negotiations with any one or mo;e of its creditors with a view to                   the  general readjustment  or rescheduling of its indebtedness or makes  a                   general assignment for the  benefit of its creditors or a composition with its                   creditors.            22.1.8  Insolvency proceedings      A Security Party:                    (a)      files for initiation of formal restructuring proceedings; or                    (b)      is wound up or declared bankrupt; or                    (c)      takes any steps or legal proceedings are started for its winding up,                            dissolution, administration   or   re-organisation  or   for  the                            appointment of a liquidator, receiver, administrator,  administrative                            receiver, conservator, custodian, trustee or similar officer of it or of                            any or all of its revenues or assets; or                    (d)      declares any moratorium or any moratorium is  declared or sought,                            in each case, in respect of any of its indebtedness; or                    (e)      any  analogous   procedure  or  step  is taken   in any  relevant                            jurisdiction.            22.1.9  Creditors' process                    (a)      A Security Party fails to comply with or pay any sum  due from  it                            (within thirty (30) days of such amount falling due) under any final                            judgment  or any final order made  or given by any court or other                            official body of a competent jurisdiction in an aggregate in respect                            of:                             (i)     each  Vessel Sponsor  Guarantor,  equals to or  is greater                                    than   thirty million  dollars  (US$30,000,000)    or  its                                    equivalent in any other currency or currencies; or                             (ii)    each  of the Borrowers, the Parent and Teekay  Operating,                                    equals   to  or  is greater  than  three   million dollars                                    (US$3,000,000) or its equivalent in any other currency,                             in each case being a judgment or order against  which there is no                            right of appeal or if a right of appeal exists, where the time limit for                            making such  appeal has expired.    LONLIVE\30137956.24                                                                   Page 103  

 

                (b)      Any   execution  or  distress  is levied  against,  expropriation,                           attachment  or  sequestration affects, or an  encumbrance   takes                           possession of, the whole or any part of, the property, undertaking                           or assets of a Security Party in an aggregate amount in respect of:                            (i)     each  Vessel Sponsor  Guarantor,  equals to or  is greater                                   than  thirty hundred million dollars (US$30,000,000) or its                                    equivalent in any other currency or currencies; or                            (ii)     each of the Borrowers, the Parent and Teekay  Operating,                                    equals  to  or  is greater  than   three  million dollars                                    (US$3,000,000)  or its equivalent in any other currency or                                    currencies,                            in each  case other  than  any execution,  distress, expropriation,                           attachment or sequestration which  is being contested in good faith                           and which  is either discharged within thirty (30) days or in respect                           of which  adequate  security has been  provided within thirty (30)                           days to the relevant court or other authority to enable the relevant                           execution, distress, expropriation, attachment or sequestration to                           be lifted or released.           22.1.10  Unlawfulness and invalidity                    (a)     It is or becomes unlawful for a Security Party to perform any of its                           obligations  under  the   Finance  Documents    (except   for the                           Replacement   Novation Side Letters) or any Encumbrance   created                           or expressed to be created or evidenced by the Security Documents                           ceases to be effective.                    (b)     Any  obligation or obligations of any  Security  Party under  any                           Finance  Documents   (except for the  Replacement   Novation Side                           Letters) are not or cease to be legal, valid, binding or enforceable                           and  the  cessation  individually or cumulatively  materially and                           adversely  affects the interests of the Lenders under the Finance                           Documents.                    (c)     Any  Finance Document   (except for a Replacement   Novation Side                           Letter) ceases to be  in full force and effect or any Encumbrance                           created or expressed  to be created  or evidenced by  the Security                           Documents    ceases  to be  legal, valid, binding, enforceable  or                           effective or is alleged by a party to it (other than a Finance Party)                           to be ineffective.                    (d)     Provided that it shall only be an Event of Default under this Clause                           22.1.10  if such  illegality is not remedied or  mitigated to  the                           satisfaction of the Agent within thirty (30) days after notice has                           been  given to the relevant Security Party.           22.1.11  Cessation  of  business    A Security Party ceases  to carry on all or any                   material part of its business and  which  would  have  a Material Adverse                   Effect.    LONUVE\30137956.24                                                                   Page 104  

 

         22.1.12 Curtailment of   business    The  business of any of the Security Parties is                   wholly or materially curtailed by any intervention by or under authority of                   any  government,  or if all or a substantial part of the undertaking, property                   or assets of any of the Security Parties is seized, nationalised, expropriated                   or compulsorily acquired  by or under authority of any government or any                   Security Party disposes or threatens to dispose of a substantial part of its                   business or assets which would have a Material Adverse Effect.            22.1.13 Loss  of property   All or a substantial part of the business or assets of any                   Security Party is destroyed, abandoned, seized, appropriated or forfeited for                   any reason, and  such occurrence in the reasonable opinion of the Agent has                   or could reasonably be expected to have a Material Adverse Effect.            22.1.14 Repudiation, rescission or breach of agreements                     (a)     A Security Party rescinds or purports to rescind or repudiates or                            purports  to  repudiate a  Finance  Document    or  evidences  an                            intention to rescind or repudiate a Finance Document.                    (b)      Subject to Clause  22.1.14(c), any  party to any  of the Relevant                            Documents   that  is not  a Finance  Document    (other than  the                            Purchase  Option Side  Letter or the  Currency  Conversion  Letter                            (each as defined in Schedule 7  (List of Assigned Documents) (the                            "Excluded   Documents"))    repudiates  that Relevant  Document,                            provided   that it shall not be an  Event  of Default if: (i) such                            repudiation is in respect of a Charter and the relevant Borrower is                            able 'to enter into a substitute charter on terms  and  conditions                            acceptable to the Majority Lenders  within forty five (45) days of                            such repudiation; or (ii) the Borrowers prepay the relevant Vessel                            Loan within forty five ( 45) days of such repudiation.                     (c)     Any  Relevant Document   (other than the  Excluded Documents)   is                            terminated, cancelled or otherwise ceases  to remain  in full force                            and  effect at  any  time  prior to  its contractual expiry date,                            provided   that it shall not be an  Event  of Default if: (i) such                            termination or cancellation is in respect of a Charter and either the                            Charter is converted into a bareboat charterparty under the terms                            of the Charter  or the relevant Borrower  is able to enter into a                            substitute charter  on terms   and  conditions acceptable  to the                            Majority Lenders within forty five (45) days of such termination or                            cancellation; or (ii) the Borrowers prepay the relevant Vessel Loan                            in  full with in forty five ( 45) days  of  such  termination  or                            cancellation.                     (d)     Any  default by a Borrower or any  other breach by  a Borrower or                            any  other  Security  Party occurs  under  any   of the  Relevant                            Documents   (other than the Excluded Documents)   where  any such                            default or breach gives  rise to a right of termination under the                            Relevant  Document,  provided   that it shall not be an  Event  of                            default if the Borrowers  either cure such  default or  breach or    LONUVE\30137956.24                                                                    Page 105  

 

                         prepay  the relevant Vessel Loan  within ninety (90) days of such                           default or breach.                    Any  prepayment  made   by the  Borrowers  pursuant to  this Clause 21.14                   (Repudiation, rescission or breach of agreements) shall not be subject to the                   conditions set out in Clause 7.3 (Voluntary prepayment of a Vessel Loan).           22.1.15  Conditions  subsequent     Any  of the conditions referred to in Clause 4.4                   (Initial Conditions subsequent)   and   Clause  4.9  (Delivery  conditions                   subsequent)  is not satisfied within the time reasonably  required by  the                   Agent.           22.1.16  Revocation   or modification  of Authorisation    Any Authorisation of any                   governmental,  judicial or other public body or authority which is now, or                   which at any time  during the Facility Period becomes, necessary to enable                   any of the Security Parties or any other person (except a Finance Party) to                   comply  with any of their obligations under any Relevant Document   is not                   obtained, is revoked, suspended, withdrawn or withheld, or is modified in a                   manner which  the Agent considers is, or may be, prejudicial to the interests                   of any Finance Party, or ceases to remain in full force and effect.           22.1.17  Reduction   of capital  Any  Security Party (other than Teekay Operating)                   reduces  its committed  or  subscribed capital other  than  any  reduction                   effected by any Security Party pursuant to (in each case while such Security                   Party is solvent) (A) a share or common unit buy-back, or (B) redemption of                   redeemable shares or units.           22.1.18  Loss  of Vessel    A Vessel suffers a Total Loss or a Total Loss occurs in                   relation to any other vessel which may from time to time be  mortgaged  to                   the Security Agent  as security for the payment  of all or any part of the                   Indebtedness, except that a Total Loss (which term shall for the purposes of                   the remainder of this Clause 22.1.18 include an event similar to a Total Loss                   in relation to any other vessel) shall not be an Event of Default if:                    (a)     that  Vessel or  other vessel is insured  in accordance  with  the                           Security Documents   and a  claim for Total Loss is available under                           the terms of the relevant insurances; and                    (b)     no  insurer has refused to meet or has disputed the claim for Total                           Loss  and it is not apparent to the Agent in its discretion that any                           such refusal or dispute is likely to occur; and                    (c)     payment   of all insurance proceeds in respect of the Total Loss is                           made   in  full to the  Security Agent  within  180  days  of  the                           occurrence  of date of the Total Loss  in question or such  longer                           period as the Agent may in its discretion agree,                    or the Borrowers prepay  the relevant Vessel Loan in full immediately upon                   the  expiry of a  one  hundred  and   eighty (180)  day  period  after the                   occurrence of the Total Loss in question.    LONUVE\30137956.24                                                                   Page 106  

 

                 Any  prepayment   made  by the  Borrowers pursuant  to this Clause 22.1.18                   (Loss of Vessel) shall not be subject to the conditions set out in Clause 7.3                   (Voluntary prepayment of a  Vessel Loan).            22.1.19 Challenge   to registration   The  registration of a Vessel or a Mortgage is                   contested  or  becomes   void  or  voidable  or  liable to cancellation or                   termination, or the validity or priority of a Mortgage is contested.            22.1.20 War     The  country of registration of a Vessel becomes   involved in war                   (whether or not declared) or civil war or is occupied by any other power and                   the Agent in its discretion considers that, as a result, the security conferred                   by  any of the  Security Documents  is materially prejudiced provided that                   there shall be no  Event of Default under this clause if the Vessel can be                   moved to another acceptable flag within thirty (30) days.            22.1.21 Master Agreement termination        A notice is given by the Swap Provider                   under section 6(a) of the Master Agreement, or by any person under section                   6(b )(iv) of the Master  Agreement,  in  either case designating  an Early                   Termination  Date for the purpose  of the Master Agreement,  or the Master                   Agreement   is for  any  other reason  terminated,  cancelled, suspended,                   rescinded, revoked or otherwise ceases to remain in full force and effect due                   to a default by the Borrowers.            22.1.22 Notice  of Determination    If either Vessel Sponsor Guarantor gives notice                   to the Agent to determine its obligations under the Guarantee.            22.1.23 Environmental matters                    (a)      Any  Environmental  Claim  is made   against any  Borrower  or  in                            connection with any Vessel, where such Environmental  Claim has a                            Material Adverse Effect.                    (b)      Any  actual Environmental Incident occurs  in connection with the                            Vessel, where such Environmental  Incident has a Material Adverse                            Effect.            22.1.24 Non-Security   Party  Transaction   Parties    any event which,  under the                   laws of any jurisdiction, has a similar or analogous effect to any of those                   events  mentioned   in  Clauses  22.1.7  (Insolvency), 22.1.8  (Insolvency                   proceedings)  and 22.1.9 (Creditors' process) occurs (mutatis mutandis)  in                   relation to a Transaction Party that is not a Security Party (but in relation to                   a  Yamal  Sponsor  Guarantor, only until such time  as the Yamal  Sponsor                   Guarantee  issued by that Yamal Sponsor Guarantor is  terminated or ceases                   to have effect in accordance with its terms) except where:                    (a)      in the case of the Charterer, the Charterer (or a third party acting                            on its behalf) continues to pay hire in accordance with the Charters                            and  provided further that: (i) in the case  of hire paid  by the                            Charterer, the Agent (acting in their sole discretion) is satisfied that                            such payment   is irrevocable and not subject to any claw-back; or                            (ii) in the case of hire paid by a third party acting on behalf of the                            Charterer, the Agent (acting in their sole discretion) is satisfied that    LONLIVE\30137956.24                                                                   Page 107  

 

                         all applicable know your  customer  requirements  required by the                           Agent  are fulfilled and that such payment  is irrevocable and not                           subject to any claw-back; and                    (b)     in the  case  of the  Charterer, YLNG  and  each  Yamal   Sponsor                           Guarantor, any event which, under the laws of any jurisdiction, has                           a similar or analogous  effect to the events mentioned   in 22.1.9                           (Creditors' process) occurs in relation to the Charterer, YLNG or a                           Yamal   Sponsor  Guarantor   and  the  amount   of the  applicable                           judgment,    final  order,  execution,   distress,  expropriation,                           attachment,  sequestration or encumbrance  which takes possession                           (each  as  referred to in 22.1.9  (Creditors' process)) is for an                           aggregate amount of:                            (i)      in respect of YLNG  and  each Yamal  Sponsor  Guarantor,                                    less than  fifty million dollars (US$50,000,000)   or its                                    equivalent in any other currency or currencies; and                            (ii)     in respect of the Charterer, less than thirty million dollars                                    (US$30,000,000) or its equivalent in any other currency or                                    currencies; and                    (c)     in the case of the Builder and Refund Guarantor, such event occurs                           after the final Delivery Date.           22.1.25  Non-delivery of Vessel    A Vessel is not delivered to the relevant Borrower                   by the  Builder under the relevant Building Contract by the relevant Long                   Stop Date  and  any Drawings  of the relevant Vessel Loan  relating to that                   Vessel have not been prepaid within thirty (30) days.            22.1.26 Litigation     Any   litigation, arbitration, administrative, governmental,                   regulatory or other investigations, proceedings or disputes are commenced                   or threatened, or any judgment or order of a court, arbitral tribunal or other                   tribunal or any order or sanction of any governmental  or other regulatory                   body  is made, in relation to the Relevant Documents   or the transactions                   contemplated  in the Relevant Documents  or against a Security Party or its                   assets which have, or has, or are, or is, reasonably likely to have a Material                   Adverse Effect.            22.1.27 Material  adverse   change     Any  event  or change  occurs which  has  a                   Material Adverse  Effect and such change   if capable of remedy  is not so                   remedied within thirty (30) days of such event or change.            22.1.28 Sanctions    Any Security Party, any Affiliate of any Security Party or any of                   their respective directors, officers or employees becomes a Restricted Party,                   provided that:                    (a)      it shall not be an Event of Default in relation to any applicable                            director, officer or employee, if thirty (30) days after it became a                            Restricted Party it ceases to be a Restricted Party or ceases to be a                            director, officer or employee; and    LONUVE\30137956.24                                                                   Page 108  

 

                 (b)      it shall not be an Event of Default if:                             (i)     the relevant Security Party, Affiliate of any Security Party                                    or any of their respective directors, officers or employees                                    becomes   a Restricted Party solely as a result of Sanctions                                    administered, enacted  or enforced by a EU  Member  State                                    other than:                                     (A)      the United Kingdom, France, Germany;  or                                     (B)      an EU  Member State  where  any Finance Party or                                             any Yamal Sponsor Guarantor is  incorporated,                                     and  it would not otherwise be a Restricted Party; and                             (ii)    the circumstances  set out in Clause 22.1.28(b)(i) above,                                    do not have a Material Adverse Effect or, in relation to any                                    applicable director, officer or employee, within thirty (30)                                    days from the date  on which it became a Restricted Party,                                    it ceases  to be  a Restricted  Party or ceases  to be  a                                    director, officer or employee  of a Security Party  or an                                    Affiliate of any Security Party.            22.1.29 Arrest    Any Vessel is arrested or seized for any reason whatsoever unless                   (i) such Vessel is released and returned to the possession of the relevant                   Borrower within thirty (30) days of such arrest or seizure or (ii) within thirty                   (30) days the Borrowers prepay the relevant Vessel Loan.                    Any  prepayment   made  by the  Borrowers pursuant  to this Clause 22.1.29                   (Arrest) shall not  be  subject to the  conditions set  out in Clause  7.3                   (Voluntary prepayment of a  Vessel Loan).            22.1.30 Exercise  of  step-in or  other  related  rights  There  occurs any of the                   following event or circumstance:                    (a)      the Charterer exercises:                             (i)     its purchase option  in accordance with clause 47.l{a) of                                    any Charter; or                             (ii)    its termination  rights  under  clause  44.2(a)  (Owner's                                    default) of any Charter; or                    (b)      any Yamal  Sponsor  Guarantor  (or a nominee   of any such Yamal                            Sponsor Guarantor) exercises its right to:                             (i)     require a novation of any Building Contract in accordance                                    with the relevant Replacement Novation Side Letter; or                             (ii)    acquire  any  Vessel  in accordance   with  any  Purchase                                    Option  Side Letter in circumstances where  the  purchase                                    option under clause  47.l{a) of the Charter to which such                                    Purchase    option  Side   Letter  relates  has   become                                    exercisable; or   LONUVE\30137956.24                                                                    Page 109  

 

                 (c)     the Charterer and/or any Borrower exercise their right to terminate                           any Charter in accordance with clause 70.10 of such Charter,                    provided  that  it shall not be an Event of Default if the Borrowers prepay                   the  relevant Vessel  Loan  within  thirty (30)  days  of such   event  or                   circumstance.                    Any  prepayment  made   by the Borrowers  pursuant to this Clause 22.1.30                   (Exercise of step-in or other related rights) shall not be subject to  the                   conditions set out in Clause 7.3 (Voluntary prepayment of a Vessel Loan).           22.1.31  Validity and   admissibility    At any  time  any  act, condition or thing                   reasonably required to be done, fulfilled or performed in order:                    (a)     to  enable any  Security Party lawfully to enter into, exercise its                           rights under and perform the respective obligations expressed to be                            assumed  by it in the Finance Documents;                    (b)     to ensure that the obligations expressed to be assumed  by each of                           the Security Parties in the Relevant Documents are legal, valid and                            binding; or                    (c)     to  make  the Relevant  Documents   admissible in evidence  in any                            applicable jurisdiction                    is not done, fulfilled or performed within thirty (30) days after notification                   from  the Agent  to the relevant Security Party requiring the same  to  be                   done, fulfilled or performed.            22.1.32 Money laundering and financing of terrorism                    (a)      Any Security Party, any Affiliate of any Security Party involves any                            breach by it of any law or regulatory measure relating to "money                            laundering"  as defined in Article 1 of the Directive (2005/EC/60)                            of the European  Parliament and  of the Council  of the European                            Communities.                    (b)      Any Security Party, any Affiliate of any Security Party engages in                            any act of providing or collecting funds with the intention that they                            be used, or in the knowledge that they are to be used, in order to                            carry out terrorist acts.            22.1.33 Expropriation    The authority or ability of any member  of the Borrowers                   Group  to conduct its business is limited or wholly or substantially curtailed                   by  any seizure, expropriation, nationalisation, intervention, restriction or                   other  action by or  on behalf of  any governmental,   regulatory or other                   authority or other person in relation to any member of the Borrowers Group                   or any of its assets.   22.2     Acceleration   On  and at any time after the occurrence of an Event of Default which           is continuing the Agent may, and shall if so directed by the Majority Lenders:    LONUVE\30137956.24                                                                   Page 110  

 

         22.2.1  by notice to the Borrowers:                    (a)      cancel  the  Total  Commitments,    at  which   time   they  shall                            immediately be cancelled;                    (b)      declare that the Loan, together with accrued interest, and all other                            amounts  accrued or outstanding under the  Finance Documents  are                            immediately  due  and payable,  at which time  they shall become                            immediately due  and payable; and/or                    (c)      declare that the Loan is payable on demand,  at which time it shall                            immediately  become   payable  on demand   by  the Agent  on  the                            instructions of the Majority Lenders; and/or            22.2.2  exercise or direct the Security Agent  to exercise any or  all of its rights,                   remedies, powers or discretions under the Finance Documents.    LONLlVE\30137956.24                                                                  Page 111  

 

Section 9        Changes to Parties   23       Changes to the Lenders   23.1     Assignments and transfers     by the Lenders    Subject to this Clause 23, a Lender           (the "Existing Lender") may:            23.1.1  assign any of its rights; or            23.1.2  transfer by novation any of its rights and obligations,            under any  Finance Document   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") without the consent of the Borrowers provided that:            (a)      it is one of:                     (i)     Industrial and Commercial Bank of China Limited;                     (ii)    China Construction Bank Corporation;                     (iii)   Agricultural Bank of China Limited;                     (iv)    Bank of China Limited;                     (v)     Bank of Communications Co.,  Ltd.;                     (vi)    The Export-Import Bank of China;                     (vii)   China Merchants Bank Co.,  Ltd.; or            (b)      it has, on the date it becomes a New Lender, a credit rating with Standard &                    Poor's of at least A- and is not an Excluded Transferee,            otherwise the  consent of the Borrowers  shall be required, such consent not to be           unreasonably withheld or delayed.    23.2    Conditions of assignment or transfer            23.2.1   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.    LONLIVE\30137956.24                                                                   Page 112  

 

         23.2.2  A  transfer will only be effective if the procedure set out in Clause 23.5                    (Procedure for transfer) is complied with.            23.2.3  If:                     (a)     a Lender assigns or transfers any of its rights or obligations under                            the Finance Documents or changes  its Facility Office; and                     (b)     as a result of circumstances existing at the date the assignment,                            transfer or change occurs, a Borrower would  be obliged to make a                            payment   to the New   Lender  or Lender  acting through  its new                            Facility Office under Clause 12 (Tax Gross Up and Indemnities) or                            Clause 13 (Increased Costs),                    then the New  Lender  or Lender acting through its new Facility Office is only                   entitled to receive payment under those Clauses  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.            23.2.4  Each  New  Lender confirms, for the avoidance of doubt, that the Agent has                   authority to execute on its behalf any amendment or waiver that  has  been                   approved  by or on behalf of the requisite Lender or Lenders in accordance                   with  this Agreement  on  or prior to the  date  on which  the transfer or                   assignment becomes effective  in accordance with this Agreement and that it                   is bound  by that decision to the same extent as the Existing Lender would                   have  been had it remained a Lender.   23.3     Assignment or transfer fee            23.3.1  Subject to Clause 23.3.2, 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 $10,000.            23.3.2  No fee is payable pursuant to Clause 23.3.1 if:                    (a)      the Agent agrees that no fee is payable; or                    (b)      the assignment or transfer is made by an Existing Lender:                             (i)     to an Affiliate of that Existing Lender;                             (ii)    to a fund which is a Related Fund of that Existing Lender;                                    or                             (iii)   in connection with the primary syndication of the Loan.   23.4     Limitation of responsibility of Existing Lenders            23.4.1  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 Relevant Documents or any other documents;    LONUVE\30137956.24                                                                   Page 113  

 

                (b)      the financial condition of any Security Party;                   (c)      the performance   and  observance  by  any  Security Party  of its                           obligations under the Relevant Documents or any other documents;                           or                   (d)      the accuracy of any statements  (whether written or oral) made  in                           or in connection with any of the Relevant Documents  or any other                           document,                    and any representations or warranties implied by law are excluded.           23.4.2   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 Security Party 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 of the Relevant Documents; and                    (b)     will continue  to make   its own   independent   appraisal of the                           creditworthiness of each  Security Party  and  its related entities                           whilst any  amount  is or may  be  outstanding under  the Finance                           Documents or any Commitment is    in force.           23.4.3   Nothing in any Finance Document obliges an Existing Lender to:                    (a)     accept a re-transfer or re-assignment from a New  Lender of any of                           the rights and obligations assigned or transferred under this Clause                           23; or                    (b)     support any losses directly or indirectly incurred by the New Lender                           by  reason of the  non-performance   by any  Security Party of its                           obligations under the Relevant Documents or otherwise.   23.5    Procedure for transfer           23.5.1   Subject to the conditions set out in Clause 23.2 (Conditions of assignment                   or transfer) a transfer is effected in accordance with Clause 23.5.3 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 23.2.1(b), 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.           23.5.2   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.    LONUVE\30137956.24                                                                   Page 114  

 

         23.5.3  Subject to Clause 23.8 (Pro rata interest settlement), 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                            Finance Documents each   Borrower and the Existing Lender shall be                            released from  further obligations towards one another under  the                            Finance Documents   and their respective rights against one another                            shall  be  cancelled   (being  the   "Discharged    Rights   and                            Obligations");                    (b)      each  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 that Borrower and the New Lender have assumed   and/or                            acquired the  same  in place  of that Borrower  and  the  Existing                            Lender;                    (c)      the Agent, the Security Agent, the Arranger, 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, the Security Agent, the                            Arranger  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".   23.6     Procedure for assignment            23.6.1  Subject to the conditions set out in Clause 23.2 (Conditions of assignment                   or  transfer) an assignment  may   be effected in accordance  with  Clause                   23.6.3 when  the Agent  executes  an otherwise duly completed  Assignment                   Agreement delivered  to it by the Existing Lender and the New Lender. The                   Agent  shall, subject to Clause 23.6.2, as soon  as reasonably  practicable                   after receipt by it of a duly completed Assignment Agreement appearing  on                   its face to comply   with the terms  of  this Agreement  and  delivered in                   accordance  with the  terms  of this Agreement,  execute  that Assignment                   Agreement.            23.6.2  The  Agent  shall only be  obliged to execute  an  Assignment   Agreement                   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 similar checks                   under  all applicable laws and regulations in relation to the assignment to                   such New  Lender.            23.6.3  Subject to Clause 23.8 (Pro rata interest settlement), on the Transfer Date:                    (a)      the Existing Lender will assign absolutely to the New  Lender  its                            rights under  the  Finance  Documents    and  in respect  of  any                            Encumbrance   created or expressed to be created or evidenced  by    LONLIVE\30137956.24                                                                  Page 115  

 

                         the Security Documents   and  expressed to  be the subject of the                           assignment in the Assignment Agreement;                    (b)     the  Existing Lender will be  released from  the  obligations (the                           "Relevant   Obligations")  expressed   to be  the  subject of the                           release  in the Assignment   Agreement   (and  any  corresponding                           obligations by which  it is bound in respect of any  Encumbrance                           created or expressed  to be created or evidenced  by the  Security                           Documents); and                    (c)     the New   Lender shall become  a Party as  a "Lender" and  will be                           bound  by obligations equivalent to the Relevant Obligations.           23.6.4   Lenders may utilise procedures other than those set out in this Clause 23.6                   to assign their rights under the Finance Documents  (but not, without the                   consent of the relevant Security Party or unless in accordance with Clause                   23.5 (Procedure  for transfer), to obtain a release by that Security Party                   from the obligations owed  to that Security Party by the  Lenders nor the                   assumption of equivalent obligations by a New Lender) provided that they                   comply with the conditions set out in Clause 23.2 (Conditions of assignment                   or transfer).   23.7    Copy  of Transfer   Certificate or Assignment    Agreement    to Borrowers     The          Agent  shall, as soon  as reasonably  practicable after it has executed a  Transfer          Certificate or an Assignment   Agreement,  send  to the Borrowers  a  copy  of that          Transfer Certificate or Assignment Agreement.   23.8    Pro rata interest settlement           23.8.1   If the Agent has notified the Lenders that it is able to distribute interest                   payments  on a "pro rata basis" to Existing Lenders and New  Lenders then                   (in respect of any transfer pursuant to Clause 23.5 (Procedure for transfer)                   or any assignment pursuant to  Clause 23.6 (Procedure for assignment) the                   Transfer Date of which is after the date of such notification and is not on the                   last day of an Interest Period):                    (a)     any  interest or fees in respect of the relevant participation which                           are expressed  to accrue  by reference to the  lapse of time shall                           continue  to accrue  in favour of the  Existing Lender up  to  but                           excluding  the Transfer  Date  ("Accrued   Amounts")    and  shall                           become   due and  payable to the  Existing Lender (without further                           interest accruing on them) on  the last day of the current Interest                           Period (or, if the Interest Period is longer than six Months, on the                           next of the dates which falls at six monthly intervals after the first                           day of that Interest Period); and                    (b)     the rights assigned or transferred by the Existing Lender will not                           include  the  right to the  Accrued  Amounts,   so  that, for the                           avoidance of doubt:    LONUVE\30137956.24                                                                   Page 116  

 

                         (i)      when   the  Accrued  Amounts    become   payable,  those                                    Accrued Amounts   will be payable to the Existing Lender;                                    and                            (ii)     the amount payable to the New Lender on  that date will be                                    the amount  which  would, but  for the application of this                                    Clause 23.8, have  been  payable to  it on that date, but                                    after deduction of the Accrued Amounts.           23.8.2   In this Clause 23.8 references to  "Interest Period" shall be construed to                   include a reference to any other period for accrual of fees.           23.8.3   An Existing Lender which retains the right to the Accrued Amounts pursuant                   to this Clause 23.8 but which does not have a Commitment shall be deemed                   not to be a Lender for the purposes of ascertaining whether the agreement                   of any specified group of Lenders has been obtained to approve any request                   for a consent,  waiver, amendment    or other vote  of Lenders  under the                   Finance Documents.   24      Changes to the Security Parties   24.1    No  assignment   or transfer by Security    Parties   No Security Party may assign          any  of its rights or transfer any  of its rights or obligations under the Finance          Documents.    LONLIVE\30137956.24                                                                  Page 117  

 

Section 10       The Finance Parties   2S       Role of the Agent, the Security Agent and the Arranger   25.1     Appointment of the Agent            25.1.1  Each of the Arranger and the Lenders appoints the Agent to act as .its agent                   under  and  in connection  with the Finance  Documents   and  each  of the                   Arranger, the Lenders and  the Agent appoints the Security Agent to act as                   its security agent for the purpose of the Security Documents.            25.1.2  Each  of the Arranger and the Lenders authorises the Agent and each of the                   Arranger,  the Lenders  and  the Agent  authorises the  Security Agent  to                   perform  the  duties, obligations and responsibilities and to exercise the                   rights, powers, authorities and discretions specifically given to the Agent or                   the Security Agent  (as the case may  be) under  or in connection with the                   Finance  Documents   together  with any   other incidental rights, powers,                   authorities and discretions.            25.1.3  The  Swap  Provider appoints the Security Agent to act as its security agent                   for the purpose  of the  Security Documents   and  authorises the Security                   Agent to exercise the rights, powers, authorities and discretions specifically                   given  to the  Security Agent  under  or in connection  with  the Security                   Documents   together with  any other  incidental rights, powers, authorities                   and discretions.            25.1.4  Except  in Clause 25.14 (Replacement  of the Agent)  or where  the context                   otherwise requires, references in this Clause 25 to the "Agent" shall mean                   the Agent and the Security Agent individually and collectively and references                   in this Clause  25  to the  "Finance   Documents"    or  to any  "Finance                   Document" shall   not include the Master Agreement.   25.2     Instructions            25.2.1  The Agent shall:                    (a)      unless a  contrary  indication appears  in a  Finance  Document,                            exercise or refrain from exercising any right, power, authority or                            discretion vested in it as Agent in accordance with any instructions                            given to it by:                             (i)     all Lenders if the relevant Finance Document stipulates the                                    matter is an all Lender decision; and                             (ii)    in all other cases, the Majority Lenders; and                    (b)      not be liable for any act (or omission) if it acts (or refrains from                            acting) in accordance with Clause 25.2.1(a).            25.2.2  The  Agent  shall be entitled to request instructions, or clarification of any                   instruction, from the Majority Lenders (or, if the relevant Finance Document                   stipulates the matter is a decision for any other Lender or group of Lenders,                   from that Lender or group of Lenders) as to whether, and in what manner, it    LONUVE\30137956.24                                                                   ,Page 118  

 

                 should exercise or refrain from exerc1smg  any  right, power, authority or                   discretion and the Agent may refrain from acting unless and until it receives                   any such instructions or clarification that it has requested.           25.2.3   Save in the case of decisions stipulated to be a matter for any other Lender                   or group of Lenders  under  the relevant Finance  Document   and unless a                   contrary indication appears in a Finance Document, any instructions given to                   the Agent by the Majority Lenders shall override any conflicting instructions                   given by any other Parties and will be binding on all Finance Parties.           25.2.4  The  Agent  may  refrain from acting in accordance with any  instructions of                   any Lender  or group  of Lenders until it has received any indemnification                   and/or security that it may in its discretion require (which may be greater in                   extent than that contained in the Finance Documents and which may include                   payment  in advance)  for any cost, loss or liability which it may incur in.                   complying with those instructions.           25.2.5   In the absence of instructions, the Agent may act (or refrain from acting) as                   it considers to be in the best interest of the Lenders.           25.2.6   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 Finance Document. This Clause 25.2.6 shall not apply to any                   legal or arbitration proceeding relating to the perfection, preservation or                   protection of rights under the Finance Documents or the enforcement of the                   Finance Documents.   25.3    Duties of the Agent           25.3.1   The Agent's duties under the Rnance  Documents are solely  mechanical and                   administrative in nature.           25.3.2   Subject to Clause 25.3.3, 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.           25.3.3   Without prejudice to Clause 23.7 (Copy of Transfer Certificate or Assignment                   Agreement  to Borrowers),  Clause 25.3.1  shall not apply to any  Transfer                   Certificate or any Assignment Agreement.           25.3.4   Except where a Finance 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.           25.3.5   If the Agent  receives notice from  a  Party referring to this Agreement,                   describing a  Default and  stating that the  circumstance  described  is a                   Default, it shall promptly notify the Finance Parties.           25.3.6   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, the Arranger  or the Security Agent) under this Agreement   it shall                   promptly notify the other Finance Parties.    LONLlVE\30137956.24                                                                  Page 119  

 

         25.3.7  The  Agent  shall have  only those  duties, obligations and responsibilities                   expressly specified in the Finance Documents to which it is expressed to be                   a party (and no others shall be implied).   25.4     Role  of the Arranger    Except  as specifically provided in the Finance Documents,           the Arranger has no obligations of any kind to any other Party under or in connection           with any Finance Document.   25.5     No fiduciary duties            25.5.1   Subject  to Clause 25.12 (Trust) which relates to the Security Agent only,                    nothing in any Finance Document constitutes the Agent or the Arranger as a                   trustee or fiduciary of any other person.            25.5.2   Neither the Agent nor the Arranger 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.    25.6    Business  with Security Parties    The Agent and  the Arranger may accept deposits           from, lend money to  and generally engage  in any kind of banking or other business           with any Borrower and any other Security Party or its Affiliate.    25.7    Rights and discretions of the Agent            25.7.1  The Agent may:                     (a)     rely on  any representation, communication,   notice or document                            believed by it to be genuine, correct and appropriately authorised;                     (b)     assume that:                             (i)      any instructions received by it from the Majority Lenders,                                     any Lenders  or any  group of Lenders  are duly given  in                                     accordance with the terms of the Finance Documents; and                             (ii)     unless it has received  notice of revocation, that those                                     instructions have not been revoked; and                             (iii)    rely on a certificate from any person:                                      (A)     as to any  matter  of fact or circumstance which                                             might  reasonably be  expected  to be within the                                             knowledge of that person; or                                      (B)     to the effect that such person  approves  of any                                             particular dealing, transaction, step, action or                                             thing,                                      as sufficient evidence that that is the case and, in the case                                     of (A), may   assume   the  truth and  accuracy  of that                                     certificate.    LONUVE\30137956.24                                                                    Page 120  

 

         25.7.2  The  Agent may assume   (unless it has received notice to the contrary in its                   capacity as agent for the Lenders or security agent for the Finance Parties                   (as the case may be)) that:                    (a)      no  Default has  occurred (unless  it has actual knowledge   of a                            Default arising under Clause 22.1 (Events of Default));                    (b)      any right, power, authority or discretion vested in any Party or the                            Majority Lenders has not been exercised; and                    (c)      any  notice or  request made   by  the  Borrowers  (other than  a                            Drawdown   Request) is made on behalf of and with the consent and                            knowledge of all the Security Parties.            25.7.3  The  Agent may  engage  and  pay for the advice or services of any lawyers,                   accountants, surveyors or other experts.            25.7.4  Without  prejudice to the generality of Clause 25.7.3 or Clause 25.7.5, the                   Agent  may  at any time engage  and pay  for the services of any lawyers to                   act as independent counsel to the Agent (and so separate from  any lawyers                   instructed by the Lenders) if the Agent in its reasonable opinion deems this                   to be desirable.            25.7 .5 The  Agent may  rely on the advice or services of any lawyers, accountants,                   tax advisers, surveyors or other professional advisers or experts (whether                   obtained by the Agent  or by any other Party) and shall not be liable for any                   damages,   costs or losses to any person,  any diminution in value  or any                   liability whatsoever arising as a result of its so relying.            25.7.6  The Agent may act in  relation to the Finance Documents through its officers,                   employees and  agents and the Agent shall not:                    (a)      be liable for any error of judgment made by any such person; or                    (b)      be bound  to supervise, or be in any way  responsible for any loss                            incurred by reason of misconduct, omission or default on the part,                            of any such person,                    unless such  error or such loss was  directly caused by the  Agent's gross                   negligence or wilful misconduct.            25.7.7  Unless a  Finance Document   expressly provides  otherwise the Agent  may                   disclose to any other  Party any information it reasonably believes it has                   received as agent under this Agreement.            25.7.8  Notwithstanding  any  other  provision of any  Finance  Document   to  the                   contrary, neither the Agent nor the Arranger 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.    LONLIVE\30137956.24                                                                  Page 121  

 

         25.7.9  The  Agent is not obliged to disclose to any Finance Party any details of the                   rate notified to the Agent by any Lender or the identity of any such Lender                   for the purpose of Clause 10.2.2 (Market Disruption).            25.7.10 Notwithstanding any provision of any Finance Document to the contrary, the                   Agent  is not obliged to expend or risk its own funds or otherwise incur any                   financial  liability in the  performance   of  its duties,  obligations or                    responsibilities or the exercise of any right, power, authority or discretion if                    it has grounds  for believing the repayment   of such funds  or adequate                    indemnity against, or security for, such risk or liability is not reasonably                    assured to it.   25.8     Responsibility   for documentation        Neither the  Agent  nor the  Arranger  is           responsible or liable for:            25.8.1   the adequacy,  accuracy and/or completeness  of any  information (whether                    oral or written) supplied by the Agent, the Arranger, a Security Party or any                    other person given in or in connection with any Relevant Document; or            25.8.2   the legality, validity, effectiveness, adequacy or  enforceability of any                    Relevant Document   or  any other  agreement,  arrangement   or document                    entered into, made or executed in anticipation of or in connection with any                    Relevant Document;  or            25.8.3   any determination as to whether any information provided or to be provided                    to any Finance  Party is non-public information the use of which  may  be                    regulated or prohibited by applicable law or regulation relating to insider                    dealing or otherwise.    25.9    No duty to monitor    The Agent shall not be bound to enquire:            25.9.1   whether or not any Default has occurred;            25.9.2   as to the performance, default or any breach by any Party of its obligations                    under any Finance Document;  or            25.9.3   whether any other event specified in any Finance Document has occurred.    25.10   Exclusion of liability            25.10.1  Without  limiting Clause 25.10.2   (and without  prejudice  to any  other                    provision of any Finance Document  excluding or limiting the liability of the                    Agent)  the Agent  shall not be  liable (including, without limitation, for                    negligence or any other category of liability whatsoever) for:                     (a)     any  damages,  costs or  losses to any person,  any diminution  in                            value, or any liability whatsoever arising as a result of taking or not                            taking  any  action  under  or  in connection  with  any  Finance                            Document or any Encumbrance    created or expressed to be created                            or evidenced by the Security Documents,  unless directly caused by                            its gross negligence or wilful misconduct;     LONUVE\30137956.24                                                                   Page 122  

 

                 (b)      exercising, or  not exercising,  any  right, power,  authority or                            discretion given to  it by, or  in connection  with, any  Finance                            Document,  any Encumbrance created   or expressed to be created or                            evidenced  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 Finance Document                            or any   Encumbrance   created  or  expressed  to  be  created or                            evidenced by the Security Documents;                    (c)      any shortfall which arises on the enforcement or realisation of the                            Trust Property; or                    (d)      without  prejudice  to  the  generality  of  Clauses  25.10.1(a),                            25.10.1(b) and  25.10.1(c), any damages,   costs or losses to any                            person, any diminution in value or any liability whatsoever arising                            as a result of:                             (i)     any  act, event or circumstance  not reasonably within its                                    control; or                             (ii)    the general risks of investment in, or the holding of assets                                    in, any jurisdiction,                    including (in each case and without limitation) such damages, costs, losses,                   diminution  in value  or  liability arising as a result of: nationalisation,                   expropriation  or other  governmental   actions; any  regulation, currency                   restriction, devaluation or  fluctuation; market  conditions affecting the                   execution or settlement of transactions or the value of assets (including any                   Disruption Event);  breakdown,  failure or malfunction  of any third party                   transport, telecommunications,   computer   services or  systems;   natural                   disasters or  acts of God;  war, terrorism,  insurrection or revolution; or                   strikes or industrial action.            25.10.2 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 Relevant Document  and  any                   officer, employee or agent of the Agent may rely on this Clause.            25.10.3 The  Agent will not be liable for any delay (or any related consequences) in                   crediting an account with an amount required under the Finance  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.            25.10.4 Nothing  in this Agreement shall oblige the Agent or the Arranger  to carry                   out:                    (a)      any  "know  your  customer"  or other  checks  in relation to any                            person; or    LONUVE\30137956.24                                                                    Page 123  

 

                 (b)      any check on the extent to which any transaction contemplated  by                            this Agreement might be unlawful for any Lender or for any Affiliate                            of any Lender,                    on  behalf of any Lender  and each  Lender confirms  to the Agent  and the                   Arranger  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 the Arranger.            25.10.5 Without  prejudice to any provision of any Finance Document   excluding or                   limiting the Agent's liability, any liability of the Agent arising under or in                    connection with any  Finance  Document   or any  Encumbrance   created or                    expressed to be created or evidenced  by the Security Documents   shall be                   limited to  the amount   of actual  loss which  has  been  finally judicially                    determined to have  been suffered (as determined by reference to the date                    of default of the Agent or, if later, the date on which the loss arises as a                   result of such default) but without reference to any  special conditions or                    circumstances known to the Agent at any time which increase the amount of                   that loss.  In no  event shall the Agent  be liable for any loss of profits,                    goodwill, reputation, business opportunity  or anticipated saving, or  for                   special, punitive, indirect or consequential damages,  whether  or not the                    Agent has been advised of the possibility of such loss or damages.    25.11   Lenders' indemnity to the Agent            25.11.1  Each Lender shall (in proportion to its share of the Total Commitments or, if                    the Total  Commitments     are then   zero, to  lts  share  of the   Total                    Commitments   immediately  prior to their reduction to zero) indemnify the                   Agent  and  every  Receiver and  Delegate,  within three Business  Days  of                    demand,  against any cost, loss or liability (including, without limitation, for                    negligence or any other category of liability whatsoever) incurred by any of                    them  (otherwise than  by  reason of  the relevant Agent's, Receiver's or                    Delegate's gross negligence or wilful misconduct) (or, in the case of any                    cost, loss or liability pursuant to Clause 28.12  (Disruption to payment                   systems  etc.) notwithstanding the Agent's negligence, gross negligence or                    any other category of liability whatsoever but not including any claim based                    on the fraud of the Agent) in acting as Agent, Receiver or Delegate under,                    or exercising any authority conferred under, the Finance Documents (unless                    the relevant Agent, Receiver or Delegate has been reimbursed by a Security                    Party pursuant to a Finance Document).            25.11.2  Subject  to Clause 25.11.3, the Borrowers  shall immediately  on  demand                    reimburse any  Lender  for any payment  that Lender  makes  to the  Agent                    pursuant to Clause 25.11.1            25.11.3  Clause 25.11.2 shall not apply to the extent that the indemnity payment in                    respect of which the Lender claims reimbursement relates to a liability of the                    Agent to a Security Party.    25.12   Trust    The  Security Agent agrees  and  declares, and each  of the other Finance           Parties acknowledges, that, subject to the terms and conditions of this Clause 25.12,           the  Security Agent  holds  the Trust  Property on  trust for the  Finance  Parties   LONLIVE\30137956.24                                                                   Page 124  

 

         absolutely. Each of the other Finance Parties agrees that the obligations, rights and           benefits vested in the Security Agent shall be performed and exercised in accordance           with this Clause 25.12.   The  Security Agent shall have  the benefit of all of the           provisions of this Agreement  benefiting it in its capacity as security agent for the           Finance Parties, and  all the powers and  discretions conferred on trustees by the           Trustee Act 1925 (to the extent not inconsistent with this Agreement). In addition:            25.12.1 the Security Agent and  any Delegate may  indemnify  itself or himself out of                   the  Trust Property  against all liabilities, costs, fees, damages, charges,                   losses and  expenses  sustained or incurred by it or him in relation to the                   taking  or holding of any of the Trust  Property or in connection with the                   exercise or purported exercise of the rights, trusts, powers and discretions                   vested in the Security Agent or any Delegate by or pursuant to the Security                   Documents or in  respect of anything else done or omitted to be done in any                   way relating to the Security Documents;            25.12.2 the  other Finance  Parties acknowledge  that the Security Agent  shall be                   under no  obligation to insure any property nor to require any other person                   to insure any property and  shall not be responsible for any loss which may                   be  suffered by any  person as a  result of the lack or insufficiency of any                   insurance;            25.12.3 the Finance Parties agree that the perpetuity period applicable to the trusts                   declared by this Agreement shall be the period of 125 years from the date of                   this Agreement;            25.12.4 the Security Agent shall not be liable for any failure, omission, or defect in                   perfecting the security constituted or created  by any  Finance Document                   including, without limitation, any failure to register the same in accordance                   with the provisions of any of the documents of title of any Security Party to                   any  of the assets thereby  charged or effect or procure registration of or                   otherwise protect the security created by any Security Document under any                   registration laws in any jurisdiction and may accept without  enquiry such                   title as any Security Party may have to any asset;            25.12.5 the Security Agent shall not be under any obligation to hold any title deed,                   Finance  Document  or any  other documents  in connection with the Finance                   Documents or any other documents in   connection with the property charged                   by any  Finance Document   or any other such security in its own possession                   or to take any steps to protect or preserve the same, and  may permit any                   Security Party to retain all such title deeds, Finance Documents and other                   documents  in its possession; and            25.12.6 save  as otherwise provided  in the Finance Documents,   all moneys  which                   under the  trusts therein contained are received by the Security Agent may                   be  placed on deposit in the name  of or under the  control of the Security                   Agent  at such bank  or institution (including the Security Agent) and upon                   such terms as  the Security Agent may think fit pending application of those                   moneys in  accordance with Clause 17.17 (Application of moneys by Security                   Agent).    LONLIVE\30137956.24                                                                   Page 125  

 

         The provisions of Part I of the Trustee Act 2000 shall not apply to the Security Agent           or the Trust Property.   25.13    Resignation of the Agent            25.13.1 The  Agent may   resign and appoint one  of its Affiliates acting through an                   office as successor by giving notice to the other Finance  Parties and the                   Borrowers.            25.13.2 Alternatively the Agent may resign by giving thirty (30) days' notice to the                   other Finance Parties and the Borrowers, in which case the Majority Lenders                   (after consultation with the Borrowers) may appoint a successor Agent.            25.13.3 If the Majority Lenders have not appointed a successor Agent in accordance                   with Clause 25.13.2 within 20 days after notice of resignation was given, the                   retiring Agent  (after consultation with  the Borrowers)   may  appoint  a                   successor Agent.            25.13.4 If the Agent wishes to resign because  (acting reasonably) it has concluded                   that it is no longer appropriate for it to remain as agent and the Agent is                   entitled to appoint a successor Agent under Clause 25.13.3, the Agent may                   (if it concludes (acting reasonably) that it is necessary to do so in order to                   persuade   the  proposed  successor  Agent  to  become   a  party  to  this                   Agreement as  Agent) agree with the proposed successor Agent amendments                   to this Clause 25  and any  other term of this Agreement  dealing with the                   rights or obligations of the  Agent  consistent with then  current market                   practice for the ilppointment and protection of corporate trustees together                   with  any reasonable  amendments    to the agency  fee payable  under  this                   Agreement which   are consistent with the successor Agent's normal fee rates                   and those amendments will bind the Parties.            25.13.5 The  retiring Agent  shall 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 Finance  Documents.   The  Borrowers  shall, within three                   Business Days  of demand, reimburse the retiring Agent for the amount of all                   costs and  expenses (including legal fees) properly incurred by it in making                   available such documents and  records and providing such assistance.            25.13.6 The  Agent's resignation notice shall only take effect upon the appointment                   of a successor and (in the case of the Security Agent) the transfer of all the                   Trust Property to that successor.            25.13.7 Upon  the appointment of a successor, the retiring Agent shall be discharged                   from any further obligation in respect of the Finance Documents (other than                   its obligations under Clause 25.13.5) but shall remain entitled to the benefit                   of Clause 14.3 (Indemnity to the Agent) and this Clause 25 (and any agency                   fees for the account of the retiring Agent shall cease to accrue from (and                   shall be payable on) that date). Any 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.    LONUVE\30137956.24                                                                    Page 126  

 

         25.13.8 The  Agent shall resign in accordance with Clause 25.13.2 (and, to the extent                   applicable, shall use reasonable endeavours  to appoint a successor  Agent                    pursuant to Clause 25.13.3) if on or after the date which is three months                    before the earliest FATCA Application Date relating to any payment to the                   Agent under the Finance  Documents, either:                     (a)     the Agent fails to respond to a request under Clause 12.7 (FATCA                            information) and a Lender  reasonably believes that the Agent will                            not be  (or will have ceased to be) a FATCA   Exempt  Party on or                            after that FATCA Application Date;                     (b)     the information supplied by  the Agent  pursuant to Clause   12.7                            (FATCA  information) indicates that the Agent will not be (or will                            have ceased  to be) a FATCA  Exempt  Party on or after that FATCA                            Application Date; or                     (c)     the Agent  notifies the Borrowers and the Lenders  that the Agent                            will not be (or will have ceased to be) a FATCA Exempt Party on or                            after that FATCA Application Date;                    and  (In each case) a Lender reasonably believes that a Party will be required                   to make  a FATCA  Deduction that would  not be required if the Agent were a                   FATCA  Exempt Party,  and that Lender, by notice to the Agent, requires it to                   resign.   25.14    Replacement of the Agent            25.14.1 After consultation with the Borrowers, the Majority Lenders may, by  giving                   thirty (30) days' notice to  the Agent  (or, at any time  the Agent  is an                   Impaired  Agent, by  giving any shorter notice determined  by the  Majority                   Lenders) replace the Agent by appointing a successor Agent.            25.14.2 The  retiring Agent shall (at its own cost if  it is an Impaired Agent and                   otherwise  at the expense of the Lenders)  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                   function as Agent under the Finance Documents.            25.14.3 The  appointment   of the successor  Agent  shall take effect on  the date                   specified in the notice from the Majority Lenders to the retiring Agent. As                   from  this date, the retiring Agent shall be  discharged from  any  further                   obligation in respect of the Finance Documents  (other than  its obligations                   under Clause  25.14.2 but shall remain entitled to the benefit of Clause 14.3                   (Indemnity  to the Agent) and this Clause 25 (and  any agency  fees for the                   account  of the  retiring Agent shall cease to accrue  from  (and shall be                   payable on) that date).            25.14.4 Any  successor Agent  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.   25.15    Confidentiality    LONUVE\30137956.24                                                                   Page 127  

 

         25.15.1 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.            25.15.2 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.   25.16    Relationship with the Lenders            25.16.1 Subject to Clause 23.8  (Pro rata interest settlement), the Agent may treat                   the person shown  in its records as Lender at the opening of business (in the                   place of the Agent's principal office as notified to the Finance Parties from                   time to time) as the Lender acting through its Facility Office:                    (a)      entitled to or liable for any  payment   due  under  any  Finance                            Document on  that day; and                    (b)      entitled to receive and act upon any notice, request, document or                            communication  or make  any  decision or determination under  any                            Finance Document made or delivered  on that day,                    unless it has received not less than  five Business Days' prior notice from                   that Lender to the contrary in accordance with the terms of this Agreement.            25.16.2 Any  Lender may  by  notice to the Agent appoint a person to receive on its                   behalf all notices, communications, information and documents to  be made                   or dispatched  to that Lender under  the Finance Documents.    Such notice                   shall contain  the address,  fax  number  and   (where  communication   by                   electronic mail or other electronic means  is permitted under Clause  30.6                   (Electronic communication))   electronic mail  address  and/or  any  other                   information required to enable  the sending  and receipt of information by                   that means  (and, in each case, the department or officer, if any, for whose                   attention communication  is to be made) and be treated as a notification of a                   substitute address, fax number,  electronic mail address, department   and                   officer by that Lender  for the purposes  of Clause  30.2 (Addresses)  and                   Clause 30.6.1(b) (Electronic communication) and  the Agent shall be entitled                   to treat such  person  as the person  entitled to receive all such notices,                   communications,   information and documents   as though  that person  were                   that Lender.   25.17    Credit  appraisal  by  the Lenders     Without  affecting the responsibility of any           Security Party for information supplied by it or on its behalf in connection with any           Finance Document,  each  Lender confirms to the Agent and  the Arranger 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 Finance           Document including but not limited to:            25.17.1 the financial condition, status and nature of each Security Party;            25.17.2 the  legality, validity, effectiveness, adequacy or  enforceability of any                    Finance Document   and  any other  agreement,  arrangement   or document    lONUVE\30137956.24                                                                    Page 128  

 

                 entered  into, made or executed  in anticipation of, under or in connection                   with any Finance Document;            25.17.3 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 Finance  Document,  the transactions contemplated  by                   the Finance Documents   or any other agreement,  arrangement or document                   entered  into, made  or executed  in anticipation of under or in connection                   with any Finance Document;   and            25.17.4 the right or title of any person in or to, or the value or sufficiency of any                   part of the Charged  Property, the priority of any Encumbrance  created or                   expressed  to be  created or evidenced  by the Security Documents   or the                   existence of any Encumbrance affecting the Charged  Property.   25.18    Reference   Banks   If a Reference Bank (or, if a Reference Bank is not a Lender, the           Lender  of which  it is an Affiliate) ceases to be a  Lender, the  Agent  shall (in           consultation with the Borrowers) appoint another Lender or an Affiliate of a Lender to           replace that Reference Bank.   25.19    Agent's  management time      Any  amount payable  to the Agent under Clause  14.3           (Indemnity to the Agent), Clause 14.4 (Indemnity to the Security Agent), Clause 16           (Costs and  expenses)  and  Clause 25.11  (Lenders' indemnity  to the Agent)  shall           include the cost of utilising the Agent's management time or other resources and will           be calculated on the basis of such reasonable daily or hourly rates as the Agent may           notify to the Borrowers and the Lenders, ~nd is in addition to any fee paid or payable           to the Agent under Clause 11 (Fees).   25.20    Deduction from amounts payable by the Agent         If any Party owes an amount to           the Agent under the  Finance 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 Finance  Documents           and apply the amount deducted   in or towards satisfaction of the amount owed. For           the purposes  of the  Finance Documents   that Party shall be  regarded  as having           received any amount so  deducted.   26       Conduct of Business by the Finance Parties            No provision of this Agreement will:   26.1     interfere with the right of any Finance Party to arrange its affairs (tax or otherwise)           in whatever manner it thinks fit;   26.2     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   26.3     oblige any Finance Party to disclose any  information relating to its affairs (tax or           otherwise) or any computations in respect of Tax.   27       Sharing among the Finance Parties   27.1     Payments    to Finance   Parties    If a  Finance Party (a  "Recovering   Finance           Party")  receives or recovers  any  amount  from  a  Security Party other  than  in    LONUVE\30137956.24                                                                    Page 129  

 

         accordance  with Clause  28 (Payment   Mechanics)  (a "Recovered   Amount")    and           applies that amount to a payment due under the Finance Documents then:            27.1.1  the  Recovering  Finance  Party shall, within three Business  Days,  notify                   details of the receipt or recovery, to the Agent;            27.1.2  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 28 (Payment Mechanics),  without taking account of                   any  Tax which  would  be imposed  on the Agent  in relation to the receipt,                   recovery or distribution; and            27.1.3  the Recovering  Finance Party shall, within three 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 28.6 (Partial payments).   27.2     Redistribution  of payments     The  Agent shall treat the Sharing Payment  as if it           had been  paid by the relevant Security Party and distribute it between the Finance           Parties (other than the Recovering Finance Party) (the "Sharing Finance  Parties")           in accordance with Clause  28.6 (Partial payments) towards  the obligations of that           Security Party to the Sharing Finance Parties.   27.3     Recovering   Finance  Party's rights   On  a distribution by the Agent under Clause           27.2 (Redistribution of payments) of a payment   received by a Recovering  Finance           Party from  a  Security Party, as  between  the  relevant Security  Party and  the           Recovering Finance Party, an amount of the Recovered  Amount equal to the Sharing           Payment will be treated as not having been paid by that Security Party.   27.4     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:            27.4.1  each  Sharing Finance  Party shall, upon request of the Agent,  pay to the                   Agent for the 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) (the "Redistributed Amount"); and            27.4.2  as between  the  relevant Security Party and each relevant Sharing Finance                   Party, an amount equal to the relevant Redistributed Amount will be treated                   as not having been paid by that Security Party.   27.5     Exceptions            27.5.1  This Clause  27 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 Security Party.    LONLIVE\30137956.24                                                                   Page 130  

 

        27.5.2  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.    LONLIVE\30137956.24                                                                  Page 131  

 

Section 11       Administration   28      Payment Mechanics   28.1    Payments    to the Agent    On  each date on  which a Security Party or a Lender is          required to make   a payment   under a  Finance Document   (other than  the Master          Agreement),  that Security Party or that Lender shall make the same available to the          Agent for value on the due date at the time and in such funds specified by the Agent          as  being customary   at the time  for settiement  of transactions in the  relevant          currency in the place of payment.           Payment   shall be made   to such account  in the  principal financial centre of the          country of that currency with such bank as the Agent specifies.   28.2    Distributions  by  the  Agent     Each payment   received by  the Agent  under the          Finance Documents for another Party shall, subject to Clause 28.3 (Distributions to a          Security Party) and Clause  28.4 (C/awback  and pre-funding) 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 Business Days' notice with  a bank  specified by that Party  in the          principal financial centre of the country of that currency.   28.3    Distributions to a  Security Party   The Agent may (with the consent of a  Security          Party or in accordance with Clause 29 (Set-Off)) apply any amount received by it for          that Security Party in or towards payment (on the date and in the currency and funds          of receipt) of any amount due from that Security Party under the Finance Documents          or in or towards purchase of any amount of any currency to be so applied.   28.4    Clawback and pre-funding           28.4.1   Where  a sum  is to be paid to the Agent under the Finance 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.           28.4.2   Unless Clause 28.4.3 applies, 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.           28.4.3   If the Agent  is willing to make available amounts  for the  account of  a                   Borrower before receiving funds from the Lenders then  if and to the extent                   that the Agent does  so but it proves to be the case that it does not then                   receive funds from a Lender in respect of a sum which it paid to a Borrower:                    (a)     the  Borrower  to whom   that sum   was  made   available shall on                           demand   refund it to the Agent; and    LONUVE\30137956.24                                                                   Page 132  

 

                 (b)      the Lender by whom   those funds should have been  made  available                            or, if that Lender fails to do so, the Borrower to whom that sum                            was made available, shall on demand  pay to the Agent the amount                            (as certified by the Agent) which will indemnify the Agent against                            any funding cost incurred by it as a result of paying out that sum                            before receiving those funds from that Lender.   28.5     Impaired Agent            28.5.1  If, at any time, the Agent becomes an Impaired Agent, a Security Party or a                   Lender  which is required to make a payment under the  Finance  Documents                   to the Agent  in accordance with Clause 28.1 (Payments  to the Agent) may                   instead either:                    (a)      pay that amount direct to the required recipient(s); or                    (b)      if in its absolute discretion it considers that it is not reasonably                            practicable to pay that amount  direct to the required recipient(s),                            pay that amount or the relevant part of that amount to an interest­                           bearing account held with an Acceptable  Bank in relation to which                            no Insolvency Event has occurred and  Is continuing, In the name of                            the Security Party or the Lender making the payment (the "Paying                            Party") and  designated as  a trust account for the benefit of the                            Party or Parties beneficially entitled to that payment under  the                            Finance  Documents    (the  "Recipient    Party"  or  "Recipient                            Parties").                    In each  case such payments   must  be made  on the  due date for payment                   under the Finance Documents.            28.5.2  All interest accrued on  the  amount  standing  to the  credit of the trust                   account  shall be for the  benefit of the Recipient Party or the  Recipient                   Parties pro rata to their respective entitlements.            28.5.3  A Party which has made  a payment in  accordance with this Clause 28.5 shall                   be  discharged  of  the  relevant payment   obligation under  the  Finance                   Documents   and  shall not take any credit risk with respect to the amounts                   standing to the credit of the trust account.            28.5.4  Promptly  upon  the appointment  of a successor  Agent  in accordance with                   Clause  25.14 (Replacement   of the Agent), each  Paying Party shall (other                   than  to the extent that  that Party has given  an instruction pursuant to                   Clause  28.5.5) give all requisite instructions to the bank with whom  the                   trust account  is held to transfer the amount  (together with any  accrued                   interest) to the successor Agent  for distribution to the relevant Recipient                   Party or Recipient Parties in accordance with Clause 28.2 (Distributions by                   the Agent).            28.5.5  A Paying  Party shall, promptly upon request by a Recipient Party and to the                   extent:                    (a)      that it has not given an instruction pursuant to Clause 28.5.4; and    LONUVE\30137956.24                                                                    Page 133  

 

                 (b)      that it has been provided with the  necessary information by that                            Recipient Party,            give all requisite instructions to the bank with whom the  trust account is held to           transfer the relevant amount (together with any accrued  interest) to that Recipient           Party.   28.6     Partial payments            28.6.1  If the Agent  receives a  payment  that is insufficient to discharge all the                    amounts  then  due and  payable  by  a Security Party  under the  Finance                   Documents   (other than the Master Agreement),  the Agent  shall apply that                   payment   towards the obligations of that Security Party under the Finance                   Documents (other than the Master Agreement)    in the following order:                     (a)     first, in or towards payment pro rata of any unpaid fees, costs and                            expenses  of the Agent  or the Security Agent  under  the Finance                            Documents;                     (b)     secondly, in or towards payment pro  rata of any accrued interest,                            fee or commission due but unpaid under this Agreement;                     (c)     thirdly, in or towards payment  pro rata of any principal due but                            unpaid under this Agreement; and                     (d)     fourthly, in or towards payment pro rata of any other sum due but                            unpaid under the Finance Documents.            28.6.2  The  Agent shall, if so directed by the Majority Lenders, vary the order set                    out in Clauses 28.6.1(b) to 28.6.1(d).            28.6.3  Clauses  28.6.1  and  28.6.2  will override any appropriation  made  by  a                   Security Party.    28.7    No  set-off by  Security  Parties   All payments  to be  made  by a Security Party           under the Finance Documents shall  be calculated and be made without (and free and           clear of any deduction for) set-off or counterclaim.    28.8    Business   Days    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).            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.    28.9    Currency of account            28.9.1  Subject to Clauses 28.9.2 to 28.9.5, dollars is the currency of account and                   payment   for  any sum   due  from  a  Security Party  under  any  Finance                   Document.    LONLlVE\30137956.24                                                                   Page 134  

 

         28.9.2  A  repayment  or payment of all or part of a Vessel Loan or an Unpaid Sum                   shall be made  in the currency in which that Vessel Loan or Unpaid Sum   is                   denominated on   its due date.            28.9.3  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.            28.9.4  Each  payment  in respect of costs, expenses or Taxes shall be made  in the                   currency in which the costs, expenses or Taxes are incurred.            28.9.5  Any  amount expressed   to be payable in a currency other than dollars shall                   be paid in that other currency.   28.10    Control account    The Agent shall open and maintain on its books a control account           in the names of the Borrowers showing the advance of the Loan and the computation           and  payment   of interest and all other sums   due  under  this Agreement.    The           Borrowers' obligations to  repay the Loan and to pay interest and all other sums due           under this Agreement  shall be evidenced by the entries from time to time made   in           the control account  opened  and  maintained  under  this Clause 28.10  and  those           entries will, in the absence of manifest error, be conclusive and binding.   28.11    Change of currency            28.11.1 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 Finance Documents   to, and any  obligations                            arising under the  Finance  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 Borrowers); 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).            28.11.2 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                   Borrowers)  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.   28.12    Disruption  to  payment   systems    etc.   If either the Agent  determines  in its           discretion that a Disruption Event  has occurred  or the Agent  is notified by the           Borrowers that a Disruption Event has occurred:            28.12.1 the Agent  may,  and shall if requested to do so by the Borrowers, consult                   with the Borrowers with a view to agreeing with the Borrowers such changes                   to the  operation or administration of the Loan  as the  Agent  may  deem                   necessary in the circumstances;    LONUVE\30137956.24                                                                   Page 135  

 

        28.12.2 the Agent  shall not be obliged to consult with the Borrowers in relation to                  any  changes   mentioned  in Clause  28.12.1  if, in its opinion, it is not                  practicable to do so in the circumstances and, in any event, shall have no                  obligation to agree to any such changes;           28.12.3 the Agent  may  consult with the Finance Parties in relation to any changes                   mentioned  in ·clause 28.12.1 but shall not be obliged to do  so if, in its                  opinion, it is not practicable to do so in the circumstances;           28.12.4  any such  changes  agreed  upon  by  the Agent  and  the  Borrowers  shall                   (whether  or not  it is finally determined that  a  Disruption Event  has                   occurred) be binding upon the Parties as an amendment to  (or, as the case                   may be, waiver of) the terms of the Finance Documents notwithstanding the                   provisions of Clause 34 (Amendments and Waivers);           28.12.5 the  Agent shall not be liable for any damages, costs or losses whatsoever                   (including, without limitation, for negligence, gross negligence or any other                   category of liability whatsoever but not including any claim based on the                   fraud of the Agent) arising as a result of its taking, or failing to take, any                   actions pursuant to or in connection with this Clause 28.12; and           28.12.6  the Agent shall notify the Finance Parties of all changes agreed pursuant to                   Clause 28.12.4.   29      Set-Off   29.1    Set-off   A  Finaoce Party may  set off any matured obligation due from  a Security          Party under the Finance Documents (to the extent beneficially owned by that Finance          Party) against any matured  obligation owed  by that Finance Party to that Security          Party, regardless of the place of payment,   booking branch  or currency  of either          obligation.  If the obligations are in different currencies, the Finance Party may          convert either obligation at a market rate of exchange in its usual course of business          for the purpose of the set-off.   29.2    Master   Agreement    rights   The  rights conferred on the Swap   Provider by this          Clause 29 shall be in addition to, and without prejudice to or limitation of, the rights          of netting and set off conferred on the Swap Provider by the Master Agreement.   30      Notices   30.1    Communications     in  writing     Any  communication   to  be  made  under  or  in          connection  with the  Finance  Documents   shall be  made  in  writing and, unless          otherwise stated, may be made  by fax or letter or (subject to Clause 30.6) electronic          mail.   30.2    Addresses    The  address and fax number (and  the department or officer, if any, for          whose   attention the  communication   is to  be  made)   of  each  Party  for any          communication or document to be   made or delivered under or in connection with the          Finance Documents is:           30.2.1   in the case of each Borrower, that identified with its name below;    LONUVE\30137956.24                                                                   Page 136  

 

         30.2.2   in the case of each Lender, that notified in writing to the Agent on or prior                   to the date on which it becomes a Party;            30.2.3  in the case of the Swap Provider, that identified with its name below; and            30.2.4  in the case of the Agent or the Security Agent, that identified with its name                   below,            or any substitute address, fax number,  or department  or officer as the Party may           notify to the Agent (or the Agent may notify to the other Parties, if a change is made           by the Agent) by not less than five Business Days' notice.   30.3     Delivery    Any  communication   or document   made  or delivered by  one Party to           another under or in connection with the Finance Documents will only be effective:            30.3.1  if by way of fax, when received in legible form; or            30.3.2  if by way  of letter, when it has been left at the relevant address or five                   Business  Days  after being deposited  in the post  postage  prepaid in an                   envelope  addressed to it at that address; or            30.3.3  if by way of electronic mail, in accordance with Clause 30.6,            and, if a particular department or officer is specified as part of its address details           provided under Clause 30.2 (Addresses), if addressed to that department or officer.            Any  communication   or document   to be  made  or  delivered to the Agent  or the           Security Agent  will be effective only when actually received by the Agent  or the           Security Agent  and  then only if  it is expressly marked for the attention of the           department  or officer identified with the Agent's or the Security Agent's signature           below (or any  substitute department or officer as the Agent or the Security Agent           shall specify for this purpose).            All notices from or to a Security Party (save in respect of the Master Agreement)           shall be sent through the Agent.            Any communication   or document  which  becomes  effective, in accordance with this           Clause 30.3, after 5.00 p.m. in the place of receipt shall be deemed only to become           effective on the following day.   30.4     Notification of address and fax number       Promptly upon  changing its address or           fax number, the Agent shall notify the other Parties.   30.5     Communication     when  Agent   is Impaired   Agent    If the Agent is an Impaired           Agent the Parties may, instead of communicating with each other through the Agent,           communicate  with each other directly and (while the Agent is an Impaired Agent) all           the provisions of the Finance Documents which  require communications to  be made           or notices to be given to or by the Agent shall be varied so that communications may           be made and  notices given to or by the relevant Parties directly. This provision shall           not operate after a replacement Agent has been appointed.   30.6     Electronic communication    LONUVE\30137956.24                                                                    Page 137  

 

        30.6.1   Any  communication   to be  made   between  any  two  Parties under  or in                   connection with the Finance Documents  may be  made   by electronic mail or                   other electronic means  to the extent  that those two  Parties agree that,                   unless and until notified to the contrary, this is to be an accepted form of                   communication  and if those two Parties:                    (a)     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                    (b)     notify each other of any change to their address or any other such                           information supplied by them  by not less than five Business Days'                           notice.           30.6.2   Any  electronic communication  made   between   those two  Parties will be                   effective only when actually received in readable form and in the case of any                   electronic communication  made  by  a Party to the  Agent or  the Security                   Agent only if it is addressed in such a manner as the Agent or the Security                   Agent shall specify for this purpose.           30.6.3   Any electronic communication  which becomes   effective, in accordance with                   Clause 30.6.2, after 5.00 p.m. in the place of receipt shall be deemed only                   to become  effective on the following day.   30.7     English language      Any  notice given under  or in connection  with any  Finance           Document  must be  in English. All other documents provided under or in connection          with any Finance Document must be:            30.7.1  in English; or           30.7.2   if not in English, and if so required by the Agent, accompanied by a certified                   English translation and, in this case, the English translation will prevail                   unless the document is a constitutional, statutory or other official document.   31       Calculations and Certificates   31.1     Accounts   In any litigation or arbitration proceedings arising out of or in connection          with a Finance Document, the entries made in  the accounts maintained by the Agent           pursuant to Clause 28.10 (Control account) are prima facie evidence of the matters          to which they relate.   31.2     Certificates and determinations     Any certification or determination by the Agent           of a rate or amount  under  any Finance  Document   is, in the absence of manifest           error, conclusive evidence of the matters to which it relates.   31.3     Day count convention      Any interest, commission or fee accruing under a Finance           Document  will accrue from day to day  and is calculated on the basis of the actual           number of days elapsed and  a year of 360 days or, in any case where the practice in           the Relevant Interbank Market differs, in accordance with that market practice.    lONUVE\30137956.24                                                                   Page 138  

 

32      Partial Invalidity           If, at any time, any provision of the Finance Documents is or becomes illegal, invalid          or unenforceable  in any  respect under  any  law  of any  jurisdiction, neither the          legality, validity or enforceability of the remaining provisions nor the legality, validity          or enforceability of such provision under the law of any other jurisdiction will in any          way be affected or impaired,   33      Remedies and Waivers           No failure to exercise, nor any delay in exercising, on the part of any Finance Party          or Secured Party, any right or remedy under a  Finance Document shall operate as a          waiver of any such  right or remedy or constitute an election to affirm any Finance          Document.   No  election to affirm any Finance Document on the part of any Finance          Party or Secured Party shall be effective unless it is in writing. No single or partial          exercise of any right or remedy  shall prevent any further or other exercise or the          exercise of any other  right or remedy.  The  rights and remedies  provided in this          Agreement  are  cumulative and not exclusive of any rights or remedies provided by          law.   34      Amendments and Waivers   34.1    Required consents           34.1.1   Subject to Clause 34.2  (Exceptions) any term  of the Finance  Documents                   (other than the Master Agreement)   may  be amended   or waived only with                   the consent  of the  Majority Lenders  and  the Borrowers  and  any  such                   amendment or waiver will be binding on all Parties.           34.1.2  The  Agent  may  effect, on behalf of any Finance Party, any amendment   or                   waiver permitted by this Clause 34.           34.1.3   Without prejudice to the generality of Clauses 25.7.3, 25.7.4  and 25.7.5                   (Rights and discretions of the Agent), the Agent may engage,  pay for and                   rely on the services of lawyers in determining the consent level required for                   and effecting any amendment, waiver or consent under this Agreement.           34.1.4   Clause 23.8.3 (Pro rata interest settlement) shall apply to this Clause 34.   34.2    Exceptions           34.2.1   An amendment,   waiver or (in the case of a Security Document)  a consent                   of, or in relation to, any term of any Finance Document that has the effect                   of changing or which relates to:                    (a)     the definition of "Majority Lenders" in Clause 1.1 (Definitions);                    (b)     an  extension to the  date of payment   of any amount   under the                           Finance Documents;                    (c)     a reduction  in the Margin  or a reduction in the  amount  of any                           payment of principal, interest, fees or commission payable;    LONUVE\30137956.24                                                                   Page 139  

 

                 (d)     a change  in currency of payment of any amount under the Finance                           Documents;                    (e)     an  increase in any Commitment,   an  extension of the Availability                           Period  or any  requirement  that a  cancellation of Commitments                           reduces the Commitments of the Lenders   rateably;                    (f)      a change to a  Borrower other than  in accordance with Clause 24                           (Changes to the Security Parties);                    (g)      any provision  which expressly  requires the  consent  of all the                            Lenders;                    (h)     Clause  2.2  (Finance Parties' rights and obligations), Clause 5.1                            (Delivery of a Drawdown  Request), Clause  7.1 (Illegality), Clause                           7.5  (Mandatory  prepayment   on  sale or Total  Loss), Clause 23                            (Changes  to the Lenders),  Clause 24  (Changes  to  the Security                           Parties), this Clause 34, Clause 39 (Governing Law) or Clause 40.1                            (Jurisdiction of English courts);                    (i)      (other than as expressly permitted by the provisions of any Finance                            Document) the nature or scope of:                             (i)     any Guarantee;                             (ii)    the Charged  Property; or                             (iii)   the manner   in which the proceeds of enforcement  of the                                    Security Documents are distributed; or                    (j)      the release of any Guarantee  or of any  Encumbrance   created or                            expressed to be created  or evidenced by the Security Documents                            unless permitted  under  this Agreement   or  any  other  Finance                            Document or relating to a sale or disposal of an asset which is the                            subject of any Encumbrance  created or expressed to be created or                            evidenced by the Security Documents   where such  sale or disposal                            is expressly permitted under this Agreement or any  other Finance                            Document,                    shall not be made, or given, without the prior consent of all the Lenders.            34.2.2  An  amendment   or waiver which  relates to the rights or obligations of the                   Agent, the Security Agent  or the Arranger (each in their capacity as such)                   may  not be effected without the consent· of the Agent, the Security Agent                   or, as the case may be, the Arranger.   34.3     Replacement of Lender            34.3.1  If:                    (a)      any  Lender  becomes   a Non-Consenting   Lender  (as  defined in                            Clause 34.3.4); or    LONLIVE\30137956.24                                                                  Page 140  

 

                  (b)     a Borrower  or any other Security Party becomes  obliged to repay                            any  amount  in accordance  with Clause 7.1  (Illegality) or to pay                            additional amounts pursuant to Clause 12.2 (Tax gross-up), Clause                            12.3  (Tax Indemnity)   or Clause  13.1 (Increased costs)  to any                            Lender,                    then  the Borrowers may,  on ten Business  Days' prior written notice to the                   Agent  and  such Lender, replace such  Lender by  requiring such Lender to                    (and, to the extent permitted by law, such Lender shall) transfer pursuant                   to Clause  23 (Changes  to the Lenders) all (and not part only) of its rights                    and obligations under this Agreement  to a Lender or other bank, financial                    institution, trust, fund or other entity (a "Replacement Lender") selected                    by the  Borrowers,  which  confirms its willingness to assume   and  does                   assume   all the obligations of the transferring Lender in accordance with                   Clause  23 (Changes  to the Lenders) for a purchase price in cash payable at                   the time of transfer in an amount equal to the outstanding principal amount                   of  such Lender's  participation in the outstanding Loan  and  all accrued                   interest (to the extent that the Agent  has not  given a notification under                   Clause  23.8 (Pro rata interest settlement)), Break Costs and other amounts                   payable  in relation thereto under the Finance Documents.            34.3.2  The  replacement of a Lender pursuant to this Clause 34.3 shall be subject to                   the following conditions:                     (a)     the Borrowers shall have no right to replace the Agent or Security                            Agent;                     (b)     neither the Agent nor the Lender  shall have any obligation to the                            Borrowers to find a Replacement Lender;                    (c)      in the event of a  replacement  of a Non-Consenting  Lender  such                            replacement  must take  place no later than fifteen (15) days after                            the date on which that Lender is deemed a Non-Consenting Lender;                    (d)      in no event shall the Lender  replaced under  this Clause 34.3 be                            required to pay or surrender to such  Replacement  Lender  any of                            the  fees  received by  such   Lender  pursuant  to  the  Finance                            Documents;  and                    (e)      the  Lender  shall only  be  obliged  to transfer  its rights and                            obligations pursuant to Clause 34.3.1 once it is satisfied that it has                            complied with all necessary "know your customer"  or other similar                            checks under all applicable laws and regulations in relation to that                            transfer.            34.3.3  A Lender shall perform the checks described in Clause 34.3.2(e) as soon as                   reasonably  practicable following delivery of a notice referred to in Clause                   34.3.1 and  shall notify the Agent and the Borrowers when it is satisfied that                   it has complied with those checks.    LONUVE\30137956.24                                                                    Page 141  

 

         34.3.4  In the event that:                    (a)      the Borrowers or the Agent (at the request of the Borrowers) have                            requested the Lenders to give a consent in relation to, or to agree                            to a  waiver or  amendment    of, any  provisions of the  Finance                            Documents;                    (b)      the  consent, waiver  or  amendment    in  question  requires the                            approval of all the Lenders; and                                                                                   2                  (c)      Lenders whose  Commitments    aggregate more  than 66 /, per cent                            of the Total Commitments (or, if the Total Commitments have  been                                                                      2                           reduced to zero, aggregated more than  66 /, per cent of the Total                            Commitments prior to that reduction) have  consented or agreed to                            such waiver or amendment,                    then  any Lender  who  does not and  continues not to consent  or agree to                   such waiver or amendment shall  be deemed a "Non-Consenting Lender".   35       Confidentiality   35.1     Confidential  Information      Each Finance  Party agrees  to keep  all Confidential           Information  confidential and not  to disclose it to anyone,  save  to  the extent           permitted by  Clause 35.2 (Disclosure of Confidential Information) and Clause 35.3           (Disclosure to numbering   service providers), and to ensure  that all Confidential           Information is protected with security measures  and  a degree  of care that would           apply to its own confidential information.    35.2    Disclosure of Confidential Information     Any Finance Party may disclose:            35.2.1   to any of its Affiliates and Related Funds and any of its or their officers,                    directors, employees,   professional  advisers,  auditors, partners   and                    Representatives such Confidential Information as that Finance  Party shall                    consider appropriate if any person to whom the Confidential Information is                    to be given  pursuant to this Clause 35.2.1  is informed in writing of its                    confidential nature and that some  or all of such Confidential Information                    may  be  price-sensitive information except that there  shall be no  such                    requirement  to  so  inform  if the recipient is  subject to  professional                    obligations to maintain the confidentiality of the information or is otherwise                    bound  by  requirements  of confidentiality in relation to the Confidential                    Information;            35.2.2   to any person:                     (a)     to (or through) whom   it assigns or transfers (or may potentially                            assign or transfer) all or any of its rights and/or obligations under                            one or more  Finance Documents   or which succeeds (or which may                            potentially succeed) it as Agent  or Security Agent  and, in each                            case,  to   any   of  that  person's  Affiliates, Related  Funds,                            Representatives and professional advisers;                     (b)     with (or through)  whom   it enters into (or may potentially enter                            into), whether   directly or indirectly, any  sub-participation in     LONUVE\30137956.24                                                                   Page 142  

 

                          relation to, or any other transaction under which payments are to                            be made   or may  be made   by reference to, one or more  Finance                            Documents and/or one   or more  Security Parties and to any of that                            person's Affiliates, Related Funds, Representatives and professional                            advisers;                     (c)     appointed by  any  Finance Party or by a  person to whom   Clause                            35.2.2(a) or 35.2.2(b) applies to receive communications, notices,                            information  or documents    delivered pursuant   to the  Finance                            Documents   on its behalf (including, without limitation, any person                            appointed under Clause 25.16.2 (Relationship with the Lenders));                    (d)      who invests in or otherwise finances (or may potentially invest in or                            otherwise finance), directly or indirectly, any transaction referred to                            in Clause 35.2.2(a) or 35.2.2(b);                    (e)      to whom   information is required or requested to be disclosed by                            any court of competent jurisdiction or any governmental, banking,                            taxation or other regulatory authority or similar body, the rules of                            any relevant stock exchange  or pursuant to any  applicable law or                            regulation;                    (f)      to whom  information is required to be disclosed in connection with,                            and for the purposes of, any litigation, arbitration, administrative or                            other investigations, proceedings or disputes;                    (g)      who is a Party; or                    (h)      with the consent of the Borrowers;                    in each  case, such  Confidential Information as  that Finance  Party shall                   consider appropriate if:                             (i)     in relation to Clauses 35.2.2(a), 35.2.2(b) and 35.2.2(c),                                    the person  to whom  the Confidential Information is to be                                    given  has  entered   into a  Confidentiality Undertaking                                    except   that  there  shall be   no  requirement   for  a                                    Confidentiality Undertaking if the recipient is a professional                                    adviser  and  is subject  to  professional obligations to                                    maintain    the   confidentiality  of  the    Confidential                                    Information;                             (ii)    in relation to Clause 35.2.2(d), the person to whom   the                                    Confidential Information is to be given has entered into a                                    Confidentiality Undertaking  or  is otherwise  bound   by                                    requirements   of   confidentiality in  relation  to  the                                    Confidential Information they receive and is informed that                                    some  or all of such Confidential Information may be price­                                   sensitive information;                             (iii)   in relation to Clauses 35.2.2(e) and 35.2.2(f) the person                                    to whom   the  Confidential Information is to be given  is    LONUVE\30137956.24                                                                   Page 143  

 

                                  informed of its confidential nature and that some or all of                                    such  Confidential Information   may   be  price-sensitive                                    information except that there shall be no requirement  to                                    so inform if, in the opinion of that Finance Party, it is not                                    practicable so to do in the circumstances;           35.2.3   to any  person appointed  by that Finance Party or  by a person  to whom                   Clause  35.2.2(a)  or  35.2.2(b)  applies  to  provide  administration  or                   settlement services in respect of one or more  of the  Finance Documents                   including without limitation, in relation to the trading of participations in                   respect of the Finance Documents, such Confidential Information as may be                   required to be disclosed to enable such service provider to provide any of                   the services referred to in this Clause 35.2.3 if the service provider to whom                   the Confidential Information is to be given has entered into a Confidentiality                   Undertaking; and           35.2.4   to any rating agency (including its professional advisers) such Confidential                   Information as may be required to be disclosed to enable such rating agency                   to carry out its normal rating activities in relation to the Finance Documents                   and/or the Security Parties if the rating agency to whom  the Confidential                   Information is to be given is informed  of its confidential nature and that                   some   or all of  such  Confidential Information  may   be  price-sensitive                   information.   35.3    Disclosure to numbering service providers            35.3.1  Any  Finance Party may  disclose t6 any national or international numbering                   service provider appointed by  that Finance Party to provide  identification                   numbering  services in respect of this Agreement, the Loan  and/or one  or                   more Security Parties the following information:                    (a)     names of Security Parties;                    (b)      country of domicile of Security Parties;                    (c)      place of incorporation of Security Parties;                    (d)      date of this Agreement;                    (e)      Clause 39 (Governing law);                    (f)      the names of the Agent and the Arranger;                    (g)      date of each amendment and  restatement of this Agreement;                    (h)      amount of Total Commitments;                    (i)      currencies of the Loan;                    (j)      type of Loan;                    (k)      ranking of the Loan;                    (I)      Termination Date;    lONUVE\30137956.24                                                                   Page 144  

 

                  (m)     changes  to any of the information previously supplied pursuant to                            35.3.1(a) to 35.3.1(1); and                     (n)     such other information agreed between such  Finance Party and that                            Security Party,                    to enable  such numbering  service provider to provide its usual syndicated                   loan numbering identification services.            35.3.2  The  Parties acknowledge and agree that each identification number assigned                   to  this Agreement,  the Loan  and/or  one or more   Security Parties by a                   numbering   service provider and the information associated with each such                   number   may  be disclosed to users of its services in accordance with the                   standard terms and  conditions of that numbering service provider.            35.3.3  Each  Borrower  represents that none of the information set out in Clauses                   35.3.1(a)  to 35.3.1(n)  is, nor will at any  time be,  unpublished  price­                  sensitive information.   35.4     Entire agreement     This Clause  35 constitutes the entire agreement between  the           Parties in relation to the obligations of the  Finance  Parties under the  Finance           Documents    regarding  Confidential Information  and   supersedes   any  previous           agreement, whether express or implied, regarding Confidential Information.   35.5     Inside information     Each of the Finance Parties acknowledges that some  or all of           the Confidential Information is or may be price-sensitive information and that the use           of such information may be regulated or prohibited by applicable legislation including           securities law relating to insider dealing and market abuse and each of the Finance           Parties undertakes not to use any Confidential Information for any unlawful purpose.   35.6     Notification  of disclosure    Each  of the Finance  Parties agrees (to the extent           permitted by law and regulation) to inform the Borrowers:            35.6.1  of the  circumstances of any  disclosure of Confidential Information made                   pursuant to Clause 35.2.2(e) (Disclosure of Confidential Information) except                   where  such  disclosure is made to any  of the persons  referred to in that                   Clause during the ordinary course of its supervisory or regulatory function;                   and            35.6.2  upon  becoming  aware  that Confidential Information has been  disclosed in                   breach of this Clause 35.   35.7     Continuing  obligations    The obligations in this Clause 35 are continuing and, in           particular, shall survive and remain binding on each Finance Party for a period of 12           months from the earlier of:            35.7.1  the date on  which all amounts payable  by the Security Parties under or in                   connection with the Finance Documents   have been  paid in full and the Loan                   has been  cancelled or otherwise ceases to be available; and            35.7.2  the date  on which  such  Finance Party otherwise ceases  to be  a Finance                   Party.    LONUVE\30137956.24                                                                   Page 145  

 

36       Disclosure of Lender Details by Agent   36.1     Supply of Lender details to   Borrowers    The Agent shall provide to the Borrowers           within seven Business Days  of the last Business Day of each calendar month  a list           (which may  be in electronic form) setting out the names of the Lenders  as at that           Business Day, their respective Commitments,  the address and  fax number (and  the           department or officer, if any, for whose attention any communication is to be made)           of each Lender  for any  communication  to be  made  or document   to be  delivered           under  or in connection with the  Finance Documents,   the electronic mail address           and/or  any  other  information required  to enable  the  sending  and  receipt of           information by electronic mail or other electronic means to and by each  Lender to           whom   any communication  under or in connection with the Finance Documents   may           be made  by that means  and  the account details of each Lender for any payment to           be distributed by the Agent to that Lender under the Finance Documents.   36.2     Supply of Lender details at Borrowers' direction            36.2.1  The  Agent shall, at the request of the Borrowers, disclose the identity of the                   Lenders and  the details of the Lenders' Commitments to any:                    (a)      other Party  or any  other person  if that disclosure is made  to                            facilitate, in each case, a refinancing of the Financial Indebtedness                            arising under  the Finance  Documents   or  a material waiver  or                            amendment of any term of any Finance  Document; and                    (b)      Security Party.            36.2.2  Subject  to Clause 36.2.3, the Borrowers shall procure that the recipient of                   information disclosed pursuant to Clause 36.2.1 shall keep such information                   confidential and shall not disclose it to anyone and shall ensure that all such                   information is protected with security measures and  a degree  of care that                   would  apply to the recipient's own confidential information.            36.2.3  The  recipient may disclose such information to any of its officers, directors,                   employees,  professional advisers, auditors and partners as it shall consider                   appropriate  if any such  person is informed  in writing of its confidential                    nature, except that there shall be no such requirement to so inform if that                    person is subject to professional obligations to maintain the confidentiality                   of  the information or is otherwise  bound  by  duties of confidentiality in                   relation to the information.    36.3    Supply of Lender details to other Lenders            36.3.1  If a Lender (a "Disclosing  Lender")  indicates to the Agent that the Agent                    may do so, the Agent shall disclose that Lender's name and Commitment to                   any other Lender that is, or becomes, a Disclosing Lender.            36.3.2  The  Agent  shall, if so directed by the  Requisite Lenders, request  each                    Lender to indicate to it whether it is a Disclosing Lender.    36.4    Lender enquiry    If any Lender believes that any entity is, or may be, a Lender and:            36.4.1  that entity ceases to have an Investment Grade Rating; or    LONLlVE\30137956.24                                                                   Page 146  

 

         36.4.2  an Insolvency Event occurs in relation to that entity,            the Agent shall, at the request of that Lender, indicate to that Lender the extent to           which that entity has a Commitment.   36.5     Lender details definitions   In this Clause 36:            "Investment Grade    Rating"  means,  in relation to an entity, a rating for its long­          term  unsecured  and  non-credit-enhanced  debt  obligations of BBB- or  higher by           Standard &  Poor's Rating Services or Fitch Ratings Ltd or Baa3 or higher by Moody's           Investors Service Limited or a comparable rating from an internationally recognised           credit rating agency.            "Requisite  Lenders"  means a Lender or Lenders  whose Commitments aggregate 15           per cent (or more)  of the Total Commitments   (or if the Total Commitments   have           been reduced  to zero, aggregated 15 per cent (or more)  of the Total Commitments           immediately prior to that reduction).   37       Counterparts            Each Finance  Document  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           the Finance Document.   38       Joint and Several Liability   38.1     Nature  of  liability  The  representations, warranties, covenants, obligations and           undertakings of the Borrowers contained in this Agreement shall be joint and several           so that each Borrower shall be jointly and severally liable with all the Borrowers for           all of the same and  such liability shall not in any way be discharged, impaired or           otherwise affected by:            38.1.1  any forbearance  (whether as to payment or otherwise)  or any time or other                    indulgence granted to any other Borrower or any other Security Party under                   or in connection with any Finance Document;            38.1.2  any  amendment,  variation, novation  or replacement  of any other Finance                    Document;            38.1.3   any  failure of any  Finance  Document   to  be  legal valid binding  and                    enforceable in relation to any other Borrower or any other Security Party for                    any reason;            38.1.4  the  winding-up or dissolution of any other Borrower or any  other Security                    Party;            38.1.5  the  release (whether in whole  or in part) of, or the entering into of any                   compromise   or composition with, any other Borrower or any  other Security                    Party; or            38.1.6  any other act, omission, thing or circumstance which would or might, but for                   this provision, operate to discharge, impair or otherwise affect such liability.    LONLIVE\30137956.24                                                                   Page 147  

 

38.2    No   rights  as  surety     Until the Indebtedness   has been  unconditionally and          irrevocably paid and discharged  in full, each Borrower agrees that it shall not, by          virtue of any payment made under this Agreement on   account of the Indebtedness or          by virtue of any enforcement by a Finance Party of its rights under this Agreement or          by virtue of any relationship between, or transaction involving, the relevant Borrower          and  any other Borrower or any other Security Party:           38. 2.1  exercise any  rights of subrogation in relation to any  rights, security or                   moneys   held or received or receivable by  a Finance  Party or any  other                   person; or           38.2.2   exercise any right of contribution from any  other Borrower  or any  other                   Security Party under any Finance Document;  or           38.2.3   exercise any right of set-off or counterclaim against any other Borrower or                   any other Security Party; or           38.2.4   receive, claim or have the benefit of any payment, distribution, security or                   indemnity from any other Borrower or any other Security Party; or           38.2.5   unless so directed by the Agent (when  the relevant Borrower  will prove in                   accordance with such  directions), claim as a creditor of any other Borrower                   or any other Security Party in competition with any Finance Party           and  each Borrower shall hold  in trust for the Finance Parties and forthwith pay or          transfer (as appropriate) to the Agent any such payment (including an amount equal          to any  such set-off), distribution or benefit of such security, indemnity or claim in          fact received by it.    LONUVE\30137956.24                                                                   Page 148  

 

Section 12       Governing Law and Enforcement   39       Governing Law            This Agreement  and  any non-contractual obligations arising out of or in connection           with it are in all respects governed by and shall be interpreted in accordance with           English Jaw.   40       Enforcement   40.1     Jurisdiction of English courts            40.1.1  The  courts  of England  have  exclusive jurisdiction to settle any dispute                   arising out of or  in connection with this Agreement   (including a dispute                    relating to the existence, validity or termination of this Agreement or any                    non-contractual obligation  arising out  of or  in  connection  with  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.            40.1.2   Notwithstanding Clause 40.1.1, 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.   40.2     Service of process            40.2.1  Without prejudice to any  other mode  of service allowed under any relevant                    law, each Borrower:                     (a)     irrevocably appoints Teekay  Shipping  (UK)  Ltd of 2"d Floor, 86                            Jermyn Street, London  SW1 Y 6JD, England  as its agent for service                            of process in relation to any proceedings before the English courts                            in connection with any Finance Document; and                     (b)     agrees that failure by a process agent to notify that Borrower of the                            process will not invalidate the proceedings concerned.            40.2.2  If any person appointed as an agent for service of process is unable for any                    reason to act as agent for service of process or terminates its appointment                    as agent for service of process, the relevant Borrower  must  immediately                    (and in any  event within five days  of such event  taking place) appoint                    another agent on  terms  acceptable to the Agent.  Failing this, the Agent                    may appoint another agent for this purpose.    This  Agreement    has been  entered   into on the  date stated  at the  beginning  of this  Agreement.    LONLIVE\30137956.24                                                                   Page 149  

 

Schedule 1   The Original Lenders    Name of Original Lender                          Commitment (US$)    China Development Bank                           1,632,000,000    LONLlVE\30137956.24                                                                   Page 150  

 

Schedule 2  Conditions Precedent and Subsequent   Part I  Initial Conditions Precedent   1        Security Parties            1.1     Constitutional   documents      Copies  of the constitutional documents  of                   each  Security Party together with such  other evidence as the  Agent may                    reasonably require that each Security Party is duly incorporated or formed in                   its country of  incorporation or formation and  remains  in existence with                   power   to enter  into, and  perform  its obligations under, the  Relevant                   Documents to which   it is or is to become a party.            1.2     Certificates of good standing     A certificate of good standing in respect of                   each Security Party (if such a certificate can be obtained).            1.3     Board  resolutions    A copy of a resolution of the board of directors of each                   Security Party or its general partner:                    1.3.1    approving the terms of, and the transactions contemplated by, the                            Relevant Documents   to which  it is a party and resolving that it                            execute those Relevant Documents;  and                    1.3.2    authorising a specified person or persons to execute those Relevant                            Documents   (and all documents  and  notices to be  signed and/or                            dispatched under those documents)  on its behalf.            1.4     Shareholder resolutions      If required by any legal advisor to the Agent, a                   copy  of a resolution signed by all the holders of the issued shares (or sole                   member   or general  partners, as the case may  be) in each Security Party                   (other  than   TGP),  approving   the  terms   of,  and  the   transactions                   contemplated  by, the Relevant Documents to which   that Security Party is a                   party.            1.5     Other   approvals     If applicable, copies of all governmental and  other                   consents,  licences, approvals and authorisations as may  be  necessary to                   authorise the performance  by each of the Security Parties of its obligations                   under the Relevant Documents to   which it is or (as the case may be) will be                   a  party, and the  execution, validity and enforceability of such Relevant                   Documents.            1.6     Officer's certificates  An  original certificate of a duly authorised officer of                   each Security Party:                    1.6.1    certifying that each copy document  relating to it specified in this                            Part I of Schedule  2 is correct, complete  and  in full force and                            effect;                    1.6.2    setting out the names of the directors, officers and shareholders (or                            members or general  partners, as the case may be) of that Security    LONUVE\30137956.24                                                                   Page 151  

 

                          Party (other than the shareholders for TGP) and the proportion of                            shares held by each shareholder; and                    1.6.3    confirming  that  borrowing  or  guaranteeing   or  securing,  as                            appropriate, the Loan would  not cause any  borrowing, guarantee,                            security or similar limit binding on  that  Security Party to  be                            exceeded.            1.7     Powers   of  attorney    The  original (and if required for the purpose of                   registering any of the Finance  Documents  under  the laws of the relevant                   jurisdiction, notarially attested and (if required) legalised) power of attorney                   of each  of the Security Parties under  which the  Relevant Documents   to                   which  it is or is to become  a party  are to be  executed or  transactions                   undertaken  by that Security Party.            1.8     General   partner  approval     The  written approval of Teekay  GP  L.L.C.                   (being the general partner of TGP) approving the terms of the Guarantee to                   be granted by TGP.   2        Direct Agreement Parties and YLNG            2.1     Constitutional   documents      Copies of the  constitutional documents of                   each Direct Agreement Party (other than the Builder) and YLNG.            2.2     Certificates of good standing     A certificate of good standing in respect of                   each  Direct Agreement  Party (other than the Builder) and YLNG  (if such a                   certificate can be obtained).            2.3     Board   resolutions   A copy of a resolution of the board of directors of each                   Direct  Agreement   Party  (other than  the  Builder  and  Yamal  Sponsor                   Guarantors) and  YLNG:                    2.3.1    approving the terms of, and the transactions contemplated by,                             (a)     in the case of the Charterer, the Charters and  the Direct                                    Agreements   to which  it is a party and resolving that it                                     execute the Charters and those Direct Agreements; and                             (b)     in the case of YLNG,  the YLNG  Guarantees  and  resolving                                    that it execute the YLNG Guarantees;                    2.3.2    authorising a specified person or persons to execute those  Direct                            Agreements,  Charters and  YLNG  Guarantees  (as applicable) (and                            all documents  and notices to be signed  and/or dispatched  under                            those documents) on  its behalf.            2.4      Builder's authority  in respect of the Builder's authority to execute the                    Replacement  Step-In  Agreements   and  the  Replacement   Novation  Side                    Letters, the relevant power or powers of attorney of the Builder.            2.5     Other   approvals     If applicable, copies of all governmental and  other                    consents, licences, approvals and authorisations as may  be  necessary to                   authorise the  performance  by  each of the Direct Agreement   Parties and    LONUVE\30137956.24                                                                    Page 152  

 

                 YLNG  of its obligations under the Direct Agreements,  Charters and  YLNG                   Guarantees  to which it is or (as the case may be) will be a party, and the                   execution, validity and enforceability of such Direct Agreements, Charters                   and YLNG  Guarantees.            2.6     Original counterparts    An original counterpart of each Direct Agreement.   3        Security and related documents            3.1     Vessel  documents     Photocopies, certified as true, accurate and complete                   by an authorised representative of each Borrower, of:                    3.1.1    the relevant Building Contract;                    3.1.2    the relevant Refund Guarantee;                    3.1.3    the relevant Charter;                    3.1.4    the  other   Relevant   Documents    (other  than   the   Finance                            Documents);  and                    3.1.5    evidence  that  each   relevant  counterparty  to  the   Assigned                            Documents   has given  its written approval to the assignment  by                            such Borrower of the relevant Assigned Documents  pursuant to the                            Charter Assignment   to which  such  Borrower  is a party, to the                            extent that the prior consent of such counterparty  has not  been                            granted  under  the  relevant Assigned  Documents   or  otherwise                            provided.            3.2     Security Documents      The Pre-Delivery Assignments, each  Guarantee, the                   Borrower   Pledge  Agreements,   the  Charter  Assignments,   the Account                   Security Deeds, the Parent  Pledge Agreement,  the Manager's Undertakings                   and  any other Credit Support Documents, together with all other documents                   required  by any  of them,  including, without limitation, (i) all notices of                   assignment and/or charge  and  evidence that upon service those notices will                   be duly acknowledged  by the recipients (other than those notices in respect                   of the  Vessels' Insurances)  and  (ii) (pursuant to the  Borrower  Pledge                   Agreements   and  the Parent Pledge  Agreement)   all certificates of limited                   liability interest, proxy forms,  letters of  resignation  and  letters of                   undertaking.            3.3     No  disputes    The  written confirmation of the Borrowers that there is no                   dispute under any of the Relevant Documents as  between  the parties to any                   such document.            3.4     Equity contribution                    3.4.1    Evidence of full payment to the Builder of any part of the Contract                            Price of the Vessel under the Building Contract which is payable on                            or before the  relevant Drawdown   Date  and  which  is not being                            financed by the Loan.    LONLIVE\30137956.24                                                                  Page 153  

 

                 3.4.2    Evidence that the equity contribution is, or will be, on or prior to                            the relevant Drawdown   Date  in place, and that the  ratio of the                            aggregate amount   drawn  under the relevant Vessel Loan  to such                            equity contribution does not and shall not following the making of                            the relevant Drawing exceed 80:20.   4        Legal opinions            The following legal opinions, each addressed to the Agent, the Security Agent, the           Swap  Provider and the Lenders and capable of being relied upon by any persons who           become  Lenders  pursuant  to the primary syndication of the Loan  or confirmation           satisfactory to the Agent that such opinions will be given:            4.1     legal opinions of Stephenson  Harwood,   legal advisers to the Agent as to                   English  and Hong   Kong  law substantially in the form  distributed to the                   Lenders  prior to signing this Agreement;            4.2     a legal opinion of Poles, Tublin, Stratakis & Gonzalez LLP, legal advisers to                   the Agent and  as to the Republic of the Marshall Islands law; and            4.3     a legal opinion of Bermudan legal counsel as legal advisers to the Agent and                   as to Bermudan  law.    5       Other documents and evidence            5.1      Drawdown Request      A duly completed  Drawdown  Request.            5;2     Process agent     Evidence that any process agent referred to in Clause 40.2                    (Service of process) and  any  process agent  appointed  under  any other                    Finance Document has  accepted its appointment.            5.3     Other   Authorisations      A  copy  of any  other  Authorisation or other                   document,  opinion or assurance which the Agent reasonably  considers to be                    necessary (if it has notified the Borrowers accordingly) in connection with                   the  entry into and performance  of the transactions contemplated  by  any                    Relevant Document   or for the validity and enforceability of any Relevant                    Document.            5.4      Financial statements    A copy of each of the Original Financial Statements                   to the extent not publicly available online.            5.5      Fees   The Fee Letter and evidence that the fees, costs and expenses then                    due from the Borrowers  under Clause  11 (Fees) and Clause  16 (Costs and                   Expenses)  have been  paid or will be paid by the relevant Drawdown Date.            5.6      "Know   your  customer"    documents      Such  documentation   and other                    evidence as is reasonably requested by the Agent in order for the Lenders to                    comply  with all necessary "know  your customer"  or similar identification                    procedures  in relation to the transactions contemplated  in  the Finance                    Documents.            5. 7     Account  Holder's  confirmation    The written confirmation of the Account                    Holder that the Accounts have been opened  with the Account Holder and to     LONLIVE\30137956.24                                                                  Page 154  

 

                its actual knowledge are free from Encumbrances   other than as created by                  or pursuant to the Security Documents and   rights of set off in favour of the                  Account Holder as account holder.    LONUVE\30137956.24                                                                   Page 155  

 

Part II  Conditions Subsequent to initial Drawing   1        Acknowledgements      of notices   Acknowledgements    of all notices of assignment           and/or charge  given pursuant  to any  Security Documents   received by the  Agent           pursuant to Part I of this Schedule 2.   2        Registration  of  Parent   Pledge   Agreement       Evidence  that the  prescribed           particulars of the Parent Pledge Agreement  have been  delivered to the Hong Kong           Companies   Registry within one  (1) Month  from  the  date  of the Parent  Pledge           Agreement.     LONUVE\30137956.24                                                                   Page 156  

 

Part III  Conditions Precedent to Instalment Drawings   1       The  receipt issued by the Builder confirming that the previous instalment(s) of the          relevant Contract Price have been paid in full by the relevant Borrower in accordance          with the terms of the relevant Building Contract.   2       The  invoice issued by the Builder evidencing the obligation of such Borrower to pay          the relevant instalment to the Builder under the relevant Building Contract on a date          no later than the proposed Drawdown  Date of the Drawing in question.   3       A copy  of the certificate from the Pre-Approved Classification Society, countersigned          by  the Builder, certifying that the scheduled  construction milestones  under  the          relevant Building Contract have been completed.   4       Evidence  of full payment to the Builder of any part of the Contract Price which is due          and  payable on  or before the proposed  Drawdown   of the Drawing in question and          which  is not being financed by the Lenders.   5       Evidence  that the  equity contribution is, or will be, on or prior to the relevant          Drawdown   Date  in place, and that the ratio of the aggregate amount drawn  under          the relevant Vessel Loan to such equity contribution does not and shall not following          the making of the relevant Drawing exceed 80:20.   6       Such  documents and  evidence required by the Agent in determining the Total Project          Cost of the relevant Vessel including, without limitation, proof issued by the relevant          Builder for any additional costs and equipment added on that Vessel).    LONLIVE\30137956.24                                                                  Page 157  

 

                                                                              -- ---- ---------   Part IV  Conditions Precedent to Drawing for Pre-delivery Expenses   1        In respect of supervision costs, there shall be provided:            1.1     a copy of the relevant Supervision Agreement;            1.2     copies of the invoices relating to such costs; and            1.3     a copy  of the written receipt of the Supervisor confirming receipt of the                   amounts payable.   2        In respect of depot spares, there shall be provided:            2.1     copies  of the  applicable tender documents   including, if available, any                   amendment     evidencing  the  reduction  of  the   budgeted   amount   to                   $5,500,000 per Vessel;            2.2     to the  extent not set  out in the  applicable tender documents   provided                   pursuant to paragraph 2.1 above, a list of the required depot spares;            2.3     no later than the earlier of (i) one Month after the last available purchase                   date and (ii) the Delivery Date of the final Vessel to be delivered, copies of                   the invoices relating to such depot spares; and            2.4     no  later than one year from  the Delivery Date  of the final Vessel to be                   delivered, remittances or receipts evidencing the payment  for such  depot                   spares.   3       In respect of any other costs approved by the Agent as a Pre-Delivery Expense, there          shall be provided:            3.1     underlying contracts;           3.2      invoices; and           3.3      remittances or receipts,           provided  that in respect of costs to be paid after the relevant Delivery Date, pro          forma invoices are to be provided to and accepted by the Agent.    LONI.IVE\30137956.24                                                                 Page 158  

 

PartV  Conditions Precedent to pre-position the Delivery Instalment   1      Officer's certificate  A certificate signed by a duly authorised officer of each Security          Party confirming that none  of the documents  and  evidence delivered to the  Agent          pursuant to Clauses 4.1 (Initial conditions precedent) and 4.4 (Conditions subsequent)          has been amended,  modified or revoked in any way since its delivery to the Agent.   2      Vessel documents           2.1      Title  transfer  documents       Agreed  forms  or drafts of the  following                   documents:                     2.1.1   the builder's certificate and/or bill of sale transferring title in the                            Vessel to such Borrower free of all encumbrances, maritime liens or                            other debts;                     2.1.2   the   protocol  of  delivery  and   acceptance    evidencing  the                            unconditional physical delivery of the Vessel by the Builder to such                            Borrower pursuant to the relevant Building Contract;                     2.1.3   the commercial invoice to be issued by the Builder in respect of the                            final contract price of the Vessel; and                     2.1.4   the declaration of warranty  to be issued by  the Builder to such                            Borrower pursuant to the relevant Building Contract;           2.2       Invoice  The invoice issued by the Builder evidencing the obligation of such                    Borrower to pay the Delivery Instalment to the Builder under the  relevant                    Building Contract on a date no later than the payment date specified in the                    relevant Payment Notice.    3       Equity contribution           3.1       Evidence of full payment to the  Builder of any part of the Contract Price                    which is due and  payable on or before the  payment  date specified in the                    relevant Payment Notice and which is not being financed by the Lenders.           3.2       Evidence that the  equity contribution is, or will be, on or prior to the                    relevant Drawdown   Date  in place, and  that the  ratio of the aggregate                    amount  drawn  under the relevant Vessel Loan  to such equity contribution                    does not and shall not following the making of the relevant Drawing exceed                    80:20.    4       Security and related documents            4.1      Security  Documents      The  relevant Mortgage  and the relevant General                    Assignment, together  with all other documents  required by any  of them,                    including, without  limitation, the notices  in relation to  the  Vessel's                    Insurances under the  relevant General Assignment  and all other notices of                    assignment  and/or  charge and  evidence  that those notices will be duly                    acknowledged  by the recipients.     LONUVE\30137956.24                                                                   Page 159  

 

        4.2      Mandates     Such  duly signed forms of mandate,  and/or other evidence of                   the opening of the relevant Accounts, as the Security Agent may require.           4.3      Other Relevant   Documents      Copies of each of the Relevant Documents                   not otherwise  comprised  in the documents  listed in Parts I to III of this                   Schedule  2  including but not limited to the  Master Agreement   and  the                   Master Agreement Proceeds   Charge.           4.4      Evidence  (in such form and  subject to such terms  and  conditions as the                   Agent  may   specify to  the Builder's Bank   in writing (electronically or                   otherwise) on or before the proposed  Pre-position Date) that such amount                   will:                    4.4.1    be held by the Builder's Bank to the order of the Agent; and                    4.4.2   only be  released to the Builder upon presentation to the Builder's                           Bank of a copy  (transmitted by fax, email or otherwise) of the duly                           executed,   dated  and  timed  Builder's PDA,  signed  by  a  duly                           authorised    officer,  signatory,   attorney-in-fact  or    other                           representative of the Builder, the relevant Borrower and the Agent,                           whose   details shall be communicated   to  the Builder's Bank  in                           writing (electronically or otherwise) on or before the proposed Pre­                          position Date.   5     Other documents and evidence           5.1      Process agent    Evidence that any process agent referred to in Clause 40.2                   (Service of process)  and any  process  agent appointed  under  any  other                   Finance Document   has accepted its appointment  if it has not already done                   so.           5.2      Other  Authorisations       A copy  of  any  other Authorisation or  other                   document,  opinion or assurance which the Agent reasonably considers to be                   necessary (if it has notified the Borrowers accordingly) in connection with                   the entry into and  performance  of the transactions contemplated  by any                   Relevant Document   or for the validity and enforceability of any Relevant                   Document.    LONLlVE\30137956.24                                                                  Page 160  

 

Part VI  Delivery Conditions Precedent   1       Vessel  documents      Photocopies, certified as true, accurate and complete by an          authorised representative of the relevant Borrower, of:           1.1      the builder's certificate and/or bill of sale transferring title in the Vessel to                   such Borrower free of all encumbrances, maritime liens or other debts;           1.2      the  protocol of delivery  and  acceptance  evidencing  the  unconditional                   physical delivery of the Vessel by the Builder to such Borrower pursuant to                   the relevant Building Contract;            1.3     the commercial  invoice issued by the Builder in respect of the final contract                   price of the Vessel;            1.4     the declaration of warranty issued by the Builder to such Borrower pursuant                   to the relevant Building Contract;            1.5     the  protocol of  delivery and  acceptance  evidencing  the  unconditional                   delivery of the Vessel by such Borrower  to the Charterer pursuant  to the                   Charter;            1.6     the Management   Agreements   (if the Approved Manager  is not part of the                   Teekay Group);            1.7     the Vessel's current SMC;            1.8     the ISM Company's current DOC;            1.9     the Vessel's current ISSC;            1.10    the Vessel's current IAPPC,            in each case together with all addenda, amendments or supplements.   2        Evidence  of Borrower's title   Evidence that any prior registration of the Vessel in           the ownership of the Builder and any Encumbrance registered against that ownership           have been  cancelled and evidence that on the relevant Delivery Date (i) the Vessel           will be at least provisionally registered under the flag of the Commonwealth of the           Bahamas  in the ownership  of the relevant Borrower and (ii) the relevant Mortgage           will be capable of being registered against the Vessel with first priority.   3        Evidence of insurance    Evidence that the Vessel is insured in the manner required           by the relevant Security Documents and  that letters of undertaking will be issued in           the manner  required by the Security Documents,  together  with (if required by the           Agent) the written approval of the Insurances by an insurance adviser appointed by           the Agent.   4        Confirmation  of class   An interim Certificate of Confirmation of Class for hull and           machinery  confirming that the Vessel is classed with the highest class applicable to           vessels of her  type with  the Pre-Approved   Classification Society or such other           classification society as may be reasonably acceptable to the Agent.    LONUVE\30137956.24                                                                   Page 161  

 

5       Valuation     A  valuation of the  Vessel addressed  to  the Agent  from  a broker          acceptable to the Agent certifying the Market Value for the Vessel, acceptable to the          Agent.   6       Legal opinions           The following legal opinions, each addressed to the Agent, the Security Agent, the          Swap  Provider and the Lenders and capable of being relied upon by any persons who          become   Lenders pursuant  to the primary  syndication of the Loan or  confirmation          satisfactory to the Agent that such opinions will be given, in which case, such legal          opinions shall be issued  and delivered to the Agent as conditions subsequent under          Schedule 2, Part VII:           6.1      a legal opinion of Stephenson Harwood,   legal advisers to the Agent as to                   English law substantially in the form distributed to the Lenders  prior to                   signing this Agreement;           6.2      a legal opinion of the following legal advisers to the Agent:                    6.2.1   Poles, Tublin, Stratakis & Gonzalez, LLP as to the Republic of the                           Marshall Islands law; and                    6.2.2   Higgs & Johnson  as to the Commonwealth of the Bahamas law.   7       Assignment Acknowledgements           Confirmation from  the parties who shall sign the acknowledgements to be  provided          under Schedule  2, Part VII that these acknowledgements are in agreed form and  will          be provided promptly upon  receipt of the relevant notifications.   8       Other  Authorisations      A copy  of any  other Authorisation or other  document,          opinion or assurance which the Agent reasonably  considers to be necessary (if it has          notified the  Borrowers   accordingly)  in connection   with the   entry  into and          performance  of the transactions contemplated by any  Relevant Document  or for the          validity and enforceability of any Relevant Document.    lONLIVE\30137956.24                                                                  Page 162  

 

Part VII  Delivery Conditions Subsequent   1     Evidence   of Borrower's   title  Transcript of Register (or equivalent) issued by the        Registrar of Ships (or equivalent official) of the flag stated in Preliminary (A) confirming        that (a) the Vessel is permanently registered under that flag in the ownership of the        relevant Borrower,  (b) the relevant Mortgage  has  been registered with first priority        against the Vessel and  (c) there are no further registered Encumbrances  against the        Vessel.   2     Letters  of undertaking      Letters of undertaking  in respect of the Insurances  as        required by  the relevant Security  Documents   together with copies  of the relevant        policies or cover notes or  entry certificates duly endorsed with the  interest of the        Finance Parties.   3     Acknowledgements      of  notices    Acknowledgements    of all notices of assignment        and/or  charge  given pursuant  to  any Security  Documents   received by  the  Agent        pursuant to Part VI of this Schedule 2.   4        Legal opinions   The  legal opinions of the following legal advisers to the Agent:            4.1     Stephenson Harwood   as to English law;            4.2     Poles, Tublin, Stratakis & Gonzalez, LLP as to the Republic of the Marshall                   Islands law; and            4.3     Higgs & Johnson  as to the Commonwealth of the Bahamas law.     LONLIVE\30137956.24                                                                  Page 163  

 

Schedule 3  Drawdown Request   From:    DSME  Hull No. 2430  L.L.C., DSME Hull No. 2431 L.L.C., DSME  Hull No. 2433 L.L.C.,           DSME  Hull No. 2434 L.L.C. DSME Hull No. 2423 L.L.C. and DSME  Hull No. 2425 L.L.C.   To:   China Development Bank   Dated:   Dear Sirs   DSME   Hull  No. 2430   L,L,C., DSME  Hull No.  2431  L.L.C., DSME   Hull No.  2433  L.L.C.,  DSME   Hull No. 2434 L.L.C.  DSME   Hull No. 2423 L.L.C.  and DSME Hull No. 2425 L.L.C.­ US$1,632,000,000        Loan    Agreement      dated     [                        ]    (the  .. Agreement..  )    1       We  refer to the Agreement.   This  is a Drawdown   Request. Terms  defined in the           Agreement   have  the same   meaning   in this Drawdown   Request  unless  given a           different meaning in this Drawdown Request.    2       We  wish to make   a Drawing  in respect of the Vessel Loan  relating to the Vessel           below on the following terms:                                                               I           Proposed Drawdown   Date: [                (or, if that is not a Business Day, the           next Business Day)            Currency of Drawing:              l            Amount: [            Interest Period:            Vessel:  [   3        We  confirm that each condition specified in Clause 4.2 (Further conditions precedent)           is satisfied on the date of this Drawdown Request.   4        The proceeds  of the Drawing should be [credited to [  ]/[[paid]/[pre-positioned] in           accordance  with the  provisions of the Building Contract in respect of the  above           Vessel [in][ towards] payment of the [      ] instalment of the Contract Price of the           above Vessel].    5       This Drawdown  Request is irrevocable.   Yours faithfully     authorised signatory for  DSME   Hull  No. 2430   L.L.C., DSME  Hull No.  2431  L.L.C., DSME   Hull No.  2433  L.L.C.,   DSME  Hull No. 2434 L.L.C.  DSME Hull No. 2423 L.L.C.   and DSME    Hull No. 2425 L.L.C.     LONUVE\30137956.24                                                                   Page 164  

 

Schedule 4   Repayment Schedule    Vessel A           Repayment              Amount of Principal           Instalment                     Instalment       following Delivery                                              (USD)                1                           1,000,000                2                           5,616,589                3                           5,779,737                4                           5,947,779                5                           6,120,862                6                           6,299,139                7                           6,482,763                8                           6,671,896                9                           6,866,703                10                          7,067,354                11  -                       7,274,025                12                          7,486,896                13                          7,706,153                14                          7,931,988                15                          8,164,598                16                          8,404,186                17                          8,650,961                18                          8,905,140                19                          9,166,945                20                          9,436,603                21                          9,714,352                22                         10,000,432                23                         10,295,095                24                         10,598,598                25                         10,911,207                26                         82,500,000    LONUVE\30137956.24                                                          Page 165  

 

Vessel B       Repayment              Principal      Instalment           Instalment  following Delivery           (USD)            1                1,000,000            2                5,596,013            3                5,758,568            4                5,925,999            5                6,098,453            6                6,276,081            7                6,459,038            8                6,647,483            9                6,841,582           10                7,041,503           11                7,247,422           12                7,459,519           13                7,677,979           14                7,902,993           15                8,134,757           16                8,373,473           17                 8,619,352           18                 8,872,607           19                9,133,459           20                9,402,137           21                9,678,875           22                9,963,916           23               10,257,507           24               10,559,907           25               10,871,378           26               82,200,000    LONUVE\30137956.24                                                         Page 166  

 

Vessel C       Repayment        Principal Instalment      Instalment                    (USD)   following Delivery            1                     1,000,000            2                     5,616,589            3                     5,779,737            4                     5,947,779            5                     6,120,862            6                     6,299,139            7                     6,482,763            8                     6,671,896            9                     6,866,703           10                     7,067,354           11                     7,274,025           12                     7,486,896           13                     7,706,153           14                     7,931,988           15                     8,164,598           16                     8,404,186           17                     8,650,961           18                     8,905,140           19                     9,166,945           20                     9,436,603           21                     9,714,352           22                    10,000,432           23                    10,295,095           24                    10,598,598           25                    10,911,207           26                    82,500,000    LONLlVE\30137956.24                                                         Page 167  

 

Vessel D       Repayment       Principal Instalment      Instalment                    (USD)  following Delivery           1                      1,000,000           2                      5,596,013           3                      5,758,568           4                      5,925,999           5                      6,098,453           6                      6,276,081           7                      6,459,038           8                      6,647,483           9                      6,841,582           10                     7,041,503           11                     7,247,422           12                     7,459,519           13                     7,677,979           14                     7,902,993           15                     8,134,757           16                     8,373,473           17                     8,619,352           18                     8,872,607           19                     9,133,459           20                     9,402,137           21                     9,678,875           22                     9,963,916           23                    10,257,507           24                    10,559,907           25                    10,871,378           26                    82,200,000    LONLIVE\30137956.24                                                         Page 168  

 

VesseiE       Repayment        Principal Instalment      Instalment                    (USD)   following Delivery            1                     1,000,000            2                     5,493,136            3                     5,652,724            4                     5,817,100            5                     5,986,407            6                     6,160,794            7                     6,340,412            8                     6,525,418            9                     6,715,975           10                     6,912,248           11                     7,114,410           12                     7,322,636           13                     7,537,110           14                     7,758,017           15                     7,985,552           16                     8,219,912           17                     8,461,304           18                     8,709,937           19                     8,966,030           20                     9,229,805           21                     9,501,493           22                     9,781,332           23                    10,069,566           24                    10,366,447           25                    10,672,235           26                    80,700,000    LONLIVE\30137956.24                                                         Page 169  

 

Vessel F       Repayment               Principal      Instalment           Instalment                                (USD)            1                 1,000,000            2                 5,410,834            3                 5,568,049            4                 5,729,981            5                 5,896,771            6                 6,068,564            7                 6,245,511            8                 6,427,766            9                 6,615,490           10                 6,808,844           11                 7,008,000           12                 7,213,130           13                 7,424,414           14                 7,642,037           15                 7,866,188           16                 8,097,064           17                 8,334,866           18                 8,579,802           19                 8,832,086           20                 9,091,939           21                 9,359,587           22                 9,635,265           23                 9,919,213           24                10,211,680           25                10,512,920           26                79,500,000     LONUVE\30137956.24                                                         Page 170  

 

ScheduleS  Form of Transfer Certificate   To:      China Development Bank as  Agent   From:    [The Existing Lender] (the "Existing  Lender")  and  [The New  Lender]  (the "New           Lender")   Dated:   DSME   Hull No.  2430 L.L.C.,  DSME   Hull No.  2431  L.L.C., DSME   Hull No. 2433   L.L.C.,  DSME Hull No. 2434 L.L.C.,    DSME  Hull No.  2423 L.L.C. and DSME Hull No.    2425 L.L.C.      US$1,632,000,000       Loan   Agreement      dated    [               ]   (the   "Loan  Agreement")   1        We  refer to the Loan Agreement.   This  agreement  (the "Agreement")    shall take           effect as a Transfer Certificate for the purposes of the Loan  Agreement.   Terms           defined in the Loan Agreement   have the  same  meaning  in this Agreement  unless           given a different meaning in this Agreement.   2        We refer to Clause 23.5 (Procedure for transfer) of the Loan Agreement:            2.1     The  Existing Lender  and the  New  Lender  agree  to the  Existing Lender                   transferring to the New Lender  by novation and in accordance  with Clause                   23.5  (Procedure  for transfer) all of  the  Existing Lender's rights  and                   obligations under the Loan  Agreement   and the  other Final]ce Documents                   which  relate to that portion of the Existing Lender's Commitment(s)   and                   participations in the Loan under  the Loan  Agreement  as  specified in the                   Schedule.            2.2     The proposed Transfer Date  is [                   ].           2.3      The Facility Office and address, fax number and attention details for notices                   of the New Lender for the purposes  of Clause 30.2 (Addresses) of the Loan                   Agreement are set out in the Schedule.   3       The  New  Lender  expressly acknowledges   the limitations on the Existing Lender's          obligations set  out in Clause  23.4.1(c)  (Limitation of responsibility of Existing          Lenders) of the Loan Agreement.   4       The  New  Lender confirms, for the benefit of the Agent and without  liability to any          Security Party, that it is:           4.1      [a Qualifying Lender other than a Treaty Lender;]           4.2      [a Treaty Lender;]           4.3      [not a Qualifying Lender].   [5]     [The New  Lender  confirms that the person beneficially entitled to interest payable to          that Lender in respect of an advance under a Finance Document is either:    LONUVE\30137956;24                                                                   Page 171  

 

        5.1     a  company   resident  in the  United  Kingdom   for United  Kingdom   tax          purposes;           5.2     a partnership each member of which  is:           5.2.1   a company so  resident in the United Kingdom; or           5.2.2   a company not so  resident in the United Kingdom which carries on a trade in          the United  Kingdom   through  a permanent   establishment  and  which brings  into          account in computing  its chargeable profits (within the meaning of section 19 of the          CTA) the whole  of any share of interest payable in respect of that advance that falls          to it by reason of Part 17 of the CTA; or           5.3     a company not so  resident in the United Kingdom which carries on a trade in          the United  Kingdom   through  a permanent   establishment  and  which  brings into          account  interest payable in respect of that advance  in computing  the chargeable          profits (within the meaning of section 19 of the CTA) of that company.]   [5]     [The  New  Lender  confirms that  it holds a passport under  the HMRC   DT  Treaty          Passport scheme   (reference number  [                    ]) and is tax resident in          [             ], so that interest payable to it by borrowers is generally subject to full          exemption   from  UK  withholding  tax, and  requests  that the  Agent  notify the          Borrowers that it wishes that scheme to apply to the Agreement.]   [5/6]   This Agreement  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          Agreement.   [6/7]   This Agreement  and  any non-contractual obligations arising out of or in connection          with it are governed by English law.   [7/8]   This Agreement  has  been entered  into on the date stated at the beginning of this          Agreement.   Note:  The  execution  of this Transfer  Certificate  may  not transfer  a  proportionate         share  of  the  Existing  Lender's   interest  in any   Encumbrance     created  or         expressed   to  be  created  or  evidenced   by  the  Security  Documents     in all         jurisdictions. It is the responsibility of the New Lender to ascertain whether         any other documents or other formalities are required to perfect a      transfer of         such  a share in any jurisdiction  and,  if so, to arrange for execution   of those         documents and completion of those formalities.    LONUVE\30137956.24                                                                   Page 172  

 

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:   This Agreement   is accepted as a Transfer Certificate for the purposes of the Loan Agreement   by the Agent and the Transfer Date is confirmed as [               ].    China Development Bank    By:     LONLIVE\30137956.24                                                                  Page 173  

 

 Schedule 6   Form of Assignment Agreement   To:      China Development   Bank  as Agent and  DSME  Hull No. 2430  L.L.C., DSME  Hull No.           2431  L.L.C., DSME Hull No. 2433 L.L.C., DSME   Hull No. 2434 L.LC. DSME   Hull No.           2423  L.L.C. and DSME  Hull No. 2425 L.L.C. as Borrowers, for and on behalf of each           Security Party    From:   [the Existing Lender] (the "Existing  Lender")  and  [the New  Lender]  (the "New           Lender")    Dated:    DSME   Hull No. 2430   L.L.C., DSME  Hull No.  2431  L.L.C,, DSME   Hull No.  2433  L.L.C.,   DSME  Hull No.  2434 L.L.C.  DSME  Hull No. 2423 L.L.C.  and DSME    Hull No.  2425 L.L.C.   - US$1,632,000,000     Loan Agreement dated [               ] (the "Loan Agreement")    1       We  refer to the Loan Agreement. This is an Assignment Agreement.  This agreement           (the "Agreement") shall  take effect as an Assignment Agreement for the purpose  of           the Loan Agreement.   Terms defined in the Loan Agreement have the same meaning           in this Agreement unless given a different meaning in this Agreement.    2       We  refer to Clause 23.6 (Procedure for assignment) of the Loan Agreement:            2.1     The  Existing Lender assigns absolutely to the New  Lender all the rights of                    the  Existing Lender  under   the  Loan  Agreement,   the  other  Finance                    Documents  and  in respect of any Encumbrance  created or expressed to be                    created or evidenced by the Security Documents   which correspond  to that                    portion of the Existing Lender's Commitment(s)   and  participations in the                    Loan under the Loan Agreement as  specified in the Schedule.            2.2      The Existing Lender  is released from  all the obligations of the Existing                    Lender  which   correspond  to  that  portion  of  the  Existing  Lender's                    Commitment(s)   and participations in the Loan under the  Loan Agreement                    specified in the Schedule.            2.3     The  New  Lender  becomes  a Party as a Lender and  is bound by obligations                    equivalent to those  from  which  the  Existing Lender  is released under                    paragraph (b).    3       The proposed Transfer Date is [    ].    4       On  the  Transfer Date  the  New  Lender  becomes   Party to the  relevant Finance           Documents as  a Lender.    5       The  Facility Office and address, fax number and attention details for notices of the           New  Lender for the purposes of Clause 30.2 (Addresses) of the Loan Agreement are           set out in the Schedule.    6       The  New  Lender  expressly acknowledges   the limitations on the Existing Lender's           obligations set out in Clause 23.4.3 (Limitation of responsibility of Existing Lenders)           of the Loan Agreement.     LONLIVE\30137956.24                                                                  Page 174  

 

7       The  New  Lender confirms, for the benefit of the Agent and without liability to any          Security Party, that it is:           7.1      [a Qualifying Lender (other than a Treaty Lender);]           7.2      [a Treaty Lender;]           7.3      [not a Qualifying Lender].   8       [The  New Lender  confirms that the person beneficially entitled to interest payable to          that Lender in respect of an advance under a Finance Document is either:           8.1      a  company   resident in  the  United Kingdom   for  United  Kingdom   tax ·                   purposes;           8.2      a partnership each member of which  is:                    8.2.1    a company so resident in the United Kingdom; or                    8.2.2    a company  not so resident in the United Kingdom which carries on                            a trade in the United Kingdom through a permanent establishment                            and which  brings into account in computing its chargeable profits                            (within the meaning  of section  19 of the CTA) the whole  of any                           share  of interest payable in respect of that advance that falls to it                            by reason of Part 17 of the CTA; or            8.3     a company not so  resident in the United Kingdom which carries on a trade in                   the United Kingdom   through a permanent   establishment and which  brings                   into account interest payable in respect of that advance in computing  the                   chargeable  profits (within the meaning of section  19 of the CTA) of that                   company.]   9        [The New   Lender confirms  that it holds a passport  under the  HMRC   DT  Treaty           Passport scheme  (reference number [  ]) and is tax resident in [ ], so that interest           payable to it by borrowers is generally subject to full exemption from UK withholding           tax and hereby notifies the Borrowers that it wishes that scheme to apply to the Loan           Agreement.]   [9/10]  This Agreement   acts as notice to the Agent (on behalf of each Finance Party) and,           upon  delivery in accordance  with Clause  23.7  (Copy  of Transfer  Certificate or           Assignment Agreement to   Borrowers), to the Borrowers (on behalf of each Security           Party) of the assignment referred to in this Agreement.   [10/11]  This Agreement  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           Agreement.   [11/12]  This Agreement  and any  non-contractual obligations arising out of or in connection           with it are in all respects governed by and shall be interpreted in accordance with           English law.   [12/13]  This Agreement  has been  entered into on the date  stated at the beginning of this           Agreement.    LONUVE\30137956.24                                                                   Page 175  

 

Note:   The   execution    of  this  Assignment     Agreement     may    not   transfer   a          proportionate share    of the  Existing  Lender's  interest in any  Encumbrance          created or expressed to be created or evidenced by the Security Documents          in all jurisdictions.  It is the responsibility of the New Lender to ascertain          whether any other documents or other formalities are required to perfect a          transfer  of  such  a  share  in  any  jurisdiction  and,  if so, to  arrange   for          execution of those documents and completion of those formalities.    LONLIVE\30137956.24                                                                   Page 176  

 

The Schedule   Commitment/rights      and  obligations  to be  transferred  by assignment,    release and  accession    [insert relevant details]    [Facility office address, fax number and attention details for notices and account details for  payments]    [Existing Lender]                                  [New Lender]   By:                                                 By:   This  Agreement  is accepted  as an  Assignment  Agreement   for the purposes  of the  Loan  Agreement by the Agent and   the Transfer Date is confirmed as [            ].   Signature  of this Agreement by the Agent constitutes confirmation by the Agent of receipt of  notice of the assignment  referred to in this Agreement, which notice the Agent receives on  behalf of each Finance Party.   China  Development Bank   By:     LONLlVE\30137956.24                                                                  Page 177  

 

 Schedule 7   List of Assigned Documents   The following documents in respect of each Vessel or each Borrower.    1       Supplemental  construction agreement dated B July 2014 each  made between   (a) the           relevant Borrower (as owner) and (b) the Charterer (as charterer).    2       Each Assignable Charter in respect of such Vessel.    3       Deed  of guarantee  dated B July 2014  and granted  by (a) YLNG  (as guarantor)  in           favour of (b) the relevant Borrower (as owner) (the "YLNG Guarantees").   4        Charter undertaking dated B July 2014 and made between   (a) the Owner (as owner),           and (b) the Time Charterer (as charterer) (in the case of Vessel E and Vessel F only,           as amended  and  restated on 27 January 2016 and 16 March  2016 respectively).   5        Yamal Sponsor Guarantees in  relation to such Vessel.   6        Purchase  option side letter dated B July 2014 and made  between   (a) the relevant           Borrower   (as owner),  and   (b) the  Yamal   Sponsor  Guarantors   (as  charterer           guarantors) (the "Purchase Option Side Letter").   7        Cash  waterfall side letter dated B July 2014 and  made  between  (a) the  relevant           Borrower (as owner), and (b) the Charterer (as charterer).   B        Charter GTT  side  letter dated B July 2014  and  made   between  (a) the  relevant           Borrower (as owner), and (b) the Charterer (as charterer).   9        Currency  conversion letter dated 22 September  2016  and  made  between  (a) each           Borrower (each  as an owner), and  (b) the Charterer (as charterer) (the "Currency           Conversion Letter").   10       Management Agreement in    respect of such Vessel.    LONUVE\30137956.24                                                                   Page 178  

 

Schedule 8   Form of Compliance Certificate   To:      China Development Bank as  Agent   From:       [Borrowers][CLNG][TGP]   Dated:  Dear Sirs:     [Insert names of Borrowers/CLNG/TGP]   - US$1,6321000,000 Facility Agreement dated             [Insert the date of the Facility Agreement] (the "Facility Agreement")  1.     We  refer to the Facility Agreement. This is a Compliance Certificate. Terms used  in         the Facility Agreement shall have the same meaning  in this Compliance Certificate.   2.     We  confirm that: [Insert details of other covenants to be certified including]   3.      [We confirm that no Default is continuing.]   4.     We   confirm that  the most  recent  set of financial statements relating to us  and          delivered to you in accordance clause [19.1 of the Facility Agreement] fairly present          our financial condition as at the date as at which those  financial statements were          drawn up.    Signed:                Authorised signatory of              Authorised signatory of                 [Borrower/CLNG/TGP]                  [Borrower/CLNG/TGP]    LONLIVE\30137956.24                                                                   Page 179  

 

Signatures   The Borrowers   DSME Hull No. 2430 L.L.C.                  )                                             )  By:                                        )                                             )  Address:  c/o Teekay Shipping (Canada) Ltd           )  Suite 2000, Bentall 5, 550 Burrard Street] )  Vancouver,  B.C.                           )           David OsbOrne  Canada, V6C 2K2                            )           Attomey-in-Fact  Fax no. : +1 604 681 3011                  )           London EC2A 2HB  Department/Officer:                        )  Renee Eng, Treasury Manager:               )  and   China LNG  Shipping (Holdings) Limited     )  Room   1904, 19/F, West Tower              )  Shun Tak Centre                            )  168- 200 Connaught Road Central            )  Hong Kong                                  )  Fax no: +852 2587 8371                     )  Department/Officer: General Manager        )    DSME Hull No. 2431 L.L.C.   By:   Address:  cjo Teekay Shipping {Canada) Ltd           )  Suite 2000, Bentall 5, 550 Burrard Street] )  Vancouver, B.C.                            )  Canada,  V6C 2K2                           )                oav\d Osborne  Fax no.: + 1 604 681 3011                  )                Attomey-\n-Fact  Department/Officer:                        )                 London EC2A 2HB  Renee  Eng, Treasury Manager:              )  and   China LNG  Shipping (Holdings) Limited     )  Room  1904, 19/F, West Tower               )  Shun Tak Centre                            )  168-200 Connaught Road   Central           )  Hong  Kong                                 )  Fax no: +852 2587 8371                     )  Department/Officer: General Manager        )    LONLIVE\30137956.24                                                                  Page 180  

 

                                                     ------------------------   DSME   Hull No. 2433 L.L.C.                )                                             )  By:                                        )                                             )  Address:  cjo Teekay Shipping  (Canada) Ltd          )  Suite 2000, Bentall 5, 550 Burrard Street] )  Vancouver,  B.C.                           )  Canada,  V6C 2K2                           )  Fax no.: +1 604 681  3011                  )  Department/Officer:                        )  Renee  Eng, Treasury Manager:              )  and   China LNG  Shipping (Holdings) Limited     )  Room  1904, 19/F, West Tower               )  Shun Tak Centre                            )  168-200 Connaught Road    Central          )  Hong  Kong                                 )  Fax no: +852 2587 8371                     )  Department/Officer: General Manager        )   DSME   Hull No. 2434 L.L.C.                )                                             )  By:                                        )                                             )  Address:  c/o Teekay Shipping (Canada) Ltd           )  Suite 2000, Bentall 5, 550 Burrard Street] )  Vancouver,  B.C.                           )  Canada,  V6C 2K2                           )  Fax no.: +1 604 681  3011                  )                 David Osborne  Department/Officer:                        )                 Attorney-in-Fact  Renee  Eng, Treasury Manager:              )                  London EC2A 2HB  and   China LNG  Shipping (Holdings) Limited     )  Room  1904, 19/F, West Tower               )  Shun Tak Centre                            )  168-200 Connaught Road   Central           )  Hong  Kong                                 )  Fax no: +852 2587 8371                     )  Department/Officer: General Manager        )    LONUVE\30137956.24                                                                   Page 181  

 

DSME Hull No. 2423     L.L.C.              )                                             )  By:                                        )                                             )  Address:  c/o Teekay Shipping (Canada)  Ltd          ) '         DV{A~  Suite 2000, Bentall 5, 550 Burrard Street] )  Vancouver,  B.C.                           )              David Osbornej  Canada, V6C  2K2                           )              Attorney-in-Fact  Fax no.: + 1 604 681 3011                  )              London   EC2A 2HB  Department/Officer:                        )  Renee  Eng, Treasury Manager:              )  and   China LNG  Shipping (Holdings) Limited     )  Room  1904, 19/F, West Tower               )  Shun Tak Centre                            )  168-200 Connaught Road   Central           )  Hong  Kong                                 )  Fax no: +852 2587 8371                     )  Department/Officer: General Manager        )   DSME   Hull No. 2425   L.L.C.              )                                             )  By:                                        )                                             )  Address:  c/o Teekay Shipping (Canada)  Ltd          )  Suite 2000, Bentall 5, 550 Burrard Street] )  Vancouver, B.C.                            )  Canada, V6C  2K2                           )  Fax no.: +1 604 681 3011                   )           ·.~RJ((J;L  Department/Officer:                       )                  David Osborn&  Renee Eng, Treasury Manager:              )                  Attorney-in-Fact      .  and                                                          London EC2A 21-1.&·  China LNG Shipping  (Holdings) Limited     )  Room  1904, 19/F, West Tower               )  Shun Tak Centre                            )  168-200 Con naught Road  Central           )  Hong Kong                                 )  Fax no: +852 2587 8371                     )  Department/Officer: General Manager        )    LONUVE\30137956.24                                                                   Page 182  

 

The Arranger   China  Development Bank                  )                                           )  By:   k      fMwL(                       j                                           )  Address:                                 )  No. 1093 Shennan  Zhong Road             )  Futlan District, Shenzhen                )  ·China                                   )  Fax no.: +!!6"755,25987731               )  Departrhimt/Officer: Client Division r,  )  COB  SZ Branch                           )  Wu  Hliide; Yi Lifu) Huang Xlngcheng     )  Liu Yongyuan                             )    The Agent   China Development Bank                   )                                           )  By:    H pMvWrA.                         }                                           }  Address:                                 }  No. ~093 Shennan  Zhong Road             }  Futlan District, ·sh·enzhem              )  C~ina                                    )  Eax no.: +86-755,25987731.               }  Dep_artme_nt/Offi~er: ~llent pivision I, )  CDB SZ  Brilnth                          )  ~u Huide;Yi IJfu; Huang Xlngcheng        )  Llu Yongyuan                             )                                                                                      P_ag~ 183  

 

The Security Agent   China  Development Bank                  )                                           )                                           )                                           )  Address:                                 )  No. 1093 Shennan Zhong   Road            )  Futian District, Shenzhen                )  China                                    )  Fax no.: +86-755-25987731                )  Department/Officer: Client Division I,   )  COB SZ Branch                            )  Wu Hulde; Yi Lifu; Huang Xingcheng       )  Uu Yongyuan                              )    The Original Lenders   China Development Bank                   )                                           )                                           )    The Swap Provider   China Development Bank                   )                                           )  By:   f--l,J '.                          )                                           )  Address:                                 )  No. 1093 Shennan Zhong Road              )  Futian District, Shenzhen                )  China                                    )  Fax no.: +86-755-25987731                )  Department/Officer: Client Division I,   )  COB  SZ Branch                           )  Wu  Huide; Yi llfu; Huang Xlngcheng      )  Llu Yongyuan                             )    LONUVE\30 137956.24                                                               Page 184

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