Document:

Exhibit 10.27

 

THIS DEMAND NOTE HAS NOT BEEN REGISTERED PURSUANT TO THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OF 1933 (AS AMENDED, THE “SECURITIES ACT”) OR QUALIFIED PURSUANT TO ANY APPLICABLE STATE SECURITIES LAW.  THIS DEMAND NOTE MAY BE RESOLD ONLY IF REGISTERED PURSUANT TO THE PROVISIONS OF THE SECURITIES ACT AND QUALIFIED PURSUANT TO APPLICABLE STATE SECURITIES LAWS OR IF AN EXEMPTION FROM SUCH REGISTRATION AND QUALIFICATION IS AVAILABLE, EXCEPT UNDER CIRCUMSTANCES WHERE NONE OF SUCH REGISTRATION, QUALIFICATION NOR EXEMPTION IS REQUIRED BY LAW.

 

DEMAND NOTE

 

$[      ],000,000

 

[          ], 2014

 

EXMAR NETHERLANDS BV, a Netherlands limited liability company (besloten vennootschap) (together with its successors and permitted assigns, the “Payor”), for value received, hereby promises to pay to EXMAR ENERGY PARTNERS LP, a Marshall Islands limited partnership with a place of business in Hong Kong (“Payee”), or its registered assigns, the principal sum of [          ] Million Dollars ($[      ],000,000.00) payable upon the earlier to occur of: (i) ten (10) days after receipt by Payor of written demand from Payee, which demand may be made at any time in the sole and absolute discretion of Payee without presentment, further demand, protest or further notice of any kind, all of which are hereby expressly waived by Payor; and (ii) acceleration of this Demand Note pursuant to Section 6 of this Demand Note (such earlier date, the “Maturity Date”).  Payor, for value received, hereby further promises to pay to Payee interest on the outstanding principal amount of this Demand Note on each Interest Payment Date, at a rate per annum equal to the Interest Rate; provided, however, that Payor agrees to pay interest at the Default Interest Rate on all amounts under this Demand Note during the continuance of an Event of Default, and such interest shall be payable promptly after demand of Payee.  Interest on this Demand Note shall be calculated on the basis of the actual number of days elapsed and a year of 360 days.  Payment of principal, interest and any other amounts in respect of this Demand Note shall be made in Dollars, in immediately-available funds, by wire-transfer to the payment office most recently notified to Payee in writing by Payor.

 

1.             DEFINED TERMS

 

Capitalized terms used in this Demand Note shall have the meanings set forth herein, and the following capitalized terms shall have the following meanings:

 

“Bankruptcy Code” shall mean Title 11 of the United States Code entitled “Bankruptcy,” as now and hereafter in effect, or any successor statute.

 

 

“Business Day” shall mean a day other than a Saturday, Sunday or any other day on which commercial banks in London, New York, Hong Kong or Amsterdam are authorized or required by law to close.

 

“Default” means the occurrence of any event that, with the giving of notice, the lapse of time, or both, would become an Event of Default.

 

“Default Interest Rate” shall mean the Interest Rate plus an additional [2.00]% per annum.

 

“Demand Note” shall mean this Demand Note, dated [          ], 2014.

 

“Dollars” and “$” shall mean the lawful currency of the United States of America.

 

“Event of Default” has the meaning given in Section 5 of this Demand Note.

 

“Fiscal Quarter” means each three-month period ending March 31, June 30, September 30 and December 31.

 

“Governmental Authority” shall mean any nation or government, any state or other political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government.

 

“GAAP” shall mean generally accepted accounting principles in effect in the Netherlands.

 

“Insolvency Proceeding” shall mean (a) any case, action or proceeding before any court or other Governmental Authority or authority relating to bankruptcy, reorganization, insolvency, liquidation, receivership, dissolution, winding-up or relief of debtors, or (b) any general assignment for the benefit of creditors, composition, marshalling of assets for creditors, or other, similar arrangement in respect of its creditors generally or any substantial portion of its creditors, in each case undertaken under United States federal, state or foreign law, including the Bankruptcy Code.

 

“Interest Payment Date” shall mean (i) the last day of each Fiscal Quarter (provided that if such day is not a Business Day, then the Interest Payment Date shall be on the immediately preceding Business Day) and (ii) the Maturity Date.

 

“Interest Period” shall mean: (a) initially, the period commencing on the date hereof and ending on the first Interest Payment Date; and (b) thereafter, each Fiscal Quarter.

 

“Interest Rate” shall mean, with respect to any Interest Period, LIBOR for such Interest Period plus 4.00% per annum.

 

“LIBOR” shall mean the London interbank offered rate for an interest period of three (3) months administered by ICE Benchmark Administration Limited (or any other person which takes over the administration of that rate) displayed on pages LIBOR01 or LIBOR02 of the Reuters screen (or any replacement 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 Reuters two (2) Business Days prior to the first day of each Interest Period. If such page or service ceases to be available, the Lender may specify another page or service displaying the relevant rate.

 

“Material Adverse Effect” shall mean a material adverse effect on (a) the business, assets, liabilities, operations or condition (financial or otherwise) of Payor and its subsidiaries

 

 

taken as a whole, (b) the ability of Payor to perform its obligations under this Demand Note or (c) the ability of Payee to enforce this Demand Note.

 

“Person” shall mean an individual, partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, joint venture, Governmental Authority or other entity of whatever nature.

 

2.             PREPAYMENT

 

The outstanding principal amount of this Demand Note may be prepaid in whole or in part at any time by Payor, without premium or penalty, upon ten (10) Business Days’ prior written notice to Payee, which notice shall be irrevocable once delivered.  Any prepayment of this Demand Note shall be accompanied by all accrued and unpaid interest on the amount so prepaid.  In the event this Demand Note is prepaid in part, a new Note or Notes of like tenor for the outstanding principal amount hereof will be issued in the name of the Payee upon request of the Payee.  Amounts in respect of this Demand Note which are prepaid may not be reborrowed.

 

3.             REPRESENTATIONS AND WARRANTIES

 

Payor represents and warrants to Payee that:

 

(a)                                 Payor (i) has been duly formed and is validly existing and in good standing under the laws of the Netherlands and (ii) is qualified to do business and is in good standing in each jurisdiction in which the ownership of its properties or the conduct of its business requires such qualification except where the failure so to qualify would not reasonably be expected to have a Material Adverse Effect.

 

(b)                                 The execution, delivery and performance by Payor of this Demand Note have been duly authorized by all necessary corporate action of Payor and do not and will not: (i) contravene the terms of the organizational documents of Payor; (ii) result in a breach of, or constitute a default under, any lease, instrument, contract or other agreement to which Payor is a party or by which it or its properties may be bound or affected that would reasonably be expected to have a Material Adverse Effect; or (iii) violate any provision of any law, rule, regulation, order, judgment, decree or the like binding on or affecting Payor.

 

(c)                                  This Demand Note constitutes the legal, valid and binding obligation of Payor, enforceable against Payor in accordance with its terms, subject to the effect of applicable bankruptcy, insolvency or similar laws affecting creditors’ rights generally and equitable principles of general applicability.

 

(d)                                 No authorization, consent, approval, license, exemption of, or filing or registration with, any Person is required for the due execution, delivery or performance by Payor of this Demand Note.

 

 

(e)                                  To the knowledge of Payor, on the date hereof there are no actions, suits, or proceedings pending or threatened against Payor before any Governmental Authority that would reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect.

 

(f)            The audited financial statements of Payor as of December 31, 2013 present fairly, in all material respects, the financial position of Payor as of December 31, 2013 in conformity with GAAP applied on a consistent basis.

 

(g)                                  Payor has filed all material tax returns and reports required to be filed (or obtained extensions with respect thereto) and has paid all taxes required to have been paid by it, except (i) taxes the validity of which are being contested in good faith by appropriate proceedings, and with respect to which Payor, to the extent required by GAAP, has set aside on its books adequate reserves or (ii) to the extent any failures to do so (individually or in the aggregate) would not reasonably be expected to have a Material Adverse Effect.

 

(h)           No Default or Event of Default has occurred and is continuing.

 

(i)                                     The making of the loan evidenced by this Demand Note does not require any authorization, consent or approval of, registration or filing with, or any other action by, any Person (including shareholders or any class of directors, whether interested or disinterested, of Payor or any other Person), nor is any such authorization, consent, approval, registration, filing or other action necessary for the validity or enforceability of this Demand Note, except such as have been obtained or made and are in full force and effect.

 

4.             COVENANTS

 

So long as any principal, interest, fee or other amount in respect of this Demand Note shall remain unpaid, Payor agrees that:

 

(a)                                 Payor shall furnish to Payee, promptly after Payor has knowledge or becomes aware thereof, notice of (i) the occurrence of any Default or Event of Default; (ii) the filing or commencement of any action, suit or proceeding by or before any arbitrator or Governmental Authority against or affecting Payor that would reasonably be expected to have a Material Adverse Effect; and (iii) any other development that results in, or would reasonably be expected to have, a Material Adverse Effect.

 

(b)                                 Payor shall comply with all laws, rules, regulations and orders of any Governmental Authority applicable to it or its property, except where any failures to do so, individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect.

 

 

5.             EVENTS OF DEFAULT

 

Any of the following events which shall occur shall constitute an “Event of Default”:

 

(a)                                 Payor shall fail to pay when due any amount of principal under this Demand Note; or

 

(b)                                 Payor shall fail to pay when due any interest under this Demand Note or any other amount payable in respect of this Demand Note (other than principal), and such failure shall continue unremedied for thirty (30) days; or

 

(c)                                  Any representation or warranty by Payor under or in connection with this Demand Note shall prove to have been incorrect in any material respect when made or deemed made; or

 

(d)                                 Payor shall fail to perform or observe any other term, covenant or agreement contained in this Demand Note on its part to be performed or observed, and such failure shall remain unremedied for a period of thirty (30) days from the date Payee provides written notice of such occurrence; or

 

(e)                                  (i) Payor shall be dissolved, liquidated, wound up or cease its corporate existence or cease to conduct its business in the ordinary course; or (ii) Payor (1) shall make a general assignment for the benefit of creditors, or shall generally fail to pay, or admit in writing its inability to pay, its debts as they become due, subject to applicable grace periods, if any, whether at stated maturity or otherwise; (2) shall commence any voluntary Insolvency Proceeding; or (3) shall take any action to effectuate or authorize any of the foregoing; or

 

(f)                                   (i) Any involuntary Insolvency Proceeding is commenced or filed against Payor, or any writ, judgment, warrant of attachment, execution or similar process is issued or levied against a substantial part of Payor’s properties and such Insolvency Proceeding shall not be dismissed, or such writ, judgment, warrant of attachment, execution or similar process shall not be released, vacated or fully bonded within sixty (60) days after commencement, filing or levy; (ii) Payor admits the material allegations of a petition against it in any Insolvency Proceeding, or an order for relief (or similar order under non-United States law) is ordered in any Insolvency Proceeding; or (iii) Payor acquiesces in the appointment of a receiver, trustee, custodian, conservator, liquidator, mortgagee in possession (or agent therefor), or other similar Person for itself or a substantial portion of its property or business; or

 

(g)                                  Payor shall (i) default in the payment of principal of any indebtedness in an aggregate principal amount in excess of $10,000,000 (other than this Demand Note) beyond the period of grace, if any, provided in the instrument or agreement under which such indebtedness was created as and when the same shall become due and payable, and such default shall have resulted in such indebtedness being

 

 

declared due and payable prior to its stated maturity or (ii) default in the observance or performance of any other agreement or condition relating to any such indebtedness or contained in any instrument or agreement evidencing, securing or relating thereto, and such default shall have resulted in such indebtedness being declared due and payable prior to its stated maturity; or

 

(h)                                 one or more judgments for the payment of money in an aggregate amount in excess of $10,000,000 shall be rendered against Payor and the same shall remain undischarged for a period of thirty (30) consecutive days during which execution shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to attach or levy upon any assets of Payor to enforce any such judgment.

 

6.             REMEDIES

 

If any Event of Default shall occur and be continuing, Payee may, by notice to Payor, declare the entire unpaid principal amount of this Demand Note, all interest accrued and unpaid hereon and all other amounts due hereunder to be forthwith due and payable, whereupon the outstanding principal amount of this Demand Note, all such accrued interest and all such other amounts shall become and be forthwith due and payable, without presentment, demand, protest or further notice of any kind, all of which are hereby expressly waived by Payor; provided that if an Event of Default described in paragraph (e) or (f) of Section 5 of this Demand Note shall occur, the result which would otherwise occur only upon giving of notice by Payee to Payor as specified above shall occur automatically, without the giving of any such notice.

 

Notwithstanding the foregoing, and for the avoidance of doubt, all outstanding amounts under this Demand Note may be called by Payee at any time as provided in the first paragraph of this Demand Note, whether or not a Default or an Event of Default has occurred.

 

7.             MISCELLANEOUS

 

Payor agrees to pay on demand all the losses, costs, and expenses (including, without limitation, attorneys’ fees and disbursements) which Payee incurs in connection with enforcement of this Demand Note, or the protection or preservation of Payee’s rights under this Demand Note, whether by judicial proceedings or otherwise.  Such costs and expenses include, without limitation, those incurred in connection with any workout or restructuring, or any bankruptcy, insolvency, liquidation or similar proceedings.

 

No single or partial exercise of any power under this Demand Note shall preclude any other or further exercise of such power or exercise of any other power.  No delay or omission on the part of Payee in exercising any right under this Demand Note shall operate as a waiver of such right or any other right hereunder.

 

This Demand Note shall be binding on each of Payor and Payee and their respective successors and assigns.  Neither party may assign or transfer this Demand Note or any of its obligations hereunder without the other party’s prior written consent.

 

 

No provision of this Demand Note shall alter or impair the obligation of Payor, which is absolute and unconditional, to pay the principal of and any premium and interest on this Demand Note at the times, place and rate, and in the coin or currency, herein prescribed, subject to Payor’s right to redeem all or a portion of this Demand Note as provided herein or as otherwise agreed to by the parties.

 

This Note shall be governed by, and construed in accordance with, the laws of the State of New York.

 

The remainder of this page intentionally left blank.

 

 

 

IN WITNESS WHEREOF, Payor has caused this instrument to be duly executed this [    ] day of [          ], 2014.

 

 

	
 
    	
EXMAR   NETHERLANDS BV
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:   
    	
 
    
	
 
    	
Name:
    
	
 
    	
Title:
    

 

Signature Page to Exmar Netherlands BV
 Demand NoteExhibit 10.28

 

[·], 2014

 

EXMAR NV

as Lender

 

-and-

 

EXMAR ENERGY PARTNERS L.P.

as Borrower

 

 

 

LOAN AGREEMENT

 

 

relating to

a US$20,000,000 revolving credit facility

 

 

INDEX

 

	
Clause
    	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    	
 
    
	
1
    	
INTERPRETATION
    	
 
    	
1
    
	
 
    	
 
    	
 
    	
 
    
	
2
    	
FACILITY
    	
 
    	
2
    
	
 
    	
 
    	
 
    	
 
    
	
3
    	
DRAWDOWN
    	
 
    	
2
    
	
 
    	
 
    	
 
    	
 
    
	
4
    	
DEFAULT   INTEREST
    	
 
    	
3
    
	
 
    	
 
    	
 
    	
 
    
	
5
    	
REPAYMENT,   PREPAYMENT AND CANCELLATION
    	
 
    	
3
    
	
 
    	
 
    	
 
    	
 
    
	
6
    	
CONDITIONS   PRECEDENT
    	
 
    	
3
    
	
 
    	
 
    	
 
    	
 
    
	
7
    	
REPRESENTATIONS   AND WARRANTIES
    	
 
    	
4
    
	
 
    	
 
    	
 
    	
 
    
	
8
    	
UNDERTAKINGS
    	
 
    	
4
    
	
 
    	
 
    	
 
    	
 
    
	
9
    	
PAYMENTS   AND CALCULATIONS
    	
 
    	
4
    
	
 
    	
 
    	
 
    	
 
    
	
10
    	
EVENTS OF   DEFAULT
    	
 
    	
5
    
	
 
    	
 
    	
 
    	
 
    
	
11
    	
COSTS
    	
 
    	
6
    
	
 
    	
 
    	
 
    	
 
    
	
12
    	
INDEMNITIES
    	
 
    	
6
    
	
 
    	
 
    	
 
    	
 
    
	
13
    	
NO   SET-OFF OR TAX DEDUCTION
    	
 
    	
7
    
	
 
    	
 
    	
 
    	
 
    
	
14
    	
ILLEGALITY
    	
 
    	
7
    
	
 
    	
 
    	
 
    	
 
    
	
15
    	
TRANSFERS
    	
 
    	
8
    
	
 
    	
 
    	
 
    	
 
    
	
16
    	
NOTICES
    	
 
    	
8
    
	
 
    	
 
    	
 
    	
 
    
	
17
    	
SUPPLEMENTAL
    	
 
    	
8
    
	
 
    	
 
    	
 
    	
 
    
	
18
    	
LAW AND   JURISDICTION
    	
 
    	
9
    
	
 
    	
 
    	
 
    	
 
    
	
SCHEDULE 1 DRAWDOWN NOTICE
    	
 
    	
10
    
	
 
    	
 
    	
 
    	
 
    
	
EXECUTION PAGE
    	
 
    	
11
    

 

 

THIS AGREEMENT is made [·], 2014

 

BETWEEN

 

(1)                                 EXMAR NV, a company incorporated in Belgium whose registered office is at De Gerlachekaai 20, 2000 Antwerpen, Belgium, (the “Lender”); and

 

(2)                                 EXMAR ENERGY PARTNERS L.P., a limited partnership formed in the Marshall Islands whose registered office is at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH96960 and having a place of business in Hong Kong at Room 3206, 32nd Floor, Lippo Centre, Tower Two, No. 89 Queensway, Hong Kong, (the “Borrower)”.

 

IT IS AGREED as follows:

 

1                                         INTERPRETATION

 

1.1                               Definitions.  In this Agreement:

 

“Advance” means the principal amount of each borrowing by the Borrower under this Agreement;

 

“Availability Period” means the period commencing on the date of this Agreement and ending on:

 

(a)                                 the date falling forty-eight (48) months after the date of this Agreement (or such later date as the Lender may agree with the Borrower); or

 

(b)                                 if earlier, the date on which the Commitment is fully cancelled or terminated;

 

“Available Commitment” means, at any time during the Availability Period, the Commitment less the amount of the Loan at that time;

 

“Business Day” means a day on which banks are open in London, New York City, Hong Kong and Brussels;

 

“Commitment” means $20,000,000 as that amount may be cancelled or terminated in accordance with this Agreement;

 

“Dollars” and “$” means the lawful currency for the time being of the United States of America;

 

“Drawdown Date” means, in relation to an Advance, the date requested by the Borrower for the Advance to be made, or (if different) the date on which the Advance is actually made;

 

“Drawdown Notice” means a notice in the form set out in Schedule 1 (or in any other form approved by the Lender);

 

“Event of Default” means any of the events or circumstances described in Clause 10.1;

 

“Fiscal Quarter” means each three-month period ending March 31, June 30, September 30 and December 31.

 

“Interest Payment Date” means (i) the last day of each Fiscal Quarter, (ii) the Termination Date and (iii) any other date on which the principal amount of an Advance is due and payable;

 

 

“Interest Period” means, with respect to an Advance: (a) initially, the period commencing on the Drawdown Date for such Advance and ending on the first Interest Payment Date succeeding such Drawdown Date; and (b) thereafter, each Fiscal Quarter;

 

“Interest Rate” means, with respect to any Interest Period for any Advance, LIBOR for such Interest Period for such Advance plus 4.00% per annum;

 

“IPO” means the initial public offering of shares in the Borrower to be effected with the New York Stock Exchange (NYSE);

 

“LIBOR” means, with respect to an Advance, the London interbank offered rate for an interest period of three (3) months administered by ICE Benchmark Administration Limited (or any other person which takes over the administration of that rate) displayed on pages LIBOR01 or LIBOR02 of the Reuters screen (or any replacement 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 Reuters two (2) Business Days prior to (i) the Drawdown Date for such Advance and (ii) the first day of each Interest Period with respect to such Advance thereafter.  If such page or service ceases to be available, the Lender may specify another page or service displaying the relevant rate;

 

“Loan” means the principal amount of all Advances for the time being outstanding under this Agreement; and

 

“Termination Date” means the date falling forty-eight (48) months after the date of this Agreement.

 

1.2                               Clause references.  References in this Agreement to Clauses are, unless otherwise specified, references to clauses of this Agreement.

 

1.3                               References to persons.  References to “person” or “persons” or to words importing persons include, without limitation, individuals, firms, corporations, government agencies, committees, departments, authorities and other bodies, incorporated or unincorporated, whether having distinct legal personality or not.

 

1.4                               Clause headings.  Clause headings are for ease of reference only.

 

2                                         FACILITY

 

2.1                               Amount of facility.  Subject to the other provisions of this Agreement, the Lender shall make a revolving credit facility not exceeding $20,000,000 available to the Borrower.

 

2.2                               Purpose of facility.  The Borrower undertakes to use each Advance to finance its general working capital requirements.

 

3                                         DRAWDOWN

 

3.1                               Request for Advance.  Subject to the following conditions, the Borrower may request an Advance to be made by ensuring that the Lender receives a completed Drawdown Notice not later than 11.00 a.m. (London time) three (3) Business Days prior to the intended Drawdown Date.

 

3.2                               Availability.  The conditions referred to in Clause 3.1 are that:

 

(a)                                 a Drawdown Date has to be a Business Day during the Availability Period;

 

(b)                                 the amount of an Advance shall be at least $5,000,000 and shall not exceed the Available Commitment; and

 

2

 

(c)                                  the Loan shall not exceed the Commitment.

 

3.3                               Drawdown Notice irrevocable.  A Drawdown Notice must be signed by an officer of the Borrower; and once served, a Drawdown Notice cannot be revoked without the prior consent of the Lender.

 

3.4                               Disbursement of Advance.  Subject to the provisions of this Agreement, the Lender shall on each Drawdown Date make each Advance to the Borrower; and payment to the Borrower shall be made to the account which the Borrower specifies in the Drawdown Notice.

 

4                                         INTEREST

 

4.1                               Ordinary interest.  Except as provided in Clause 4.2, the Borrower shall pay interest on the outstanding principal amount of the Loan on each Interest Payment Date, at a rate per annum equal to the Interest Rate.

 

4.2                               Default interest.  In lieu of interest pursuant to Clause 4.1, the Borrower shall pay interest on all overdue amounts under this Agreement from (and including) the date due until (and excluding) the date of actual payment (as well after as before judgment) at the rate of 2.0% per annum plus the Interest Rate.

 

4.3                               Payment of accrued default interest.  Interest due under Clause 4.2 shall be paid on demand of the Lender.

 

4.4                               Interest on interest.  For the avoidance of doubt, any interest under this Clause 4 which is not paid when due (whether on demand or otherwise) shall itself accrue interest in accordance with Clause 4.2.

 

5                                         REPAYMENT, PREPAYMENT AND CANCELLATION

 

5.1                               Termination Date.  On the Termination Date, the Borrower shall repay any Advance then outstanding in full and shall additionally pay to the Lender all other sums, if any, then owing or accrued under this Agreement.

 

5.2                               Voluntary prepayment.  The Borrower may prepay the whole (but not part only) of an Advance on giving at least ten (10) days’ prior written notice to the Lender.

 

5.3                               Effect of notice of prepayment.  A prepayment notice may not be withdrawn or amended without the consent of the Lender and the amount specified in the prepayment notice shall become due and payable by the Borrower on the date for prepayment specified in the prepayment notice.

 

5.4                               Amounts payable on prepayment.  A prepayment shall be made together with any amount payable under Clause 12 or otherwise under this Agreement in respect of the amount prepaid.

 

5.5                               Reborrowing permitted.  Subject to the terms of this Agreement, any amount repaid or prepaid may be reborrowed.

 

5.6                              Effect of notice of cancellation.  The service of a cancellation notice shall cause the amount of the Commitment specified in the notice to be permanently cancelled.

 

6                                         CONDITIONS PRECEDENT

 

6.1                               Conditions.  The Lender’s obligation to make an Advance is subject to the following conditions precedent:

 

3

 

(a)                                 that, on or before the service of the first Drawdown Notice, the IPO shall have taken place; and

 

(b)                                 that, on the Drawdown Date, but prior to the making of the Advance, no Event of Default has occurred and is continuing or would immediately result from the borrowing of the Advance.

 

7                                         REPRESENTATIONS AND WARRANTIES

 

7.1                               Borrower’s representations and warranties.  The Borrower represents and warrants to the Lender that the following statements are, at the date hereof, true and accurate:

 

(a)                                 it is duly formed with limited liability under the laws of the Republic of the Marshall Islands and has full power and authority to enter into and perform its obligations under this Agreement;

 

(b)                                 the execution, delivery and performance of this Agreement:

 

(i)                                     have been duly authorised by all necessary corporate action on its part; and

 

(ii)                                  do not contravene any applicable law, regulation or order binding on it or any of its assets or its constitutional documents;

 

(c)                                  neither the execution, delivery and performance by it of this Agreement require the consent or approval of, the giving of notice to, the registration with, or the taking of any other action in respect of, any relevant governmental authority or agency, except such as have been obtained and are in full force and effect; and

 

(d)                                 this Agreement constitutes its legal, valid and binding obligations, subject to the effect of applicable bankruptcy, insolvency or similar laws affecting creditors’ rights generally and equitable principles of general applicability.

 

7.2                               Survival of representations and warranties.  The representations and warranties given in this Clause 7 shall survive the execution of this Agreement.

 

8                                         UNDERTAKINGS

 

8.1                               General.  The Borrower undertakes with the Lender to comply with the following provisions of this Clause 8 at all times whilst it has any outstanding obligations or liabilities under this Agreement, except as the Lender may otherwise permit.

 

8.2                               Notification of Event of Default.  The Borrower will promptly inform the Lender of any event which constitutes or, with the giving of notice, the lapse of time, or both, would constitute an Event of Default or which could reasonably be expected to materially adversely affect the Borrower’s ability to perform its obligations under this Agreement.

 

8.3                               Information.  The Borrower will deliver to the Lender such financial or other information in respect of its business and financial status as the Lender may reasonably require including, but not limited to, copies of its unaudited quarterly financial statements and of its audited annual financial statements.

 

9                                        PAYMENTS AND CALCULATIONS

 

9.1                               Currency and method of payments All payments to be made by the Borrower to the Lender under this Agreement shall be made to the Lender:

 

(a)                                 by not later than 11.00 a.m. (New York City time) on the due date;

 

4

 

(b)                                 in same day Dollar funds; and

 

(c)                                  to such account of the Lender as the Lender may from time to time notify to the Borrower.

 

9.2                               Payment on non-Business Day.  If any payment by the Borrower under this Agreement would otherwise fall due on a day which is not a Business Day:

 

(a)                                 the due date shall be extended to the next succeeding Business Day; or

 

(b)                                 if the next succeeding Business Day falls in the next calendar month, the due date shall be brought forward to the immediately preceding Business Day.

 

9.3                               Basis for calculation of periodic payments.  Default interest shall accrue from day to day and shall be calculated on the basis of the actual number of days elapsed and a 360 day year.

 

10                                  EVENTS OF DEFAULT

 

10.1                        Events of Default.  An Event of Default occurs if:

 

(a)                                 the Borrower fails to pay when due any sum payable under this Agreement unless such failure is due to a technical breakdown or communication error in which case the Borrower shall rectify such non-payment within three (3) Business Days of it having been notified of the missed payment by the Lender; or

 

(b)                                 any breach by the Borrower occurs of any provision of this Agreement (other than a breach covered by paragraph (a)) which, in the opinion of the Lender, is capable of remedy and which continues unremedied ten (10) Business Days after receipt by the Borrower of a written request from the Lender that the breach be remedied; or

 

(c)                                  any material written information given by the Borrower to the Lender in relation to this Agreement proves to be materially misleading, inaccurate or incorrect when given; or

 

(d)                                 any other loan, guarantee or other obligation of the Borrower exceeding $10,000,000 is declared (or is capable of being declared) by the relevant creditor or creditors due prematurely due to a default, to non-payment or any security in respect thereof becomes enforceable; or

 

(e)                                  a lien, arrest, distress or similar event is levied upon or against any substantial part of the assets of the Borrower which is not discharged or disputed in good faith within ten (10) Business Days after the Borrower has become aware of the same; or

 

(f)                                   a substantial part of the Borrower’s business or assets is destroyed, abandoned, seized, appropriated or forfeited for any reason; or

 

(g)                                  any order shall be made by any competent court or resolution passed by the Borrower for the appointment of a liquidator, administrator or receiver of, or for the winding-up of, the Borrower; or

 

(h)                                an encumbrancer takes possession of or a receiver is appointed of the whole or, in the opinion of the Lender, any material part of the assets of the Borrower or a distress, execution or other process is levied or enforced upon or sued out against the whole or, in the opinion of the Lender, a material part of the assets of the Borrower; or

 

(i)                                     the Borrower shall generally be unable to, or shall admit in writing its general inability to, pay its debts as they fall due, or shall be adjudicated or found bankrupt or insolvent, or shall enter into any composition or other arrangement with its creditors generally; or

 

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(j)                                    any event shall occur which under the law of any jurisdiction to which the Borrower is subject has an effect equivalent or similar to any of the events referred to in Clause 10.1(c), (d) or (e); or

 

(k)                                 the Borrower ceases or suspends or threatens in writing to cease or suspend the carrying on of its business or a substantial part of its business or disposes of or threatens to dispose of a substantial part of its business or assets which, in each case, in the opinion of the Lender, is material in the context of this Agreement; or

 

(l)                                     it becomes unlawful for the Borrower to fulfil its obligations under this Agreement; or

 

(m)                             Exmar General Partner Limited ceases to be the General Partner of the Borrower; or

 

(n)                                 the constitutional documents of the Borrower are amended or varied in any way which is materially adverse to its interests in connection with this Agreement.

 

10.2                        Actions following an Event of Default.  On, or at any time after, the occurrence of an Event of Default the Lender may:

 

(a)                                 serve on the Borrower a notice stating that all obligations of the Lender to the Borrower under this Agreement are cancelled; and/or

 

(b)                                 serve on the Borrower a notice stating that the Loan, any accrued default interest and all other amounts owing under this Agreement are immediately due and payable or are due and payable on demand; and/or

 

(c)                                  take any other action which, as a result of the Event of Default or any notice served under paragraph (a) or (b), the Lender is entitled to take under this Agreement or any applicable law.

 

10.3                        Termination of obligations.  On the service of a notice under Clause 10.2(a), all the obligations of the Lender to the Borrower under this Agreement shall terminate.

 

10.4                        Acceleration of Loan.  On the service of a notice under Clause 10.2(b), the Loan and all other amounts accrued or owing from the Borrower under this Agreement shall become immediately due and payable or, as the case may be, payable on demand.

 

11                                  COSTS

 

11.1                        Costs.  The Borrower shall pay all reasonable costs incurred by the Lender in connection with the preparation of this Agreement and any and all other costs reasonably incurred by the Lender in connection with the facility provided pursuant to this Agreement.

 

12                                  INDEMNITIES

 

12.1                        Indemnities regarding the borrowing and repayment of Loan.  The Borrower shall fully indemnify the Lender on its demand in respect of all claims, expenses, liabilities and losses which are made or brought against or incurred by the Lender, or which the Lender reasonably and with due diligence estimates that it will incur, as a result of or in connection with:

 

(a)                                an Advance not being borrowed on the Drawdown Date specified in the Drawdown Notice for any reason other than a default by the Lender;

 

(b)                                 the receipt or recovery of all or any part of the Loan or an overdue sum otherwise than on an Interest Payment Date;

 

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(c)                                  any failure (for whatever reason) by the Borrower to make payment of any amount under this Agreement on the due date therefor or, if so payable, on demand; and

 

(d)                                 the occurrence of an Event of Default and/or the acceleration of repayment of the Loan under Clause 10,

 

and in respect of any tax (other than tax on its overall net income) for which the Lender is liable in connection with any amount paid or payable to the Lender (whether for its own account or otherwise) under this Agreement.

 

12.2                        Breakage costs.  Without limiting its generality, Clause 12.1 covers any claim, expense, liability or loss, including a loss of a prospective profit, incurred by the Lender in liquidating or employing deposits from third parties acquired or arranged to fund or maintain all or any part of the Loan and/or any overdue amount (or an aggregate amount which includes the Loan or any overdue amount).

 

13                                  NO SET-OFF OR TAX DEDUCTION

 

13.1                        No deductions.  All amounts due from the Borrower under this Agreement shall be paid:

 

(a)                                 without any form of set-off, cross-claim or condition; and

 

(b)                                 free and clear of any tax deduction except a tax deduction which the Borrower is required by law to make.

 

13.2                        Grossing-up for taxes.  If the Borrower is required by law to make a tax deduction from any payment:

 

(a)                                 the Borrower shall notify the Lender as soon as it becomes aware of the requirement;

 

(b)                                 the Borrower shall pay the tax deducted to the appropriate taxation authority promptly, and in any event before any fine or penalty arises; and

 

(c)                                  the amount due in respect of the payment shall be increased by the amount necessary to ensure that the Lender receives and retains (free from any liability relating to the tax deduction) a net amount which, after the tax deduction, is equal to the full amount which it would otherwise have received.

 

13.3                        Exclusion of tax on overall net income.  In this Clause 13 “tax deduction” means any deduction or withholding for or on account of any present or future tax except tax on the Lender’s overall net income.

 

14                                  ILLEGALITY

 

14.1                        Illegality.  This Clause 14 applies if the Lender notifies the Borrower that it has become, or will with effect from a specified date, become:

 

(a)                                 unlawful or prohibited as a result of the introduction of a new law, an amendment to an existing law or a change in the manner in which an existing law is or will be interpreted or applied; or

 

(b)                                 contrary to, or inconsistent with, any regulation,

 

for the Lender to maintain or give effect to any of its obligations under this Agreement in the manner contemplated by this Agreement.

 

14.2                        Notification and effect of illegality.  On the Lender notifying the Borrower under Clause 14.1, the Commitment shall terminate; and thereupon or, if later, on the date specified in

 

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the Lender’s notice under Clause 14.1 as the date on which the notified event would become effective the Borrower shall prepay the Loan in full.

 

14.3                        Mitigation.  If circumstances arise which would result in a notification under Clause 14.1 then, without in any way limiting the rights of the Lender under Clause 14.2, the Lender shall use reasonable endeavours to transfer its obligations, liabilities and rights under this Agreement to a subsidiary not affected by the circumstances but the Lender shall not be under any obligation to take any such action if, in its opinion, to do would or might:

 

(a)                                 have an adverse effect on its business, operations or financial condition; or

 

(b)                                 involve it in any activity which is unlawful or prohibited or any activity that is contrary to, or inconsistent with, any regulation; or

 

(c)                                  involve it in any expense (unless indemnified to its satisfaction) or tax disadvantage.

 

15                                  TRANSFERS

 

15.1                        No Transfers.  Neither party to this Agreement may, without the prior written consent of the other party (such consent of the Borrower, in the case of a proposed transfer by the Lender, not to be unreasonably withheld), transfer any of its rights, liabilities or obligations under this Agreement.

 

16                                  NOTICES

 

16.1                        General.  Unless otherwise specifically provided, any notice under or in connection with this Agreement shall be given by letter or fax and shall be effective upon receipt; and references in this Agreement to written notices, notices in writing and notices signed by particular persons shall be construed accordingly.

 

16.2                        Addresses for communications.  A notice by letter or fax shall be sent:

 

(a)                                 to the Lender:

 

Exmar NV

De Gerlachekaai 20

2000 Antwerpen 1

Belgium

Attention:              Chief Financial Officer

 

(b)                                 to the Borrower:

 

Room 3206, 32nd Floor,

Lippo Centre, Tower Two,

No. 89 Queensway, Hong Kong

 

Attention:              Chief Financial Officer

 

or to such other address as the relevant party may notify the other.

 

17                                  SUPPLEMENTAL

 

17.1                        Rights cumulative.  The rights and remedies which this Agreement gives to the Lender are:

 

(a)                                 cumulative;

 

(b)                                 may be exercised as often as appears expedient; and

 

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(c)                                  shall not, unless explicitly and specifically stated so, be taken to exclude or limit any right or remedy conferred by any law.

 

17.2                        Severability.  If any provision of this Agreement is or subsequently becomes void, unenforceable or illegal, that shall not affect the validity, enforceability or legality of the other provisions of this Agreement.

 

17.3                        Third party rights.  A person who is not a party to this Agreement has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce or to enjoy the benefit of any term of this Agreement.

 

18                                  LAW AND JURISDICTION

 

18.1                        English law.  This Agreement shall be governed by, and construed in accordance with, English law.

 

18.2                        Exclusive English jurisdiction.  Subject to Clause 18.3, the courts of England shall have exclusive jurisdiction to settle any Dispute.

 

18.3                        Choice of forum for the exclusive benefit of the Lender.  Clause 18.2 is for the exclusive benefit of the Lender, which reserves the rights:

 

(a)                                 to commence proceedings in relation to any Dispute in the courts of any country other than England and which have or claim jurisdiction to that Dispute; and

 

(b)                                 to commence such proceedings in the courts of any such country or countries concurrently with or in addition to proceedings in England or without commencing proceedings in England.

 

The Borrower shall not commence any proceedings in any country other than England in relation to a Dispute.

 

18.4                        Process agent.  The Borrower irrevocably appoints Exmar UK Shipping Company  Limited at its registered office for the time being, presently at Moreau House, 116 Brompton Road, London SW3 1JJ, to act as its agent to receive and accept on its behalf any process or other document relating to any proceedings in the English courts which are connected with a Dispute.

 

18.5                        Lender’s rights unaffected.  Nothing in this Clause18 shall exclude or limit any right which the Lender may have (whether under the law of any country, an international convention or otherwise) with regard to the bringing of proceedings, the service of process, the recognition or enforcement of a judgment or any similar or related matter in any jurisdiction.

 

18.6                        Meaning of “proceedings”.  In this Clause 18, “proceedings” means proceedings of any kind, including an application for a provisional or protective measure and a “Dispute” means any dispute arising out of or in connection with this Agreement (including a dispute relating to the existence, validity or termination of this Agreement).

 

THIS AGREEMENT has been entered into on the date stated at the beginning of this Agreement.

 

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SCHEDULE 1

 

DRAWDOWN NOTICE

 

To:          EXMAR NV

De Gerlachekaai 20

2000 Anwterpen 1

Belgium
 attn. Chief Financial Officer

 

[·], 2014

 

1                                         We refer to the Loan Agreement (the “Loan Agreement”) dated [·] October, 2014 and made between us as Borrower and you as Lender in connection with a revolving credit facility of up to US$20,000,000.  Terms defined in the Loan Agreement have their defined meanings when used in this Drawdown Notice.

 

2                                         We request to borrow an Advance as follows:-

 

(a)                                 Amount: US$[·];

 

(b)                                 Drawdown Date:  [·];

 

(c)                                  Payment instructions : account in our name and numbered [·] with [·] of [·].

 

3                                         We represent and warrant that no Event of Default or has occurred or will result from the borrowing of the Advance.

 

4                                         We confirm that we will indemnity you against any loss or expecnse which you  may sustain or incur as a consequence of the Advance not being drawn, including but not limited to any loss or expenses incurred by you to fund the Advance.

 

5                                         This notice cannot be revoked without the prior consent of the Lender.

 

Yours faithfully

 

 

	
 
    	
 
    	
 
    
	
Name:
    	
 
    	
 
    
	
Title:
    	
 
    	
 
    
	
for and on behalf of
    	
 
    	
 
    
	
EXMAR ENERGY PARTNERS   L.P.
    	
 
    	
 
    

 

10

 

EXECUTION PAGE

 

	
BORROWER
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
SIGNED by
    	
)
    
	
 
    	
)
    
	
for and on behalf of
    	
)
    
	
EXMAR NV
    	
)
    
	
in the presence of:
    	
)
    
	
 
    	
 
    
	
 
    	
 
    
	
LENDER
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
SIGNED by
    	
)
    
	
 
    	
)
    
	
for and on behalf of
    	
)
    
	
EXMAR ENERGY PARTNERS   L.P.
    	
)
    
	
in the presence of:
    	
)
    

 

11

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