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Otto Marine Limited Secures USD26 Million Loan

Source: www.gulfoilandgas.com 7/3/2015, Location: North America

Otto Marine Limited wishes to announce that Surf Subsea Inc. (the Borrower), a Delaware corporation in, which the Company indirectly has a 19.2% stake through its wholly-owned subsidiary, Surf Subsea Pte. Ltd. (“SSPL”), has entered into a US$26,000,000 term loan agreement (the “Loan Agreement”) with a USA investment company (the “Lender”).

Details of Loan Agreement
The US$26,000,000 term loan facility is to be utilised for the purposes of refinancing of the United States vessel “Surf Challenger” and for general working capital by the borrower and other purposes set forth in the Loan Agreement. The term loan facility is secured by, amongst other things, (i) a first priority preferred ship’s mortgage on the United States vessel “Surf Challenger” by the Borrower in favour of the Lender; and (ii) Corporate Guarantee.

The transaction is undertaken on an arm’s length basis.

Save for Mr. Craig Foster Pickett, a Non-Executive and Non-Independent Director of the Company, who is also the President of the Lender and that as disclosed above, none of the Company’s Directors or substantial shareholders of the Company has any interest, direct or indirect on the above transaction.

Rule 704(31)
Pursuant to Rule 704(31) of the SGX-ST Listing Manual, the Guarantee contains a condition which makes reference to the shareholding interest of one of the Company’s controlling shareholders (the “Condition”), Mr. Yaw Chee Siew. The Condition obliges the Company to ensure that Mr. Yaw Chee Siew holds directly or indirectly no less than 51% equity interest in the issued share capital of the Company at all times. The breach of this Condition will cause a default in the Loan Agreement and consequently, the Guarantee, which may trigger cross-defaults under the Group’s other credit facilities and significantly affect the Company’s operations.

The aggregate level of the Group’s other credit facilities that may be affected by a breach of this Condition is US$333 million.

Rule 728 In compliance with Rule 728 of the SGX-ST Listing Manual, the Company has previously obtained an undertaking from Mr. Yaw Chee Siew, for him to notify the Company, as soon as he becomes aware, of any share pledging arrangements relating to his shares in the Company and of any event which may result in a breach of any relevant condition and/or restriction in any loan agreements that contain provisions which make reference to his shareholding interest.

As of today, Mr. Yaw Chee Siew holds an aggregate interest of 61.2% in the issued share capital of the Company.

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Related Categories: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Industrial Development  Insurance  Investment  Mergers and Acquisitions  Risk Management 

Related Articles: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Insurance  Investment  Mergers and Acquisitions  Risk Management 


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