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UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
Pursuant To Section 13 or 15(d) of The Securities Exchange Act of 1934
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| Item 1.01 | Entry into a Material Definitive Agreement. |
As previously disclosed, during the third quarter of 2020, we amended each of our export credit backed facility agreements (the “Export Credit Facilities”) in order to extend the period during which a breach of the financial covenants will not trigger a mandatory prepayment or default, as applicable, under each facility through and including the fourth quarter of 2021. In connection with these amendments, we agreed that certain of our subsidiaries (none of which directly own a vessel) will issue guarantees for the debt outstanding or to be outstanding under the Export Credit Facilities (the “Financial Covenant Extension Amendments”).
Further to and in accordance with these Financial Covenant Extension Amendments, on December 21, 2020, we entered into amendments to certain of the Export Credit Facilities guaranteed by Euler Hermes Aktiengesellschaft, including those facilities incurred or to be incurred to finance the purchase of (i) Odyssey of the Seas, Anthem of the Seas, Ovation of the Seas, Quantum of the Seas, Spectrum of the Seas for Royal Caribbean International, (ii) Celebrity Equinox, Celebrity Eclipse, Celebrity Solstice, Celebrity Reflection and Celebrity Silhouette for Celebrity Cruises and (iii) the first and second Evolution-class vessels for Silversea Cruises (collectively, the “Hermes Facilities”). These amendments provide for the issuance of the previously agreed guarantees, which in the case of the loans for the financing of Odyssey of the Seas and the first and second Evolution-class vessels will occur once the debt is drawn, in satisfaction of our obligations under the relevant Financial Covenant Extension Amendments. Following issuance, the guarantees will be released under certain circumstances as other debt is repaid or refinanced on an unsecured and unguaranteed basis. In connection with and following the issuance of the guarantees of the Hermes Facilities, the guarantor subsidiaries are restricted from issuing additional guarantees in favor of lenders (other than those lenders who are party to the Export Credit Facilities), and certain of the guarantor subsidiaries are restricted from incurring additional debt. In addition, the Hermes Facilities will benefit from guarantees to be issued by intermediary parent companies of subsidiaries that take delivery of any new vessels financed with export-credit backed financing.
We are in the process of amending our other export credit facilities to implement similar pari passu guarantees in favor of the lenders thereunder.
Certain of the lenders participating in the Hermes Facilities, and affiliates of those parties, provide banking, investment banking and other financial services to us from time to time for which they have received, and will in the future receive, customary fees.
| Item 2.03. | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant |
The disclosure required by this item is included in Item 1.01 of this Current Report on Form 8-K and is incorporated herein by reference.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| ROYAL CARIBBEAN CRUISES LTD. | ||
| Date: December 22, 2020 | By: | /s/ Bradley H. Stein |
| Name: | Bradley H. Stein | |
| Senior Vice President, General Counsel & Secretary | ||
