8-KMaterial AgreementsExhibits & Filings

ROYAL CARIBBEAN CRUISES LTD 8-K Report, Material Agreement (Mar 4, 2009)

Filed March 4, 2009For Securities:RCL

Summary

This 8-K filing by Royal Caribbean Cruises Ltd. (RCL) on March 3, 2009, details a significant financing agreement executed on February 27, 2009. A subsidiary, Celebrity Solstice IV Inc., entered into a definitive credit agreement with KfW IPEX-Bank GmbH for an unsecured term loan of up to the Euro equivalent of $444.0 million. This loan, guaranteed by the parent company, is intended to finance the purchase of the fourth Solstice-class ship, slated for delivery in the third quarter of 2011. The financing terms include a 12-year tenor with semi-annual amortization and a fixed interest rate of 5.82%, with an option to convert to a floating rate under specific conditions. This agreement is crucial for investors as it demonstrates RCL's ability to secure long-term funding for its fleet expansion, even in a challenging economic environment, and provides clarity on the financing structure for a major upcoming asset acquisition.

Key Highlights

  • 1RCL subsidiary Celebrity Solstice IV Inc. secured a definitive credit agreement for a term loan.
  • 2The unsecured term loan amounts to up to the USD equivalent of €444.0 million.
  • 3The loan is guaranteed by the parent company, Royal Caribbean Cruises Ltd.
  • 4Proceeds are designated for the purchase of the fourth Solstice-class ship, expected in Q3 2011.
  • 5The loan has a 12-year tenor with semi-annual amortization.
  • 6A fixed interest rate of 5.82% is specified, with an option to convert to a floating rate.
  • 7The agreement was executed on February 27, 2009.

Frequently Asked Questions

The primary purpose of this 8-K filing is to announce that Royal Caribbean Cruises Ltd.'s subsidiary, Celebrity Solstice IV Inc., has entered into a definitive credit agreement to secure financing for a new ship.

RCL secured a term loan of up to the U.S. dollar equivalent of €444.0 million. This financing is intended to fund the purchase of the company's fourth Solstice-class ship, which is scheduled for delivery in the third quarter of 2011.

The loan has a 12-year term with semi-annual amortization and a fixed interest rate of 5.82%. Under certain conditions, the interest rate can be converted to a floating rate (LIBOR plus margin) upon payment of breakage costs. The loan is unsecured from the subsidiary's perspective but is guaranteed by the parent company, Royal Caribbean Cruises Ltd.

This filing indicates RCL's continued commitment to its fleet expansion strategy by securing long-term debt financing for a new vessel. It demonstrates their ability to access capital markets for strategic investments, even within the context of the economic conditions prevailing at the time of the filing.