What is the main purpose of this filing?

The main purpose of this filing is to inform investors that Royal Caribbean Cruises Ltd. has consolidated several ship financing credit facilities from its ship-owning subsidiaries directly to the parent company. This is a structural change to the company's debt management.

Does this assignment of credit facilities affect the cost of borrowing for Royal Caribbean?

No, the filing explicitly states that the economic terms of these facilities remain unchanged. Therefore, the assignment itself does not alter the interest rates, fees, or other financial costs associated with these specific credit lines.

Which vessels' financing is being consolidated?

The financing for Celebrity Solstice, Celebrity Equinox, Celebrity Eclipse, and Celebrity Silhouette has been consolidated. Additionally, the credit agreement for the upcoming Celebrity Reflection, scheduled for delivery in the fourth quarter of 2012, is also included in this assignment.

What are the implications of moving debt to the parent company level?

Moving the debt to the parent company level generally simplifies the overall corporate financing structure. It can lead to more centralized management of debt and may align these ship financings with other corporate-level credit agreements and covenants.

RCL 8-K: Material Agreements

Summary

Royal Caribbean Cruises Ltd. (RCL) filed an 8-K on February 23, 2012, disclosing the assignment of credit facilities from its ship-owning subsidiaries to the parent company, Royal Caribbean Cruises Ltd. This move consolidates debt at the corporate level for several key vessels, including those in the Celebrity Solstice class and the upcoming Celebrity Reflection. The economic terms of these credit facilities remain unchanged, but the change in borrower streamlines the company's financing structure.

Key Highlights

1Assignment of ship financing credit facilities to the parent company, Royal Caribbean Cruises Ltd.
2Consolidation of debt for Celebrity Solstice, Celebrity Equinox, Celebrity Eclipse, and Celebrity Silhouette.
3Includes credit facility for the upcoming Celebrity Reflection, expected in Q4 2012.
4No change in the economic terms of the credit facilities.
5The assignment simplifies the company's financing structure by moving debt from ship-owning subsidiaries to the parent level.
6Amended facilities now contain covenants similar to other parent-level ship financing and revolving credit agreements.

ROYAL CARIBBEAN CRUISES LTD 8-K Report, Material Agreement (Feb 23, 2012)

Summary

Key Highlights

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