8-KMaterial AgreementsFinancial EventsExhibits & Filings

ROYAL CARIBBEAN CRUISES LTD 8-K Report, Material Agreement (Jul 12, 2013)

Filed July 12, 2013For Securities:RCL

Summary

Royal Caribbean Cruises Ltd. (RCL) announced on July 11, 2013, a significant financing agreement for its third Oasis-class ship, scheduled for delivery in the second quarter of 2016. The company has secured an unsecured term loan of up to approximately €892 million, fully guaranteed by COFACE, the export credit agency of France. This structure provides substantial credit support for the financing. Investors should note the favorable financing terms, offering a choice between a fixed interest rate of 2.60% or a floating rate linked to EURIBOR plus 1.15%. The loan will amortize semi-annually and mature twelve years after the ship's delivery. This agreement demonstrates RCL's ability to secure substantial capital for fleet expansion on attractive terms, mitigating financial risk through the export credit agency guarantee.

Key Highlights

  • 1RCL secured a credit agreement for its third Oasis-class ship, due in Q2 2016.
  • 2The financing includes an unsecured term loan of up to approximately €892 million.
  • 3The loan is fully guaranteed by COFACE, the export credit agency of France, reducing lender risk.
  • 4Borrowers can elect a fixed interest rate of 2.60% or a floating rate (EURIBOR + 1.15%).
  • 5The loan will amortize semi-annually and mature twelve years after ship delivery.
  • 6The agreement was entered into on July 9, 2013, and filed on July 11, 2013.

Frequently Asked Questions

The financing agreement is specifically for the construction and acquisition of Royal Caribbean Cruises Ltd.'s third Oasis-class ship, which is expected to be delivered in the second quarter of 2016.

The loan is an unsecured term loan of up to approximately €892 million. It features a 100% guarantee from COFACE, the French export credit agency. Borrowers have the option to choose between a fixed interest rate of 2.60% or a floating rate (EURIBOR + 1.15%). The loan will amortize semi-annually and mature twelve years after the ship's delivery.

The 100% guarantee from COFACE significantly de-risks the loan for the lenders, which likely contributed to the favorable interest rates and unsecured nature of the financing. For Royal Caribbean, this means access to a large amount of capital on attractive terms, supporting their fleet expansion without requiring traditional collateral in this specific instance.

The credit agreement was entered into on July 9, 2013. The loan is expected to be funded prior to the ship's delivery. The repayment schedule involves semi-annual amortization, with the entire loan maturing twelve years after the ship's delivery, which is anticipated in the second quarter of 2016.