Royal Caribbean amends credit facilities to extend covenant waivers

By Sarah Lizee

Olympia, Wash., Aug. 3 – Royal Caribbean Cruises Ltd. amended on July 28 its $1.55 billion unsecured revolving credit facility due 2022 with Nordea Bank ABP, New York Branch as administrative agent, its $1.925 billion unsecured revolver due 2024 with Bank of Nova Scotia as administrative agent and its $1 billion unsecured three-year term loan agreement with Bank of America, NA as administrative agent, according to an 8-K filing with the Securities and Exchange Commission.

The amendments extend the waiver of the quarterly tested fixed charge coverage and net debt to capitalization covenants in each credit facility through and including the fourth quarter of 2021 and increase the monthly tested minimum liquidity covenant for the duration of the extended waiver period.

Under the amendments, the restrictions on paying cash dividends and effectuating share repurchases during the waiver period were extended through and including the fourth quarter of 2021.

In addition, the amendments incorporate the restrictions on investments set forth in the indentures governing the 9 1/8% senior guaranteed notes due 2023, 10 7/8% senior secured notes due 2023 and 11½% senior secured notes due 2025.

Also on July 28, the company obtained a financial covenant waiver extension consent letter with KfW IPEX-Bank GmbH to amend its Hermes backed loan facilities in order to extend the period during which a breach of the financial covenants will not trigger a mandatory prepayment or default under each facility through and including the fourth quarter of 2021.

Similarly, on Friday, the company amended the Finnvera-backed loan facilities in order to extend the period during which a breach of the financial covenants will not trigger a default under each facility through and including the fourth quarter of 2021, provided that some structural enhancements are provided on or before Sept. 30.

Royal Caribbean is a Miami-based cruise vacation company.

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