2017 Annual Report for Norwegian Cruiseline Holdings - 25

The impact of volatility and disruptions in the global credit and financial markets may adversely affect our ability to borrow and could increase our
counterparty credit risks, including those under our credit facilities, derivatives, contingent obligations, insurance contracts and new ship progress
payment guarantees.
There can be no assurance that we will be able to borrow additional money on terms as favorable as our current debt, on commercially acceptable terms, or
at all. Economic downturns, including failures of financial institutions and any related liquidity crisis, can disrupt the capital and credit markets. Such
disruptions could cause counterparties under our credit facilities, derivatives, contingent obligations, insurance contracts and new ship progress payment
guarantees to be unable to perform their obligations or to breach their obligations to us under our contracts with them, which could include failures of
financial institutions to fund required borrowings under our loan agreements and to pay us amounts that may become due under our derivative contracts
and other agreements. Also, we may be limited in obtaining funds to pay amounts due to our counterparties under our derivative contracts and to pay
amounts that may become due under other agreements. If we were to elect to replace any counterparty for their failure to perform their obligations under
such instruments, we would likely incur significant costs to replace the counterparty. Any failure to replace any counterparties under these circumstances
may result in additional costs to us or an ineffective instrument.
Our inability to recruit or retain qualified personnel or the loss of key personnel may materially adversely affect our business, financial condition and
results of operations.
Our success is dependent upon our personnel and our ability to recruit and retain high quality employees. We must continue to recruit, retain and motivate
management and other employees in order to maintain our current business and support our projected growth. We need to hire and train a considerable
number of qualified crew members to staff the ships that will be joining our fleet in the coming years. This may require significant efforts on the part of
our management team, and our inability to hire a sufficient number of qualified crew members would adversely affect our business.
Our executive officers and other members of senior management have substantial experience and expertise in our business and have made significant
contributions to our growth and success. The unexpected loss of services of one or more of these individuals could materially adversely affect us.
Delays in our shipbuilding program and ship repairs, maintenance and refurbishments could adversely affect our results of operations and financial
condition.
The new construction, refurbishment, repair and maintenance of our ships are complex processes and involve risks similar to those encountered in other
large and sophisticated equipment construction, refurbishment and repair projects. Our ships are subject to the risk of mechanical failure or accident, which
we have occasionally experienced and have had to repair. If there is a mechanical failure or accident in the future, we may be unable to procure spare parts
when needed or make repairs without incurring material expense or suspension of service, especially if a problem affects certain specialized maritime
equipment, such as the radar, a pod propulsion unit, the electrical/power management system, the steering gear or the gyro system.
In addition, availability, work stoppages, insolvency or financial problems in the shipyards' construction, refurbishment or repair of our ships, or other
"force majeure" events that are beyond our control and the control of shipyards or subcontractors, could also delay or prevent the newbuild delivery,
refurbishment and repair and maintenance of our ships. Any termination or breach of contract following such an event may result in, among other things,
the forfeiture of prior deposits or payments made by us, potential claims and impairment of losses. A significant delay in the delivery of a new ship, or a
significant performance deficiency or mechanical failure of a new ship could also have an adverse effect on our business. The consolidation of the control
of certain European cruise shipyards could result in higher prices for the construction of new ships and refurbishments and could limit the availability of
qualified shipyards to construct new ships. Also, the lack of qualified shipyard repair facilities could result in the inability to repair and maintain our ships
on a timely basis. These potential events and the associated losses, to the extent that they are not adequately covered by contractual remedies or insurance,
could adversely affect our results of operations and financial condition.
We rely on third parties to provide hotel management services for certain ships and certain other services, and we are exposed to risks facing such
providers. In certain circumstances, we may not be able to replace such third parties or we may be forced to replace them at an increased cost to us.
We rely on external third parties to provide hotel management services for certain ships and certain other services that are vital to our business. If these
service providers suffer financial hardship or are otherwise unable to continue providing such services, we cannot guarantee that we will be able to replace
such service providers in a timely manner, which may cause an interruption in our operations. To the extent that we are able to replace such service
providers, we may be forced to pay an increased cost for equivalent services. Both the interruption of operations and the replacement of the third-party
service providers at an increased cost could adversely impact our financial condition and results of operations.
We rely on scheduled commercial airline services for passenger and crew connections. Increases in the price of, or major changes or reduction in,
commercial airline services could undermine our customer base or disrupt our operations.
A number of our passengers and crew depend on scheduled commercial airline services to transport them to ports of embarkation for our cruises. Increases
in the price of airfare due to increases in fuel prices, fuel surcharges, changes in commercial airline services as a result of strikes, weather or other events,
or the lack of availability due to schedule changes or a high level of airline bookings could adversely affect our ability to deliver guests and crew to or from
our ships and thereby increase our cruise operating expenses which would, in turn, have an adverse effect on our financial condition and results of
operations.

Table of Contents for the Digital Edition of 2017 Annual Report for Norwegian Cruiseline Holdings